Individuals
Home > Individuals > Loans
Mortgage Loan for Refinancing
The Mortgage Loan for Refinancing is a long-term financing product secured by a mortgage over real estate, designed for individual clients who wish to transfer an existing mortgage loan from another bank to ABI Bank.
The product is offered for the refinancing of existing mortgage loans used for residential and non-residential purposes, as follows:
- Purchase of an apartment, house, or villa.
- Construction or renovation of a residential property, provided that the existing loan has been classified as a residential mortgage loan.
- Purchase of the client's primary residence and family home.
- Purchase of a second home or residential properties intended for rental purposes.
The refinancing loan is secured by a mortgage over the property being financed or another real estate asset acceptable to the Bank as collateral.
This product excludes loans intended for investment purposes and loans for the purchase of commercial units.
Eligibility Criteria
Individual clients are eligible to apply for this product if they meet the following criteria:
- They must have an existing mortgage loan with another bank, with a credit repayment history of more than 12 months.
- They must not have had any delays in repaying the instalments of the loan to be refinanced and must have maintained a regular repayment history on the existing loan.
Interest Rates for the Mortgage Loan for Refinancing
- Interest rates are applied to the amount used to refinance the existing loan.
- The client may choose between two fixed annual interest rate options, applicable for an initial period of either 2 or 3 years. Upon expiration of the selected fixed-rate period, a variable interest rate will apply.
| LEK | EUR | |
| Applicable Interes Rate |
- 2.50% for the first 2 years; or |
- 2.50% for the first 2 years; or |
Loan Amount
- Maximum financing amount: Up to EUR 1 million (or the equivalent in Albanian Lek).
- Refinancing amount: Up to 100% of the client's outstanding debt with the existing bank, but in any case not exceeding 70% of the collateral's value.
- Additional financing: If the client requests additional financing beyond the amount required to settle the existing loan, such financing will be assessed according to the criteria and terms of the relevant standard loan product.
Mortgage Loan Term
- Home Purchase or Construction Loans: Up to 30 years, subject to the criteria and conditions of the existing loan being refinanced.
Applicable Commissions and Fees
- 0% disbursement commission for refinancing and transferring loans from other banks.
- Collateral valuation fee, depending on the type of property.
- Notary fees (according to applicable notary tariffs) and collateral mortgage registration costs (according to the fees charged by the State Cadastre Agency – ASHK).
- Mandatory property and life insurance, payable annually.
Collateral Requirements
- A mortgage over the financed property or another property acceptable to the Bank as collateral.
- The property valuation must be carried out by valuers authorized by the Bank, and the valuation costs shall be borne by the Client.
Required Documentation
Documentation is required for the borrower, co-borrower, and financial guarantor (if applicable).
Identification Documents
- Identity card or passport.
- Family certificate.
Income Documentation
- Employment income: Annual salary certificate (obtained through e-Albania) and social security contribution certificate (obtained through e-Albania).
- Rental income: Rental agreement, proof of property ownership, and bank account statements showing rental income payments for at least the last 6 months.
- Business income: At least 2 years of licensed business activity and positive financial results for the last 2 years.
Property and Existing Loan Documentation
- Mortgage loan agreement with the existing bank.
- Current loan amortization schedule.
- Sale and Purchase Agreement or Construction Agreement (Entrepreneurship Agreement) relating to the purpose of the loan being refinanced.
- Documentation regarding the property offered as collateral: ownership certificate, updated property registration card, and proof of property ownership origin.
The required documentation depends on the type and characteristics of the collateral.
Illustrative Example of the Mortgage Loan for Refinancing
| Fixed for 2 Years | Fixed for 3 Years | |
| Loan Amount | 8,000,000 ALL | 8,000,000 ALL |
| Currency | ALL | ALL |
| Loan Term | 25 years | 25 years |
| 12-Month Treasury Bill Rate | 3.027% | 3.027% |
| Interest Rate | 2.5% fixed for the first 2 years, then 1.4% + 12-month Treasury Bill Rate, minimum 2.5% | 2.99% fixed for the first 3 years, then 1.4% + 12-month Treasury Bill Rate, minimum 2.5% |
| Monthly Instalment |
First 2 years: ALL 35,889. |
First 3 years: ALL 37,895. Thereafter: ALL 44,670. |
| Annual Percentage Rate (APR) | 4.63% | 4.68% |
| Total Interest Amount | ALL 5,078,379 | ALL 5,157,124 |
| Total Amount Payable | ALL 13,078,379 | ALL 13,157,124 |
Important Information and Risk Warnings
- A loan denominated in a currency different from the currency of the borrower's income increases the risk associated with exchange rate fluctuations.
- Treasury Bill (T-Bill) reference rates are subject to change and are determined by the monetary policy of the Bank of Albania.
To view the Standardized Pre-Contract Information Sheet, please refer to the document below. For more detailed information regarding Loan Interest Rates, please check the Price List.
Warning! Borrowing costs money!
__________________________
* If the interest rate on the loan depends upon Euribor and the Euribor value falls below zero, this value will be considered zero for calculating the interest rate.
Please note: Borrowing costs money!
