Mortgage and Property Financing in Turkey

If you are going to apply for a mortgage or need any financial support to buy property in Turkey, you will find the following information very useful.

How to Get a Mortgage to Buy Property in Turkey?

When it comes to financing your property purchase in Turkey, how do you get started?

  1. Consult with Nevita – a professional real estate consultancy – to check if you’re eligible for a mortgage.
  2. Choose your property.
  3. Get a valuation report – which will indicate the amount you can qualify for a loan.
  4. Fill out the mortgage application.
  5. Send your documents.
  6. Sign the mortgage agreement.

Required Documents for a Mortgage Application in Turkey

When applying for a mortgage in Turkey, you’ll need to provide the following documents:

  • The title deed of your property (Tapu).
  • Notarised Passport copies.
  • Turkish Tax number.
  • Address certificate – electricity or water bill proving your address.
  • Past 3 months’ bank income statement.
  • If employed: your payroll is signed by the employer.
  • If self-employed: records showing 2 years of financial history.
  • If retired: retirement letter.
  • Official document certifying personal assets and debts.
  • Credit registration bureau record from home country.
  • Signed application form.

Can a Foreigner or Non-Permanent Resident Get a Mortgage in Turkey?

As a foreign national, and for non-permanent residents alike, you have several opportunities for obtaining a mortgage for Turkish property. However, like with other mortgages, receiving acceptance for your Turkish mortgage application will be contingent on the conditions of the lenders and their perception of you as a borrower.

All of the conditions could change based on the region, the bank you use, the currency you use, and the type of property you want to buy. Additionally, lenders will look at your employment type, age, credit history, income, and property type to determine this. They want to know that you can not only afford your mortgage but that you are also a trustworthy person on whom they can rely to repay their loan.

A great advantage is that you also don’t need to be physically present in order to obtain your mortgage. With a notarized power of attorney, a legal representative can represent you in legal matters and fully complete your mortgage application.

Mortgage Interest Rates in Turkey

The yearly interest rates range from 11% and 15% per annum, on Turkish Lira. Foreign currency interest rates range between 5% and 7%. It’s preferable for banks to provide the mortgage in the same currency as your income. Loans in USD and Euro are available to foreigners who earn their income in foreign currency.

Amount of Mortgage Loan Available and Payment Terms

Turkish banks provide mortgages averaging from 50% to 70% percent of the property’s selling price to foreign purchasers. Up to 80% of the property’s worth can be covered by a mortgage for EU nationals. A Russian, Ukrainian, or Kazakhstani national’s mortgage loan might range from 30% to 50% of the purchase price of the property they intend to buy in Turkey.

A Turkish mortgage can be obtained by anybody between the ages of 21 and 70.

Euros, US Dollars, Turkish liras, British pounds, and Russian rubles are all accepted as forms of currency for loans. 

Certain banks may have different minimum and maximum lending amounts for mortgages. For example, HSBC offers 5,000 TL as a minimum amount, while the maximum amount is 75% of the Mortgage Appraisal Value. For this reason, it would be better to get detailed information from the relevant bank. 

The maximum term to pay back your loan in Turkey is 15 years. If your mortgage is not paid on time then a 2% penalty may apply.

Mortgage Process and Costs in Turkey

Along with your down payment, you will be responsible for a number of other expenses and charges at the time of closing. These costs will include the property valuation report fee and the protection insurance costs.

Getting Interest-Free Financing from a Property Developer in Turkey

In Turkey, mortgages are not the only kind of finance available. Structured payment plans are common in Turkey because of the country’s long history of cash-only real estate transactions and the fact that non-Turkish citizens were unable to get loans until 2007. 

Payment plans are not nearly as long-term as mortgages, but they will allow you to pay the purchase price over a period of five years, stretching your payments to decrease the one-time impact on your bank account or giving you time to restructure your investment portfolio if necessary. Getting finance from off-plan properties tends to be favored as property developers charge little to no interest in contrast to mortgage lenders.

At the outset of a deal, a down payment percentage is typically required to be paid in order to proceed. This varies widely and is entirely dependent on the company. Using this type of debt will entail the property developer placing a hypothec on your title deed in order to secure the remaining claim. 

After paying the down payment, the remaining balance can be paid off over a period of 12 to 60 months using an installment payment plan, depending on the period set by the property developer. When the entire money has been received, the hypothec will be removed from your property.

Mortgage on Off Plan and Under Construction Properties

Since obtaining a mortgage requires the existence of a title deed, taking out a loan for an off-plan property is not possible. You might be able to receive your title deed while your property is under construction and only then you can apply for a mortgage.

This is why construction companies have implemented installment payment methods, which benefit both the buyer and the company.

Explore and View Installment Properties in Turkey

If you are looking for a property with interest-free installments, take a look at our Properties and Projects pages, where our apartments and villas for sale in many regions of Turkey are listed. Each listing includes everything you need to know, including price, location, and property features like how to find out or arrange a viewing tour. For more, feel free to contact us.