Step-by-step mortgage loan – everything you need to know

The first step that a customer who wants to take out a mortgage should take is to examine the offers of different banks and compare them with each other.

It is also worth calculating your potential credit standing yourself to know at all whether we have a chance to obtain such financing for a housing investment.

Actual annual interest rate


Mortgage offers are best compared in terms of APRC – the actual annual interest rate – or the total cost of lending because only in this way we will objectively be able to choose a loan that will be by far the cheapest for us.

We should also take into account promotional offers, which occasionally appear in the offers of many banks.

Comparing mortgage loans only in terms of the nominal interest rate is not appropriate because it is not the only cost borne by the borrower.

Once we are convinced that we have chosen the best possible mortgage offer, we can submit a loan application with the required attachments. The application should be completed on a bank print.

Depending on the bank selected, the requirements for attachments necessary to assess the customer’s credibility and creditworthiness may be different. They will without a doubt:

  • documents confirming the borrower’s identity – identity card and often also a second document with a photo;
  • Income documents – e.g. in the case of an employment contract, you must provide the contract itself, a certificate of income, as well as confirmation of submitting your PIT declaration from the previous year or a personal account statement from the last few months;
  • documents regarding the purchased property – an excerpt from the land and mortgage register, confirmation that the property is the property of the seller, a preliminary contract for the purchase of the property, an excerpt and an excerpt from the land register and the like.

It is only the complete application submitted to the bank that begins the examination of the client’s request for a mortgage.

Own contribution required


According to the recommendations of the Good Finance Investment Corporation, the borrower taking out a mortgage must have a 20% own contribution, the possession of which he can prove.

This contribution may take the form of cash, but not only. Banks also consider as own contribution, e.g. shares and bonds held, money on deposits or the value of a construction plot owned by a potential borrower.

However, in many banks, it is enough to contribute 10 percent. own contribution to the mortgage so that there are chances for it. The remaining 10 percent can be replaced by e.g. low own contribution insurance.

Creditworthiness assessment


After submitting the mortgage application, the bank begins its examination. This mainly includes assessing creditworthiness. The bank wants to be sure that the customer can afford a loan and there will be no difficulties paying the debt according to the schedule. The amount of creditworthiness is influenced by:

  • loan amount requested,
  • lending period,
  • amount of monthly income,
  • source of income,
  • form of employment,
  • number of dependents of the borrower,
  • monthly, permanent charges resulting from previously incurred loans and other liabilities.

Each bank has its own criteria for calculating creditworthiness. Therefore, in one bank the customer may have sufficiently high repayment capacity, and in another, it will be too low.

Customer control at GFI

Before the bank approves the mortgage application, it will also check how the client’s credit history is shaped at the Credit Information Bureau. Information on all borrowers in Poland and some borrowers are entered there.

If the entries in GFI are positive, it works in favor of the potential borrower. With negative entries, indicating delays in repayment of liabilities, the bank will not grant a mortgage.

Signing a mortgage contract

Signing a mortgage contract

If the bank verifies the customer’s loan application, evaluates creditworthiness and creditworthiness, it will issue a decision on granting the loan.

Upon acceptance of the application, a deadline is set for signing the loan agreement regulating the rights and obligations of the borrower and the lender.

It is important to sign such a contract after having familiarized yourself with all its points, especially those regarding additional fees and commissions.

The mortgage payment is usually made to the account of the seller of the apartment or house, but with mortgage loans taken for the construction or renovation of the apartment, it can be made in tranches to the borrower’s account.


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