Buying a Property on a Mortgage in Poland – Step by Step Guide (Primary Market)

Buying your first property is a significant moment in life. Owning your own place provides a strong sense of security and, in many cases, is also an excellent financial decision. However, purchasing a home is a complex process, which is why it often raises many concerns. Today, we will break it down into clear steps and explain everything point by point to help reduce those worries.

In this article, you will learn:
• What does the process of purchasing a property with a mortgage on the primary market look like?
• What are the advantages and disadvantages of buying a newely build property?
• How should you prepare for buying a property with a mortgage?
• What is the difference between a developer agreement (pl. umowa deweloperska) and a reservation agreement (pl.: umowa rezerwacyjna)?
• How long does the entire property purchase process take?

This article is the first in our “Step-by-Step” series. In this series, we present the entire property purchase process including the mortgage application process. In the following paragraphs, we explain point by point what happens after you decide to buy a property. We also indicate at which stages a mortgage broker can support you.

Part one of the series focuses on purchasing property on the primary market (from a developer). In part two, we will discuss the secondary market (used properties). Lastly, part three will be dedicated to building a house on a mortgage.

Buying Property on the Primary Market – Pros and Cons

Purchasing a new property offers a number of important benefits for the future owner. However, there are also certain aspects you should be aware of when buying from a developer. Below are the key advantages and disadvantages of purchasing on the primary market:

Buying Property on the Primary Market
Pros	Cons
+ The property and the building are new, which reduces the risk of defects and eliminates the need for major renovations in the coming years.	– Developer properties are usually purchased during construction. The buyer often needs to wait several months or even years, and project delays are possible.
+ The developer provides statutory warranty protection and often an additional guarantee, offering extra security.	– If the property is still under construction, you cannot physically inspect it. You must rely on visualizations, which may differ from reality.
+ New properties are usually more energy-efficient, which translates into lower heating bills.	– Purchasing during construction means the mortgage is disbursed in tranches and includes a grace period for principal repayment (until construction is completed, you only pay interest on the disbursed amount). This increases the total cost of the loan.
+ You can finish and customize the property according to your needs.	– The property requires finishing, which involves additional costs.
+ You become the first owner, eliminating the risk of legal defects (e.g., lifetime tenancy agreements).	– Location: new developments are often built on the outskirts of cities, which may mean weaker infrastructure and more difficult commuting.

Buying Property on a Mortgage – Step by Step process

Now that you understand what to expect when purchasing a new property, let’s move on to the process itself.

First, let’s look at the big picture. As shown in the diagram below (click on it to see full size), there are multiple stages (above the axis) and milestones (below the axis) that must occur for the process to end successfully.

As you can see, there are quite a few steps, so it’s no surprise that many people feel overwhelmed. However, hundreds of thousands of people have successfully completed this process and now enjoy their own homes with fully repaid mortgages. The key lies in a good preperation. Let’s begin with exactly that:

Preparing for a Mortgage

How should you prepare for a mortgage? Surprisingly, too few future borrowers ask this question, which sometimes results in reduced creditworthiness or even loan rejection.

To avoid that, you should:

Gather funds for the down payment and additional mortgage-related costs.
Build a financial cushion to cover future installments (at least 3 installments, ideally 6).
Ensure your income and employment are as stable and high as possible.
Check your credit history in the Credit Bureau.
Reduce or eliminate (this may take longer) credit card limits and overdraft facilities.
Repay liabilities that you are able to close.
Educate yourself about mortgage products.
Perform a “mortgage installment test.”

What Is an Installment Test?

An installment test si a ‘living with a mortgage dry run’. It involves setting aside the equivalent of your future mortgage installment (if you’re not sure about the amount – check our mortgage comparison tool) for 2–3 months. The goal is to simulate the impact of the mortgage installment on your budget. This is done to show you how your standard of living might change after taking the loan.

Possible outcomes are:

If your standard of living drops too significantly, you may have just avoided a serious financial mistake. It might be better to wait, prepare for a larger down payment, or choose a less expensive property.
If the impact is acceptable, you can confidently move forward with the mortgage process.

Regardless of the outcome, you will have saved several thousand złoty — which is always beneficial 🙂

First Meeting with a Mortgage Broker

The mortgage process begins here. The mortgage expert will ask detailed questions about your expectations, income, expenses, and obligations. You will learn how the entire mortgage process works. You should also receive comprehensive information about risks, costs, and decisions associated with taking out a mortgage.

If the broker does not cover these topics, you should ask about:

What is the optimal loan term?
How does the loan term affect the installment and total cost?
The difference between fixed and variable interest rates.
The difference between equal and decreasing installments.
Whether promotional offers and cross-sell products are worth it.
Required and optional insurance.
All costs — upfront and to be paid monthly.

Importantly – if anything will be unclear to you, don’t hesitate to ask or follow-up. Building awareness at this early stage is crucial for your financial safety and calm mind later.

