Speaking to the bank before you set out to look for your ideal home in Malta and Gozo is the way to go. In the majority of cases, we find that buyers—especially first-time buyers—often start searching for a property before checking with a local bank to find out what they can actually borrow. This is a common mistake made by anyone looking for home loans in Malta for the first time; it can be frustrating and sometimes disappointing if the buyer finds out they can’t borrow the full amount.

To help any future buyers out there, we’ve prepared a guide to the documentation you’ll need to present to a bank here, as well as what a bank’s expectations are of you throughout the process.

The journey to getting home loans in Malta or Gozo is fairly similar across all banks on the Maltese islands.

Choosing the right home loan is vital, and a lot of that depends on the property and what the buyer plans to do with it. Residents can get flexible loans that provide up to 90% of the purchase price, with repayments spread out over 40 years at highly competitive interest rates. If you're buying a home with your partner or spouse, the bank will take into consideration the disposable income of both individuals.

For non-residents, there are loans available covering up to 80% of the property value, although this varies. In both cases, monthly repayments shouldn’t be more than 30% of gross income.

To apply for a home loan and for banks to process the application efficiently, you're usually required to submit the following documents:

• A recent pay slip and FS3 as evidence of income
• An architect’s estimate of the property value
• Any building permits and plans
• Records of any existing financial commitments, including credit card debt and any other loans
• A photocopy of the your ID card
• A copy of the preliminary agreement
• If the person applying for a loan is not already an account holder with the bank, a character reference might also be necessary
• A complete life insurance policy is required for any home loan, as is a building insurance policy.

If you’re a non-resident applying for a home loan, all of the above would be required in addition to other documentation depending on your circumstances. The banks, in turn, offer home loans under the following terms:

• Up to 90% of purchase price or completion costs for residents, or 80% for non-residents
• Preferential interest rates particularly for the first years and high-value loans
• Monthly repayments of up to 30% of the gross income
• Flexible loan repayment terms of up to 40 years, or up until age 65

Banks in Malta can also offer Bridging Loans.

At Damcar Properties, we’re qualified to help you contact the bank of your choice effectively, and guide you through the insurance services that best suit your specific needs. We provide you and your spouse with support throughout the process of finding and processing home loans in Malta.