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Credit card limits and creditworthiness in Poland: How a limit can reduce your mortgage.
Many people who are planning buy an apartment in Poland with a mortgage, They calculate their creditworthiness roughly like this: they have a salary, they have expenses, they have several loans—which means they can calculate how much the bank is willing to lend.
In practice, things are a little more complicated.
Problems arise especially often due to credit cards, overdrafts and other available credit limits.
The most interesting thing is that sometimes a person doesn't use a credit card at all, has no outstanding balance, and always pays their bills on time. But the very fact of having a high credit limit can reduce the mortgage amount the bank is willing to lend.
For example, you have a credit card with a limit 30,000 PLN, but you almost never use it.
From your point of view, the debt is:
0 PLN.
But for the bank, the situation may look different: the client has the opportunity to use up to 30,000 PLN of additional credit at any time.
Therefore, when calculating creditworthiness, the bank may take such a limit into account as a potential financial burden.
Why does the bank take into account not only your actual debts?
When reviewing a mortgage loan application, the bank evaluates whether the client will be able to regularly service the new loan.
To do this, not only current loan payments are analyzed, but also the client's other financial obligations, income, maintenance costs, and the stability of income sources.
That is why the bank looks not only at the question:
«"How much does the client owe now?"»
But also to the question:
«"What additional financial obligations or available lines of credit does he have?"»
This is especially important when it comes to mortgages, as they typically involve large sums and long loan terms.
A credit card with no debt - why it can still affect mortgage?
This is one of the most frequently asked questions from clients.
Let's imagine the situation.
Do you have:
- salary — 10,000 PLN net;
- no consumer loans;
- no credit card debt;
- credit card with a limit of PLN 20,000.
You can say:
«"I don't owe the bank a single zloty. Why should that affect my creditworthiness?»
Because the bank evaluates your potential debt burden.
If you use up your credit limit tomorrow, you will have an additional obligation.
Therefore, when calculating mortgage creditworthiness, the bank may take into account the established limit, and not just the actual amount used.
Example: How the PLN 30,000 limit may affect a mortgage
Let's say a client wants to get a mortgage for 500,000 PLN.
He doesn't have any consumer loans, but he does:
credit card – limit 30,000 PLN.
The client believes:
«"I don't use the card, so the bank shouldn't take it into account.".
But the bank may include this limit in the creditworthiness calculation.
As a result, the customer's potential creditworthiness may be lower than if the credit card had not existed at all.
How much exactly will it decrease?
It is impossible to name one universal amount in advance.
Different banks may have different internal rules for calculating creditworthiness. Therefore, it's impossible to say that a limit of PLN 30,000 will always reduce a mortgage by, for example, exactly PLN 50,000 or PLN 100,000.
In one bank the impact may be small, in another it may be more significant.
This is why, when looking for a mortgage, it is important to compare several banks, and not rely solely on the calculations of one bank.
What to do with the credit limit before a mortgage?
There is an important practical point here that many clients learn about too late.
Closing a credit card or line of credit completely does not always happen immediately.
After submitting an application, the bank may need time to close the product, process the information, and transfer the updated data to the BIK. In practice, the entire process can sometimes take about 1-2 months.
This can be a problem if you've already found an apartment and want to apply for a mortgage soon.
Therefore, in some situations a more practical solution may be not a complete closure of the credit card, but a significant reduction in its limit.
For example:
was: limit of 10,000 PLN
became: limit 500 PLN.
For a bank, this is a completely different potential burden.
In this case, the client retains the credit card itself, but its available credit limit becomes minimal.
Why might this be more convenient?
A limit change can be processed more quickly than a full closure of the credit product, and once the bank has submitted updated data, the reduced limit should be reflected in the credit information used to assess creditworthiness.
Therefore, if you need a mortgage in the near future, it is sometimes wiser First, reduce the unnecessary limit to the minimum, rather than waiting for the card to be completely closed.
For example, if you have multiple cards:
- card No. 1 — 10,000 PLN;
- card No. 2 — 20,000 PLN;
- card No. 3 - 15,000 PLN,
and you hardly use them, you can consider reducing limits or closing unnecessary products.
But it is better to make a specific decision after calculating your creditworthiness and taking into account the bank where you plan to take out a mortgage.
Important: The time it takes to update information in the BIK depends on how the bank transmits data, so it cannot be guaranteed that the limit change will be reflected on the same day.
What is an overdraft and why is it important?
An overdraft is an opportunity to go into negative balance on a bank account up to a certain amount.
For example, on your account:
balance: 2,000 PLN
but the bank provides:
overdraft: 10,000 PLN.
This means that technically you can use up to 10,000 PLN of additional funds.
Even if you are not currently in the red, having such a line of credit may be taken into account when analyzing your creditworthiness.
So before taking out a mortgage, you need to look beyond just credit cards.
Sometimes a client closes one card but forgets about the old limit on the account.
A limit is not the same as a debt.
This is a fundamental difference.
Debt - this is money that you have already borrowed and must return.
For example:
credit card - 5,000 PLN used.
Limit — This is the maximum amount you can borrow.
For example:
card limit: PLN 30,000.
