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Bulgaria's FIBank offers mortgages to foreigners

“It is possible to do basic background checks on foreigners. You can check if someone is registered or delayed with their credits whatsoever,” he said.

So, it appears that this is not a problem. Furthermore, what FIBank is offering is secured lending, where an individual’s financial circumstances are slightly less important than if the lending is unsecured, Harfield said.

“Yes, the interest rates in Bulgaria are higher, but then you are acquiring an asset in a country, which is still regarded as having slightly higher political and economic risk than, let us say, the UK or Germany. Therefore, you will also pay a slightly higher interest premium,” he said, commenting on the difference in interest rates between Bulgaria and most of the other European countries.

In Harfield’s view, a person may take the view that if he or she wishes to balance the risk of his or her overall lifelong investment portfolio, he or she has an asset that is mortgaged in Bulgaria and it is less risky and less costly for the portfolio than borrowing for a principle private residence in the UK, for example.

“There is a general view in the UK that the sterling will appreciate against the euro. And so people would prefer to have a euro loan and have sterling income, rather than to take a sterling loan and convert into a euro asset,” Harfield said.

He said that Bulgarian banks should change their view of foreign customers.

“You cannot have a trace of xenophobia or a trace of skepticism about foreign businesses if, as a country, you are trying to enter one of the world’s largest business clubs. Bulgaria at the moment is at a very advanced stage of entering the European Union. You cannot say that foreigners are too risky,” he said.

FIBank is the biggest among the few domestically owned banks in Bulgaria. It is 63.66 per cent controlled by two Bulgarian businesspersons, Tseko Minev and Ivailo Moutafchiev.

FIBank ranked as the sixth largest bank by assets in Bulgaria at the end of 2005.

The bank has about 100 branches throughout Bulgaria, a branch in Cyprus, a branch in Albania’s capital Tirana and an office in Durres, in western Albania.