Construction financing – what can i afford?

A mortgage loan is a good solution if you have bought or built a house and you need tens of thousands more zlotys to furnish it. It is a good alternative to cash loans and credit cards. A mortgage loan is cheaper than a mortgage loan. It can be repaid much longer, which makes the monthly installments less painful.

It is difficult to give a clear answer to the question of how much we will spend on household appliances. It all depends on the size of the unit and the standard we are interested in. However, it will be an amount of tens of thousands of zlotys. This is why it pays to apply for a mortgage loan, not a regular cash loan. It will be cheaper.

We will have no problem finding a mortgage loan offer. They are currently available to all major banks in Germany that also grant home loans. Use our free construction financing comparison to find the best financing offer.

What is a mortgage loan?

Mortgage loan combines solutions characteristic of two products: Mortgage Loan and Cash Loan. The client receives money for any purpose, but on terms similar to a home loan.

The disadvantage of a mortgage loan can be the formalities and the time that should be spent on obtaining it. They will certainly last longer than a regular cash loan. The bank must first check our credit rating, the valuation of the property as collateral, etc. determine.

Mortgage loan: amount and duration of the loan

As a rule, the minimum amount is 10.000 EUR and the upper limit is 60-80% of the value of the property used as collateral for the repayment. As a result, large amounts of money can be at stake, not only borrowed for a long time, but also. The term of a mortgage loan can be up to 20 years.

Mortgage: interest rate

The most important advantage of mortgage loans is the interest rate. It is significantly lower than cash loans and only slightly higher than home loans. The rate can be relatively low-impact on the household budget.

Mortgage loan – whether or not you must have a property with a clean mortgage.

As the name suggests, the loan is secured by a mortgage on real estate. To think about this type of money, you must have an apartment, house or land that can be pledged. It is best if the property is not mortgaged because it has taken another loan.

It is possible that the collateral could be the property built and mortgaged with a bank loan, but in this case the new lender (the bank granting the mortgage loan) would have to agree to the establishment of a second rank mortgage. Such collateral is much riskier, because in the situation of execution and auction, the funds received are first used to satisfy the original creditor. In practice, banks very rarely agree to such a solution. If already, provided that the amount of the original mortgage is sufficiently low, so that together with the new loan the maximum LTV ratio, d.h. The ratio of the total amount of debt to the value of the property (currently 80%), is not exceeded.

Mortgage loan as a supplement to the home loan

People who finance the construction of a house with a home loan are often mistaken in thinking that this will also cover expenses such as the purchase of ADG/RTV appliances (TV, washing machine, refrigerator, etc.).), furniture for the living room, bedroom and other rooms are covered. Unfortunately this is not the case. Since the collateral of such a loan is real estate, banks will only finance what is reflected in its value. In addition to the building itself, these are the elements that are permanently connected to it. An appraiser who prepares an appraisal does not pay attention to furniture and other movable appliances.

With a home loan secured on a property we want to furnish, we won't be able to afford to buy equipment. Most banks consider the purchase and installation of: fixed built-in cabinets, custom kitchen furniture, shower stalls, toilets, bathtubs, and bathroom sinks.

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