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A mortgage decision does not begin with an advertised rate. It begins with three questions: can the household budget carry the payment, are the buyer's own funds sufficient for the down payment and costs outside the loan, and will a bank accept both the borrower profile and the property? All three need to be checked together.
What mortgage readiness means
Readiness is more than an online repayment estimate. The borrower needs income evidence accepted by the selected bank, a traceable source of own funds, a reserve, status documents and time for property due diligence. The property must also meet the bank's collateral requirements and pass the buyer's independent legal review.
- Income and existing obligations can be evidenced in the form accepted by the bank.
- Income currency is compared with loan currency and household spending.
- Own funds cover the down payment and the transaction costs that are not financed.
- A reserve remains for delay, repairs and changes in household income or spending.
- The borrower understands rate changes, early repayment and enforcement against the collateral.
Separate the borrower profile from the property purchase
Citizenship, residence, tax residence and country of income may affect the documents requested and the bank's internal assessment. Owning property does not by itself confer a right to reside in Bulgaria. Mortgage and migration routes must be checked separately.
| Profile | Ask the bank | Check separately |
|---|---|---|
| EU, EEA or Swiss citizen | Which income, address, tax status, banking and identity documents the bank accepts | Residence formalities and any rules affecting the particular property |
| Third-country national residing in Bulgaria | Which residence document and validity the bank accepts, which income countries and currencies it considers, and what history it requests | Continuing validity of the residence basis independently of the purchase |
| Non-resident or borrower with income earned abroad | Whether the bank considers this profile and which transfers, evidence, currencies and documents it accepts | Tax, banking and migration consequences of the individual situation |
Do not copy the terms offered to a friend or citizen of another country. Before paying a non-refundable deposit, ask the bank to provide a written document list for the actual borrower profile.
Eight fields required for a valid comparison
| Field | What to record | Why it matters |
|---|---|---|
| Income and loan currency | Currency in which income is received, debt is recorded and payments are made | A mismatch creates exchange-rate risk |
| Rate and APR | Nominal rate, annual percentage rate of charge, fixed or variable period and change mechanism | A low nominal rate does not show every cost |
| LTV and own funds | How the bank defines collateral value and what the buyer must fund | The bank valuation may differ from the purchase price |
| Fees | One-off and recurring bank charges, valuation, account and linked services | They change total cost and cash needed at the start |
| Insurance | Required policies, coverage, beneficiary, term and any choice of insurer | Price and protection differ |
| Collateral | Property mortgaged, document requirements and consequences of default | The risk concerns the property as well as the payment |
| Early repayment | Procedure, notice, possible charges and recalculation method | The terms affect flexibility |
| Stress scenario | Payment and remaining budget under selected adverse conditions | The base illustration does not show resilience |
Interest rate and APR answer different questions
The nominal rate is used to calculate interest. APR, the annual percentage rate of charge, is designed to give a broader view of credit cost under the rules and assumptions stated in the document. Compare the same amount, term, currency and offer date; otherwise accurate figures may still describe different scenarios.
Record which part of the rate is fixed, which part may change, the index or bank decision linked to the change, and how notice is given. If an account, insurance policy or other service affects the offered terms, include it in the comparison.
LTV and down payment: identify the valuation basis
Loan-to-value, or LTV, compares the loan with the value the bank accepts for collateral purposes. Do not assume that the bank will use the contract price or produce the valuation needed for the planned down payment. Ask the dated written offer to state the valuation basis, applicable LTV and own funds required.
The full purchase cost is wider than the credit cost
Build a separate transaction budget. Depending on the actual deal, it may include bank fees, valuation, insurance, notary and registration fees, local tax, independent legal due diligence, translation, brokerage, account charges and initial repairs. Confirm which cost applies, who receives it and when it is due.
Practical rule: do not use all available cash as the down payment. Calculate costs outside the loan and the reserve that remains after completion first.
Collateral and property due diligence
The bank values the property for its own credit-risk purposes. That does not replace the buyer's independent review of title, encumbrances, construction documents, identifiers, boundaries, debts and preliminary-contract terms. The bank's interest and the buyer's interest overlap, but they are not identical.
Request the borrower document list from the named bank
A bank may request identity and residence documents, tax status information, employment or business income evidence, account statements, current obligations and evidence of the source of own funds. Foreign documents may require translation, certification or additional verification.
Do not send a full set of sensitive data to an unverified intermediary. Obtain the bank's official submission channel, privacy information and a personal document list. Record the bank's name, the issue date and the borrower profile to which the list applies.
Run a stress scenario before applying
Test the household budget as well as the bank illustration. Apply selected adverse conditions separately and together:
- income falls temporarily or one income source disappears;
- the payment rises under the change mechanism described in the contract;
- income currency moves against the currency of the obligation;
- repairs, healthcare costs or a period without a tenant occur;
- selling the property takes longer and creates additional costs.
Record the amount left after the mortgage payment and essential spending. If the plan works only with a permanent bonus, full rental occupancy or a quick resale, its resilience depends on an unconfirmed assumption.
Compare dated written bank offers
Use identical inputs first, then record the bank's name and the date of every document. Compare the current European Standardised Information Sheet, or ESIS, any applicable Key Information Document, or KID, and any other required pre-contractual disclosure together with the bank's individual dated written offer. An advertisement or oral illustration is not a substitute for this package.
| Parameter | Bank and date A | Bank and date B | Bank and date C |
|---|---|---|---|
| Amount, term and currency | Complete | Complete | Complete |
| Rate and change mechanism | Complete | Complete | Complete |
| APR and total amount payable | Complete | Complete | Complete |
| LTV and own funds | Complete | Complete | Complete |
| Fees, account and required services | Complete | Complete | Complete |
| Insurance | Complete | Complete | Complete |
| Early repayment | Complete | Complete | Complete |
| Property and drawdown conditions | Complete | Complete | Complete |
Read assumptions and exclusions as carefully as headline numbers. Check whether costs shown in one document are omitted from another, whether the same property value is used, and whether a linked product changes the rate or APR.
A safer transaction sequence
- 1Build the household budget, reserve and income file.
- 2Ask several banks whether they consider the actual borrower profile.
- 3Obtain a written list of requirements and documents without treating it as final approval.
- 4Select a property and arrange independent legal due diligence.
- 5Obtain the valuation, current pre-contractual disclosures and an individual dated bank offer.
- 6Compare total cost, stress scenario and preliminary-contract conditions.
- 7Accept binding commitments only after the banking and legal routes are aligned.
Official verification routes
- Bulgarian National Bank: aggregate interest-rate statistics, consumer materials and registers of credit institutions. Aggregate statistics do not confirm a rate, LTV, down payment, document list or approval for one borrower.
- Official website of the named bank: current consumer information, ESIS, any applicable KID or other pre-contractual materials, and official contacts for an individual written offer.
- The individual bank package: a dated offer naming the bank, draft agreement, repayment schedule and lists of fees and drawdown conditions.
Keep property due diligence separate from the bank valuation. Use the property-purchase process guide for the transaction sequence and the current catalogue when selecting properties. The original page's archive link leads to additional mortgage information.
Purchasing property does not create a right to reside. Check the separate route in the guide to residence, long-term and permanent residence and citizenship and with the competent authorities.
Information refreshed: 11 August 2026.
