Authored by the expert who managed and guided the team behind the Luxembourg Property Pack
Everything you need to know before buying real estate is included in our Luxembourg Property Pack
Foreigners can apply for mortgages in Luxembourg without living there full-time, but face stricter requirements than locals.
Luxembourg banks differentiate between EU and non-EU citizens, with non-EU applicants needing higher down payments and more documentation. While the process is accessible, approval times are longer and requirements more stringent for foreign buyers compared to Luxembourg residents.
If you want to go deeper, you can check our pack of documents related to the real estate market in Luxembourg, based on reliable facts and data, not opinions or rumors.
Foreigners can access Luxembourg mortgages but typically need 20-40% down payments and face longer approval times of 4-8 weeks.
EU citizens receive more favorable terms than non-EU applicants, with banks like BGL BNP Paribas and Spuerkeess actively serving international buyers.
| Applicant Type | Down Payment Required | Approval Timeline |
|---|---|---|
| Luxembourg Residents | 0-20% | 2-4 weeks |
| EU Citizens (Non-residents) | 20-30% | 4-6 weeks |
| Non-EU Citizens | 30-40% | 6-8 weeks |
| Cross-border Workers (EU) | 20-25% | 3-5 weeks |
| Investment Properties | 20-40% | 4-8 weeks |
Can foreigners actually apply for a mortgage in Luxembourg if they don't live there full-time?
Yes, foreigners can apply for mortgages in Luxembourg without being full-time residents.
Luxembourg banks accept applications from non-residents, including cross-border workers and international buyers purchasing investment properties or second homes. You don't need to live in Luxembourg permanently to qualify for a mortgage.
However, banks impose stricter requirements on non-residents compared to Luxembourg residents. These include higher down payment requirements, more extensive documentation, and longer approval processes. Non-residents typically need to demonstrate stronger financial profiles to compensate for the perceived higher risk.
Being legally present in the country through valid visas or EU citizenship significantly improves your approval chances.
What minimum residency or visa requirements do banks in Luxembourg usually ask for?
Luxembourg banks don't require full-time residency but expect legal presence documentation.
EU citizens need only provide valid EU identification and proof of income, regardless of where they live. Non-EU citizens must show valid visa documentation or residence permits if they plan to live in Luxembourg, though this isn't mandatory for investment purchases.
Banks typically require proof of a Luxembourg address, which can be temporary accommodation or a rental agreement. Cross-border workers need employment contracts showing they work in Luxembourg or neighboring countries. Most banks prefer applicants who can demonstrate some connection to the Luxembourg economy, whether through employment, business interests, or existing banking relationships.
As of September 2025, banks focus more on financial stability and income verification than strict residency requirements.
Do Luxembourg banks treat EU citizens and non-EU citizens differently when approving mortgages?
Luxembourg banks clearly favor EU citizens over non-EU applicants in mortgage approvals.
| Criteria | EU Citizens | Non-EU Citizens |
|---|---|---|
| Down Payment | 20-30% | 30-40% |
| Documentation Required | Standard | Extensive (including international credit reports) |
| Loan-to-Value Ratio | Up to 80% | 60-70% |
| Interest Rate Premium | Standard rates | 0.1-0.3% higher |
| Income Verification | EU payslips accepted | Apostilled documents required |
| Approval Timeline | 4-6 weeks | 6-8 weeks |
| First-time Buyer Benefits | Available | Limited or unavailable |
This differential treatment reflects regulatory frameworks that encourage EU financial integration while requiring additional due diligence for non-EU applicants.
What is the minimum income foreigners must show to qualify for a mortgage in Luxembourg?
Luxembourg banks don't set absolute minimum income thresholds but use debt-to-income ratios to assess affordability.
Your total monthly debt payments, including the proposed mortgage, cannot exceed 40-45% of your net monthly income. For example, if your net monthly income is €5,000, your maximum allowable debt payments would be €2,000-€2,250.
Banks typically require at least three months of recent payslips and employment contracts showing stable income. Self-employed applicants need 2-3 years of audited accounts or tax returns demonstrating consistent earnings. Income must be verifiable and preferably from EU sources, though international income is accepted with additional documentation.
It's something we develop in our Luxembourg property pack.
Most successful foreign applicants have monthly net incomes of at least €4,000-€5,000 to comfortably meet affordability criteria for average Luxembourg property prices.
How much down payment do foreigners typically need compared to locals?
Foreign buyers need significantly higher down payments than Luxembourg residents.
Luxembourg residents, especially first-time buyers, can access up to 100% financing for primary residences. EU non-residents typically need 20-30% down payments, while non-EU citizens usually require 30-40% deposits.
For investment properties, even residents face stricter requirements with maximum 80% loan-to-value ratios, but foreigners often see this reduced to 60-70%. These higher down payment requirements reflect banks' risk assessment of non-resident borrowers.
Cross-border workers from neighboring EU countries may receive more favorable terms, similar to residents, especially if they have long-term employment contracts in Luxembourg.
Don't lose money on your property in Luxembourg
100% of people who have lost money there have spent less than 1 hour researching the market. We have reviewed everything there is to know. Grab our guide now.
Are foreigners allowed to borrow up to the same loan-to-value ratio as Luxembourg residents?
Foreigners face lower maximum loan-to-value ratios than Luxembourg residents.
