The Czech Republic is becoming an increasingly popular destination for foreign workers, students, and investors. With growing demand for real estate comes the need to understand how the mortgage process for foreigners works here. While it may seem complicated at first glance, with enough information and preparation, getting a mortgage in the Czech Republic is entirely possible.

We have also prepared this article in English so it’s accessible to foreigners living in the Czech Republic – you can read it here: Understanding the Mortgage Process for Foreigners in the Czech Republic – Part 1

Here’s an overview of what’s required to obtain a mortgage as a foreigner in the Czech Republic.

Conditions for Foreigners

Unlike some other countries that have stricter rules for granting mortgages to foreigners, the Czech Republic allows foreign nationals to obtain a mortgage. However, certain conditions must be met:

• Residence status: Foreigners with long-term or permanent residence are eligible for a mortgage. In some cases, those with short-term residence may also qualify – depending on their financial situation and the specific bank’s policy.

• Stable income and employment: Banks require proof of stable income. In practice, this means showing that your salary is regularly deposited into a Czech bank account. It’s not just the amount of income that matters, but also its regularity. This is crucial for assessing your ability to repay the mortgage over the long term.

No Need for Foreign Credit History

One advantage for foreigners is that banks in the Czech Republic do not require proof of credit history from the home country. Unlike in other countries, where international credit agency reports are often used, Czech banks focus on your current financial situation and verifiable local data.

Proof of Income and Bank Statements

The key is to demonstrate stable and sufficient income, usually by providing:

• Bank account statements: The bank will require statements for the last 3–6 months, showing that your income is regularly deposited into a Czech account. This income must be clearly identifiable and match the information in your employment contract or tax return.

• Employment contract or income confirmation: In addition to statements, you need to provide income confirmation, usually on a form signed by your employer. In some cases, the bank may also require a copy of your employment contract and payslips. Self-employed individuals will need to submit documents such as a tax return or a profit and loss statement.

Checks in the Czech National Bank Registers

Banks not only verify your income but also any liabilities. They do this through the registers of the Czech National Bank (ČNB), which contain information about loans and debts in the Czech Republic. It’s important to disclose all liabilities truthfully and to have a repayment history without delays.

Types of Mortgages and Conditions

In the Czech Republic, there are two main types of mortgages:

• Fixed interest rate: The interest rate remains the same for a certain period (e.g., 5, 10, or 15 years), providing predictability in expense planning.

• Variable interest rate: The interest rate changes based on market conditions. It may be lower initially, but there’s a risk of it increasing over time.

The mortgage term typically ranges from 5 to 30 years. The maximum loan amount for foreigners usually covers 80% of the property’s value (in some cases up to 90%), with the rest to be paid from your own funds as a down payment.

Property Valuation

The bank will want to know the real value of the property, so it will require a professional valuation. This serves as the basis for determining the loan amount the bank is willing to offer.

Legal Aspects

Before finalizing a mortgage, it’s essential to verify that the property is legally sound – properly registered in the Land Register and free from disputes or legal defects affecting the land or building.

What’s Next?

Now you know the basic conditions for getting a mortgage as a foreigner in the Czech Republic. In the next part, we’ll take a closer look at the actual process of obtaining a mortgage and how an experienced financial advisor can help you.

And the best part? Most of these advisory services are free for you. They make the whole process simpler, faster, and clearer – without unnecessary stress and with greater confidence in your decisions.