Loan for Flat Finishing in 2026 – Mortgage or Cash Loan?

You can finance the finishing of a flat in three ways: add an amount for finishing to your mortgage (some banks list this as a loan purpose), buy a flat with a finishing package included in the price, or take a separate cash loan or personal loan. A mortgage usually has the lowest interest rate, but spread over 30 years it costs more in interest than it seems. We show how each route works, the maximum a consumer loan can cost and how they compare in an example of PLN 60k.

Key facts

• The average interest rate on new housing loans in July 2026 was 6.07%, and on consumer loans – 10.22% (NBP, new agreements excluding renegotiated ones).
• Maximum interest is twice the statutory interest: with the NBP reference rate at 3.75% this gives 14.5% per year (art. 359 § 2¹ of the Civil Code).
• The non-interest costs of a consumer loan (commissions, fees) cannot exceed 45% of the loan amount (art. 36a of the Consumer Credit Act).
• PLN 60k in a mortgage over 30 years means an instalment of about PLN 362 and about PLN 70.5k in interest; in a cash loan over 8 years at 12% – an instalment of about PLN 975 and about PLN 33.6k in interest (our calculation).
• A loan not secured by a mortgage and intended for renovating a flat is a consumer loan regardless of the amount – among other things you have 14 days to withdraw from the agreement.

A loan for flat finishing – three routes at a glance

Before you start comparing offers, work out how much you really need. The starting point is a flat finishing cost estimate – a bank that finances finishing within a mortgage will ask for one anyway. Only once you know the amount can you sensibly choose the source of funding.

Method	Interest rate (indicative)	Repayment period	Formalities	Who it suits
Finishing amount within a mortgage	as a mortgage – on average 6.07% (NBP, July 2026)	until the end of the mortgage, e.g. 25–30 years	cost estimate, separate tranche, accounting for expenses	buyers with a down payment and spare borrowing capacity
Finishing package included in the flat price	as a mortgage (the package is part of the price)	as a mortgage	scope and standard in the development agreement (umowa deweloperska)	people who do not want to run a renovation
Cash loan / personal loan	on average 10.22% (NBP, July 2026), max. 14.5% + non-interest costs	usually a few years	quick decision, no valuation and no mortgage	smaller amounts, finishing after the purchase

A mortgage with finishing – how it works at banks

Not every bank lets you add finishing to a purchase loan, but some banks state this purpose directly in their general information on mortgages. Examples from public documents: PKO Bank Polski lists among its purposes "purchase and finishing of a residential unit on the primary market", Santander Bank Polska – finishing of a property bought on the primary market, Bank Millennium – renovation, modernisation and finishing of a flat, and Bank Pekao offers a construction-and-mortgage loan covering, among other things, renovation and the purchase of a flat from a developer. The terms differ in the details, so always check the current rules of the specific bank before applying.

In practice a mortgage for purchase and finishing usually works like this:

1. Cost estimate in the application – you declare the amount for finishing and justify it with a list of works and materials.
2. Separate tranche – the money for finishing is not paid out together with the price of the flat, but in a later tranche according to the schedule in the agreement.
3. Accounting for expenses – the bank requires documents confirming the spending. In one public model agreement (BOŚ Bank) these are, for example, invoices, receipts, a final cost estimate or a declaration on the scope of works, and funds paid out in advance must be accounted for within the period set in the agreement, no longer than 3 months and before the next tranche.
4. Progress control – the bank may commission an inspection or an assessment of the progress of works before it pays out further money.

We described the details of the loan path itself – from the decision to the release of tranches – in our guide to the mortgage step by step.

Is LTV calculated on the value of the flat after finishing?

It depends on the bank and the valuation – there is no single rule. Some banks use the so-called future value, i.e. the purchase price increased by the cost of finishing, but with a cap. For example, in Alior Bank's general information the future value is the transaction price plus the costs of renovation or finishing, at most 110% of the transaction price. Another bank may rely solely on the price in the development agreement or on a valuer's report.

