Loan With Collateral
Loan With Collateral – long-term loan, which purpose is other than residential, property acquisition and when amount of consumer credit without collateral is insufficient.
When is it useful to choose a loan for consumption purposes with real estate collateral?
- Purchasing or reconstructing non-residential property (homestead, land plot).
- Purchasing expensive movables.
- Investing in education, studies in Lithuania or abroad.
- Improving own house environment.
- Medical or health improvement costs funding.
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Individuals of at least 18 years old.
Loan amount and period
Loan for consumption purposes with real estate collateral can cover up to 80 percent of the value of the mortgaged property.
Only for real estate purchase the borrower’s down payment is required (participation in the project with own funds).
The maximum loan period is 30 years.
Loan can be granted in euro.
Loan interest rate
We try to find the most optimal solution for every customer!
Loan interest rate consists of the reference rate (EURIBOR) and margin percentage which is established by the bank for each customer separately. Loan with collateral margin is lower compared to other bank loans without collateral.
The bank can offer solutions of insurance against possible change of interest rates in the future. You can choose from the following types of interest rate:
- Fixed interest rate is established for the period of up to 15 years, and upon its expiry, the interest rate is changed to variable.
- Variable interest rate is established for the first time when the loan agreement is signed, and later base rate is changed every 6 or 12 months depending on EURIBOR of your chosen term.
Loan with real estate collateral must be secured by the hypothecation (mortgage) of real estate acceptable to the bank. Every customer applying for a loan with real estate collateral should consider the assumed financial liabilities, non-fulfilment of which could have negative impact on their loan history and pose a risk of lossing the property right to the pledged real estate.
You can choose the acceptable loan repayment method:
|Fixed principal||Loan is repaid in equal instalments, and the interest is paid for the outstanding loan amount. Monthly payments are gradually decreasing for the whole contract period.|
|Annuity||Loan and interest are paid in equal instalments each month.|
In case of unforeseen circumstances and with motivated application, loan repayment can be delayed for a period of up to 12 months (over the entire term). Grace period starts from the day of signing of the loan agreement.
Loan is repaid and interest is paid every month on selected day based on loan repayment schedule. Early repayment is possible.
When applying for a loan, the applicant and their spouse or co-applicant must submit the following documents (document copies and originals / duplicates):
- Passport or personal identity card.
- Certificate regarding the salary for the last 6 months or other income (under bank’s separate request).
If income is received from a sole proprietorship, the following additional documents must be submitted:
- Sole proprietorship registration certificate.
- Financial statements of the sole proprietorship for the last two years.
- Description of the sole proprietorship activity.
- Agreements and repayment schedules of current financial liabilities.
- Income and assets tax return for the last year if income must be declared in cases established by laws.
Documents supporting the proper use of funds are necessary (purchase contracts, service contracts and invoices, employment contracts, treatment/education institutions payment invoices etc.)
Bank may require additional documents.