A mortgage is often the biggest financial decision most people make in their lives. Proper preparation is key not only to successfully securing a loan but also to ensuring long-term financial stability. So, how can you best prepare for this important step in the Czech Republic?
1. Assess Your Financial Situation
The first step is to evaluate your current financial situation. Key questions to ask yourself include:
- What are your monthly income and its stability? Will your income grow annually?
- How much do you spend each month?
- What is the ratio of your income to your expenses?
- Do you have enough savings to cover unexpected expenses?
2. Determine How Much You Can Borrow
Most banks in the Czech Republic offer preliminary mortgage calculations to help you understand how much you can realistically borrow based on your income and obligations. Key factors to consider include:
- Your income (employment, business, passive income).
- Existing debts (such as personal loans or leases).
- Your ability to make payments even if interest rates change.
3. Prepare Your Own Funds
Most banks require personal savings to cover a portion of the property price, usually 10-20%. However, some banks may offer higher financing options. For example:
- Property price: CZK 5,000,000
- Required deposit (10%): CZK 500,000
If you don’t have sufficient personal savings, consider alternatives like building savings accounts (stavební spoření), short-term investments such as government or real estate bonds, or additional credit sources.
4. Compare Offers from Banks
The mortgage market in the Czech Republic offers many products with varying conditions. When comparing, focus on these aspects:
- Interest rate (fixed rate and its duration).
- Fees for processing and maintaining the loan.
- Options for early repayments.
- Penalties for prepayment.
If you don’t have the time for this, consider using a licensed financial advisor who has access to multiple banks and can provide a thorough market analysis.
5. Prepare the Required Documentation
To get your mortgage approved, you’ll need to provide various documents. Common requirements include:
- Proof of identity (ID card, passport).
- Proof of income (payslips, income statements, tax returns for self-employed individuals).
- Purchase agreement for the property.
- Property valuation report.
Each bank may have specific requirements, so make sure to check their documentation list in advance.
6. Final Recommendations
Preparing for a mortgage can be challenging but essential. Careful planning and regular evaluation of your financial situation will help you not only secure the loan but also manage its long-term repayment. If you’re unsure, don’t hesitate to seek advice from financial consultants who can help you find the best solution in the Czech Republic.
TIPS: How to Calculate Your Own Mortgage
DTI (Debt-to-Income): This parameter indicates the maximum mortgage amount you can get compared to your annual income. The average parameter is 9. For example:
- Monthly income: CZK 50,000
- Multiply by 12 months: CZK 600,000
- Multiply by 9: CZK 5,400,000 (maximum mortgage amount)
DSTI (Debt Service-to-Income): This parameter represents the percentage of your income that can be used for monthly mortgage payments. The average is 50%. For example:
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- Monthly income: CZK 50,000
- 50% of income: CZK 25,000 (maximum allowable for all loan payments, including the mortgage)

Bc. Andy Le, PFP
Managing Director & CEO | DAG Advisory s.r.o.
Helping expats in Czechia take control of their finances with expert advice on loans, investments, and business growth. Founder and CEO of DAG Advisory, Andy Le combines innovation and personalized strategies to help clients navigate their financial journeys and achieve success.
For any questions, feel free to contact me anytime via Facebook – Andy Le, or by phone at +420 608 003 126.