Constant rent increases, loud tenants and inappropriate cleaning plans? Are you still renting and have you been dreaming of your own home for a long time, in which you can be your own master, independent of others?
At the same time, you have no motivation to do a stressful and labor-intensive home construction? Maybe then you can imagine buying a turnkey house. Of course, the purchase of a house is always accompanied by high costs.
WSW Financing has published a test on real estate financing. This shows very clearly that it is worth comparing different banks in terms of their offers before you conclude a loan. If you have a cheap bank, you will get a 25-year loan for less than 2 percent. Compared to the most expensive bank, this can bring you a savings potential of up to 64,700 euros. As you can see, with the appropriate financing, buying a property can be lucrative and you can fulfill your dream of owning a home.
How cheap is a real estate financing with the current interest rate development?
The amount of the loan is influenced by the respective market situation. The EVB (EV Bank) is currently running a low-interest-rate policy with a key interest rate of 0.00% in the eurozone. National banks can lend themselves cheaply at the currently given interest rate and then lend this money to their customers at a favorable rate. All loans, including real estate loans, are particularly lucrative due to interest rates.
Tips for your real estate financing
Long term mortgage interest rates
The interest rates are currently at an extremely low level. According to WSW Financing, you receive interest below 2 percent on house financing. You not only secure this advantage by taking out a real estate loan, but also by having this low interest rate fixed for as long as possible.
Tip: With a forward loan, you can secure the favorable interest rates for future follow-up financing after the mortgage expires.
Fixed interest – short, medium or long term?
If the interest rates are very high, a short-term fixed interest rate of eg 5 years is recommended. In this case, you can split the loan amount to select different interest rates for your home financing. For example, there is the chance that the interest rate development will be accompanied by a falling interest rate after a few years.
If interest rates are already at a very low level, it is generally advisable to fix the real estate loan over the long term in order to benefit from the favorable interest rates.
Tip: If you have a fixed interest rate of more than 10 years, you have the following option: 10 years after you have paid the loan, you can terminate it unilaterally with a notice period of 6 months. You have the option to repay the remaining loan amount at a possibly cheaper interest rate.
Monthly repayment in the form of a repayment plan
The repayment of a real estate loan is usually in monthly installments. A rate consists of the interest and the redemption portion. The amount of the interest amount refers to the amount of the remaining loan amount. Based on the agreed repayment plan, you as a consumer can calculate precisely which financial burden is due to you monthly. A special repayment is outside this repayment plan and involves an early repayment of the loan or a part of it.
Keep option for special repayment open
When you make a loan with your bank, be sure to consider the possibility of special repayment. This allows you to repay larger sums of money in addition to the monthly installments, for example if you are particularly liquid due to a higher tax refund, a heirs payment or similar.
This calculation example shows you how much a special repayment pays off: For example, with an interest rate of 2 percent after 5 years and again after 7 years, you pay back € 3,500 in addition to the monthly installments, and save on a total loan amount of € 200,000 € 3,300 interest.
Summary – What does a sound real estate financing look like?
The current EVB low interest rate policy has a positive effect on lending rates. If possible, opt for a high repayment installment. This not only saves you in the form of low interest rates, but also faster debt-free.
Experts also continue to recommend the classic annuity loan. In such case, you raise a certain amount and repay a fixed monthly amount until the loan expires or the debt is repaid.
In order to make the dream of owning a home a reality, real estate financing with attractive interest rates is indispensable. Get help from experts in this important matter. With your Guermantes family, you can now request an offer for mortgage lending and use the currently favorable interest rate development for your property.