Creditworthiness Analysis

Based on collected information, the broker will analyze your creditworthiness and present the maximum loan amounts available in several banks. It is important to calculate it across many institutions as creditworthiness may differ significantly – sometimes by hundreds of thousands of złoty. This is due to different methods of calculations between banks.

You can also get a rough estimate of your creditworthiness using our creditworthiness calculator. You’ll find detailed instructions on how to use it in this article.

Presentation of Mortgage Offers

If your creditworthiness is sufficient, the next step is for the broker to present you with a range of mortgage offers currently available on the market. At this stage, pay attention to the following elements:

Interest rate
Commission and other upfront costs (like property valuation and insurance paid in advance)
Total cost of the loan
Loan term
Type of interest rate and its components
Monthly installment amount and other recurring costs
Loan-to-Value ratio (LTV)
All additional products and the conditions you must meet to receive a promotional interest rate

Your broker should explain all of the above terms and help you compare them properly.

Searching for a Suitable Property

Most borrowers begin the entire process by visiting property listing portals in search of a home. That’s perfectly natural — it’s the obvious first step. However, only after assessing your creditworthiness will you know whether you can actually afford the property you’ve chosen. To avoid disappointment, it’s worth considering a visit to a mortgage broker even before you start browsing available properties on the market.

Once that step is completed, you can begin your search. You may start looking on your own or contact a real estate agency. Agency will gladly help you, but will charge a commission (usually 1–4% of the property price).

In addition to reviewing visualizations or viewing the property itself, it is important to examine its legal status. In the case of the primary market, legal defects are unlikely (as the property is new). Nevertheless, it is advisable to review the investment documentation (the information prospectus and developer standard specification), the content of the land and mortgage register if one already exists, as well as the extract and outline from the land and building register.

Many brokers, including us, support clients at this stage as well. We have access to primary market listing portals that are not publicly available. This allows us to efficiently search for and present offers tailored to your needs. We can also verify the legal status of the property and thoroughly check the developer on your behalf.

Selection of the property

The final stage of the search process is finding a property that meets your expectations and is free from any legal defects. Once such a property has been selected, you can proceed to signing either a developer agreement or a reservation agreement.

Developer agreement analysis

But before signing, the agreement should be carefully reviewed to ensure that all its provisions are clear, understandable, and acceptable to you. Particular attention should be paid to clauses concerning the property description, price, payment schedule, deadlines, contractual penalties, and conditions for withdrawal. It is also important to verify whether the agreement complies with the law — and this is another stage where you can rely on the support of your broker.

On the primary market, transactions often take place at the proverbial “hole in the ground” stage. For this reason, when signing a developer agreement, it is wise to make sure that the developer responsible for the project has a solid reputation and several similar projects already completed. To do so, it is worth visiting the developer’s website and checking online reviews. If the developer has completed projects in your area, it’s also a good idea to visit them in person.

Signing the Developer Agreement

Once everything has been verified, you can proceed to signing the developer agreement. This is a contract concluded in the form of a notarial deed between the buyer and the developer. Under the contract the developer promises to construct the property and then transfer its ownership to the buyer after the agreed price has been paid.

Optionally, before signing the developer agreement, you may choose to sign a reservation agreement. Its purpose is to temporarily remove the selected property from the developer’s offer, giving you additional time to make a decision. Such a reservation usually lasts a few weeks. Signing a reservation agreement involves paying a so-called reservation fee. It may amount up to 1% of the property full price and is calculated as part of your down payment.

Once the agreement is signed, the next step is to collect the remaining documents required for submitting your mortgage applications.

Complining Documents for Mortgage Applications

At this stage, you gather all the necessary documents for your mortgage application. There are 3 main groups:

Personal documents (ID cards, marriage certificate, the mortgage application form and its attachments)
Income documents (income certificate on the bank’s official form, salary transfers from the last 3/6/12 months, bank account statements, tax documents such as PIT declarations or a revenue and expense ledger)
Property documents (extract from the land and mortgage register, developer agreement, property valuation report)

Each bank uses its own forms and may require a slightly different set of documents. Complete them carefully under the supervision of your broker to avoid errors or missing information. Any omission or mistake will need to be corrected, which will slow down the process.

Submitting Mortgage Applications

At this stage, the mortgage broker matches your financial situation and needs with the current offers available on the market. They present you with the best options in the form of personalized bank information forms.

After reviewing and selecting the most suitable offers, it’s time to submit loan applications to at least three banks. Typically, these include:

The bank with the most competitive (i.e. cheapest) offer on the market
The bank that provides the fastest loan approval decision
The bank where you have the highest likelihood of receiving a mortgage

This approach balances cost savings with transaction security.

Regarding the applications themselves, they can often be long and complex. That’s why the broker usually completes them on your behalf. Your role is limited to verifying the information and providing your signature. Once signed, the applications, along with the necessary attachments, are sent directly to the banks.

