FinanceMortgagePropertiesBuying property in Italy as a foreigner: Can you get a mortgage?

2 August 20230

Italy has long been a popular destination for foreigners wishing to buy holiday homes or investment property. With its rich culture, breathtaking landscapes and Mediterranean climate, it is easy to understand why so many non-Italians are eager to put down roots in the Bel Paese.
For foreign buyers, obtaining a mortgage in Italy used to be difficult, if not impossible. But banking laws and practices have softened over the years, making it easier for non-EU citizens to obtain home loans. Today, foreigners can obtain mortgages in Italy under certain conditions.

In this article, we will review everything you need to know as a foreigner seeking a mortgage to buy property in Italy. Topics covered include:

– Requirements for foreigners to obtain a mortgage in Italy
– Types of mortgages available
– The mortgage application procedure
– Tips to improve chances of approval
– Hidden costs and fees to look out for

Mortgage requirements for foreigners in Italy

To obtain a mortgage in Italy as a non-citizen or non-resident, you need to meet several requirements:
– Have a valid long-stay visa or residence permit – This shows lenders that you can live legally in Italy for the long term.
– Provide your tax code – All residents in Italy must have a tax code.
– Prove your income – Most lenders require 1-3 years of income in Italy or abroad
– Make a down payment of 20-30% – A higher down payment helps to confirm that you are good and serious about embarking on a mortgage transaction
– Have good credit – Lenders check international credit reports to ensure that you have a solid repayment history.

Meeting these criteria demonstrates to lenders that you have the means to repay the loan and ties to Italy. Some banks may impose additional requirements based on nationality and visa status. The stronger your financial profile, the greater your chances of approval.

Types of mortgages for foreign buyers

Italian banks offer different mortgage products for both nationals and foreigners. The most common ones according to rate are:
– Fixed: linked to the IRS (Interest Rate Swap) index, it is established at the time the loan contract is stipulated and remains constant throughout its duration, as does the amount of all the instalments;
– Variable: it is established at the time the contract is stipulated but is then recalculated periodically throughout the duration of the loan on the basis of the fluctuation of the Euribor, i.e. the interbank reference rate for variable-rate mortgages disseminated daily by the European Banking Federation, or the European Central Bank reference rate (ECB rate). It entails a greater risk than the fixed rate as it follows the trend of the money market: if the cost of money falls, the instalment decreases, otherwise it increases;
– Variable fixed rate: compared to a normal variable rate mortgage, the instalment is kept constant at the starting amount, and over time the actual duration of the repayment period will vary: if rates fall the duration will be reduced, if rates rise the duration of the mortgage will be longer than originally planned;
– Capped rate (also called cap) variable rate: this is a variable rate but has a predetermined cap;
– Mixed: can be modified at the terms and conditions set out in the contract, or one part of the capital to be repaid at a fixed rate and the other at a variable rate;
– Balanced: consists of a fixed-rate part and a variable-rate part, depending on the weighting you want to give to the fixed and variable rate.
Always compare interest rates and fees to find the best product for your needs. If possible, avoid risky adjustable mortgages.

Applying for an Italian mortgage as a foreigner

The process of applying for an Italian mortgage is similar to that of other countries. Here are the typical steps:

1. Check eligibility – Make sure you meet all requirements, particularly income, residency status and credit.
2. Choose the property – Apply only after you have found a property that fits your budget.
3. Select the credit institution – Look for banks that accept foreign applicants. Larger banks often have more experience.
4. Submitting the mortgage application – Provide all the required documents, including income declarations, visa, tax code, bank documents, etc.
6. Get a property valuation – The bank will send an appraiser to assess the fair market value of your chosen property.
7. Receive the outcome of the mortgage application – Approval can take from 2 weeks to 2 months after submitting a complete application.
8. Sign the final mortgage contract – This contract specifies the interest rate, amortisation schedule, fees and other agreed conditions.
9. Complete the purchase – Once approved, you can finalise the sale of the property and become the new owner.

Being well prepared with all the documentation made the approval process easier. Ask questions and negotiate the rate on the best terms.


Tips for foreigners looking for an Italian mortgage

Given the difficulties that non-citizens may face in obtaining approval, here are some tips to increase your chances of obtaining a mortgage:
– Turn to a multilingual broker such as FMoretto Consulting www.fmorettoconsulting-com. who, having contacts with the best banks, will be able to guide you safely in choosing the best mortgage.Their aim is to assist foreigners in overcoming bureaucratic difficulties and provide support throughout the process and beyond.
– Make a larger down payment – A down payment of at least 30%…40% shows your commitment to the purchase.
– Be patient – Approval for non-EU buyers often takes longer, so do not be discouraged by delays.
With preparation and perseverance, obtaining an Italian mortgage as a foreigner is possible.

Hidden mortgage costs and fees in Italy

When budgeting for your mortgage, be aware of the additional costs and fees involved in buying a property in Italy. These expenses can add up:

– Conclusion fees – Banks charge 1-2% of the mortgage amount to secure financing.
– Valuation fees – You will have to pay around 200-500 euros for the valuation of the property.
– Notary fees – About 1-3% of the purchase price goes to the notary. Your fee will include a fee for these activities, but also taxes to be paid to the tax authorities, which will be the largest part of the fee. In fact, when we go to a Notary to purchase a first home from a private individual we will pay the price of the property to the private individual, but to the Notary the taxes due, i.e. 2% of the cadastral value of the property (cadastral annuity revalued at 5% multiplied by the coefficient of 110) plus 50 euros for cadastral and mortgage taxes. If we buy a second home, the tax percentage rises further: the registration tax is in fact 9% and the multiplication coefficient of the cadastral annuity rises to 120.
– Surveyor’s fees – Appointed by the bank to inspect the condition of the property, at a cost of 200-500 euros.
– Translation fees – If the documents are not in Italian, certified translations may be necessary.
– House insurance – Necessary to protect against damage, on average 200-400 euros per year.
– Consultant’s fee: The consultant’s fee generally ranges from 3% to 5% on the amount disbursed by the bank as a mortgage.
Take these expenses into account in your budget. Ask the bank and the consultant to explain the costs to you.


While it was once rare to obtain a mortgage in Italy as a non-resident, today’s more globalised world has led to a relaxation of lending rules. There are now clearly defined requirements that foreign property buyers must meet in order to be approved for financing.
By demonstrating strong ties to Italy, submitting complete applications and working with experienced brokers such as FMoretto Consulting, international buyers can access mortgage loans for the purchase of real estate. Careful budgeting for taxes and fees is equally crucial.
With proper advisory support and understanding of the process, the dream of owning a home in beautiful Italy can become a reality for many foreigners.

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