Mortgage Loan with a Fixed Interest Rate
The mortgage loan with a fixed interest rate for the first three years enables you to purchase a home, refinance an existing mortgage loan or obtain funds for construction or completion works.
UBB offers you a mortgage loan in BGN with a fixed interest rate for the first 3 years:
- 3% fixed interest rate over the initial 3 years
- Variable interest rate for the remaining period (RIR 0.2% + fixed margin of 3.75)
- No application fee
- Maximum loan amount : EUR 250 000 / BGN 500 000
- Preliminary approval within 1 day, prior to selecting a property for purchase
- Repayment period: up to 30 years
You may obtain preliminary approval for a mortgage loan based on income and credit history, without the need to provide a document for a particular real estate
We offer you a mortgage loan in Bulgarian leva.
Loan purpose: purchase of a residential real estate; construction and completion works; refinancing a mortgage loan from another bank
Collateral: mortgage on a real estate
- Prepayment Fee - 1% until the 12th monthly installment
- Property appraisal fee – BGN 130 (per apartment )
- No application fee
- Credit assessment fee – BGN 200.
- Loan account maintenance fee – BGN 2.50 monthly
- Mortgage release fee - BGN 60
Annual Percentage Rate (APR): 3.90% with a loan of BGN 80 000 for a period of 30 years and 3% fixed interest rate for the first 3 years and variable interest rate, formed of the RIR+3.75 percent fixed margin for the remaining loan period: 36 monthly installments on the loan in the amount of BGN 337.28 for the period with a fixed interest rate and 324 monthly installments on the loan in the amount of BGN 375.97 during the remaining loan period; the total amount due equals BGN 135 249.90. Conclusion of Property Insurance policy is required, as the related expenses are not included in the APR. The value of the RIR, accepted by the Bank as of 17.04.2018 is 0.20%.
Description of the Methodology for determining a Reference Interest Rate (RIR), used by United Bulgarian Bank AD for determining the variable interest rate on loans to natural persons is avalable here.
UBB offers you "Home and Family Potection" insurance program with comprehensive "Property and Life" insurance coverage, further information about which is available here.
Needed documents for applying
Main documents, needed upon applying for a mortgage loan:
|Document Type||Issuing institution|
For obtaining preliminary approval
|Mortgage loan application form||UBB AD|
|Copy of the Borrower/ Co-debtor’s ID card||---------|
|Certificate of Income, concerning the income amount and the employment contract period of the Borrower and his/her spouse||Issued by the Employer according to a sample form of the Bank|
|Depending on the income source: Annual Tax Return for natural persons, independent employment contracts and Statements of Honoraria (Received Income), Rental Agreements etc.||----------|
For ascertaining marital status and presence/ absence of liabilities
|Certificate of marital status||Issued by the municipality’s Civil Registration Office, according to the permanent address (permanent residence)|
|Certificate of tax liabilities under Art.87, para.6 of the Tax Insurance Procedure Code.||Issued by the local office of the National Revenue Agency, as per the mortgagors’ permanent address|
Documents of the real estate, standing collateral under the loan
|Documents, certifying the real estate’s ownership: Title Deed, Purchase-Sale Agreement or Construction Right Agreement, signed with the State or Municipal Authorities||----------|
|Certificate of encumbrances on the real estates over a minimum period of 10 years prior to submitting the loan application||Issued by the Registry Agency Office|
|Tax valuation certificate for the real estate||Issued by the Municipality, according to the real estate’s location|
Real estate layoutRegarding areas with approved cadastral map- real estate layout, building design/ design of an independent unit in a building
|Issued by the local technical office of the Geodesy, Cartography and Cadastre Agency|
|When the offered collateral is not completed and has not been put into operation: Land ownership documents or such certifying established construction right, Construction Permit, approved architectural designs, surface calculation table, Statement under Art.181, Para.2 of the Spatial Development Act, certifying reached shell-and-core construction stage||Issued by the respective municipal or regional administration|
Documents, pertaining to the specific purpose of the loan
|Detailed budget estimations and an Agreement for Construction and Assembly Works (if any) /concerning loans for construction, repair works and furnishing/||----------|
By judgement of the Bank and depending on the content of provided documents additional documents, relating to the borrower and the collateral may be requested.
