Italian Morgage: everything you need to know
Mortgage rates on Italian properties are extremely low, around 1%, nearly one-third of those in the United States.
On the downside, you’ll likely need a lawyer to assist you in the process acting on your behalf as many Italian processes require your physical presence.
When applying for a mortgage you should consider other applicable fees for the: mortgage application, broker, notary and home insurance as well as mortgage taxes and appraisal.
It’s also worth noting that both residents and non-residents are eligible for heavy tax breaks when purchasing their first property in Italy.
Additionally, chances of mortgage approval success, loan amount, timing and cost depend on several factors: personal conditions and property conditions, domicile, and even the applicant’s nationality.
- Solvency check: the bank reviews your personal financial status and property information within 1 or 2 days;
- Pre-approval: this can take 3-14 days;
- Compliance check: a bank-appointed surveyor inspects the property, issuing a compliance and evaluation certificate in 14-21 days;
- Title check: a borrower-appointed notary reviews the property title, issuing a title check report for the bank in 7-14 days;
- Final approval: after a satisfactory solvency check, compliance check and title check by the notary, the bank issues a formal mortgage approval within 7-14 days;
- Funds release: after approval, the bank and borrower set a signing date. The documents are signed in front of the same notary. Depending on the bank’s policy this can take from 14-28 days.
Steps 3 and 4 ensure that the property is adequately inspected by all parties.
Italian banks may insist that you open an account with them to set up automatic mortgage payments although this is not legally required, so it can be negotiated.
As a side note, if the current owner already has a mortgage on the property and you are happy with the terms of the existing mortgage, you might be able to undertake it with no cost or fee. This can work out well for everyone involved.