Mortgages

How to choose the right mortgage

In a mortgage review I check the total cost first and what happens after the fixed-rate period. The first-year payment is only the start of the comparison.

Roman Dumitrescu, Head of Editorial

A mortgage finances buying a home and is secured by the property. It has long terms (up to 30 years) and usually the lowest interest of all loans.

Compare fixed vs. Variable rate, the required down payment (usually at least 15%) and the total cost over the term. A small APR difference means thousands of lei long-term.

• ✓Large amounts, secured by the home
• ✓Terms up to 30 years
• ✓Down payment from 15%
• ✓Fixed or variable rate

Down payment, Noua Casă program, fixed vs variable IRCC, and the right term

On a standard mortgage, the minimum down payment required by Romanian banks is 15% of the property value for a first purchase, per NBR rules.

For a second home it rises to 25%, and the third crosses 35%.

There is one important exception: the Noua Casă programme (successor to Prima Casă), under which the state guarantees part of the loan and the required down payment can fall to 5% for properties under a certain ceiling.

Partner banks include nearly all major commercial banks, but guarantee funds are allocated annually and limited.

Insurance comes in two: property insurance (mandatory PAD by law plus a top-up insurance required by the bank) and, frequently, a credit-linked life policy — optional but pushed hard.

Property insurance typically costs 0.1-0.3% of value per year; life insurance can add 0.2-0.5% more.

The key question to ask the lender: is life insurance mandatory, or can I exclude it from the APR?

The choice between fixed and variable rate (IRCC + bank margin) depends on the term and your risk tolerance.

On long mortgages (25-30 years), most banks now offer hybrid products: fixed for the first 5-7 years, then variable on IRCC. This gives you early predictability and flexibility later.

Purely fixed rates over 30 years are rarely available in RON and usually meaningfully pricier.

A 30-year term lowers the monthly payment but raises total cost significantly; 20 years tends to be the sweet spot for buyers who can carry the higher payment.

Compare mortgage offers: Estimate a Romanian mortgage from property price, deposit, term and interest. See the monthly payment, total and a higher-rate scenario.