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So I am 95% sure I am moving to Finland in March 2019. This will be my second time living and working in Finland and I hope for this to be a permanent move this time round.
So right now I am looking at trying to sort accommodation etc. most likely starting the first 2 months in an airbnb. None of this is actually a concern, as that's the easy bit really. I will be a sole trader and I have all the information I need on that as I have a Finnish accountant dealing with that process for me.
So I am feeling confident and prepared for the move. What I would really like to know is peoples experience buying a property in Finland. I have lived in 6 countries across Europe now with work and rented every-time. I have spent the last 3 years saving and have approx €25,000 in savings. As I would like to make Finland my home I have been looking into buying a property, but to do this i need a mortgage.
From my research I can see banks typically give a maximum of 75% loan against the property value, but I have been reading in some cases that as a first time buyer you can get 95%. Or that there is something called a loan guarantee which could allow you to borrow more than the 75%. I will have a Finnish social security number and I will be paying Finnish taxes and social security (no tax equalisation to the UK).
Would I qualify for a mortgage in Finland?
Also would I be seen as a first time buyer? I am 34 so fall into the right age bracket which would mean I could borrow more and would avoid the 2% transfer tax. (I am aware that borrowing more means higher monthly repayments and I need to make sure I can afford to pay it back, but I earn good money and will also be paying more in social security payments to give me the employment insurance and sickness cover).
Any advice is very much welcomed.
Kiitos
Tim
Obtaining a Mortgage as a Foreigner
Re: Obtaining a Mortgage as a Foreigner
You can use the property as 75% guarantee for your loan, the bank can apply for state guarantee (not sure how much is that now) or you can also purchase a guarantee in a form of an insurance for the bank.
For getting the loan will be no problem as a foreigner but you will not qualify most probably only after over a year you have lived in Finland. Depends on the banks. Also your job matters quite a lot as will reduce or increase the risks for the banks based on what field you are working on.
Anyway, good luck with the move.
For getting the loan will be no problem as a foreigner but you will not qualify most probably only after over a year you have lived in Finland. Depends on the banks. Also your job matters quite a lot as will reduce or increase the risks for the banks based on what field you are working on.
Anyway, good luck with the move.
Re: Obtaining a Mortgage as a Foreigner
Thanks for the replies.
I have seen both those websites and had a good read, what I couldn't find is the criteria for a state guarantee. I have also seen that Nordea do their own guarantee and from what I can tell, either way you pay a 2.5% fee.
So you can borrow 75% maximum loan followed by a maximum of 20% on the guarantee with the remaining 5% with your own deposit. I am waiting for a call back form Nordea to try and get a better understanding.
Does anyone know the criteria for the state guarantee and is it a one off fee that you pay or are there monthly repayments on it also?
I have seen both those websites and had a good read, what I couldn't find is the criteria for a state guarantee. I have also seen that Nordea do their own guarantee and from what I can tell, either way you pay a 2.5% fee.
So you can borrow 75% maximum loan followed by a maximum of 20% on the guarantee with the remaining 5% with your own deposit. I am waiting for a call back form Nordea to try and get a better understanding.
Does anyone know the criteria for the state guarantee and is it a one off fee that you pay or are there monthly repayments on it also?
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Re: Obtaining a Mortgage as a Foreigner
Maximum 20% (25% for ASP) of the loan amount, 50000€. One has to have a Finnish identity number and has to reside in Finland, also the property must be located in Finland. One-time fee 2,5% of the guaranteed amount, to be paid at the time of the first withdrawal of the loan. All this information using Google for a couple of minutes.
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Re: Obtaining a Mortgage as a Foreigner
You won't have a Finnish social security number because such a thing does not exist. There are personal identity codes and they imply nothing about access to social security.