Useful tips for residential purchase
"The purchase of a home is one of the most exciting moments in a person's life. In most cases this represents the paramount investment you have ever made and relates to the making of very important decisions, such as location, layout, surface, price and financing. In order be useful to you while making your choice, please, find below some tips for you to make use of :
Step 1:Clarify the amount of funds you will have available for the purchase
In case you are to make the purchase through a mortgage loan, you shall have to ensure minimum 15% of the selling price through own funds. In order to be sure about the amount of funds you may obtain through a loan you can apply for a preliminary approval even prior to choosing a property. Thus you will also know the approximate amount of the repayment installment on the loan, which you are going to pay after becoming owner. This option enables you to judge how it suits your financial performance and long-term expectations.
Step 2: Make some calculations about your monthly /annual expenses, related to the property
As a future owner of the property it is useful to have an idea about the expenses, you shall have to spare for its maintenance. It will be useful for you to take into account the amount of taxes, utility bills and the property management expenses.
Step 3: Initiate property search processes
The larger part of people, willing to purchase a real estate confide in the services of a professional broker, to render them assistance in finding the sought property. The advantages are expert knowledge in the market and pricing levels, legal background, skills for concluding a successful deal and last but not least -time saving.
- Location: We all know the famous saying that the 3 most important things upon chosing a real estate are: „Location, location and once again location ”. Regardless whether you would agree with that rule the property's location is one of the first things one should be very pricise about.
- Property description: It is important that you should be clear about your needs and wishes regarding the characteristic feautures of your residential real estate in terms of square meters, number of rooms and their intended use, floor, layout, lighting, availability and size of terraces, a parking space or a garage, a yard, number of residents in the entire building.
Step 5: Choosing a property.
The market forces determine the property's value and that is why it is important for each buyer to have the following information, in order to be convinced in the choice of a property according to its price:
- Professional appraisal, based on market comparative method
- Prices of analogous real estates, published in the Internet and in specialized editions
- Information about recently sold similar estates in close proximity or with similar characteristic features
Step 6: Offers to the Seller
Having selected a property, complying with your requirements you should make a proposal to the seller regarding the price, you are willing to pay. In order to be sure about the real market value of the property you may order an expert appraisal by a licensed appraiser, which is also a mandatory part of your loan approval process.
Step 7: Signing a preliminary sale-purchase agreement
We advise you, upon purchasing a residential real estate along with part of the furniture, electric appliances included, to have it described in the preliminary agreement with the seller. Additionally, it's better to comply the contractual amount payment deadline to your means, to eliminate the time pressure upon obtaining a mortgage loan .
In order to be of use to you while selecting a property and comparing the characteristic features of several sites, of interest to you, we have created for you the attached comparative table .
Are you aware that the National Revenue Agency offers tax alleviations for young families upon residential estate purchase ?
Pursuant to the Natural Persons' Income Tax Act /NPITA/ young families are given the option to refund a portion of the interest, paid by them under a mortgage loan, intended for purchase of a sole residential property. The tax alleviation represents reduction of the tax base, on which the due annual income tax of natural persons is to be determined, with the amount of the interest payments, made by them during the year on the first BGN 100 000 of their mortgage loan for purchase of a sole residentail property for the family.
What requirements should you comply with in order to use this alleviation?
- The mortgage loan agreement should be concluded by a married individual. The condition for availability of a concluded civil marriage shall have to be fulfilled as of 31 December of the fiscal year, for which the tax aliviation is being used. The civil marriage may be concluded either prior to or after the signing of the mortgage loan agreement
- At least one of the spouses should be younger than 35 years of age as of the mortgage loan agreement's date.
- The mortgaged residential property should be the family's only home during the fiscal year. The tax alleviation for young families cannot be used, in case your mortgage loan has been collateralized with another residential real estate, and not the one, purchased with the loan.
The tax alleviation is to be utilized mandatory by submitting the Annual Tax Return pursuant to Art.50 of the Natural Persons' Income Tax Act at an office or at the NRA territorial departments, according to permanent residency address.
What are the needed documents, relating to your mortgage loan?
- A certificate by the Bank, concerning the made interest payments during the year
- A copy of the Mortgage Loan Agreement
- A copy of a Repayment schedule, certified by the Bank
Additional information about the utilization of the tax alleviation for young families may be obtained at the telephone of NRA's information centre, 0700 18 700, at the price of a local call, dialled countrywide.
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