Moroccan Mortgages: an Introduction
Anybody who isn’t able to purchase their Moroccan Property in full will need to negotiate a mortgage to pay the remainder of the purchase cost, less the deposit they had available. French procedure is closely followed when obtaining a mortgage in Morocco.
The mortgage market in Morocco is still in its infancy - applicants often encounter complications when applying When dealing with non-resident applications, there are often difficulties. Moroccan banks are much slower than banks that you may be used to; expect that the mortgage application service is slow and at a lower standard than in a Western bank. The Moroccan lender’s staff often has difficulty dealing with overseas documentation due to a lack of knowledge and experience. It will be necessary for you to provide official translations of your domestic documentation as well as original copies of these documents.
In Morocco, any mortgage loan is linked to a price, which has been paid for a home and will require a 30% minimum down payment. For your own peace of mind, you may wish to obtain a property assessment because the lending bank probably will not do so. The Moroccan Dirham will be the currency for the loan and repayments, so ensure that your home bank can transact payments in the Moroccan currency or arrange for a local bank to receive your remittances and make the payments by exchanging the currency for Moroccan currency.
The typical term of a mortgage is 15 years. Still, you may find a lender who will extend the term all the way to 25 years. Realize the mortgages that have the lowest interest rates are those with the shortest terms. Your loan may be interest-free for the first half of the year, but you will not have interest-only for the entire loan period. A repayment holiday can be obtained for up to two years in some instances, but keep in mind that you will still need to make the interest payments and the lender may apply certain other conditions.
According to your mortgage and specific bank, arrangement fees will be charged. Likewise, when registering the mortgage deed, there is a charge associated with the notary. In addition, a mortgage tax will be assessed across the term of the mortgage.
It is a good idea for you to possess a good, working knowledge of the local lending practices so that you can ensure that you are prepare. You may anticipate a tedious and bothersome application procedure in addition to much frustration. The use of a Moroccan Mortgage professional who is familiar with the market and all the application processes is essential when arranging finance for a home in Morocco, especially for those who do not speak the language or understand the customs of the area.
