To this end, in many cases, the only option is to use a mortgage. But do we have this opportunity since our earnings are in foreign currency? The answer is “YES” – but it’s not as easy as it used to be.
To explain the changes that have occurred in this area, it is worth going back to 2014. It was then that the Polish Financial Supervision Authority updated the rules for granting mortgage loans in Poland. One of the many changes was the provision that the bank should grant mortgage loans to clients only in the currency in which they earn an income.
Ultimately, this provision was to protect customers against taking loans in foreign currencies, which as a result of exchange rate differences could overcharge them. However, in the case of an immigrant who wants to buy property in Poland, the loan must be paid in the currency in which he is currently earning.
Foreign currency loan
It must be admitted that the offer of foreign currency loans in Poland is not very large. Currently, banks granting foreign currency loans can be counted on one hand. Customers earning in Euro are in the best position because there are the most offers. Customers applying for loans in francs, pounds or dollars are in a worse situation.
Only three or four banks have a loan offer for these customers. For clients earning in the Norwegian krone and the Swedish krone, it will be only one bank. Customers earning in currencies other than the above-mentioned mortgage will unfortunately not receive.
The poor offer of banks is not the only problem of Poles living abroad, because the requirements set by banks for them are higher than for loans in USD. A person applying for such a loan must earn enough and make a larger own contribution. This is not the only difference – a loan in a foreign currency also involves higher fees. In particular, this applies to margins, but also fees for any currency conversion.
Granting credit in currency
Banks granting such loans pay attention to many factors, however, the basic parameters are such as employment stability, credit history and amount of own contribution. Let’s remember, however, that the situation of each client is different.
If the loan is joined by a marriage in which the husband earns in a foreign currency and the wife in USD, then the loan will be granted in the currency in which the income is higher. In addition, creditworthiness will be calculated solely on the basis of income from this one currency.
The second situation concerns the customer who receives income from several sources in different currencies. In this case, the loan will be granted in the currency in which the income is the highest and of course only he will be taken into account when calculating creditworthiness.
There are many ways to get a mortgage
A person who receives a fixed income – both in US dollar and foreign currencies – can apply for a mortgage. Of course, whether a loan is granted to us depends on many factors.
Appropriate market orientation and professional advice will allow us to secure our future and make a rational decision. In this case, it is worth meeting an adviser who will tell us what the financial market looks like and what should be done to finance the dream property.