Mortgage for cottage — what's specific
Mortgage for a cottage (chata) or vacation home is a regular product but with stricter conditions than for primary residence. Banks see vacation property as less essential — first thing you'd give up in trouble.
Conditions vs. primary residence mortgage
- Higher rate — typically 0.2–0.5 % above primary residence
- Lower max LTV — usually 70 % (sometimes 75 %), not 80 %
- Shorter term — typically up to 25 years, not 30
- Property must be classified as habitable — bank rejects sheds and unfinished structures
What counts as 'cottage'
Czech property classification distinguishes:
- Recreation building (objekt pro rodinnou rekreaci) — cottage, summer house, weekend home
- Family house (rodinný dům) — primary residence
- Apartment — separate category
If your "cottage" is registered as recreation building, it falls under cottage mortgage rules. Some larger cottages are reclassified to family house — better terms.
Practical advice
- Check property type in cadastre before applying — you can sometimes reclassify before applying for better rate
- Year-round habitability matters — cottages without insulation, heating get worse rates
- Consider American mortgage on primary residence instead — sometimes cheaper than cottage mortgage
FAQ
Can I get a mortgage on a cottage I plan to live in year-round?
Yes, but if it's classified as recreation building, you'll get cottage rate. Reclassification to family house requires meeting habitability standards (year-round insulation, heating, sanitary facilities).
Is it better to take cottage mortgage or American mortgage on my home?
Compare rates: cottage mortgage typically 5–6 %, American on primary 6–8 %. Cottage usually cheaper, but only if cottage qualifies. Run both calculations.
Can I rent out the cottage?
Yes, but bank may reclassify it as investment property — rate goes up further. Check the contract before listing it on Airbnb.