Every person who buys a property is different and therefore requires approach.
For us there are no two the same clients and solutions.
If you want to buy a property to meet your own housing needs, we will help you obtain the exact credit you need. We always take into account both your current plans as well as those which may appear. We will build for you a plan of action that will protect you in the best possible way!
Does it irritate you that during every meeting banks try to sell you a regular savings program or a credit card? You do not need to be worried about it with us. We will not offer you such solutions, either now or in the future, unless we find out together that that is what you really need or that the product actually reduces the cost of credit.
Perhaps you are looking for a credit advisor who understands the needs of investors in real estate. In that case you are at the right place! Do you want to buy two, three, five or even more properties soon? It does not have to be difficult! Nevertheless, the whole undertaking must be appropriately planned. And that is why you have us at your disposal. For the last several years, we have helped hundreds of investors from across Poland in obtaining passive income as well as in buying property for sale (FLIP). Since we invest in real estate ourselves, we know exactly what investors expect from a loan.
Below, there are presented examples of situations and problems of our clients.
All of them were successfully resolved by our credit advisors.
▼ Employment in the family business, lack of documented income
We will remember this case for a long time. Buying an apartment for housing purposes. Marta, because of her profession, worked on contract work, and usually in this form of accounting for income taxes, income tax is 0 PLN. And so it was this time. The tax office did not collect any fees from her. In addition, the money for the work done was not transferred to the account but delivered in the form of cash. This was compounded by the fact that she was employed in the family business. From the point of view of banks, Marta was not able to prove that her income actually exists. In other words, where there is no demonstrated income and evidence of this income, there is no credit rating either. After several talks with banks, the situation seemed hopeless. All banks officially refused to work with her. Despite this, we decided to help her. It turned out that one of the banks issued a positive decision. Credit rating was therefore accepted by virtue of a declaration, that is the bank believed Marta's "word of honor". The loan was paid out. Marta already knows that in order to apply for a loan in the future, she has to leave evidence confirming the source of income. We, however, once again, have a proof that when there is a will there is a way. A proper credit advisor is just enough!
▼ Apartment with unregulated land ownership rights
Another interesting case. Marcin and his wife decided to buy on credit an apartment in Warsaw. The problem was that the property was with unregulated land ownership rights. Under the new law, since the beginning of 2014, real-estate register cannot be established for such properties hence the bank cannot protect itself. The exception are properties which before the new law came into force already had established real-estate registers. It turned out that this was the case. Unfortunately, it was not a guarantee of success, and specialists assessed the chances of success at 10-20%. Another credit had been already taken out on the property. Despite the fact that the real-estate register was established, banks, one by one, rejected loan applications and issued negative decisions. In the end, however, the losing streak was stopped. We got a bank approval. Today the apartment is renovated and inhabited by its new owners!
▼ Purchase with cash and the recovery of money spent on the purchase
Wojtek came to us in the best possible situation as he has not taken out any mortgage yet. He decided to buy a property with the intention of building a passive income from rental properties. He had his own cash that he cleverly used to negotiate the transaction price. In fact, the case was not complicated. We buy for cash then get back all the costs associated with the purchase of property (purchase price, notary, tax on civil law transactions, cost of bank fees, required insurance cost, etc.) so that the own contribution to the investment is equal to 0 PLN. Credit rating allowed him to purchase three apartments, one by one, most of them with own contribution equal or close 0 PLN. In addition, he plans to buy more real estate. Wojtek is getting closer to obtaining financial freedom. Without slowing down, perhaps he will reach it soon. It is possible by planning the whole undertaking together with an experienced advisor and by common and consistent pursuit of that objective.
▼ Buying a property from parents and obtaining free cash
Krzysztof, an investor in real estate came up with an idea seemingly simple but difficult to implement. He had an apartment which he had received from his parents. According to the law, however, he was not its owner. There appeared an interesting opportunity - buying a property from parents with a mortgage for meeting housing needs. This is possibly the cheapest loan on the market. Krzysztof buys a property on loan from his parents, and they receive money from the sale on their account. Further assumption was that Krzysztof would receive money from the loan as a donation from his parents. Due to the first degree of kinship, such a donation is exempted from taxation. The money was to be used for further investments in real estate. The plan was simple. Nevertheless, some serious complications connected with its implementation arose. Firstly, banks know about such cases thus they are extremely reluctant to agree to such transactions. Much bigger problem, however, was the fact that according to the law, such a transaction could be seen as credit extortion which is, of course, prohibited and illegal. Yet, we came up with a better idea. Krzysztof ran a business and his parents donated a house to him. Therefore, Krzysztof took out a mortgage investment loan and the objective of that investment was obtaining financing for business development with collateral for the property. There is no disguising the fact that an investment loan is more expensive than a loan to meet the housing needs. However, the lack of costs such as tax on civil law transactions (due to the donation) significantly reduced the cost of the entire undertaking. Obtained money was quickly transferred to the account, and Krzysztof pays interest installments only on the capital used. When he does not use the money - he does not pay the installments. Despite the seemingly more expensive loan conditions as compared to a mortgage, the actual cost of the loan is much lower. The undertaking was clearly carried out in accordance with the law. The wolves are sated and the sheep intact.
▼ Purchase of a utility room for housing needs on credit
Michał found a property which he had certain plans about. He wanted to transform the utility room - attic - into a residential premises, namely an apartment. From the point of view of the bank, one cannot get a home loan for a property having a different legal status i.e. non-residential premises. Luckily, our advisor knew what to do. After a few weeks we were finally granted a permission from the residential community to convert non-residential premises into a dwelling unit. As a result, the property fulfilled all the conditions to be a collateral for the loan. The property was purchased and the loan paid out. It is worth noting that changing of the status of the premises was associated with an increase in the value of a property by a few dozens of percent. Consequently and due to our advice, after the renovation of the premises, Michał sold the apartment with a considerable profit.
