Deniz Aydın posted 10 months ago

A Comprehensive Guide to Real Estate Financing Options and Mortgages in Turkey

applying for credit in Turkey

The Turkish real estate market has grown substantially over the past decade, becoming an enticing opportunity for domestic and international investors alike. Turkey’s strategic geographical location, rich culture, robust economy, and burgeoning real estate industry make it an ideal destination for property investment. However, comprehending the multifaceted nature of real estate financing and the dynamics of mortgages in Turkey is vital for potential investors. This guide provides an in-depth examination of these areas to aid your understanding.

Real Estate Financing in Turkey: An Overview

In Turkey, there exists a myriad of approaches investors can utilize to finance real estate purchases. These range from direct cash payments to securing mortgages and procuring loans from financial institutions. Over recent years, the Turkish government and banking system have demonstrated a commitment to creating and expanding flexible, easily accessible financing options for potential investors, providing a favorable climate for investment.

Delving into Turkish Mortgages

In Turkey, a mortgage is commonly referred to as a “Konut Kredisi” or housing loan. It’s a specific type of loan offered by banks to finance residential property purchases. Turkish banking institutions provide mortgages to both Turkish residents and foreign investors, but the terms and conditions can differ significantly.

Ordinarily, for foreign investors, banks are willing to finance up to 70% of the appraised value of the property. The term of the loan usually falls between 5 to 20 years, dependent on the borrower’s age and the lending institution’s specified terms.

It’s noteworthy that Turkish mortgages bear relatively high interest rates compared to those in other countries. This factor often influences investors to finance their purchases via personal savings or explore alternative financing options.

Exploring Alternative Financing Options

In addition to traditional bank mortgages, there exist several other means to finance real estate acquisitions in Turkey:

Developer Financing: A considerable number of property developers in Turkey offer personalized financing schemes. These often prove more flexible and less stringent than conventional bank mortgages. These schemes generally allow payment installments over an extended period, often until the project’s completion.

Equity Release: This option is often employed by investors who already own properties. They can release the equity in their existing property to finance the purchase of another.

Joint Ventures: Particularly in large-scale developments, investors may collectively pool resources to finance property purchases. This collaborative investment allows for risk and reward sharing among multiple parties.

Islamic Financing: Turkey also provides Islamic financing options, known as participation banking, adhering to Islamic law (Sharia). These alternatives are favored by investors who wish to avoid engaging in interest-based transactions.

Making the Right Financing Decision

Choosing the optimal financing option is influenced by a host of factors, including the investor’s financial standing, risk appetite, and investment objectives. It’s crucial to conduct meticulous research and possibly seek advice from financial advisors or real estate professionals to fully understand the advantages and disadvantages of each option.

The Mortgage Process for Foreigners in Turkey

Foreign nationals are permitted to obtain a mortgage for property in Turkey, but the process can be somewhat intricate. The key steps typically involved include:

  1. Property Selection: The borrower chooses a property and negotiates a price with the seller.
  2. Appraisal: An independent appraisal company is commissioned to evaluate the property to establish its value.
  3. Application: The borrower submits a mortgage application to the bank, providing necessary documentation such as proof of income and identification.
  4. Approval: The bank scrutinizes the application, assesses the borrower’s creditworthiness, and establishes the loan amount.
  5. Property Transfer: Once the loan is granted, the property title is transferred to the borrower at the local Land Registry Office. Non-Turkish speaking buyers will require a sworn translator at this juncture.
  6. Mortgage Registration: The mortgage is then registered on the title deed.

Digital Resources to Help with the Process

Comprehensive information about the process and relevant regulations can be obtained from the official Turkey Government website. Leading Turkish banks, such as Garanti BBVA, provide useful information about real estate financing on their websites, and international platforms like Zingat offer extensive listings of properties available for purchase in Turkey.


Turkey’s dynamic real estate market continues to attract investors worldwide. While the process can seem daunting, especially for foreign investors, understanding the available financing options, intricacies of the mortgage process, and utilizing available resources can make this journey significantly smoother. The key is to do thorough research, utilize professional advice when necessary, and align your financing decision with your overall investment strategy. With the right approach, investing in Turkish real estate can be a profitable venture.



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