The dream of your own four walls is sometimes an expensive undertaking. But even those who have not accumulated a mountain of gold in their savings account in the past do not have to do without their own home – certain banks also make construction financing without equity possible. If you want to make it into your own four walls without any reserves, you usually have two different financing products to choose from, which only a few institutes offer: on the one hand, the so-called purchase price financing, on the other hand full financing, i.e. a loan for the purchase or construction costs that are incurred ancillary costs and a cash portion. However, since the granting of these loans usually goes far beyond the so-called loan-to-value limit of the property – i.e. the value at which the bank calculates it can sell the property in the worst case – home financing without equity is relatively risky for the banks. For this reason, only a few institutes offer purchase price financing, and even fewer full financing. However, not every bank offers financing for a property without your own savings. The reason for this lies in the earmarking of real estate loans, because mortgage lending is a loan in rem that is secured by a mortgage: If the customer encounters payment difficulties during the repayment, the bank has the option of selling the property due to the registered mortgage or land charge. In the case of home financing without equity, however, the loan exceeds the achievable selling price of the property due to the purchase or ancillary construction costs – even in the case of a foreclosure sale, the bank would not be able to settle the outstanding claim in this case. In order to prevent this risk, certain institutes, such as insurance companies and building societies, offer their real estate financing for a maximum of 80 percent of the real estate price – building financing without equity is not possible with these institutes. In addition, banks distinguish between purchase price financing and full financing of real estate. While a maximum of the entire purchase price is issued as a loan in the case of purchase price financing, the customer also receives the construction or incidental purchase costs as a loan from the bank in the case of full financing. These include, for example, fees for the broker, notary, the land register entry and the real estate transfer tax due. In principle, much higher interest rates are usually due for house financing without equity than for projects in which the buyer or builder also contributes his own funds. However, Belize Property even a minimal increase in interest rates often has important consequences for home financing due to the high loan amounts and long terms: With a higher interest rate, the customer pays back a smaller amount of the borrowed money at the same monthly rate – the term of the mortgage loan is extended accordingly and the total costs increase. For this reason, home financing without equity is usually a costly affair with banks that issue such loans – many institutions do not grant the loans at all. 1. Individual financing proposal Do you want a condominium or your own house, but don't have the savings to fulfill this wish? No problem, CHECK24 is also your contact for construction financing without equity. Now enter your financing request together with information about the property, your person and your financial situation in our free financial comparison – we will find an individual construction financing proposal for you that suits your dream property as well as your financial situation. 2. Get personal advice However, we are not satisfied with providing you with an individually suitable and inexpensive construction financing proposal free of charge from the loans from our more than 550 providers: After you have entered your details, a trained CHECK24 construction financing expert will get in touch with you – your personal contact. Together with you, the consultant will check and optimize your information and your financing request. In this way, we ensure that we always make a proposal that suits our customers and offers the lowest interest rates. 3. Apply for fundingHave you found a suitable financing proposal thanks to your non-binding financing request and the subsequent advice and optimization from your personal real estate financing expert? Then all you have to do is sign the application documents that you receive from CHECK24 by email or post and send them back to us together with some of the required documents. If your documents are complete, your home financing expert will check them, possibly compare them with you and then submit the financing request to the bank discussed. Once the loan agreement has been approved and sent by the bank, nothing stands in the way of purchasing your dream property. Correctly calculate construction financing without equityAnyone who has already found their dream property and is concerned with the pending financing of the property should first calculate thoroughly and consider the total costs that will be incurred – builders in particular should be prepared for additional costs that have not been taken into account. But even consumers who decide to buy an existing property should not assume that they will not have any further bills to pay in addition to paying the purchase price. Both the purchase of real estate or land and the securing of bank financing in the corresponding land register, the so-called land charge order, must be carried out under notarial supervision in Germany. Therefore, in addition to the costs for the property or property, real estate buyers or builders always have to pay notary fees and fees for the land registry: These additional costs usually add up to around 1.5 to 2 percent of the purchase price of the property or property. In addition, depending on the federal state, a real estate transfer tax of 3.5 to 6.5 percent of the purchase price is due. Bring in at least ancillary costs in construction financing All of these costs, plus expenses incurred for modernization or conversion work, the furnishing and moving into the new home, add up to the so-called purchase or ancillary construction costs. Only with special home financing without equity do consumers have the opportunity to settle these expenses via the building loan – with classic home financing, however, this is not possible.In principle, it is not advisable to tackle the project of your own home entirely without your own savings. Consumers should be able to pay at least the incidental additional costs, which usually add up to a fifth of the purchase price, out of their own pockets. These award guidelines apply to construction financing without equity Due to the higher risk that the bank takes when lending without equity, there are also stricter guidelines for consumers when lending these loans. In principle, real estate financing is only granted to persons of legal age. Due to the high loan amounts, most banks also require that the loan customer is in permanent employment or has been self-employed for at least three years and also has sufficient income and a perfect SCHUFA.If you want to take out real estate financing without equity, you usually have to meet other criteria, which can vary greatly from bank to bank. For example, some institutes require a higher budget surplus than with classic real estate loans for the granting of construction financing without equity. This means that the financial buffer between income and expenses has to be higher for these borrowers – in this way the bank at least wants to limit the risk that the customer gets into payment difficulties during the repayment. Consumers who want to take advantage of home financing without equity should also work in a certain professional group at certain institutes. Because of their very secure and long-term income, civil servants therefore obtain mortgage loans without equity more easily than consumers in other occupations. The background to this is that the more secure income and the almost non-terminable employment of an official for the bank offers security despite the higher risk of real estate financing without equity. Restrictions regarding the maximum age of the borrower or the repayment speed of construction financing without equity are also not uncommon. Who is worth the construction financing without equity Basically, home financing without equity is not suitable for many consumer groups: Due to the secure, long-term employment, however, purchase price or full financing can be worthwhile for young civil servants, and financing a property without own funds may also make sense for investors who are planning the property for rent. If the income from the rental significantly exceeds the installment due on the loan, such financing can also make sense. Last but not least, a curiosity, because real estate financing, in which the buyer or builder does not contribute a cent, may also be of interest to particularly wealthy consumers. This may be a better option for affluent consumers who do not want to invest their savings in real estate but in an investment that offers a return that exceeds the cost of borrowing.
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Construction financing without equity 2 years, 1 month ago