An example based on data from our catalogue: a 2-room flat in Wroclaw for PLN 662 405 (the median in our offer, 40.8 m²). With a 20% down payment (PLN 132 481) the purchase loan is PLN 529 924, and the instalment at 6.07% over 30 years is about PLN 3 201. After adding PLN 60 000 for finishing, the loan rises to PLN 589 924 and the instalment to about PLN 3 563. If the bank accepts a future value of PLN 722 405 (price + finishing, within the 110% limit), the LTV will be about 81.7%. If it counts only the purchase price – about 89.1%. In both cases you exceed 80%, which usually means additional collateral or a higher cost of the loan (we explain the rules in the article on the down payment). To stay at 80% on the future value, the loan should not exceed PLN 577 924 – so you are short of about PLN 12k in down payment.

Topping up the loan for finishing after the purchase

If you bought the flat without an amount for finishing, you can try to increase the loan or take a second mortgage loan or mortgage-backed personal loan from the same bank. It is not a formality: before any significant increase in the amount of a mortgage, the bank must reassess your creditworthiness on current data (art. 24(3) of the Mortgage Act), unless such an increase was already provided for at the start. So expect a new application, an annex to the agreement and the costs of establishing the security. That is why it is cheapest to plan the finishing right away, at the stage of the purchase loan application.

A finishing package included in the flat price

The second route avoids the problem of a separate tranche. If the developer offers turnkey finishing and records it in the development agreement, the cost of the package becomes part of the price of the unit – you finance it with the same loan as the purchase, and the bank values the flat as already finished. The Developer Act requires the agreement to specify the scope and standard of the finishing works the developer undertakes to carry out (art. 35(1)(6)), so it is easy to compare what you are paying for.

The downsides: less influence over materials, usually a higher price than with a renovation you organise yourself, and the need for a down payment calculated also on the value of the package. Whether it pays off is analysed in the article on the developer's finishing package.

A cash loan for finishing – how much it can cost at most

A cash loan or personal loan for finishing is a consumer credit agreement. The Act covers loans of up to PLN 255 550, but a loan not secured by a mortgage and intended for renovating a house or residential unit is a consumer loan also above that amount (art. 3(1) and (1a) of the Consumer Credit Act). The cost of such financing is capped by two limits:

• Maximum interest – twice the statutory interest, i.e. 2 × (NBP reference rate + 3.5 percentage points). With a reference rate of 3.75% (in force since 5 March 2026) that is 2 × 7.25% = 14.5% per year. The agreement cannot exclude this limit.
• Maximum non-interest costs – calculated with the formula MPKK = (K × 10%) + (K × n/R × 10%), where K is the loan amount, n – the repayment period in days, R – the number of days in the year, but never more than 45% of the loan amount (art. 36a). For PLN 60 000 over 8 years the formula gives PLN 54 000, so the upper limit applies: PLN 27 000.

These are limits, not typical prices. The average interest rate on new consumer loans in July 2026 was, according to the NBP, 10.22%, but a specific offer depends on your credit history at BIK (the credit bureau), your income and the commission. So compare the APR (RRSO), which covers the total cost of the loan, not the interest rate alone. In addition you have 14 days to withdraw from the agreement without giving a reason (art. 53), and on early repayment the total cost of the loan is reduced by the costs relating to the shortened period (art. 49).

A mortgage-backed personal loan is an intermediate solution: it is secured by a mortgage on the flat, so it requires a valuation and an entry in the land and mortgage register (księga wieczysta), but it lets you spread the repayment over a longer period than a cash loan. Banks treat it as a separate product with its own margin, so compare its terms with a housing loan in the information forms.

Mortgage or cash loan? A calculation for PLN 60k of finishing

Let us assume PLN 60 000 – roughly what basic finishing of a flat of about 40 m² costs (in our sample cost estimate for 40.8 m² it came to PLN 68.5k before the reserve). We compare equal instalments, without commissions and insurance, at a fixed interest rate throughout the term.

