Car Loans and Leasing

Car Loans and Leasing
There are several Bulgarian banks that grand car loans to individual permanently residing in the country, business entities and sole proprietors.

Maximum allowed loan amount – 100,000 BGN

Loan currency

New vehicles
– up to 3-4 years from production date

Secondary market vehicles
– Some banks grant loans for purchasing of secondary market vehicles not older than 4 years. In such type of deals, the banks have additional requirements regarding the applicant own financing, which should cover the difference between the vehicle market value and its insurance value (value according to “Kasko” insurance), but not less than 20% of the vehicle value.

Installment plan
– annuity or equal instalments
The car loan should be paid back according to an instalment plan based on equal annuity instalments. The banks offer the possibility for partial or full loan pay-back at any time during the loan period, with the corresponding penalty interests.

Minimal loan period
– 12 months, maximum period for new vehicles – 48 months (4 years); for secondary market vehicles – maximum period of 48 months, as the sum of the vehicle age and loan amount should not exceed 60 months (5 years). For motorcycles, the maximum loan period is 3 years.

Grace period
– the banks do not currently offer a grace period for instalments on the principles.

Fees and commissions
: the administrative tax for servicing of the loan varies between 2 and 3.2% of the loan granted depending on the loan period.

Penalty interest in case of loan pay-back in advance
– between 0.5 and 2% of the amount of the loan, which is paid back in advance.

Applicant own financing
– Banks require that applicants participate in the purchase of the vehicle with own financing of at least 20% of the vehicle value.

Initial instalment
– at least 20%. In cases of special bank promotions, the initial instalment could be 10%.

Loan approval and utilization
– from 3 to 5 business days

Interest Rate

Annual interest rate for loans in BGN
– for a loan period of 12 months – 12%, for 18 months – 13%, for 24 months – 14%, for 36 months – 15%, for 48 months – 16%.

Annual interest rate for loans in USD
– for a loan period of 12 months – 9%, for 18 months – 9.5%, for 24 months – 9.5%, for 36 months – 10%, for 48 months – 10%.

Annual interest rate for loans in EUR
– for a loan period of 12 months – 9.5%, for 18 months – 10%, for 24 months – 10%, for 36 months – 10.5%, for 48 months – 10.5%.

Collateral – registered pledge in favour of the bank, promissory note without the right of appeal