Mortgage Approved: Portrait of Ideal Borrower in Cyprus

Ипотека одобрена: как выглядит портрет идеального заемщика на Кипре?
11 March 2022 Irina Star

Mortgage in Cyprus is one of the most popular ways to purchase residential and commercial real estate on the island.

Banks in Cyprus want to give loans for the purchase and construction projects, offering adequate interest rates. And the state often provides assistance and incentives to buyers. That is why many residents of the island prefer to invest their money in real estate in Cyprus.

Cypriot banks offer many attractive mortgage programs both for local residents and for those who do not live on the island permanently. 

In 2022, the demand for mortgages has increased significantly. In 2020-2021, this method of buying a first home on the island was widely advertised through the introduction of subsidies from the government. 

As of today, the subsidy program has been suspended, but the government is still interested in attracting additional investments into the country's economy. And construction companies are actively building up cities and suburbs with modern, comfortable houses in the Mediterranean style.

It is important to understand that in such a case as a housing loan, everything is very individual. And even if your case does not respond to any of the following points, it is worth trying to visit the bank yourself and sort out a specific situation.

Do not forget that a mortgage is an important step in the life of any family, which should be approached with special care. It is not uncommon for all dreams of a new family nest to collapse with the first refusal of the bank.

Who is this ideal borrower that the banks in Cyprus are looking forward to? 

Resident or non-resident? 

Absolutely everyone, including citizens of other third countries, can get a loan for a house or villa, apartment, construction site or commercial object in Cyprus. The island's government stimulates the development of the economy and, we must say, quite successfully.

According to the Central Bank of Cyprus, the number of mortgage transactions continues to grow, and the mortgage loan rate has decreased by 5% since 2007.

It is more convenient for banks to work with those who permanently live, work and pay taxes on the island. Nevertheless, solvent foreigners who are ready to immediately contribute 50-70% of the cost of the object, sometimes enjoy more trust than locals with a 20% contribution in their pocket.

Given the interest rates from 1.8 to 5%, foreign investors choose long-term loans for at least 10-20 years, or even longer. For residents, the interest rate tends to the lower level, but as a rule not higher than 2.5%.

Stable income

Definitely banks in Cyprus, like banks in other countries, are much more interested in borrowers with a stable and understandable income than representatives of creative bohemians and freelancers. 

In addition, the bank must be sure that after the repayment of monthly contributions, the borrower will still have money for a normal existence. 

The ideal borrower takes a loan from a bank in which they have an account. Preferably not the first year. With positive dynamics of funds. 

Age from 18 to 65 years

Unfortunately, age is one of the most important criteria for evaluating a borrower. At the time of repayment of the debt to the creditor should not be much over 60. Individual banks allow 70 years. However, in the conditions of the Mediterranean climate, with the years comes not old age, but maturity. 

Liquid real estate

Liquid real estate is always in demand and it is easy to sell at any time. Bankers are well aware that objects popular on the market are always in price and become more expensive over time. Applications for such loans are considered faster and give a positive result. On average, the application is considered within one month. 

Today, the most liquid are two-bedroom apartments in buildings no older than 2000 and in new buildings. Also, small apartments and studios near higher educational institutions or the sea are always in demand. The average cost of such objects starts from 200 thousand euros.

At the same time, the average cost of comfortable family options with three or four bedrooms is 300-400 thousand euros. It would seem that adding a little more and business class is already close, but an expensive house is already falling out of the category of "the most liquid housing"


Changes in the underworld of the island are sometimes reflected on the surface of the earth. There are always risks of earthquakes and landslides. Therefore, it is extremely important to take the time to study the soil on which the selected property stands.

The borrower is obliged to insure his purchase, but, as you know, sometimes proceedings with insurance companies last for years, and you still have to pay the loan. In this regard, it is useful to trust the knowledge of the indigenous people and just be a little more observant. 

Salary in a stable currency

Ideally, to have an income in euros or pounds. For example, if the borrower's salary is in rubles, then a mortgage in Cyprus may be unprofitable for them. 

Does not repay the loan ahead of schedule

If the borrower suddenly decided to close the mortgage in Cyprus ahead of time, he may be disappointed. As a rule, banks do not welcome this and may even be fined. 

The ideal borrower sincerely appreciates the favorable conditions that Cyprus offers him and invests free funds in education and development of his business, rather than paying everything at once. 

A high-quality borrower does not take risks

At a personal meeting at the bank, it would be useful to indicate that the decision to buy a house in Cyprus is weighted. Explain the logic of your choice. How did you decide on a construction company? Have you been living in Cyprus for a long time?

Many underestimate the risks associated with buying a home with a mortgage and choose housing that objectively they cannot afford. Try to ask yourself the question, are you ready for a mortgage and how will this financial instrument help you? Are the bank's conditions psychologically difficult for you? Mortgage programs are designed to make life more comfortable, not the other way around. 

Have you decided to buy an apartment or a house in Cyprus? Contact DOM! The website offers a huge selection of real estate — residential and commercial. Experienced agency specialists will be happy to help you make the right choice.

See also:

  1. How to remotely buy a property to quickly get permanent residence and move to Cyprus?
  2. Buying real estate in Cyprus for cryptocurrency
  3. Elite Island Properties: Continuing Middle Eastern traditions in Cyprus
  4. Permanent residence in Cyprus
  5. Land Registry Department in Cyprus
  6. Cyprus Developers Alliance (CDA Group): affordable luxury in Cyprus
  7. Cyprus Real estate features: obvious for locals and amazing for visitors
Source: DOM
Photos: DOM, Pixabay
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