Option	Interest rate	Term	Monthly instalment	Total interest
Part of a mortgage	6.07%	30 years	PLN 362	PLN 70 477
Part of the mortgage repaid with overpayments in 8 years	6.07%	8 years	PLN 791	PLN 15 891
Cash loan – NBP average	10.22%	8 years	PLN 917	PLN 28 075
Cash loan – assumption	12.00%	8 years	PLN 975	PLN 33 616
Cash loan – maximum interest	14.50%	8 years	PLN 1 059	PLN 41 706

What follows from this:

• A low mortgage instalment does not mean "cheap". PLN 60k repaid over 30 years generates more interest (about PLN 70.5k) than a cash loan over 8 years even at 12% (about PLN 33.6k). The mortgage's advantage appears only when you repay that part faster – by overpaying it like a cash loan you pay about PLN 15.9k in interest.
• Overpayments on a mortgage are cheap. With a variable interest rate the bank can charge compensation only for repayment within 36 months of concluding the agreement and no more than 3% of the amount repaid (art. 40 of the Mortgage Act).
• A commission changes the calculation. A 5% commission on a cash loan (PLN 3 000) raises the cost of the 12% option to about PLN 36.6k.
• A cash loan reduces borrowing capacity. An instalment of about PLN 975 on a cash loan taken earlier means, in simplified terms, about PLN 120k less mortgage (using the method from the article on borrowing capacity: interest rate with a buffer of 8.57%, 25 years). If you are only just applying for a mortgage, do not take a cash loan "in reserve".

Are you buying a flat and want to plan the finishing in the loan right away? Book a consultation with a mortgage expert – we will compare offers from several banks and check which of them finance finishing and how they value the flat.

When each route makes sense

• An amount in the mortgage – when finishing costs several tens of thousands of zloty or more, you have a down payment with a margin and you choose a bank that has this lending purpose. Take care of the cost estimate and the schedule, because the tranche is paid out against documents. You will find a comparison of banks (margin, APR, commission) in the text on which bank to choose for a mortgage.
• A developer package – when you have no time for contractors and the package offer is reasonable compared with the prices of finishing firms.
• A cash loan – when only a little is missing (e.g. for a kitchen or appliances), the purchase is already financed or you need the money quickly, without a valuation and a mortgage entry. Choose a short term and check the non-interest costs.
• A flat to let – here return on investment is what counts; what is worth finishing and where to save is covered in the article on finishing a flat for rent.

The whole process – from collecting the keys to moving in – is described step by step in our guide Finishing a developer-standard flat step by step. If you are only just looking for a unit, see the current new flats in Wroclaw and in Warsaw – according to data from the TM Invest offer, as at 27.09.2026, the median price of a 2-room flat is PLN 662 405 in Wroclaw and PLN 755 824 in Warsaw.

Frequently asked questions

Summary

A loan for flat finishing comes out cheapest when you plan it together with the purchase: an amount in the mortgage or a package in the flat price gives the lowest interest rate, provided you do not spread that part over the full 30 years without overpayments. A cash loan is quicker and simpler, but more expensive and limits borrowing capacity – it works for smaller amounts and a short repayment period. Remember LTV: adding finishing can push you above 80%.

Want to check whether finishing will fit in your loan? Book a consultation with a TM Invest mortgage expert – we will compare offers from several banks and calculate options for your flat.

Legal position as at September 2026. The calculations are indicative and do not constitute a loan offer or legal or financial advice. The terms of financing finishing differ between banks – the lender's current documents are decisive.

Sources

• Consumer Credit Act of 12 May 2011, consolidated text Dz.U. 2025 item 1362 – art. 3(1) and (1a), art. 36a, art. 49, art. 53
• Civil Code, consolidated text Dz.U. 2026 item 795 – art. 359 § 2, § 2¹–2³ (statutory and maximum interest)
• Act on Mortgage Credit and on Supervision of Mortgage Credit Intermediaries and Agents, consolidated text Dz.U. 2025 item 720 – art. 24(3), art. 40
• Act on the Protection of the Rights of Purchasers of Residential Units or Single-Family Houses and on the Developer Guarantee Fund, consolidated text Dz.U. 2026 item 880 – art. 35(1)(6)
• NBP – basic interest rates (reference rate 3.75% since 5.03.2026)
• NBP – average interest on new agreements in PLN excluding renegotiated ones (Table 4), July 2026
• Banks' general information on mortgages (Alior Bank, Bank Millennium, PKO Bank Polski, Santander Bank Polska, BOŚ Bank) – a collection published by a credit intermediary
• Bank Pekao – your own flat or house (construction-and-mortgage loan)
• Flat prices: TM Invest development catalogue, as at 27.09.2026