A mortgage is a secured loan used to purchase property, where the property acts as collateral, and it can be provided by banks, credit unions, or non-bank lenders. While banks are common lenders, many other parties can issue mortgages, including mortgage companies, private lenders, or government-backed entities.
When individuals or companies establish a mortgage on a property in Türkiye, or when an existing mortgage is removed from the land registry, several different fees and expenses arise during the process. These expenses are often collectively referred to as “mortgage costs”.
In practice, the term mortgage cost does not refer to a single payment. Instead, it includes a combination of official fees paid to the land registry, bank commissions, valuation expenses, legal service fees, and sometimes notary expenses.
Understanding these costs is important for property owners, borrowers, and investors because the total expense may reach 2–3 percent of the loan amount depending on the circumstances.
This guide prepared by Bayraktar Attorneys explains the main components of mortgage costs in Türkiye, current fee ranges, how these costs are calculated, and how borrowers can optimize them.
What Are Mortgage Costs?
Mortgage costs arise during two main procedures:
Mortgage establishment (İpotek Tesisi)– when a property is pledged as collateral for a loan
Mortgage release (İpotek Terkin)– when the mortgage is removed from the land registry after the debt is paid
The costs associated with these procedures usually consist of the following categories:
Land registry fees
Property valuation fees
Bank commissions and loan processing charges
Legal service fees
Notary and official certification costs
Each of these expenses plays a role in completing the mortgage transaction.
Main Mortgage Cost Components
Land Registry Fee (Tapu Harcı)
The most significant official expense in mortgage transactions is the land registry fee.
In Türkiye:
Mortgage establishment fee: 0.5% (5 per thousand)
Mortgage release fee: 0.5% (5 per thousand)
The calculation is based on the loan or debt amount written in the land registry record.
For example, if the mortgage amount is 500,000 TL, the land registry fee will be calculated on this amount.
Property Valuation Fee (Ekspertiz Ücreti)
Banks require an official property valuation report before approving a mortgage loan.
This valuation determines the market value of the property and ensures that the property provides sufficient collateral for the loan.
Typical valuation fees range between:
35,000 TL – 65,000 TL
The exact amount may vary depending on:
property size
property location
building characteristics
Bank Commission and Loan File Fee
Banks often charge a loan processing commission when granting a mortgage loan.
This fee may take two forms:
0.5% – 1% of the loan amount, or
a fixed loan file fee, typically between 500 TL and 1,000 TL
The commission is usually collected during the loan disbursement process.
Legal Service Fee (Optional)
Although not mandatory, many borrowers choose to work with a lawyer to ensure the mortgage transaction is completed correctly.
Legal services may include:
reviewing loan agreements
verifying land registry records
ensuring correct registration of the mortgage
obtaining additional documentation
representing the client in case of disputes
Legal fees may be calculated either:
as a fixed amount, or
as 0.5% – 3.5% of the loan amount
Notary and Other Official Expenses
Certain transactions may also require notary services.
These expenses may arise for:
power of attorney documentation
additional document certification
official approvals
Typical costs usually range between 10,000 TL – 30,000 TL.
Current Mortgage Fee Overview
The table below summarizes the most common mortgage-related expenses in Türkiye.
Expense Type | Rate / Amount | Explanation |
|---|---|---|
Land Registry Fee (Mortgage Establishment / Release) | 0.5% (5 per thousand) | Calculated based on the loan or debt amount |
Property Valuation Fee | 35,000 – 65,000 TL | Depends on property characteristics |
Bank Commission | 0.5% – 1% or fixed 500 – 1,000 TL | Collected during loan approval |
Legal Service Fee | 0.5% – 3.5% | Determined depending on service scope |
Notary / Official Certification Fees | 10,000 – 30,000 TL | Power of attorney and document approvals |
How to Calculate Mortgage Costs
Example scenario:
A borrower establishes a mortgage for a 500,000 TL loan.
The estimated expenses may be calculated as follows.
Land Registry Fee
500,000 TL × 0.005 = 2,500 TL
Property Valuation Fee
Estimated valuation fee: 40,000 TL
Bank Commission (0.75%)
500,000 TL × 0.0075 = 3,750 TL
Legal Service Fee (3.5%)
500,000 TL × 0.035 = 17,500 TL
Notary and Other Expenses
Estimated amount: 20,000 TL
Total Estimated Mortgage Cost
2,500 + 40,000 + 3,750 + 17,500 + 20,000
Total: 83,750 TL
This amount may vary depending on the bank’s policy, the complexity of the transaction, and the services involved.
How to Optimize Mortgage Costs
Borrowers can reduce their mortgage expenses by considering several strategies.
Using a Single Valuation Report
When applying to multiple banks, it may be possible to use the same valuation report rather than paying for multiple valuations.
Monitoring Low-Commission Loan Campaigns
Some banks periodically offer zero-commission mortgage campaigns, which may significantly reduce costs.
Agreeing on Fixed Legal Fees
Negotiating a clear fixed legal fee before starting the process helps avoid unexpected expenses.
Avoiding Unnecessary Registry Amount Increases
Mortgage registration fees depend on the declared loan amount. Declaring unnecessarily high mortgage amounts may increase land registry fees.
Why Legal Support Is Important in Mortgage Transactions
Although mortgage registration procedures may appear straightforward, mistakes during the process can lead to significant legal and financial complications.
Working with a lawyer helps ensure:
correct mortgage registration at the land registry
accurate documentation
avoidance of procedural errors
faster resolution of disputes with banks
A lawyer can also conduct risk analysis, ensuring that the mortgage registration does not create unforeseen liabilities in the future.
Conclusion
Mortgage establishment and release procedures in Türkiye involve several types of expenses. When all components are considered together, the total cost may approach 3–5 percent of the loan amount.
These expenses typically include:
land registry fees
valuation reports
bank commissions
legal service fees
notary expenses
Careful planning and proper cost calculations can significantly reduce the financial burden of mortgage transactions.
If you require legal assistance for mortgage registration, mortgage release procedures, or property financing matters in Türkiye, the legal team at Bayraktar Attorneys can assist you throughout the process.
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