What Foreigners Should Know About Mortgage Loans in Georgia
Real estate is a significant acquisition and requires substantial funds—many don't have the means to cover it all at once, so most properties in the country are bought with a mortgage loan.
Taking out a mortgage in Georgia is relatively simple compared to other countries, even if you're not a Georgian citizen - as long as you have all the necessary documents in order and follow certain rules. In the blog below, we'll discuss what you need to know to have your bases covered.
What is a Mortgage Loan?
A mortgage loan is a long-term targeted credit that allows you to borrow money from a bank based on real estate collateral. If you can't repay the loan obligation, the bank has the right to sell the property to recover the unpaid amount.
Loan terms are individual and depend on both the consumer (income, employment history, credit history, property value, and estimated loan duration) and the bank.
Giving out mortgages in Georgia for foreigners is common, though banks may have additional requirements.
That said, before you start the process, find a reliable construction company - their support throughout the process can be crucial for obtaining a mortgage loan. Among other things, they may ultimately spare you from dealing with banks. For example, OKTO GROUP offers potential buyers, including non-residents, a 0% internal installment plan spread over 40 months with a 20% down payment.
What Documents Are Needed for Foreigners to Get a Mortgage?
The foreigners are required to submit the following documents for mortgage application in Georgia.
Keep in mind that this is just an essential list all banks require in one form or another. The rest depends on specific banks’ internal policies - some may require additional documentation or information.
Notarized copy of passport translated into Georgian - necessary for identifying you.
Proof of income (salary certificate, bank statement) - information about your financial situation. The bank needs it to confirm that you have income to repay the loan and to see how stable your income history is.
Employment verification - shows your professional stability. Banks use it to assess the stability of your long-term solvency (the more stable your employment history - you've been working for one company for a long time, have no long-term breaks, etc. - the more reliable a borrower you are).
Tax residency confirmation - shows which country you pay taxes in. Banks need this information for tax and legal purposes.
Georgian residence permit (if you have one) - not mandatory, but will help speed up processes and increase the likelihood of loan approval. The document confirms your legal status in Georgia. Banks are often more lenient towards foreigners with residence permits, as it shows your long-term connection to the country and, in the bank's view, somewhat reduces loan issuance risks.
Real estate-related documentation - confirm property ownership and its value. The bank needs this information to determine how the property corresponds to the loan amount.
How to Get a Loan Secured by Real Estate?
First, you need to approach a bank for a preliminary assessment. The bank will review your financial situation and determine the maximum potential loan amount.
Then you can start choosing a property that fits your budget. While many non-residents go directly after seaside apartments under construction in Batumi, we’d advise them not to rush and to consider several options. The lower your final mortgage loan, the more advantageous your situation with the bank.
Once you've made your choice, you need to fill out a mortgage loan application and submit all necessary documents. The bank will assess the property to ensure the value aligns with the credit. If everything is in order, the bank will approve the loan and offer you a contract. It's best to familiarize yourself with real estate taxes in Georgia in detail before starting this entire process..
When you receive the contract from the bank, carefully review it and sign if you agree to the terms. In the final stage, the property should be registered in your name, and the mortgage should be registered in the public registry. This process ensures everything is conducted transparently and your rights are protected in all legal aspects.
Overview of Mortgage Loan Interest Rates in the Georgian Market
Georgia’s interest rates for mortgages today depend on several factors, including the currency, terms, and the borrower’s financial situation. Generally, foreigners may get slightly higher interest rates than local citizens.
As of 2024, the maximum repayment period for a mortgage loan in Georgia is 180 months (15 years). The average mortgage payment interest rate in GEL is about 14%, while in USD and EUR, it's 8-9%. However, your interest rate may differ as conditions are calculated based on individual circumstances.
can be a great opportunity, but it's crucial to thoroughly research and budget so that your dream doesn’t turn into a nightmare.We advise you to consult a professional lawyer before starting the process to understand the details well and avoid potential problems. Only after that should you go ahead with the purchase. Investing in Batumi real estate can be a great opportunity, but it's crucial to thoroughly research and budget so that your dream doesn’t turn into a nightmare.
