In the following, we present a detailed overview of the general procedure and key stages your application for a consumer or housing loan goes through:
SUBMISSION OF LOAN DOCUMENTATION
The basic documentation you submit to the Bank’s officer to initiate the loan process includes:
- Valid identification document – identity card or passport (for review and copy),
- Certificate of employment and income issued by the employer,
- Loan application form provided by the Bank (which you must fully complete),
- Consent for access and processing of data from the Credit Register of the Central Bank of Montenegro (CBCG);
For housing loans: you must also submit a land registry extract for the property being purchased/renovated or offered as collateral where the mortgage will be established.
For purpose-specific (consumer and housing) loans: specific documentation depends on the loan purpose, e.g. invoice/quotation for goods or services, or purchase agreement/pre-agreement for real estate. If the loan is cash-based, no additional purpose-related documentation is required.
Note: Depending on the type and amount of the loan, the Bank may request additional evidence of primary repayment sources – inflows and outflows – as well as other supporting documentation.
Based on the submitted documentation, the Bank officer may provide an initial estimate of your borrowing capacity.
PRE-CONTRACTUAL INFORMATION (PK and PSK FORMS)
After you provide the Bank with the necessary information about your needs, financial situation, and desired terms, the Bank, in accordance with legal requirements, provides the relevant forms enabling you to compare offers and make an informed decision:
For consumer loans: the Bank provides the PK Form – Pre-contractual information for consumer loans. This standardized document contains key information about the loan, including interest rate, effective interest rate (EIR), total costs, and consumer rights.
For housing loans: the Bank provides the PSK Form – Pre-contractual information for housing loans. This form provides personalized information tailored to your needs, including a detailed repayment schedule (annuity plan) throughout the entire loan period, as well as clear information on risks in case of interest rate changes.
These forms allow you to clearly, transparently, and comparably assess lending conditions, evaluate financial impacts, and understand your rights before signing the contract.
PROPERTY VALUATION (applicable only to mortgage housing loans)
Property valuation is required when a mortgage is established in favour of the Bank. The valuation is carried out by authorised appraisers. The cost of valuation is paid by the customer directly to the authorised appraiser after the valuation report is completed.
LOAN PROCESSING AND CREDITWORTHINESS ASSESSMENT
After you provide the necessary information about your needs, financial situation, and desired terms, the Bank performs a detailed creditworthiness assessment. In accordance with legal provisions, determining relevant facts includes assessing minimum living costs of the consumer and their immediate household, to ensure that the obligations do not jeopardize basic living conditions.
If your creditworthiness is insufficient for the requested amount, the Bank may offer a co-borrower option.
The Bank also defines required collateral instruments (e.g. promissory notes, salary assignment, insurance policies, mortgage, pledges, etc.), depending on the type and amount of the loan.
LOAN APPROVAL
Once all documentation is complete and all conditions are met (including property valuation for housing loans), and based on information obtained from you and the Credit Register of CBCG, as well as assessed minimum living costs of your household, the Bank makes the final loan approval decision. The maximum installment amount is determined in relation to monthly income.
CONTRACT SIGNING
After approval, the Bank officer contacts you to sign the loan agreement. With this documentation, you go to a notary to prepare the mortgage statement, with the presence of the mortgagor(s). In case of marital property (joint ownership under Montenegrin Family Law), both spouses must be present and sign, regardless of registered ownership in the cadastre. Other relevant parties may also participate depending on the case.
The Consumer is obliged to conclude the loan agreement within 2 months from the approval date; otherwise, it is considered that the Consumer has withdrawn from the loan. The loan utilization period is up to the end of the month following the contract signing.
MORTGAGE AND COLLATERAL INSTRUMENTS (for housing loans)
The notarised mortgage statement is submitted to the competent cadastral authority for registration of the mortgage in favour of the Bank. The decision on mortgage registration is delivered to the Bank and the mortgagor.
Insurance policies: property insurance against fire and basic risks is mandatory, and life insurance may also be required depending on the Bank’s assessment, assigned in favour of the Bank.
LOAN DISBURSEMENT
After all collateral instruments are established (including mortgage registration), the Bank disburses the loan. For consumer and housing loans, funds are paid to your account, while for housing loans and other purpose-specific loans, funds are transferred further to the seller/service provider/refinancing bank in accordance with the loan purpose.
The loan is disbursed in a single payment.
The Bank does not provide advisory services within the meaning of Article 29 of the Law on Consumer Credit (“Official Gazette of Montenegro”, No. 015/25 of 20.02.2025).
For advice or assistance in protecting your consumer rights, you may contact:
CEZAP – Consumer Protection Center, Slobode 17, Podgorica, tel: +382 20 244 170, website: cezap.me, as well as other authorised consumer organisations or local self-government advisory services. You may also contact the Central Bank of Montenegro (CBCG), which supervises credit institutions and handles client complaints.
