How long does it take to get a mortgage loan?

A mortgage loan is one of the most complex retail banking products. Therefore, the actual approval of the mortgage loan may take various amounts of time.

Mortgage loan - complete process

Mortgage loan - completion of all the necessary documents for a mortgage loan assessment

The mortgage loan requires a number of documents with data to be assessed. If, for example, you buy real estate with the mortgage loan, you need to prove the purpose of the mortgage appropriately - you will need a purchase contract of sale, a contract on a future purchase contract or a reservation contract. If the purpose is proven, in order for the mortgage loan to be assessed, it is necessary to document the value of the property through an expert report and your creditworthiness. Everything can be simple if there is no encumbrance on the real estate, the property is settled, the value of the property is reasonable, and you need only 70% of LTV (the value of the security and the amount of the mortgage ratio). However, what is awaiting you if you find out there is a problem with the access road, or if the legal situation of the real estate is different than the factual situation? And what if... There are a lot of things you do not need to detect at first glance, but a mortgage specialist is very likely to deal with them in a way that there is little risk of slowing down the mortgage approval process after the mortgage loan application is submitted.

Mortgage loan - approval process

Once all mortgage documents are submitted to the bank, the branch employee enters the mortgage loan application into the system. He then sends all documents to the bank’s headquarters. The mortgage risk managers there give their opinion on the subject of security (the value and acceptability of the property), the client’s creditworthiness (acceptability and amount of income), the client’s risk profile (credit history...) and after consideration of all aspects, the statement comes. The client learns whether the mortgage loan has been approved, the amount of the mortgage and under what conditions the mortgage loan will be provided.
The entire approval process for a standard client and purpose of the mortgage takes approximately 5 days. However, it may also be 2 days or more than 2 weeks.

Mortgage loan - fulfillment of the conditions for finance release

The mortgage loan can be drawn at the earliest after the submission of the property deed with a seal marked on the basis of the deposit procedure (bank’s encumbrance registration) or the following week after the mortgage has been approved. In some cases, banks include registering the lien in favor of the bank (not the marked seal) in the conditions of mortgage finance release. In some cases, the mortgage loan may also be drawn after the change of ownership (after the transfer of the property to the applicant). In addition, it is necessary to document any possible payment of part of the purchase price from one’s own resources and the insurance of the property with insurance vinculation and a confirmation of the insurance payment. 

The mortgage loan for reconstructionmay also include the submission of bills and invoices for material and work in the conditions of the mortgage drawdown.
The mortgage loan for the purchase of a new-build property also requires submitting the invoice from the developer and possibly other things (depending on the project and eventual conditions in the bank).