Any property purchase requires thorough preparation in advance. In 2026, although interest rates on bank loans appear to have stabilised, banks remain highly demanding. To give yourself the best possible chance of securing your financing, you must present an impeccable application file — one that reassures your advisor both about your financial solvency and the seriousness of your project. Here is a concise guide on how to proceed.
Understand and master CSSF regulatory ratios
In Luxembourg, the Commission de Surveillance du Secteur Financier (CSSF) imposes strict rules to regulate the property market and household borrowing. One key indicator is the Loan-To-Value (LTV) ratio, which compares the amount borrowed to the value of the property:
- For first-time buyers, financing up to 100% of the purchase price (excluding notary fees) is generally still possible.
- For buyers who are not first-time purchasers, the limit is usually 90%.
- For buy-to-let investments, the LTV typically drops to 80%.
At the same time, your debt-to-income ratio (DSTI) should theoretically not exceed 33% to 40% of your net income. However, in 2026, banks place particular emphasis on disposable income (“reste à vivre”). Given the cost of living, a high-income couple may obtain an exemption up to 45% or even 50%, provided the remaining income after monthly repayments comfortably covers everyday expenses.
Prepare a complete file with all required supporting documents
A bank that receives an incomplete application is a bank that hesitates. To be convincing, you should provide all documents from the very first meeting:
- Identification: a copy of your valid ID card or passport.
- Stability: your employment contract and your last three payslips. If you are self-employed, provide your last three balance sheets and tax assessments.
- Tax: your most recent tax return.
- Bank accounts: your last three statements for all accounts (current and savings).
- Existing loans: amortisation schedules for any personal loans or car loans. If possible, settle small consumer credits before submitting your application.
- Signed preliminary sales agreement and the property’s Energy Performance Certificate (EPC).
Maximise your own funds and take advantage of the Bëllegen Akt
Personal equity remains a key factor. Ideally, you should at least cover notary and registration fees, which amount to approximately 7% of the purchase price.
To help you do so, make use of the Bëllegen Akt. This tax credit on notarial deeds can reach up to €40,000 per person(or €80,000 for a couple) when purchasing a primary residence. It significantly reduces the amount of cash you must provide at the notary’s office.
Also show your bank that you retain a precautionary savings buffer after the purchase. Lenders are reassured when they see that, despite the loan and down payment, you still have funds available to handle unforeseen expenses.
Working with real estate professionals is another way to secure the success of your project.
Anticipate energy performance requirements
In 2026, energy performance is no longer optional — it has become a financing criterion. Banks now offer preferential “green” interest rates for properties rated A, B or C on the Energy Performance Certificate (EPC).
If you are buying a property rated F, G or H, expect a more rigorous assessment. To reassure the bank, you must:
- Include the cost of energy renovation works in your financing plan.
- Provide quotations from certified professionals.
- Demonstrate that the future energy rating will enhance the property’s value, thereby protecting the bank’s mortgage collateral.
Adopt the mindset of a partner, not a borrower
To convince your bank, adjust your mindset. You are not asking for a favour — you are proposing a secure and profitable partnership.
- Take care of your financial image: avoid major purchases (new car, expensive furniture) in the six months preceding your application.
- Leverage your career: if you work in a strong sector in Luxembourg (such as finance, IT or healthcare), highlight your employability and salary progression prospects.
By following this structure and presenting a clear, well-documented file, you reduce uncertainty for the credit analyst. A bank that fully understands your situation is more likely to grant approval quickly and on better terms.
