"Thanks to this law, we are eliminating the barrier of lack of funds for the own contribution required to obtain a mortgage loan for the purchase of a flat or the construction of a house. In this way we want to meet the housing needs of Poles".

- said to Ministry of Economic Development and Technology Piotr Nowak.

Basic assumptions of the act

A guaranteed housing loan will be granted up to 100% of the purchase price of a flat or the cost of construction of a single-family house. In the case of a loan financing also the cost of finishing a flat or a single-family house, this ratio may be even higher than 100%, as the loan will also be able to cover expenses incurred in connection with finishing the flat.

The new regulation introduces the possibility of covering with a guarantee a part of a mortgage loan taken out for the purchase of a flat. This part must constitute no less than 10% and no more than 20% of the expenditure (value of the real estate) for which the credit is taken. The guarantee replaces the requirement for an own contribution.

The family repayment is an instrument combined with a guaranteed housing loan. It will be available if, during the repayment period of this loan, the household grows by a second or subsequent child. BGK will make a one-off repayment of part of the guaranteed housing loan in connection with the birth of a child. The repayment amount will be:

• PLN 20,000 - in the case of enlarging the household with a second child,
• PLN 60,000 - in the case of enlarging a household with a third or subsequent child.

The loan will be granted for a minimum of 15 years and can be granted in the Polish currency. As a result, there will be no exchange rate risk.

In addition, the Act contains mechanisms to mitigate the risk of stimulating housing price increases through

• This will be the introduction of a maximum price limit (including construction contribution) per 1 m2 of usable area of the financed flat.
• authorisation for the Council of Ministers to reduce, by way of a regulation, the level of coefficients affecting statutory price limits.

Pursuant to the Act, guaranteed housing loans will be granted until the end of 2030 by banks that enter into an agreement with BGK in this respect.

What is the procedure?

The procedure will depend on the bank granting the loan. In principle, it is the same as a mortgage loan granted with own contribution. The only difference is the obligation to present statements confirming fulfilment of the conditions, which allow to take advantage of the programme.

What conditions must be met to get a guaranteed loan?

The borrower and members of his/her household must not own another dwelling, unless the household includes two or more children. In this case, they may own one additional dwelling altogether, but no larger than 50m2 when there are two children, 75m² when there are three children and 90m2 when there are four children. For families with five or more children, the metric limit is no longer there.

On the repayment date, it will not be possible to own any other dwelling than the one purchased using the guaranteed housing loan.

Deadline

The new regulations will come into force six months after their publication in the Journal of Laws.