Mortgages and bank financing
A loan from a Turkish bank or instalments from the developer? The difference between them, what the bank asks for, and how to work out the real cost.
Two routes to financing
The first is a mortgage from a Turkish bank; the second is instalments direct from the developer. A bank loan carries interest and depends on the bank's valuation and your creditworthiness, but runs for years. Developer instalments on off-plan projects are usually interest-free but over a shorter term, typically ending at handover. Choosing between them is a cash-flow question, not a question of which is better.
Do banks lend to non-Turks?
A number of Turkish banks, both conventional and participation, lend to non-residents. Terms vary by bank and change often, and the loan-to-value is set against the bank's own valuation rather than the sale price. Do not rely on a rate or ratio quoted by an agent — get a written offer from the bank itself before signing anything.
What the bank will ask for
Typically: a translated and certified passport, a tax number, proof of income, bank statements, a valuation of the property, and earthquake insurance. Expect the assessment to take weeks rather than days, and never tie a contractual payment date to the drawdown of a loan that has not yet been approved.
Work out the loan's full cost
The monthly instalment is not the cost. Add arrangement fees, the valuation, compulsory insurance, and currency risk if you earn in something else. Borrow in the currency you earn in where you can: a lira loan against dollar income — or the reverse — turns an ordinary mortgage into a bet on the exchange rate.