In July 2023 the 2% mortgage program will start in Poland. In Polish it is called “Bezpieczny Kredyt 2%”. The program is backed by Polish government and it’s created for supporting first-time buyers in Poland.
Key points of the 2% mortgage program:
- Available to first-time buyers in Poland under age 45
- The first 120 monthly mortgage payments partly paid by Polish government
- Maximum mortgage amount 500,000 PLN (for a single person) or 600,000 PLN (for a couple with children, a married couple or a single person with children)
- Minimum down payment 0%
- Maximum down payment 200,000 PLN
- Maximum purchase price 700,000 PLN or 800,000 PLN
What are the benefits of the 2% mortgage program?
- The main benefit of this program is much lower effective mortgage interest rate in comparison to a normal mortgage. Over the first 10 years most of interest is paid by Polish government.
- Mortgage monthly payments over the first 10 years mainly consist of capital repayments.
- Mortgage monthly payments over the first 10 years are much lower in comparison to a normal mortgage.
- A borrowing power for a mortgage in this program is higher than for a normal mortgage. So it’s easier to get a mortgage.
- You need zero deposit – so you can borrow up to 100% of the purchase price.
Who qualifies for the 2% mortgage program in Poland?
First-time homebuyers
A first-time homebuyer is a buyer who has never owned any residential property in Poland. If you own a residential property outside Poland, you are still treated as a first-time homebuyer. This rule only applies to properties in Poland.
If you are a co-owner of a residential property in Poland, you have a share up to 50% and you inherited that, you qualify for this program.
A borrower under age 45
Once you hit 45, you don’t qualify for this program. If you are a couple and one of you is under 45 you qualify for this program.
A single person, a married couple, an unmarried couple with children
If you are an unmarried couple and you don’t have kids, you can’t buy a property together and take out a mortgage in this program together.
How much can you borrow?
The maximum amount you can borrow in this program is 500,000 PLN (for a single person) or 600,000 PLN (for a couple with children, a married couple or a single person with children).
The maximum deposit in this program is 200,000 PLN. So you can buy a property for maximum price of 700,000 PLN if you are a single person or 800,000 PLN if you are a couple with children, a married couple or a single person with children.
For what purposes can you borrow money in this program?
Approved applicants may borrow money in this program for these purposes:
- to buy a residential property
- to buy a residential property and renovate/finish the property
- to build a house
Note: You can’t rent out the property. You need to live in this property and it has to be your primary residence.
Other important rules:
As I mentioned above if you get a mortgage in the 2% mortgage program you need to live in the property you bought and it has to be your primary residence.
The 2% mortgage will be switched to a normal mortgage (Polish government will stop paying interest):
- if you rent out the property
- if you start running business in the property
- if you move out to different property
- if buy another residential property in Poland
- if you overpay a mortgage too much (there are limits)
In practice a bank which grants you a mortgage in this program will receive every month a full amount of interest (like in a normal mortgage). Part of the interest is paid by you and part by Polish government. So you receive something like a grant from Polish government.
If you won’t start living in the property within the 24 months from the date of buying the property you will have to give back the money paid by the government.