Frequently Asked Questions
This section is dedicated to the most common questions we are asked by our clients about moving to Italy or arranging a Mortgage in Italy
80% of the Italian bank valuation is available.
Yes but only with dual UK and Italian borrowings or a significant valuation above purchase price. Any UK mortgage will need to be secured against an asset in the UK.
Yes. IMS can arrange interest only for a period of up to 5 years.
You will need to allow for numerous fees from both the Italian bank and the Italian government. These include mortgage arrangement fees, valuation fees, notary fees, land registry fees, and value added tax or registration tax. All costs are quoted in writing before you proceed. Some costs like the Italian bank opening fee and valuation costs will be specific to the mortgage lender selected. All land registry, notary and tax costs will apply whichever bank in Italy is selected. You should allow anything between 9% and 15% of the property purchase price to cover all purchase and finance costs that will be due. You should not decide whether to take your finance for your property in Italy from Italy or the UK until you understand the relative set up costs in full.
Yes , you can choose to refinance an existing mortgage but be aware of the terms of your existing loan and any costs associated with early redemption.
No, but we do occasionally experience a valuation that does not meet the market value. This can be driven by a number of factors, including non-registration of full square meter age or restrictions placed on the valuation company by their regulatory body.
IMS will update you by phone, email or fax at key stages in the mortgage application process and will provide a courtesy update at least once a week.
If you are experiencing any difficulties with payments you should talk to your bank in Italy immediately. As in the UK, if you do not communicate with them the bank in Portugal will start legal action.
For all initial guidance on level of Italian and total mortgage borrowing; written mortgage product quotes and general information there is no charge. If and only if you instruct us to submit a mortgage application on your behalf do we apply a fee. This fee is a flat rate of £ 650 for standard Italian residential mortgages. All Italian bank fees, tax and registry costs related to the Italian mortgage will be provided in writing.
In general most banks in Italy like to see the mortgage completed by the time the applicant is age 80. We can get terms up to 30 years. For clients falling outside this UK lending against an UK asset may be possible as an alternative financing option.
Most Italian banks expect the client to have a current bank account with them and buildings insurance is a legal requirement although there are banks that will offer this free of charge when taking out a mortgage. All other products can be avoided unless you wish to take them. Attractive headline interest rates can have compulsory products tied to them and the full cost of all products should be considered when assessing the mortgage against the mortgage of another bank in Italy.
Currently the banks in Italy are under no obligation to register your debt in the UK. The mortgage in Italy will not show on your credit file in the UK.
For all urbanized purchases in Italy, the Italian bank will be happy to lend. If you buy a property in Italy sitting on rustic land the amount of banks in Italy willing to use the property as security will diminish. Italian properties on rustic land are unlikely to reach the valuation levels of similar properties in urbanized areas. Cave houses which are very popular in some parts are difficult to finance in Italy.
In general most banks in Italy assess your net not gross income and relate it to the actual monthly mortgage payments level. For most Italian lenders your monthly mortgage payments in Italy should not exceed 1/3rd of your proven income minus tax and existing UK liabilities. Each bank in Italy will have a slightly different view on how they underwrite and what papers they need to see. Some banks in Italy will provide mortgages with income ratios up to 38%.
No. Italian banks are not obligated to provide you with and operate under the regulation as laid out by the FSA. It is therefore extremely important you deal with an expert who can inform you in full of the drawbacks and benefits of financing in Italy.
Not all banks in Italy provide a written formal offer of lending as standard. Where this is the case we at IMS insist on the terms in writing from your Italian lender before completion which we will forward to you and your Lawyer in Italy to check and agree.
Once you have completed the notaio is then responsible for collecting any completion taxes that are payable to the Italian government and to ensure that the new ownership is registered with the land registry. He should also inform the local police of the change of ownership.
Once the deeds are with the land registry is the property officially yours.
Your bank arrangements fee etc will usually be taken with your first mortgage payment.
If you have not had any communication from your lender in Italy within 4 weeks of completion please call us.
Contact Us
If you have a query not answered on this page, please contact us via this website.
Buyer's Guide
In order to buy a property in Italy, you will need an official fiscal number so that the Italian tax authorities can identify you. Read our guide for details of the various contracts you will come across.
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