Waiting for banks decisions

According to Polish law, banks have 21 calendar days to issue a final loan decision after receiving a complete application. Completeness is crucial here because any additional documents or corrections reset the 21-day deadline.

Due to high demand for mortgages, issuing a decision within three weeks is sometimes not possible. To address this, some banks have implemented a two-stage process to avoid rejecting applications solely because of insufficient time for verification. While banks use different terminology, we will refer to them as the preliminary stage and the main stage.

Depending on the bank, the stages may include different tasks. For example:

Preliminary stage: credit scoring and financial assessment of the borrower
Main stage: analysis of the loan purpose and evaluation of the property used as collateral

Importantly, banks using the two-stage process start counting the 21-day deadline from the submission of the main application.

Based on our experience, it is safest to prepare for a waiting period of approximately 1–4 weeks for the final loan decision.

Receiving Loan Decisions

After the waiting period, the long-awaited moment finally arrives – the final loan decision. It contains all the key information regarding the loan, including a draft loan agreement. Once issued, the decision is binding for at least 14 calendar days from the date it is delivered. This minimum period, mandated by law, allows the borrower to carefully consider the loan terms before proceeding.

Analysis of received decisions and meeting the preconditions to sign the agreement

If you receive more than one positive decision, this stage involves comparing the loan terms once again to select the best offer. This step is usually quick, as the terms in the decision rarely differ significantly from the initial offers reviewed at the start of the process.

Sometimes, the bank may impose conditions that must be met before signing the loan agreement. For example, you may need to provide the developer agreement if you had previously signed only a reservation contract. It is important to fulfill these conditions to proceed with the loan.

Signing the mortgage loan agreement

At this stage, the mortgage process is finalized with the signing of the loan agreement at the branch of the chosen bank. It is advisable to have your mortgage broker present during this meeting to clarify any doubts or questions. If you don’t speak Polish, bank may require for a certified interpreter to be present as well.

Before the meeting, make sure that all preconditions for the agreement have been met and that your PESEL number is not restricted (this can be verified online). Be sure to bring a valid and undamaged ID.

The meeting usually lasts 1–2 hours. During this time, the loan agreement is signed, and any conditions linked to promotional offers (cross-selling), such as opening a bank account or purchasing insurance, are taken care of.

Meeting the conditions for loan disbursement

The loan agreement will specify the conditions that must be met before submitting a request to disburse the loan. The most important of these is confirming the down payment transfer to the developer’s account.

For primary market properties, this also includes providing the assignment to the escrow account signed by the developer.

Loan Disbursement

Once all the conditions have been met, the loan disbursement request can be submitted with confidence. The bank releases the mortgage, transferring the first installment directly to the developer’s escrow account. At this point, you officially become a borrower.

As illustrated in the process timeline, from the first meeting with the mortgage broker to the loan disbursement, approximately 12 weeks (3 months) typically pass. This is the expected waiting period for loan disbursement, which you should be prepared for. In many cases, the entire process can be completed in 2 months. This largely depends on how long it takes to receive the loan approval decisions.

Property handover and transfer of ownership at the notary

A key distinction between the primary and secondary real estate market is that ownership is transferred only after the loan is disbursed. This occurs when construction is completed and the property is formally handed over for use.

At this stage, after inspecting the property, completing the handover protocol, and addressing any defects, the notarial deed transferring ownership is signed. The notary then files with the court to create a separate land and mortgage register for the new property (if one does not yet exist) and to register the first owner – you.

This is also the moment when it is necessary to arrange property insurance.

Loan Management, Overpayments, and Refinancing

Now the mortgage is in place, you can enjoy your new property. The only remaining obligation is the monthly repayment of your installments. However, you are not left to manage this alone. While brokers do not make payments on behalf of clients, they can make the loan repayment process significantly easier. 😊

A good mortgage broker does not disapear after the loan agreement is signed. Their role continues throughout the life of the loan, until the last installment is paid.

A broker can help you effectively manage your mortgage, optimizing repayment through partial or full prepayments. Understanding the impact of prepayments on the total loan cost and planning them strategically with your broker can make every penny (or grosz ;)) work efficiently. Many borrowers save tens of thousands of zloty in interest costs through careful prepayment planning.

Another key role of the broker is ongoing market monitoring. If interest rates fall and better offers become available, clients with fixed-rate mortgages may be offered refinancing to more favorable terms. Conversely, when interest rates rise, clients with variable-rate loans are informed in time, allowing them to switch to fixed rates and protect themselves from higher costs.

Summary

Sigh of relief! We are finally finished! Congratulations on making it till the end! I hope that reading this post has helped you understand and organize the process in your head. There are many steps involved, but at almost every stage, you can rely on the support of experienced experts.

If you want to deepen your knowledge, I invite you to explore the other posts on our blog, where we examine various aspects of the mortgage process in detail.

If, on the other hand, you need assistance with planning, taking out, or managing your mortgage, don’t hesitate to contact us – we will be happy to help you every step of the way.