trouble getting a mortgage

Discussion in 'Bulgaria Property' started by mdacruz1, Jun 16, 2008.

  1. mdacruz1

    mdacruz1 New Member


    I am concerned, I have been reading a few posts and see people are having trouble getting a mortgage. I too like some people were not told that VAT would be seperate from the banks mortgage they would give me. If this is the case I would not be able to afford to buy the house and it now looks I will lose my deposit. I have contacted my lawywer which now says that I cannot get out of the deal.

    surely there must be soemthing I can do and others in my position to try and get soem of the money back.

    Any help you could give would be appreciated.
  2. Damian George

    Damian George New Member


    Bulgaria is difficult at best - why dont you give Steve Keys a call at Key Mortgages

    He should be able to help - Let me know how he goes as i do know other people that may be able to help

  3. jamiew

    jamiew New Member

    Me too.

    Re-couping some of the deposit looks unlikely unless we can group together (provided we are dealing with the same people), and advisor from Bulgarian Home Loans didn't seem to think there would be a problem pulling out of the mortgage though. I'm not so sure...
  4. Jain and Chris

    Jain and Chris Senior Member

    The mortgage situation in Bulgaria has changed significantly this year. Whilst last year, the majority of banks were willing to lend 75% ltv and were not so stringent on credit checks, there has been a marked turnround in 2008.

    The banks have been (as all banks would) concerned by the amount of new and continuing construction in some large tourist resorts (Sunny Beach, Bansko..). They know that if they had to repossess the property they would potentially find it difficult to sell quickly - particularly in relation to covering the debt owed to them. Therefore they have drawn in their lending criteria.

    This has led to decreasing valuations and even refusing to lend in some specific resorts. In effect they have become more and more risk-averse.

    I spoke with Chris Downham of Bulgarian Home Loans, specialist in Bulgarian mortgages to get the most up-to-date information as he met with the Bulgarian banks only 10 days ago.

    Those looking for a Bulgarian mortgage at the moment will find they can expect a maximum loan of between 350 to 500 euros a sq.m in some tourist areas. Clearly this may be massively short of the amount that many people require and does not represent a true valuation of the majority of developments in those areas.

    We are confident about the future for tourism and associated property in Bulgaria. However, right now the banks are positioning themselves defensively in the short term. This is not at all unique to Bulgaria, this is something being witnessed in the UK and across the world.

    Quite probably the short term "gold rush" mentality of UK buyers and Real Estate Agents, plus the developers, contributed to this altering attitude of the banks.

    Unfortunately, those who applied for a mortgage last year and have been waiting for the results of their application are now caught between a rock and a hard place as the banks' lending criteria have substantially changed.

    We would advise everyone in this situation to contact their lawyers to investigate their preliminary contracts (was there a clause inserted, saying the purchase was subject to a mortgage?) and also to contact a specialist in overseas or Bulgarian mortgages to explore other ways in which finance may be raised.

    Best wishes
  5. brendan92

    brendan92 New Member

    hi has anyone bought in vitosha palace sofia
  6. postestate

    postestate New Member

    I know what you mean. I invested in off plan as well in Sunny Beach, and i had the same problems with the mortgage. I am going to sale now, and of course because of the market i will have a loss. I m looking thought in reverse auctions sales, aparently american and australian goverment sale houses using this system. Any ideas or has anydoby knows about thetekramgroup?
    Thank you
  7. mdacruz1

    mdacruz1 New Member


    Does anyone know who I can try and resell my property in Perun Lodge, paid the 30% and reservation fee, but would like to sell and try and recoup something back

  8. celee

    celee New Member


    I am in the same position also. A Bulgarian (Spanish) Company were meant to be doing mine and have just told me they can't help. I have an alternative broker who has been very helpful, let me know if you want their details.........
  9. Jain and Chris

    Jain and Chris Senior Member

    OK, one and all,

    What exact and precise difficulties are you experiencing - we may be able to help you.

    You will most certainly have to have 30% (maybe 25%) deposit, plus proof of income and bank statements to support the lending.

    Let me know.. Hope to be able to help

    All the best, J n C
  10. celee

    celee New Member

    Not experiencing any difficulties now i have been referred to a proper Financial Advisor. Let me know if you want the details
  11. Richard Brown

    Richard Brown New Member


    NYD Law (Neli Zhelyazkova) were recommeded to me by a friend. They took the time to keep me informed of the relevant points of Bulgarian mortgage law. Their professionalism and patience in explaining the intricacies of Bulgarian mortgage process has been invaluable. Cheers!Richard
  12. debseason

    debseason New Member

    Losing deposits

    My partner is about to lose his deposit too, we are searching for lawyer who can fight these contract deals and get his money back. Stay in touch as we will not give up until we have that money back too. We need to form a group of people who need to do this. I still believe it is possible with the right person fighting for you.

