In our country, the Central Bank periodically lowers or raises overnight interest rates to influence spending, and these changes directly affect the interest rates offered on bank loans. The main reason for the decline in consumer loan rates since the beginning of 2017 is this monetary policy. Especially with reductions in mortgage rates, borrowers have been able to obtain loans at rates below 1% in certain cases. As a result of the drop in mortgage interest rates, banks have received thousands of new loan applications.
Those looking to buy a home can apply for both standard mortgage products and time-limited promotional mortgage campaigns offered by banks. To make this clearer, below is a list of the mortgage interest rates in effect during 2017, sorted by bank.
- Akbank – 1.11%
- Garanti Bank – 1.08%
- Yapı ve Kredi Bank – 1.01%
- Anadolu Bank – 1.20%
- Bank Pozitif – 0.99%
- Burgan Bank – 1.29%
- Halkbank – 0.80%
- Denizbank – 1.19%
- ICBC Turkey (Tekstil Bank) – 1.35%
- HSBC – 1.25%
- Türkiye İş Bankası – 1.05%
- ING Bank – 1.10%
- Kuveyt Türk Participation Bank – 1.01%
These figures represent the typical mortgage interest rates offered by banks. However, applicants should pay attention to whether the loan package they apply for is part of a campaign or a standard product. Banks often run mortgage campaigns that include lower interest rates or reductions in loan fees and other costs. To avoid problems and secure the best possible deal, borrowers should compare both standard offers and special campaign packages before applying.
How to Apply for a Mortgage
After reviewing mortgage interest rates and selecting a suitable offer, applicants should complete a few preparatory steps to speed up the process and close on a property quickly. Banks generally approve loans after the following requirements are met.
- Mortgage applications should be submitted in person at a bank branch with the required documents.
- When visiting the branch, bring the title deed (tapu) for the property you plan to buy. The bank first needs to confirm that the property is eligible for financing and then determine its market value.
- With a title-deed-based application, the bank will assign an appraiser to calculate the property’s value. The loan amount offered will be based on the appraiser’s valuation.
- Depending on the specific mortgage package, you may be eligible for financing up to 100% or, more commonly, up to 80% of the appraised value.
- Once the loan is approved, you must visit a notary to register the mortgage. The buyer and the bank’s authorized representative sign the necessary documents at the notary. After the official procedures are completed, the approved loan funds are disbursed.
These are the key points to understand about mortgage interest rates and the home loan application process.
Who Can Obtain a Mortgage?
In addition to the title deed, the application process requires official documents such as proof of income and proof of residence. After submitting the necessary documents, the bank will run a credit check and review your credit history. The bank assesses prior loans, repayment behavior, and credit score to determine eligibility. Finally, applicants must be at least 18 years old to qualify for a mortgage.