A way to obtain a mortgage loan has been revealed!

A reader came forward with his own experience.

Latvia lags behind both Estonia and Lithuania in terms of the volume of granted loans. Concerns about the availability of loans for both private persons and legal entities have also caught the attention of Latvian authorities – both the president, the prime minister, and the finance minister have begun discussing it. Have banks truly become so stringent? Are the reasons hidden elsewhere? And are there ways to still relatively quickly and easily obtain a loan? One of our regular readers has shared their experience. This experience is so interesting that it is worth sharing with other readers as well.

So, the man who called the editorial office explained that the process of obtaining a loan was expedited by the fact that he had intended to buy real estate in Riga to later rent out the apartment using popular platforms like Booking and Airbnb. This means that the person requested the loan as a prospective entrepreneur.

It turns out that this could be done?

Of course, all banks in Latvia offer loans, including those for individuals engaged in entrepreneurial activities.

All major banks emphasize that each case is, of course, considered individually. For example, Citadele Bank offers mortgage and other types of financing for both salaried employees and those engaged in entrepreneurial activities. The main requirements include stable, legal income, sufficient to make loan (mortgage) payments and meet daily needs (food, maintenance, etc.). Potential clients can even check their creditworthiness by taking a special computer test.

SEB Bank offers loans for the purchase of energy-efficient and environmentally friendly homes. However, in this case as well, the bank, of course, establishes certain criteria, evaluating the income and credit history of each potential client.

Citadele, SEB Bank, and Swedbank can offer state guarantee program ALTUM for obtaining a mortgage to new specialists and families with children. However, the criteria remain the same – a “pure” credit history, stable and sufficient income. Moreover, the ALTUM program allows for a reduction in the initial down payment.

The increase in the minimum wage to 620 euros also made adjustments in the assessment of the client's income – now, after repaying the loan, more funds must remain “on hand” for basic life needs.

What is the opinion of non-bank financiers?

“The case described by your reader is quite interesting, and indeed, such things can happen," said Sergei Malikov, the chairman of the board of West Credit company. But first, I would like to emphasize that each case is individual. I can only say that non-bank creditors probably assess clients more flexibly and promptly. We try to understand the situation that has arisen for each specific client.

We also assess a person’s income, but we consider it important whether our potential client is engaged in economic activities. If they are an entrepreneur, their chances of getting a loan increase. This applies to the case you mentioned, where people take out a loan to purchase real estate and later rent it out. It turns out that your reader is right – based on my experience in the financial business for decades, I can say that taking a loan for the acquisition of a property, later renting it out, and gaining profit is a relatively common option.

I could recommend everyone in need of a loan to confidently seek information and ask all relevant questions”.

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