Home Banking Getting quotes for a home loan in Malta

Getting quotes for a home loan in Malta

1 March, 2018 12 comments

After 8 years in Malta I felt like it was time to stop wasting money on rent and finally buy my own place. I’m only just taking the first steps on buying my own property in Malta but thought it’d be helpful to bring you all along on the journey. Right now I’m not sure if I’m buying something I want to live in, or something to rent, but I was told that being a foreigner (shudder!) I’d find it much harder to get decent terms on a loan, so I figured I’d first go and see what kind of home loan I can get before deciding what kind of property I want.

So far I have approached BOV (👎🏽), Banif (👎🏽) and APS (👍🏽) to try and get a first time mortgage in Malta.

Applying for a home loan in Malta as a British expat comes with some difficulties. Here’s what you need to know about me:

  • 30 years old
  • in Malta for almost 8 years
  • first time buyer
  • not married
  • no kids
  • full time employment (3 years at current company)

Home Loan Calculator Malta

You should absolutely book an appointment at each bank to see exactly what terms you’re eligible for, as so many factors will affect how much you can borrow, the deposit amount and the interest amount, however, get a rough idea using home loan calculators. I found these really helpful before the appointments to at least get a rough idea of monthly repayments for my desired loan amount. The terms I was actually offered were quite a bit better than what the home loan calculator shot out, but it was so great to be prepared!

Banks offering Mortgages to Expats in Malta

BOV 👎🏽

I’ve banked with Bank of Valletta for a number of years so when it came to getting a home loan in Malta, even as an expat, I thought they’d be the best bet. They have seen my salary go in steadily, they see I have no mandatory outgoings, no debt. They know me. But BOV is a real pain as it’s only open part-time during the day, so appointments are limited. The guy I met with also double booked me so I wasted my lunch hour on waiting. The guy himself wasn’t outright rude but he didn’t smile once during the discussion, and barely looked me in the eyes.

Questions:

BOV asked me extensive questions about

  • my salary,
  • my job,
  • my marital status,
  • whether I have kids at school in Malta,
  • whether I have blood relatives here in Malta,
  • how often do I travel and much more.

Finally he told me that they would give me a loan.

Home Loan Terms:

  • 30% deposit (the maximum amount) regardless if I borrowed 100k or 400k 👎🏽
  • around 5 – 6% interest 👎🏽
  • 34 year term only 👎🏽

This put me in the ‘highest risk’ bracket, so I asked him what factors made me high risk, to see if I could maybe do something about them, but he refused to tell me what factors affect the rating.

Conclusion

I will not be getting a first time buyers home loan from Bank of Valletta, Malta.

APS👍🏽

APS is a church bank, which was initially very off-putting, but with the terms from BOV making it completely useless for me, I figured APS was worth a shot. APS have a new evening policy where they open for personal appointments until 8PM on certain days, which already makes them so much more convenient. I headed over after work and was met by smiling, friendly faces.

Questions:

APS asked me a few questions before letting me know if I was eligible for a mortgage in Malta, much fewer than BOV:

  1. how long have I lived here
  2. what is my salary
  3. is my job indefinite or do I have a definite contract.

Then after a few minutes were able to confirm a loan. This was of a lower figure than BOV, but still a lot more than I’d be needing and they said more was possible but the terms would be slightly different.

Terms:

  • 10% deposit (the minimum amount) 👍🏽
  • 2.5% interest for 2 years, increasing to 3% variable afterwards  👍🏽
  • flexible, up to 33 year term 👍🏽

Conclusion

I’d definitely recommend checking out APS and getting a quote on your home loan.

BNF 👍🏽

It took a little while and quite a few attempts to get a meeting at BNF but once I got one sorted, they were very helpful. Their terms were better than APS, offering:

  • 90% loan (so I pay 10%)
  • 1.95% for the first 20 months
  • variable after that, currently at 2.99%
  • flexible, up to 33 year term.

