How much should the initial repayment be?
We recommend an initial repayment of at least 2 per cent. With a borrowing rate of around 3.5 per cent, the loan would thus be fully repaid after around 30 years, provided the terms and conditions remain unchanged.
For let properties, a lower repayment rate may be advisable. This is because loan interest is generally tax-deductible, and a lower instalment leaves you with more financial flexibility.
However, the lower the repayment rate, the higher the remaining debt will be at the end of the fixed-rate period. This also increases the risk that a higher follow-on interest rate will significantly increase your monthly payments.
An agreed right to make unscheduled repayments provides additional flexibility, for example up to 5 per cent of the loan amount per year. Many banks also allow you to adjust the repayment rate during the fixed-rate period.
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Documents required for a mortgage
When assessing a property loan application, the bank requires various documents relating to your personal details, your income, your assets and the property itself. Gathering these documents well in advance makes the process smoother and can save you valuable time. This can be crucial, particularly in a competitive property market such as Munich. - FinanzierungKaufen
How long should the fixed-rate period be?
A longer fixed-rate period offers planning security, whilst a shorter term may offer more favourable terms, depending on market conditions. Which option makes sense depends on your financial situation, the outstanding balance and your personal plans. - FinanzierungKaufen
Plan your follow-up financing in good time
When the fixed-rate period on your mortgage comes to an end, there is often still a balance outstanding. There are various options available to you for refinancing. Which option makes sense and when you should arrange it depends on your personal circumstances and interest rate trends. - FinanzierungAltbau
What is the best way to finance a renovation?
Whether it’s a renovation loan, a mortgage or government funding: the most suitable financing option depends on your income and assets. Whether you intend to live in the property yourself or let it out also plays an important role.
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