Italian Mortgage Calculator: Estimate Your Repayments & Costs

Use our free Italian mortgage calculator to estimate your monthly capital and interest repayments. International buyers can calculate approximate loan costs in euros before applying for an Agreement in Principle.

For a more detailed view of your particular requirements based on your personal financial circumstances, please click here.

Italian Mortgage Rules applicable to properties valued under €2m (different rules apply on purchases over €2m with a minimum loan of €1m): LTV Limits and Debt-to-Income (DTI)

Italian banks typically enforce strict lending limits for non-residents. Depending on the lender and your circumstances, you could borrow up to 50% to 60% of the property’s value, with a cash deposit of at least 40% to 50%. Your total global debt, including any additional Italian mortgage, generally needs to sit within around 30% of your net monthly income, depending on the lending source.

When planning your purchase, you should account for these structural constraints that are typically enforced by Italian financial institutions:

• Maximum Loan-to-Value (LTV): If you are a foreign national or non-resident, Italian banks may cap your mortgage at 50% to 60% of the purchase price or the bank’s appraised value, whichever is lower. You usually need to cover the remaining 40% to 50% in cash.
• The Debt-to-Income (DTI) Ceiling: Lenders typically enforce a 30% DTI ceiling. Your total monthly debt obligations, including your existing local domestic mortgage, car finance, and the new Italian mortgage, generally should not exceed this percentage of your net monthly take-home pay.
• No Rental Income Considered: Please note that lenders do not include potential or existing rental income in their affordability calculations.
• Capital Repayment Only: Interest-only mortgages are virtually non-existent on properties valued under €2m. Italian mortgages are usually exclusively repayment loans, meaning you could expect to pay both capital and interest from day one.

The Hidden Costs of Buying Property in Italy

When buying a house in Italy, you should usually budget at least an additional approximate 10% of the property’s purchase price in cash. This typically covers mandatory acquisition costs, including Notary fees, agency commissions, and the Italian Imposta Sostitutiva mortgage tax.

Italian banks typically do not allow you to roll these upfront acquisition costs into the mortgage loan. Your cash reserves may need to cover:

How We May Help You Bypass Italian Bureaucracy

Navigating Italian banks may require overcoming language barriers and navigating rigid bureaucratic underwriting processes. We may assist with lender negotiations, pre-assess your income against local Italian lending criteria, and introduce you to professional contacts who can guide you through the legal requirements.

Securing an overseas mortgage can typically take 8 to 12 weeks. 

We may help protect your interests by:

• Suggesting a Clausola Sospensiva: We strongly advise that your independent lawyer include a finance condition clause in the preliminary sales contract (Compromesso). This could protect your property deposit if the bank’s surveyor undervalues the property, the mortgage is ultimately rejected, or there are any unforeseen legal issues with the property being purchased.
• Translating Financial Culture: Local Italian branch staff may not speak fluent English and might have little experience with your country’s specific income documentation (such as Form 1040s in the USA or SA302s in the UK). Our Italian lending sources could possibly assist in packaging and presenting your translated financial documents directly to underwriters.
• Navigating Prerequisites: You usually cannot apply for a loan or buy property without a Codice Fiscale (Italian tax identification number). We can introduce you to professional contacts who can further assist you with obtaining this and opening a local Italian bank.