8 Things You Didn’t Know About European Mortgage Markets

European Mortgage

The European mortgage market has become more complex in recent years with the introduction of new and different types of mortgages

While there are plenty of well-known alternatives, such as interest-only and endowment mortgages, there are also innovative products that you may not be aware of, such as bridging loans and two-year fixes. 

If you’re thinking about remortgaging or applying for a mortgage in Europe, it’s worth familiarizing yourself with these things you didn’t know about European mortgage markets.

1. Mortgages Are Cheaper

According to a recent report, European mortgage markets are becoming more cost-effective for homeowners. 

According to their findings, first-time mortgage customers have saved an average of 7% on home loans by going with a new lender.

2. You Can Take Out Mortgages for Over 100 Years

There are a few differences between mortgage terms in Europe and North America, but one of them is particularly striking: Europeans can take out mortgages that last more than 100 years. 

In France, for example, people can choose to repay their mortgage at a rate of 1% per year for up to 120 years.

3. First-Time Buyers Can Use Help-to-Buy Schemes

If you’re a first-time buyer looking to buy a home in Europe, don’t forget about two schemes that can make buying your first house easier. 

The Help-to-Buy (HTB) scheme was introduced in Britain in 2013 and makes it possible for first-time buyers to purchase a new-build home with just a 5% deposit. See The Mortgage Depot to look at deals for budding first-time UK home owners.

4. Mortgages Have Bigger Deposits (But Are Still Low Risk)

Recent research from Bank of America Merrill Lynch found that, in Europe, mortgages have deposits equivalent to 67% of the property value on average – which is a lot more than mortgage lenders ask for in many countries around North America. 

That’s because mortgages are still perceived as low-risk investments by banks and other financial institutions – so they can afford to offer lower interest rates to borrowers.

5. Most Mortgages Include Repayment Holiday Periods

Approximately 1⁄4 of all new mortgages taken out by customers in Europe include a repayment holiday period, which is typically 12 months long. 

The goal of such a policy is to help provide enough breathing room for customers as they transition into homeownership and begin building equity. 

However, it’s important to note that any interest paid during these holidays is lost—meaning you won’t start repaying your mortgage until you reach maturity on your loan.

6. Most Mortgages Include Interest Relief After 2 Years of Owning Property

UK mortgage providers often offer interest relief on new mortgages if you’ve owned your property for over two years. 

This can save you a substantial amount of money and make your monthly mortgage payments more manageable. 

So next time you’re thinking about getting a mortgage, remember to ask about any extra benefits. Check here for more information and useful reference: 1st UK Money. 

7. There’s No Speculation Tax on Buy to Let (BTL) Properties in Europe

BTL mortgages are popular in Europe, but unlike Britain, there’s no speculation tax on BTL properties in Germany or Italy. 

This means you can buy property as an investment without having to pay a tax penalty for borrowing against it.

8. Banks Offer Flexible Arrangements When It Comes to Buying Property with Bitcoin

Yes, you read that right. In a recent trend in European mortgage markets, banks are offering their clients flexible payment arrangements when purchasing property with Bitcoin. 

While there has been some backlash from central bankers and investors alike, many argue that these sorts of transactions could be a sign of even bigger things to come. 


With more and more people choosing to start a new life in another country, there are many mortgage brokers ready to help potential expats get up to speed with current mortgage-market trends. 

Check with your local mortgage company for more details. 


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