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Can I get a mortgage in Italy as a foreigner?

Clare Speak
Clare Speak - [email protected]
Can I get a mortgage in Italy as a foreigner?
Italian banks are notoriously strict on lending, but it is possible for international buyers to take out a mortgage. (Photo by GIUSEPPE CACACE / AFP)

There's no law stopping foreigners from getting a mortgage with an Italian bank, however, there's a lot you need to know about the process.

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The good news is that getting a mortgage as a foreigner in Italy is generally possible.

But if you're a foreign national in Italy, you can expect to be asked for more paperwork than an Italian or EU citizen might be, and for the application process to take considerably longer.

The process of applying for a mortgage in Italy can also seem opaque and difficult for consumers to navigate, as rates and availability of mortgages are often not advertised openly.

While it's a complex topic, here's an overview of what you'll need to know before you start:

Non-residents

There are no rules against non-residents buying property or taking out a mortgage in Italy - but in practice, you're likely to find getting a mortgage from an Italian bank is far from straightforward.

Italian banks do not advertise non-resident mortgage products, even if they offer them, meaning rates are not readily available for comparison. You are almost certain to require the services of a specialist mortgage broker in order to access this information, as well as to apply.

READ ALSO: Five things non-residents need to know about buying property in Italy

There are also more paperwork requirements and checks in place throughout the process, as non-EU nationals without permanent residency are considered a greater risk by lenders.

Generally, it's advisable to seek independent advice from Italian financial and property law experts well in advance if you're considering a property purchase as a non-resident.

How much can you borrow?

While this will of course depend largely on your own circumstances, it's important to know that Italian banks are known to be strict lenders and tend to require a larger deposit than many international buyers may be expecting.

This is always true whether or you're an Italian or non-EU national, resident in Italy or abroad - though, as noted above, non-residents face additional hurdles.

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"Due to the economic crisis and the new Anti-Money Laundering Regulation, over the past few years Italian banks had made their mortgage policy stricter, especially when dealing with non-Italian residents," explain lawyers from legal consultancy Italy Law Firms (ILS) on their blog.

"In general, expect your down payment to be higher than it would be in the US or UK," ILS says.

"Italian banks usually accept mortgage requests for a sum amounting not less than €70,000," it adds, while mortgage terms of between five and 30 years are typical.

EXPLAINED: The hidden costs of buying a home in Italy

ILS notes that "the maximum mortgage is typically 50-80 percent of the purchase price depending on your individual circumstances."

Italian mortgage lenders generally require proof of at least 2-3 years’ stable income before they will consider lending to an Italian resident.

For this reason, if you're based abroad and are planning a move to Italy in the near future, many experts advise that you may have more success in applying for an Italian mortgage before you relocate - as counterintuitive as this may seem.

How long does it take?

As with most things in Italy, patience is a virtue here as you'll need to be prepared for a relatively long wait for a mortgage application to be approved.

Even in the most straightforward scenario - an Italian citizen resident in Italy, applying with the assistance of a mortgage broker - the process generally takes up to a month to complete.

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A mortgage application with an Italian bank "is a rather complex process that takes on average between 20 and 60 days," property search portal Idealista explains.

Non-EU nationals resident in Italy often report being told that they would need to wait an additional 1-2 months for approval due to the need to carry out further checks, though the timeframe will vary by bank and applicant.

This waiting time is a problem for Italian as well as international buyers, as it "in some cases makes it impossible for the potential buyer to sign an agreement, and in many cases the house of their dreams will be lost due to the lack of immediate financial resources to complete the process."

READ ALSO: Five pitfalls to watch out for when buying an old house in Italy

Idealista notes that "some banks allow clients to apply for a mortgage with pre-approval ... lasting up to six months, to allow the potential buyer to arrive with the cheque in hand when visiting the property to buy."

However, as you might expect, this is less likely to be an option offered to non-EU or non-resident applicants.

What paperwork is required?

The exact requirements will depend on the bank and your circumstances, but generally, as an Italian resident, at a minimum you will need to provide copies of your Italian carta d'identita (ID card); permesso di soggiorno (residency permit) or equivalent; your passport; and your birth certificate.

Be prepared to produce your residency permit if you’re a non-EU citizen. EU citizens, including Italians, may be able to just use their registration certificate proving their resident address in Italy.

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British nationals who were resident in Italy before Brexit, and who therefore do not have a permesso di soggiorno (residency permit), may instead need the post-Brexit carta di soggiorno to prove their status.

Some lenders may require applicants to have permanent residency, as permanent residents don’t face the danger of a permit renewal request being denied. However, this is up to the individual lender rather than being required by law.

And, as noted above, you'll need to be able to prove at least 2-3 years of stable income, so be prepared to provide your bank statements and financial records.

See more in The Local's Italian property section.

Please note that The Local is unable to advise on individual cases. For further information on applying for a mortgage with an Italian bank, consult an independent financial expert.

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Comments (2)

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Philip 2024/06/07 22:02
We were just on the verge of this process and then worked out a cash only option at the last minute. That was a bit of luck but we had begun the mortgage route first. We were told to expect 4 months AFTER the purchase agreement, which is a minimum of 30 days after the preliminary agreement. Even with a cash deal we had given 35% down plus lawyer fees, notary fees, tax fees, and 5% plus VAT on the sales price to the seller’s agent. We are well known to our bank and have all the paperwork to back up a mortgage request at the ready. We are also dual citizens and are considered returning Italians. All that said the time consuming process of checks and balances necessary to get a mortgage are just that: time consuming. An interesting point we learned was that the mortgage application and processing process would not begin until the purchase agreement had been made. This could have just been our situation, but that may be helpful for others to consider. For us, the 4 months were mainly due to August popping up in the middle of everything. Time off during that month means much of business comes to a halt. It took us 6 weeks to go from seeing the property, making an offer, signing a preliminary agreement with deposits and on to the purchase agreement. I think we got lucky because we had a great attorney. This is an extra fee but, IMHO, one that cannot be emphasized enough. This will be our primary residence and that makes a difference from buying a second property from abroad. The point, however, is that it’s both time consuming and important to have help.
S. L. Jackman 2024/06/07 18:30
I did it, and got a mortgage at 60% of purchase price. There were lots of paperwork requests, but no more really than in the USA. One difference was a face-to-face meeting at the bank, which was useful for opening the account there as well. I used Intesa Sanpaolo and they could not have been nicer.

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