Home Loans in Malta

Obtaining a Home loan in Malta or Gozo – Procedure

Checking with the bank before you head out looking for a home in Malta & Gozo is a smart idea. In many cases we find that buyers, especially First Time Buyers, often start looking for a property before they have checked with a local bank what their disposable income will allow them to borrow. This being a common mistake can cause frustration and leads to disappointment when one finds out that the bank will not loan them the full amount.

Hereunder, we have provided you a guideline of what documentation you will need to present to a bank in Malta or Gozo as well as what a bank expectations are from you throughout the loan period.

The procedure to obtain a home loan in Malta or Gozo is fairly similar across all banks on the Maltese islands.

Choosing the right home loan is vital, and much depends on the state of the property and what the buyer intends to do with it. Residents can obtain flexible loans that can provide up to 90% of the purchase price, with repayments spread out over 40 years at very competitive interest rates. If you are purchasing a home with your partner or spouse the bank will take into consideration both individuals disposable income.

For non-residents, loans can be found that cover up to 80% of the property value, although this varies. In both cases, monthly repayments should not exceed 30% of gross income.

To apply for a home loan and for the banks to process the application efficiently, one is usually required to submit the following documents:

  • A recent pay slip and FS3 (Annual Employee Statement of Earnings reconciliation) as evidence of income
  • An architect’s estimate of the property value
  • Any building permits and plans
  • Records of any existing financial commitments, including credit card debt and any other loans
  • A photocopy of the applicant’s ID card
  • A copy of the preliminary agreement
  • If the person applying for a loan is not already an account holder with the bank, a character reference might also be necessary
  • A complete life insurance policy is required for any home loan, as is a building insurance policy.

In the case of a non-resident’s application for a home loan, all of the above would be required as well as additional documentation depending on the circumstances of the individual application.

In turn, the banks offer home loans under the following terms:

  • Up to 90% of the purchase price or completion costs for residents, or 80% for non-residents.
  • Preferential interest rates especially for the first years and for high value loans.
  • Monthly repayments up to 30% of the gross income.
  • Flexible loan repayment terms of up to 40 years, or up until age 65.

All banks in Malta offer Bridging Loans.

At RE/MAX Malta we are able to assist you in contacting the bank of your preference as well as guide you with Insurance Services that best suits your needs on a case-by-case basis. We are able to provide you and your partner/spouse ongoing support throughout the process.