Terms and conditions for taking out a mortgage
Mortgage loans are one of the most sought after loans in Hungary today. The mortgage interest rate is currently low, and applying for it is not too complicated, in fact, every resident of Hungary who has a job or a suitable unencumbered property can apply for a mortgage. In order to qualify for a mortgage loan, certain personal factors must be met and the property offered as collateral must meet the bank’s requirements. Each bank has an internal (approved by law) credit policy approved by their supervisors, which includes the terms and conditions on which they grant loans. For a positive credit assessment, you need to meet these requirements if you want to take out a mortgage.
The minimum age is 18 years, but in many cases a guarantee is required for a certain age (21-23 years). There is also an upper age limit, which is also required if the loan term exceeds that age. For mortgages, this age limit is usually higher than for personal loans, 70-75 years.
Both lower and upper age limits may vary from bank to bank. If the loan applicant does not reach the age specified by the chosen bank, it is necessary to involve a debtor.
(A natural person who has attained the age of 18 years and whose legal capacity is not restricted or excluded by law). You must have been employed for at least three months.
Your primary income may not be below the minimum wage ($ 138,000 gross, which is $ 91,770 net in 2018), but for some products, banks set a minimum amount, usually at least $ 100,000 or more. With higher income requirements, such as $ 200,000, you can meet the expectation of two income with a co-worker. For debtors, some credit institutions may set less minimum income, for example, for a debtor, they ask for $ 100,000, but they can accept 2x $ 80,000 from 2 debtors. The JTM rule must always be taken into account, ie what proportion of the income can be used for repayment.
Credit institutions only accept verifiable income in the form of salary, entrepreneurial income, retirement pension and invalidity pension. Supplementary income, which is uncertain every month and may not be verifiable (GYED, GYES, other benefits, bonuses, etc.).
Accepted as primary income
A permanent Hungarian address is required, and in the case of foreigners a residence permit is required.
You also need a telephone (landline, mobile) with the debtor’s name.
You must be able to present a bank statement of at least 3 months counting as an employee and at least 1 tax year as an entrepreneur. In the case of the KATA business form, some banks may lend even in the non-closed year. For KATA, 60% of the revenue shown in your income statement statement of income is the product of the number of months subject to tax and the minimum monthly wage.
Taking out a mortgage loan also requires a number of documents, which you should know in advance so that you do not hinder your borrowing. Terms and conditions of mortgage loan: Terms and conditions of real estate collateral. ownership sheet. appropriate market / market value (the property must be worth at least HUF 4-8 million). the current state of the property corresponds to that recorded on the property page
The property must have a final use permit (except for building land). There is no pending court action on the property
independently marketable (A property whose marketability is not restricted by anything, that is, the property’s registration status is orderly. There is no litigation record on its property page.). meets bank-specific value and sellability criteria. lien or admissible lien (The property for which no record of proceedings, mortgage, enforcement, or prohibition of alienation or encumbrance is recorded on the title deed.)
The property must be covered by insurance or, if there is one, cannot be terminated during the term of the loan.
Use the Jerdosapalos Mortgage Calculator to select the best mortgage. You’ll find offers from several banks in one place to choose from. This saves you a lot of time by not having to go through the bank branches personally.