Every house or apartment owner knows that there is always something to do on and within their own four walls. For example, the bathroom has to be renovated or the attic has to be insulated, the heating system has to be replaced or the floorboards have to be sanded down.
Such work always costs money and this is often not available for construction work of all kinds. So the owner is required to take out a loan.
The home loan is just right for this case.
Meet prerequisites. The main ones include the following:
- The place of residence must be in Germany
- The applicant must be of legal age
- The income must be sufficient
- The Credit Bureau arrival must be positive
Proof of property ownership can be provided by means of an extract from the land register or by submitting a fee notice. If the applicant fulfills all the necessary requirements, nothing stands in the way of approval of the loan.
Security for the lender entered in the land register in the form of a land charge. This is not the case with a home loan. In return, the loan amount is much lower than with a classic building loan, which involves sums of 100,000 USD and beyond. In the case of residential loan contracts, sums in the four- or five-digit range are usually lent.
Another special feature of such loans is the relatively quick and unbureaucratic procedure, since neither a notary nor the land registry need to be involved. The low cost of such a loan is also an advantage. They are limited due to the mostly low loan amount as well as the omitted notary and land register fees.
Home renovations, repairs or maintenance work.
- As a rule, the owner and applicant do not have to prove which work they want to do with the loan amount. Proof of ownership is sufficient for most lenders.
The banks are therefore very generous when it comes to the purpose of such a loan and also allow, for example, a redesign of the outdoor facilities or the garden to be the purpose of the loan.
Some banks offer special additional benefits for home loans such as special repayments without prepayment penalty or the possibility to temporarily suspend payment in installments. Here you should find out from your bank what additional options they offer with a home loan.
Conditions offered, which makes it interesting for many. However, lenders often also offer classic installment loans with extremely low interest rates. It is therefore worthwhile for the borrower to compare this with the housing loan dealt with here.
It is best to get offers from banks that do not have such a loan in the program and look at the interest rates. Not infrequently, these are as low as with a home loan.