Credit in a Czech bank – documents, terms, rates and deadlines
Bank loan in the Czech Republic for foreigners. Czech banks do not really trust foreigners, so when signing a loan agreement in the Czech Republic, they want to clearly understand who they are giving a loan to. Some banks got rid of this problem by deciding not to lend to foreigners in Prague. Nevertheless, there are still opportunities for obtaining loans in the Czech Republic for foreign citizens. Credit in a Czech bank. What loans are available in the Czech Republic to a foreigner?
Credit in a Czech bank for foreigners
Consumer credit in a Czech bank
Under the terms of such programs, borrowers are given about 500,000 CZK. This type of loan in the Czech Republic is provided for a period of 3-5 years. As a rule, when considering a loan application in Prague, there are no strict conditions on the intended use of the loan. A foreign borrower in Prague is guaranteed fixed credit conditions for the entire term of the loan in the Bank of the Czech Republic. The interest rate on a consumer loan for foreigners in the Czech Republic is slightly higher (from 6%) than on a mortgage loan, but fewer documents are required to apply for a loan.
The maximum loan amount in the Czech Republic is 2,000,000 CZK (80,000 euros).
In order for banks to consider an application for a consumer loan in the Czech Republic, a foreigner must provide the applicant with the following documents.
Documents for a loan in a Czech bank
- your passport + 2nd identity document (for example, international law)
- an extract from the bank, which indicates the amount of available savings. This will confirm the customer’s solvency;
- a certificate of income for six months;
- documents confirming the legality of staying in the country;
- an extract from the Czech National Credit History Bureau confirming the purity of the borrower’s credit history;
- application for a loan in the Czech Republic in the form of a questionnaire.
A foreigner in Prague must have a permanent Czech employer for a loan or that his income is provided by doing business in the Czech Republic.
In addition, at the request of the bank, the list of documents for a Czech loan to a foreigner can be supplemented with an employment contract with the employer, which specifies the term of employment obligations.
What are the rates for loans in the Czech Republic offered to a foreigner by banks?
Loan rates in Czech banks
Mortgage loans in the Czech Republic. Loan rate in the Czech Republic
Issued for the purchase of real estate. The mortgage rate for an individual is from 3 to 5% per annum, but a legal entity will have to pay more – from 5 to 7% per annum.
The amount that the bank can issue is a maximum of 70% of the value of the purchased property, while the bank usually gives only 50% of the required amount to foreigners. That is, at least 30% of the money must be paid by the borrower himself. Moreover, he must pay off the loan in the Czech Republic before he retires or leaves the country.
Mortgage loan in the Czech Republic in Sberbank
Interest on a loan in a Czech bank. Sberbank CZ has been operating in the Czech financial market since 1993. Foreigners who have not issued a permit for a long-term stay in the territory of the Czech Republic can take a loan in it.
Why does Sberbank issue loans to foreigners in the Czech Republic? It should be noted that no other bank in the Czech Republic demonstrates such loyalty when obtaining a mortgage loan to foreigners. The following information testifies to the profitability of cooperation with Sberbank CZ. In Sberbank of the Czech Republic , the loan percentage is as follows:
- if a foreigner does not have a permit for a long-term stay in the Czech Republic, a mortgage loan is issued to him at 4.99 %;
- lending to foreign citizens with a residence permit in the Czech Republic is carried out at 2.29% per annum;
- the minimum 1.79% is valid only for foreigners who have permanent residence in the Czech Republic.
Bank loan in the Czech Republic for foreigners. Among other conditions for issuing a mortgage loan in the Czech Republic, it is worth knowing that in the Czech Republic Sberbank issues loans for the amount of:
- the minimum is 500,000 CZK.
- the maximum is 27,000,000 CZK.
The duration of lending in the Czech Republic: minimum – 5 years, maximum – 20 years. Sberbank in the Czech Republic interest rates on loans are fixed for 3, 5, 7 or 10 years.
Necessary documents to obtain loans in the Czech Republic for foreign citizens:
- application form;
- international passport;
- a document that confirms the status of stay in the Czech Republic;
- an extract from the bank account to which the salary comes and personal savings are postponed;
- a certificate reflecting the receipt of income for at least the last six months;
- extract from the National Credit History Bureau in the Czech Republic about the borrower’s credit history
Documents for a real estate object to be purchased in the Czech Republic:
- extract from the cadastre;
- preliminary purchase and sale agreement;
- the cost of square meters set by an independent appraiser, etc.
How to get a mortgage in the Czech Republic?
What is the mortgage rate?
Let’s look at a real example. I’ll take an ad for the sale of an apartment. Announcement of the sale of 2+kk on sreality.cz
Apartment 2+kk located on Prague 5 — Smikhov. Quite a well-known area, from where you can easily get to the center. The cost of this apartment is 6,500,000 kronor or 255,000 euros.
Mortgage calculator in the Czech Republic on the website hypotecnibanka.cz
After filling in the real estate price in the mortgage calculator in the Czech Republic, you can specify the loan amount up to 90% of the price of the apartment.
I choose a loan period of 20 years with a rate fixing period of 5 years. The bank offers a mortgage in the Czech Republic at 3.39% per annum, which is not the most profitable option in the real estate market. The monthly payment will be 33,598 CZK. I pay for rent 2 + kk an order of magnitude less. The big question arises, is it profitable to buy an apartment in Prague now? Chekhov is very worried about this issue now. According to the latest data, a Czech needs almost 12 annual salaries to save up for an average apartment. Well, simple hard workers like us can only hope for the best.
Bank loan in the czech republic – micro-loans
Micro-loans in non-bank organizations. The loan amount is usually small and available to absolutely everyone. In this case, you need to give loans in the Czech Republic quickly, because the interest rate is very high. Due to the fact that these organizations have practically no connection with the banking system of the Czech Republic, they are not so picky about their customers. However, to apply for a loan in a non-banking organization in the Czech Republic, you also need to meet certain requirements:
- the borrower must be at least 18 years old;
- have a confirmed source of income;
- reside in the Czech Republic (have a residence permit, during which the loan amount will be paid);
- have a registered bank account.
Examples of non-banking organizations in the Czech Republic
- Pújčka na účet – can issue a loan in the amount of 500 to 20,000 CZK;
- Pówjčka 7 – loans in the amount of 1000 to 4000 CZK;
- Credit Limit – provides loans from 2000 to 25,000 CZK.