Luxembourg residents can access up to 100% LTV for primary residences and 80% for investment properties. EU non-residents typically receive maximum 70-80% LTV, while non-EU citizens are usually limited to 60-70% LTV.
These restrictions apply regardless of the applicant's financial strength, reflecting regulatory and bank policy differences for non-resident lending. Some banks may offer higher LTV ratios to foreigners with exceptional financial profiles, substantial assets, or existing significant banking relationships.
Cross-border workers with long-term Luxembourg employment may receive more favorable LTV ratios, approaching those offered to residents.
Do banks in Luxembourg require foreigners to open a local bank account before approving the loan?
Yes, Luxembourg banks typically require foreigners to open local accounts as part of the mortgage process.
Most lenders mandate that borrowers open a current account with the lending bank, which serves multiple purposes: facilitating monthly mortgage payments, demonstrating financial commitment to Luxembourg, and enabling banks to monitor the borrower's financial behavior.
This requirement applies to both EU and non-EU foreign buyers. Banks use local accounts to establish banking relationships and ensure smooth transaction processing. Some banks may waive this requirement for existing clients or those with substantial deposits.
You'll also need to provide proof-of-funds letters showing the source of your down payment and closing costs.
What interest rates do foreigners usually get compared to residents—are they higher, lower, or the same?
Foreign buyers typically receive similar interest rates to residents, with slight premiums for higher-risk profiles.
As of September 2025, standard mortgage rates in Luxembourg range from 3.5-4.1% for fixed-rate mortgages. EU citizens with strong financial profiles often receive rates identical to residents. Non-EU citizens or those with less stable income sources may face premiums of 0.1-0.3% above standard rates.
Banks price mortgages based on individual risk assessment rather than blanket foreign buyer penalties. Factors affecting rates include down payment size, income stability, existing banking relationships, and overall financial profile.
It's something we develop in our Luxembourg property pack.
Foreign buyers with substantial deposits, stable EU income, and strong credit histories often secure the same competitive rates as Luxembourg residents.
Are foreigners required to provide proof of income only from Luxembourg, or can income from abroad also count?
Foreign income is accepted but requires more extensive documentation and verification.
Luxembourg banks prefer Luxembourg or EU-sourced income as it's easier to verify and considered more stable. However, international income from OECD countries is generally acceptable with proper documentation including apostilled employment contracts, tax returns, and bank statements.
Income from outside the EU faces stricter scrutiny and may require currency conversion calculations, political risk assessments, and verification of tax obligations in the source country. Banks typically apply more conservative affordability ratios to foreign income streams.
Self-employed individuals with international income need audited financial statements and may face additional requirements to demonstrate business stability and continuity.
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Luxembourg versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you're planning to invest there.
How long does the mortgage approval process usually take for foreigners in Luxembourg?
Foreign mortgage applications typically take 4-8 weeks compared to 2-4 weeks for Luxembourg residents.
EU citizens usually experience 4-6 week approval times, while non-EU applicants often wait 6-8 weeks due to additional verification requirements. The extended timeline accounts for international document verification, credit checks in home countries, and more detailed financial assessments.
Complex applications involving self-employment, multiple income sources, or unusual property types may extend beyond 8 weeks. Pre-approval processes can reduce these timelines by completing preliminary assessments before property selection.
Banks recommend starting mortgage applications well before property purchase deadlines to accommodate longer processing times for foreign buyers.
Are there any extra taxes, fees, or notary costs that foreigners specifically face when buying property with a mortgage?
Foreigners pay the same standard taxes and fees as Luxembourg residents—no additional foreign buyer penalties exist.
Standard costs include notary and stamp duties of approximately 7% of purchase price, bank arrangement fees of €250-€1,000+, and property valuation fees of €300-€500. These apply equally to all buyers regardless of nationality or residency status.
However, foreign buyers may incur additional costs for document translation, apostille certifications for international documents, and legal advice for complex cross-border transactions. Some banks charge higher arrangement fees for non-resident applications due to increased processing requirements.
It's something we develop in our Luxembourg property pack.
Which banks in Luxembourg are known to work more willingly with foreign buyers, and what conditions do they set?
Several Luxembourg banks actively serve international buyers with dedicated expat services.
1. **BGL BNP Paribas** - Offers comprehensive expat mortgage services with English-speaking advisors and accepts international income sources 2. **Spuerkeess (BCEE)** - Luxembourg's largest bank with extensive experience in cross-border lending and competitive rates for foreigners 3. **ING Luxembourg** - Specializes in expat banking with streamlined processes for EU citizens and flexible documentation requirements 4. **Banque Raiffeisen** - Provides personalized service for foreign buyers with dedicated relationship managers 5. **Banque Internationale Ă Luxembourg (BIL)** - Offers premium services for high-net-worth foreign investorsThese banks typically require full documentation packages, prefer EU income sources, and offer dedicated consultation services for foreign buyers. They set conditions including minimum down payments, local account requirements, and comprehensive income verification, but provide clearer guidance and more predictable approval processes than smaller regional banks.
Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.
Foreign buyers can successfully access Luxembourg mortgages despite facing stricter requirements than residents.
EU citizenship provides significant advantages in terms of down payments, documentation, and approval timelines compared to non-EU applicants.