Next Steps for Buying Property in Malta

  1. Get quotes for a bank loan
  2. Find a property, make an offer, have the offer accepted
  3. Sign Promise of Sale
  4. Officially apply for the bank loan

12 comments

Gary 1 March, 2018 - 6:26 pm

Very interesting Rhi. If you don’t mind me asking- what’s your thinking behind the 34 year loan term? That seems like an awfully long time to be paying a mortgage to me.

Reply
Gary 1 March, 2018 - 6:28 pm

Very interesting Rhi. If you don’t mind me asking what’s your thinking behind the 34 year loan term? That seems like an awfully long time to be paying a mortgage to me.

Reply
Rhi 1 March, 2018 - 6:43 pm

Was the only option available and is a pretty standard mortgage repayment length. Also there are no penalties for paying off early.

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Marc 3 March, 2018 - 8:47 am

Hi Rhi,
Thanks so much for this really interesting and helpful article. I am also considering buying in the next couple years, and I hadn’t even heard of APS so that is super helpful! I was just wondering if you are planning on approaching HSBC?

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Rhi 3 March, 2018 - 6:39 pm

I will maybe try just for a quote incase I can barter the length of the loan and interest but I’m not really interested in HSBC. Seen too many documentaries about them and what a mess they are!

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Felice 5 March, 2018 - 11:36 am

Hi Rhi. Do they have such a thing as a mortgage broker over there in Malta? Some of my friends swear by them, although I’m not sure whether online financial price comparison websites (e.g. Comparethemarket, moneysupermarket) aren’t eroding their profit. On the positive side, hopefully you won’t have to deal with the menace of Buy-To-Let landlords bidding up prices or even gazumping you.

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Rhi 6 March, 2018 - 12:56 pm

To be honest, I had to google mortgage broker as I didn’t know what it was and still don’t really understand. There aren’t a lot of banks here in Malta though so I only have to check 3 or 4.

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Scott 15 July, 2018 - 7:25 pm

Hey Rhi, Did you buy your own property in the end? I remember this post and was curious how far you got. I’m in the (very) early stages of looking at the option of buying. Even more so than the waste of money that is renting, is being held ransom but unscrupulous landlords. Ours is blackmailing us to increase the rent part was through an agreement (despite having signed on a set amount until next February!). I work for a bank (not allowed to say which publicly but can tell you privately, so the home loan itself would be through them. I would need to get my deposit together first and find a suitable property. I’m not sure if now is a good time to buy as property prices on the Island seem to be at an all time high? Grateful for any advice or tips from you experiences so far on your journey :)

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Rhi 17 July, 2018 - 8:22 am

I didn’t do a lot since this last post but actually yesterday I put an offer in for an apartment! Now is when I’ll find out exactly how this stuff all works and I’m already finding out all these extra fees. I’ll have more info in a few days so I’ll drop you a message and will do an updated post! Good luck, your landlord sounds awful, definitely time to stop wasting money on rent I think! Prices are increasing but it’s still possible to find good properties at reasonable prices that aren’t likely to lose value, may just have to adjust the areas you’re looking in. Like St Julians and Sliema are pretty much not worth it, but Gzira, Msida and Pieta are still pretty reasonable.

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Scott 17 July, 2018 - 8:36 am

Oh that’s amazing! Good luck with the offer you’ve put in :D Definitely keep me updated and I will do the same. Still very early stages, going to see the bank to see what they will lend me and then go from there. :)

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Martin 7 January, 2019 - 1:58 pm

Looking for an update to this :)
Btw if you feel comfortable in answering what budget and area are you aiming/hoping for?
Thanks!

Reply
Rhi 7 January, 2019 - 4:10 pm

Have delayed the process a bit but will most likely be buying this year, so will keep you posted! I’m looking around 150k – 250k, if I can find anything! Location, I’m not sure. If it’s for living, will most likely look between Sliema and Valletta, but if it’s for renting out will take any locations that fit in my budget with a demand for rentals. Still need to do a bit of deciding and researching!

Reply

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