You could only use PLN 5,000, but you could potentially use another PLN 25,000.
This is why a bank may take the limit into account when calculating your creditworthiness.
What if I have several credit cards?
This is a fairly common situation.
For example:
Card No. 1 - 10,000 PLN
Card No. 2 - 20,000 PLN
Card No. 3 - 30,000 PLN
Total potentially available limit:
60,000 PLN.
In this case, a person can use only a few hundred zlotys.
Before taking out a mortgage, this situation requires separate analysis.
Sometimes it is more profitable for a client to keep one card with a small limit and close the others or significantly reduce their limits.
But don't automatically assume that the fewer cards, the better.
The main thing is to understand, how the specific bank where you plan to take out a mortgage will take into account your obligations.
What about loans that are almost paid off?
The client may say:
«I only have 2,000 PLN left in credit, so it doesn’t matter anymore.».
But the bank looks at the existing obligation and its current payment.
Therefore, a loan that ends in a few months and a loan that will be repaid for several more years may have different impacts on the calculation.
In some cases, it makes sense to pay off a small loan first and then apply for a mortgage.
But again, the decision must be made after calculation.
Sometimes paying off a small loan early can actually improve the situation, while other times the money is better spent on a down payment or property purchase costs.
Why is it especially important for foreigners in Poland to check limits?
For a foreigner, obtaining a mortgage loan in Poland sometimes requires more careful preparation of documents.
The bank can analyze:
- citizenship;
- legality of stay in Poland;
- residence card;
- validity period of the document;
- form of employment;
- length of employment with the employer;
- size and stability of income;
- credit history;
- existing obligations;
- currency of income;
- down payment;
- real estate object.
Therefore, if you have several credit cards, limits or consumer loans at the same time, they can further complicate the calculation.
This is especially important for clients who are close to the maximum amount that the bank is willing to provide.
For example, if the calculation shows the possibility of obtaining about 400,000 PLN, and the client wants to buy an apartment for 450,000 PLN, even a relatively small factor affecting zdolność kredytową can make a difference.
Therefore, before submitting an application, it is especially important for a foreigner to check your entire financial situation.
How to increase creditworthiness before a mortgage?
If you are planning get a mortgage In the near future, you can start with simple things.
1. Check your credit cards
See what cards you have and what limits they have.
2. Check overdrafts
Even if you don't use them, your available line of credit may count towards your calculation.
3. Close unnecessary cards or reduce limits
If you don't need the card, you may want to consider closing it.
If closing takes too long, it is sometimes more practical to reduce the limit to the minimum.
For example:
10,000 PLN → 500 PLN.
4. Pay off small loans
If you have several small consumer loans, paying them off early can sometimes improve your credit score.
5. Don't take out new loans before your mortgage.
Even a small new loan creates an additional obligation.
6. Don't increase your credit limits
Before taking out a mortgage, you shouldn't increase your credit card or overdraft limit unless necessary.
7. Check BIK in advance
Don't wait until the bank starts reviewing your mortgage application.
It's best to see in advance what obligations and limits appear on your credit report.
8. Count first zdolność kredytową
And only after that make a decision about closing the obligations.
Sometimes it is more profitable for a client to leave money for a down payment than to pay off a small loan in full.
Therefore, each situation must be considered individually.
The most common mistake before taking out a mortgage
One of the most common mistakes looks like this:
A person finds an apartment, makes a deposit, negotiates with the seller, and only then begins to check creditworthiness.
And then it turns out that the bank is ready to provide not 500,000 PLN, as the client expected, but, for example, only 420,000 PLN.
Why?
There may be several reasons:
- income is lower than expected;
- the bank takes into account expenses differently;
- there are active loans;
- there are credit cards;
- there are high limits;
- there is leasing;
- insufficient income stability;
- features of citizenship or legalization of stay;
- insufficient down payment;
- The selected bank calculates zdolność differently.
This is especially true if you plan to buy an apartment without a large down payment or are hoping to get the maximum possible loan amount.
What to do if you are planning a mortgage in Poland?
If you are a foreign citizen planning to buy an apartment in Poland with a loan, it is best to start by analyzing your financial situation before searching for a specific property.
First of all, it’s worth checking:
Income → expenses → loans → credit cards → limits → BIK → down payment → documents → banks.
Even if you don't have any credit card debt, a high unused limit can affect your credit score.
If you're planning a mortgage soon, don't put off checking your limits until the last minute. Fully closing a credit card or line of credit can take several weeks, and the information in your BIK is updated after the bank submits the data.
So in some cases a reasonable solution might be quickly reduce the unnecessary limit to the minimum, for example from 10,000 PLN to 500 PLN, instead of waiting for the card to be completely closed.
Want to know how your credit cards and limits affect your mortgage?
В Rutkowski Home We help foreigners navigate mortgage lending in Poland and select banks tailored to their individual needs.
If you are planning to buy an apartment or a house in Poland, but don’t know, What loan amount can the bank actually provide you?, it is better to check creditworthiness before signing a real estate contract.
We can analyze your income, liabilities, credit cards and limits, and then determine which banks are worth considering in your case.
