Below is a full transcription of the video interview with Pavel Parizek on Czech mortgage and refinance.

Nathan: Pavel, we like to meet with you at this time and get some feedback on mortgages. You’ve been dealing for our clients for mortgages for 3 years and you’ve had some real particular success lately on renewals lately. Some amazing results, so please tell us a little bit about that.

Pavel: You won’t believe me, but we were able to negotiate a discount for a client 2.4% from his previous offer from the bank.

Nathan: That’s fantastic!

Pavel: Yeah, he saves four and a half thousand Czech crowns just because of the discount or interest rate. Usually you cannot get such a high discount from the bank. But it is normal to negotiate from 0.8 to 1.5% discount.

Nathan: That’s fantastic, that makes a big difference for investments and the cash flow. What’s with the interest rates themselves? What’s been happening with that?

Pavel: Comparing last year the interest rates went down significantly. You can go to the bank and ask for interest rate for your own living and you can get even 3.6%. Of course you have to be the best client. Because then the bank would like to give you insurance and also some other bank product. But normally, you can get around 4.1% for your own living. And if you go for investments property then you can expect about 4.6-4.7%.

Nathan: Ah, that’s very good. And for first time buyer that is looking for mortgage what would you suggest for them, if they’re looking from a product from a bank.

Pavel: Even though you do not need any kind of residency here in Czech in order to be an owner of a property, most of the banks still require to see some kind of residency. So better be prepared for this. Also what makes change on the interest rate is LTV (percentage of LTV) if you would like to take, then also the property itself, and then also your income and the value of your income.

Nathan: Good feedback, thanks for that. And with renewals how have you achieved this kind of success? Give us some of your secrets.

Pavel: Well the most important thing lies with the owner because the owner has to pay regularly and in time. If you miss even a single payment and you can lose your ground for negotiating with the bank about the discount. And also some bank appreciate if you send more money to their accounts or if you use more products from their own bank, and then they can give you better interest rates.

Nathan: Okay. What would you say for an owner who first receives this proposal from a bank. What would they do at that point? This proposal for renewal of their fixation period.

Pavel: I would say never accept the first proposal from the bank. The bank gives you always a higher interest rate than you deserve. So it is best always to say no I don’t agree with the proposal, please come with some other proposal. Also it is good to approach some local mortgage advisers and ask them what’s the current situation of the market. Because then they can show you what’s your bank interest rate that they are offering you and the market situation and you can compare it, and also approach the bank with this research.

Nathan: That’s fantastic advice. That’s very good. Thanks Pavel very much for your feedback on the mortgage market right now.

Pavel: Welcome!

You can also ask any questions about this interview or Czech mortgages in general, by contacting us: info@czechpoint101.com.

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2. Can I get a mortgage for my Czech property purchase? What are common terms?


3. Under What Conditions Can Someone Refinance a Czech Republic Mortgage?


4. Czech Mortgage Refinancing Quandaries – You Are Not Alone!


5. Brno Real Estate Market Video Update – 02/2011