▼ An idea apartment for less than 50% of its value - yes, it's possible!
The other day a married couple - Anna and Hubert - contacted us. They had the opportunity to purchase a two-level apartment in Warsaw's Praga district. The apartment, however, was in a deplorable condition and required a complete overhaul. Nevertheless, our clients did not need such a large apartment - only one level of this property would fully satisfy them. In the meantime it turned out that long time ago the property was created from two separate flats, forming one 110 meter apartment. Without going into details, Anna and Hubert bought the property with a mortgage. In a short time, they did the renovation (also on credit) and applied for permission to transform the property back into two separate dwellings. Obviously, the whole operation was conducted in the cooperation and with the consent of the bank which paid out the loan. The couple moved into the upper apartment and sold the one below at a price allowing to repay as much as 70% of the loan. In the end, they bought the apartment (one of the two) of a value of about 450,000 PLN for less than 200,000 PLN. The whole undertaking together with the time spent for the application for the loan and final sale took us only ten months.
▼ Borrower in Ireland, property in Poznan
Pawel had a credit rating and wanted to purchase a real estate in Poland. The only problem, however, lay in the fact that he permanently lived and worked in Ireland. Due to the lack of time, "going round the banks" in order to find the best credit offer was out of question, not to mention applying for a loan on his own. Our services were the solution to Paweł's situation. We needed only two meetings − one to sign loan applications, and the other to conclude a credit agreement. Although initially banks rejected our applications because of the specificity of his income, we were finally granted a loan for which Paweł's own contribution was close to zero PLN. Today, the apartment is rented out and the income from rent is more than enough to pay the loan payment, costs connected with maintenance of the property and tenant management (Paweł commissioned it to the Hryniewicz.pl company). In addition, there even remains a significant amount of money. Passive money.
▼ Building a house with a mortgage
Beget a son, plant a tree and build a house. Grzegorz with his wife Emilia asked us for help with the latter. They had no idea how to go about the whole undertaking. They were keeping an eye on a plot with a building permit and also had some savings which were, however, not enough to buy and build a house entirely for cash. Therefore we applied for a loan from a bank to buy a building plot. After having received it, we applied for a second loan (in the same bank), this time to build a house. According to the project, the cost of construction was 2000 PLN/m2 but in the construction estimate attached to the loan application, we inflated the price to 3000 PLN/m2. As we predicted, it soon became apparent that 2000 PLN/m2 would not be enough to build the house. With the money obtained from the loan, they bought a plot, built a house and fully equipped it, and their own contribution to the whole investment amounted to zero PLN.
▼ Buying an apartment under construction versus an increase of the required own contribution
Although Piotr has been living in this property for six months, the issue of required own contribution is still open. So the situation is that someone wants to buy a property under construction in the primary market, but in the real estate purchase contract there is the provision saying that the money for the installment has to be paid counting from "today" e.g. in half a year. In this case, it is typical that most of the people put off the issues related to the loan. This is a serious mistake. We remind you that until the end of 2015 there is required minimum own contribution of 10%. In 2016, this requirement will increase to 15%, and in 2017 to 20%. If you want to buy an apartment under construction with a mortgage loan, but you do not want to pay an additional own contribution (because of the requirement), you should, just like Peter, submit loan applications as soon as possible. Why? You may submit an application today for the current credit offer (these days there is an increasing trend) in accordance with the current principle of 10% of the own contribution, and an installment loan can be paid off even in a few/dozen months! We may disburse a loan tranche of up to only 1000 PLN, which gives us a guarantee of credit conditions. An installment of 1000 PLN for 30 years is approximately 5 PLN/month. It is better to take care of the credit earlier and this way determine credit conditions than apply for a loan only when the advance schedule indicates that. Peace of mind guaranteed.
▼ Buying a commercial property versus credit based on business
This issue is very complex and laborious, and requires a real expert. Our client acquired an eight commercial unit building with a mortgage investment loan. Credit rating was based on the income from rental of the premises since the building has already been rented out (form of business: limited liability company − partnership). Our advisor helped the client make an appropriate business plan which was a key element of the whole undertaking, and loan applications were submitted to the banks that accept this type of undertakings. We have obtained a number of positive decisions and chose this bank which required the lowest own contribution which, however, was generated by the difference between the transaction price and the market value of the property. The customer is from Szczecin and property is in Krakow!
▼ Purchase of four properties for rent - each being financed with a mortgage
- The total time of execution − 20 months.
- Client's own contribution − 0 PLN. After paying all costs associated with the purchase and the loan, he was left with a surplus of 80,000 PLN.
- Total gross passive income after payment of the loan, costs of the property maintenance − 6,500 PLN before taxation.
- Currently, we apply for the fifth loan for our client! We are threading unknown paths since the limit is three loans taken out by a natural person at a time.
▼ Buying a property, recovering own contribution and reinvestment
- Currently, the client regained about 98% of the invested cash.
- All in one large loan, because according to the Loan Information Office, if the client has only one loan taken out, he will receive two more.
- The aim is to purchase a total of 16 apartments, 12 of which with a mortgage and 4 for cash.
- The client must have adequate credit rating and cash. We are on the right track to achieve the intended purpose!
▼ Building up a credit rating "from scratch" to 500,000 PLN
- The client came to us in 2013. Unfortunately, due to a bad credit history, he could not get a loan.
- By making a joint effort, we regained credibility and raised the credit rating. To this end, once again we cooperated with our reliable solicitor who knew exactly what to do to make the bank remove the former credit history from the Loan Information Office.
- Thanks to that, the client fulfilled his life-long dream and together with his family moved into their own home.