Mortgage vs. Installment Plan in Batumi: A Complete Comparison of Financing Options in 2025

Available Purchase Options

1. Cash — full payment

2. Developer installment plan — 0% per year

3. Mortgage in Georgian banks — 12–15% per year

4. Russian mortgage — limited availability

5. Mixed financing — combination of methods

6. Real estate leasing — a new tool

Developer Installments — the Popular Choice

Terms in 2025

Standard parameters:

• Interest rate: 0% per year

• Term: up to 60 months

• Down payment: 10–30% of the price

• Early repayment: no penalties

• Currency: US dollars

Who Offers Installments

Top developers with favorable terms:

Next Group:

• Term: up to 60 months

• Down payment: from 15%

• Features: fixed USD exchange rate

One Development:

• Term: up to 48 months

• Down payment: from 20%

• Features: installments may cover finishing

Alliance Group:

• Term: up to 36 months

• Down payment: from 30%

• Features: premium properties

ORBI Group:

• Term: up to 60 months

• Down payment: from 10%

• Features: participation in a management program

Installment Plan — Practical Example

$60,000 apartment:

• Down payment (20%): $12,000

• Amount to be paid: $48,000

• Term: 48 months

• Monthly payment: $1,000

• Overpayment: $0

Advantages of Installments

Financial benefits:

• No interest and no overpayments

• Minimal paperwork

• Fast approval

• Flexible payment schedule

• Option for early repayment

Practical conveniences:

• No income verification required

• Available to non-residents

• Can be arranged remotely

• Ownership after full payment

Disadvantages of Installments

• Limited property selection

• Requires a substantial down payment

• Short repayment term (up to 5 years)

• No ownership rights until fully paid

• Risk of losing funds if unpaid

Mortgages in Georgian Banks

Terms for Russians in 2025

Bank of Georgia:

• Rate: 12.5–14% per year

• Term: up to 20 years

• Down payment: 30%

• Maximum amount: $300,000

TBC Bank:

• Rate: 12–15% per year

• Term: up to 15 years

• Down payment: 25%

• Maximum amount: $250,000

Liberty Bank:

• Rate: 13–16% per year

• Term: up to 20 years

• Down payment: 35%

• Maximum amount: $200,000

Borrower Requirements

Mandatory conditions:

• Age: 21–65 years

• Verified income

• Positive credit history

• Property and life insurance

• Guarantors (at some banks)

Required documents:

• Passport and translations

• Income statements for 6–12 months

• Credit history report

• Property documents

• Property valuation

Mortgage — Practical Example

$60,000 apartment:

• Down payment (30%): $18,000

• Loan amount: $42,000

• Rate: 13% per year

• Term: 15 years

• Monthly payment: $461

• Overpayment: $41,000

Advantages of a Mortgage

• Long repayment term

• Relatively small monthly payments

• Ownership immediately after the deal

• Wide property selection

• Possibility of refinancing

Disadvantages of a Mortgage

• High interest rates

• Significant overpayment

• Complex approval process

• A lot of paperwork and documents

• Mandatory insurance

Comparative Analysis of Options

Comparison Table (for a $60,000 apartment)

Total Cost Calculation

For a $60,000 apartment over 15 years:

Cash:

• To pay: $60,000

• Additional expenses: $2,000

• Total: $62,000

Installments (4 years):

• To pay: $60,000

• Additional expenses: $2,000

• Total: $62,000

Mortgage (15 years):

• To pay: $101,000

• Insurance (15 years): $9,000

• Additional expenses: $3,000

• Total: $113,000

Mixed Financing Schemes

Installments + Early Repayment

Strategy:

1. Arrange installments with a minimal down payment

2. Pay for 12–24 months without interest

3. Repay early using accumulated funds

Advantages:

• Time to save money

• No interest

• Flexible repayment

Installments + Mortgage

Scheme:

1. Buy with installments

2. After 1–2 years convert to a mortgage

3. Obtain ownership

4. Stretch payments over a long term

When it fits:

• You need ownership quickly

• Income allows a mortgage, but not right away

• You plan to rent out

Regional Specifics

Currency Risks

US dollars:

• Installments are more often in USD

• Mortgages may be in GEL

• Exchange rate fluctuations affect payments

GEL (lari):

• Local salaries are in GEL

• Mortgage is more favorable in the national currency

• Lower currency risks

Taxation

With installments:

• Property tax is paid by the owner

• Until full payment — the developer pays

With a mortgage:

• Property tax from the first year

• Possible benefits for mortgage holders

Recommendations for Choosing

Choose Installments if:

• Stable income for the next 3–5 years

• Planning a quick sale

• Want to avoid interest overpayments

• Buying at the construction stage

• Don’t want extensive paperwork

Best properties for installments:

• New builds from major developers

• Apartments up to $80,000

• Properties in popular areas

Choose a Mortgage if:

• You need ownership immediately

• Planning for long-term holding

• Income allows monthly payments

• Want to buy a move-in-ready apartment

• Considering higher-priced properties ($100,000+)

Best properties for mortgages:

• Ready apartments in completed buildings

• Liquid properties in central locations

• Units suitable for rental

Option Selection Calculator

Answer the questions:

1. Down payment amount?

• Up to $20,000 → installments

• Over $30,000 → any option

2. Planned ownership period?

• Up to 5 years → installments

• Over 10 years → mortgage

3. Monthly income?

• Up to $2,000 → installments

• Over $3,000 → mortgage is affordable

4. Do you need to rent it out?

• Immediately → mortgage (ownership)

• In 2–3 years → installments

Practical Tips

How to Reduce Risks with Installments

1. Choose reliable developers with a track record

2. Review the contract for penalties

3. Create a reserve for 3–6 payments

4. Consider life and health insurance

5. Monitor construction progress

How to Get a Favorable Mortgage

1. Compare offers from all banks

2. Prepare documents in advance

3. Consider co-borrowers to lower the rate

4. Choose the right loan currency

5. Plan early repayments

What to Avoid

Risky offers:

• Installments with high interest

• Mortgage without insurance

• Deals without legal due diligence

• Overpaying for “fast” approval