    Maybe through this site you can get my contact details and get in touch.

    I'm also interested to hear from anyone else out there who has been in a similar situation too.

    Stay positive!

  13. kmichael

    kmichael New Member

    I would support the comments in this post, the rules have changed for some of the banks and that their lending LTV criteria has changed. In previous posts I had indicated that a had a pre-approved loan with EIB (all seems fine eh?).. well seems all bets are off! this is beacuse their LTV limit has been reduced, the lending criteria is still the same (they need to validate you can affort it) but with the EIB, they simply cannot now lend at 70%LTV as they had previously indicated. So if you do get a mortgage with them and you had put down 30% hence needing the 70% balance as a mortgage, you are left with a shortfall to make up yourself. Aside from that, it seems apartments in Perun Lodge will be undervalued per Sq M, less than people purchased them for.. me included and I thought I got a reasonable deal.. so I now have to find another bank that will not only give me 70% LTV but then probably make up the difference due to the valuation price. I have addressed this and things seem to be going smoothly to this point. My advice is get you mortgages prepared now, don't wait any longer (if you are buying in Perun Lodge) if they are to be completed in December, it will take that long to arrange
  14. Mikeyv

    Mikeyv New Member

    I had a mortgage in principle and paid my fees etc summer 08 but now that the construction of my resort has taken longer than expected the mortgage application has run out and now going through it looks it could look like I am going to have put more cash into it hich is a shame!!!

    even though I have put down 40%
  15. bbq

    bbq New Member

    I am a developer based in Bulgaria and I have been busy building my own development based close to the new Pirin Golf and Country club. My business model is different from many other developers and this season will be the first time I am actively advertising the resort and other services my company will be involved in (such as maintenance etc).
    I have realised there are big problems now with getting mortgages and also with the devaluation of the pound, however I can control at least one of these factors- mortgages. I can offer 60% mortgages on all my properties, access to these funds are relatively simple, interest rates are best in the market and what I am building, I believe is a unique development- check out the website on pioneer resort bulgaria dot com.
  16. annamj885

    annamj885 New Member

    Hi all, me and my partner are in the same situation. Cannot get a mortgage either, we have lost so much money paying for mortgage application fees etc. But we also have another issue, in our contract it stated that our solicitors have to contact us 2 months prior to protocol 15 being issued so we can get everything sorted out. We were never contacted and I accidently found out on a forum that the apartments were completing. So we are arguing that fact across in order that we can get our deposit back. Maybe reading through your contracts might be an idea to see if all information has been fulfilled. But the solicitors and developers are ignoring us now so it looks like we are losing our deposit, lets face it a Bulgarian court isnt going to side with us English.
  17. debseason

    debseason New Member

    loss of deposits


    Just to let you know that it is very difficult to get large deposits back after committing yourself to a deal on an apartment or a house abroad. Many people are losing large amounts of money and there is very little help or advice available. Even lawyers do not want to know and it would be very costly to find out that you can't get your money back. Once you have signed a contract to say that the developer can keep the deposit if you cannot go through with the sale....there is very little you can do. You can try and pleed with the developers good nature to return some of the money, as someone I know did. She made such a pest of herself the developer refunded 70% of her money.

    Anyway, we are still trying different avenues to no good luck to anyone else who is trying to retrieve any deposits.
  18. annamj885

    annamj885 New Member

    Hi, I think what we should do is all the people that are losing deposits or feel that they arent being treated fairly, should all get together and make it public by contacting Watchdog and hopefully bad publicity will help us get our money back? I work in a Solicitors and have spoken to the solicitor that i work for and he said that this is the best idea for now as Bulgarian law is completely difference to English and we wouldnt have a leg to stand on really.
  19. debseason

    debseason New Member

    I think your solicitor is right. We don't have a leg to stand on trying to retrieve money back from a completely different foreign system. That is why our laywers and solicitors are very reluctant to touch cases against foreign developers. I have already approached Watchdog, who haven't responded to anything I have said. I think we all need to learn from what is being written on this website. But also there may be mileage in an organisation being set up to protect buyers in this country from being ripped off buying abroad......anyone interested in setting up a new business?
  20. annamj885

    annamj885 New Member

    Hi debseason,

    The business idea is good but how do we go about that? I have no clue about business and things.... though I do work in Law and i know solicitors advise in that kind of thing, i will ask my solicitor on Monday... what do you have in mind?


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