Refinancing means a new bank gives you a mortgage that pays off the one you already have. From application to the old loan being repaid usually takes 4–6 weeks, and you should start no later than 3 months before your fixed-rate period (fixace) ends. At the end of the fixation, or within 3 months of being told the new rate, your current bank cannot charge you anything for the repayment.
You pay only for the valuation (odhad), CZK 3,000–6,000 and often refunded by the new bank, plus CZK 2,000 each to register the new lien and to delete the old one. This article covers the procedure. The saving and the payback period are worked out by our mortgage refinancing calculator. Whether to move at all, or stay and negotiate a better rate, is the subject of Refixation or refinancing.
The timeline on one page
| When | What to do | Who |
|---|---|---|
| 6 months before the fixation ends | check the end date, the outstanding balance and the terms of your contract | you |
| 4–3 months before | get 2–3 written offers; the letter with the new rate arrives | you, the banks |
| 3 months before | apply to the new bank and order the valuation | you, the new bank |
| 2–4 weeks after applying | loan approval | the new bank |
| 1–2 months before | payoff statement, signing the contracts, application to register the lien | the old bank, you, the new bank |
| The day the fixation ends | drawdown: the new bank sends the money to the old one | the new bank |
| Within a few weeks of repayment | discharge letter and deletion of the old lien from the land registry | the old bank, you |
The buffer is there mainly because of the land registry (katastr). It may enter the new lien no sooner than 20 days after notifying the owner of the pending change (in August and September 2026 a registration took 22 days on average), and the bank usually will not release the money until the application to register it has been filed.
How do you refinance a mortgage in eight steps?
- Get your starting figures. The date your fixation ends, the balance on that day, the remaining term and any discount conditions that tie you to your bank.
- Approach 2–3 banks or a broker. Ask for written offers with the same fixation, term and insurance, otherwise you cannot compare them.
- Submit the application and documents. The new bank assesses your income and debts from scratch, just as it would for a new mortgage.
- The new bank orders the valuation. For flats it is often done online and cheaply, for houses with a site visit. Your LTV depends on it.
- Approval usually takes 2–4 weeks once the paperwork is complete.
- Ask the old bank for a payoff statement as at the repayment date. The new bank needs the exact amount and the account number.
- You sign the loan agreement and the pledge agreement, and the application to register the lien is filed. The new lien enters the land registry behind the existing one and moves up to first place once the old one is deleted.
- After repayment, make sure the old lien is deleted. The old bank issues a discharge letter (kvitance) and its consent to deletion; the application to the land registry is usually filed by you or by the new bank. The administrative fee is CZK 2,000.
Remember to move the assignment of your property insurance (vinkulace) to the new bank as well, and to cancel the standing order for the old payment once the loan has been repaid.
Documents the new bank will ask for
- two proofs of identity,
- proof of income: for employees an income confirmation from the employer or payslips, for the self-employed (OSVČ) 1–2 tax returns,
- the loan agreement for your current mortgage and a loan account statement or confirmation of the balance,
- an extract from the land registry (list vlastnictví), which the bank often downloads itself,
- the property insurance policy, which you then assign to the new bank.
Some banks also want statements from the current account you have been paying from. A record of regular, on-time payments is the best evidence they can get that you can handle the loan. The full list by type of income is in Documents for a mortgage.
Can you refinance in the middle of a fixation?
Outside the end of the fixation and the other free windows, the old bank may charge compensation of at most 0.25 % of the amount repaid for each started year until the fixation ends, and no more than 1 % in total. It can never be more than the interest the bank actually loses. If the gap between the rates is large, switching pays even so.
Worked out on CZK 3,000,000 (18 years left, current rate 6.00 %, 18 months until the fixation ends, another bank offering 5.00 %; annuity payment):
- Compensation to the old bank: 2 started years × 0.25 % = 0.50 %, so at most CZK 15,000.
- Valuation, lien registration and deletion: around CZK 9,000. Total costs roughly CZK 24,000.
- The payment falls from CZK 22,745 to CZK 21,091, which is CZK 1,654 a month less.
- Over the 18 months to the original end of the fixation you save CZK 44,500 in interest. The costs are recovered in about 15 months.
With a gap of only 0.3 pp the switch would not pay for itself before the fixation ends, and waiting is the better option. How the compensation is calculated, and when it is worth paying, is covered in When to repay a mortgage early.
Borrowing more or changing borrowers
Refinancing is the one moment when you can rework the mortgage substantially without the old bank's consent. These are the two most common changes:
- Borrowing more. The new bank pays off the old mortgage and lends you something extra, for a renovation, say, or to clear more expensive loans. The whole loan must then meet the LTV cap of 80 % (90 % under 36). Interest on the part not spent on housing cannot be deducted from tax. When it makes sense to fold loans into a mortgage is covered in Consolidating loans into a mortgage.
- A co-borrower leaving. After a separation or divorce the new mortgage can be in one name only. The bank then counts only that person's income, so they have to pass the creditworthiness test on their own.
Where refinancing most often gets stuck
- Starting late. Apply a month before the fixation ends and the lien registration will not be done in time, so the loan rolls over automatically at your current bank's rate.
- A lower valuation than you expected. LTV is calculated from the new valuation, not from the price you paid years ago.
- Lower income than at the first mortgage. Parental leave, a probation period or a newly started business can block the new approval.
- A slow payoff statement from the old bank. Ask for it as soon as the new loan is approved.
- A forgotten deletion. An old lien left in the land registry gets in the way the next time you sell or borrow.
Sources
- Act No. 257/2016 Coll., on consumer credit, as amended with effect from 1 Sept 2024, § 117 (early repayment and compensation of costs)
- Act No. 256/2013 Coll., on the land registry (registration and deletion of liens)
- Act No. 634/2004 Coll., on administrative fees (CZK 2,000 fee for an application for registration)
- ČNB – LTV cap of 80 % (90 % under 36)