Financing your own four walls takes staying power. Builders should expect 20 to 30 years – depending on the cost of the property and the available equity capital. However, many have the interest rate fixed for only ten or 15 years at the beginning of financing. Therefore, at the end of the fixed interest rate, a residual debt remains, a follow-up financing is due. Schwabisch hall expert karsten eib explains how to successfully manage the upcoming follow-up financing without getting out of breath financially.
With a follow-up financing cheap into the verlangerun (image: anaken2012 / clipdealer.En)
"Those who financed for four to five percent ten years ago can now rejoice. He gets away with financing his remaining debt significantly cheaper today," says the schwabisch hall expert. This applies even if he agreed at the time to a fixed interest rate of 15 or 20 years, because: "every borrower has a special right of termination after ten years and can get out of his contract," explains eib. Borrowers should deal with follow-up financing in good time. Otherwise, they may miss out on significant interest savings. The type of follow-up financing that comes into question depends on when the fixed-interest period expires.
Expiration of fixed interest rate in six months or less: follow-on loan
If the fixed interest rate on the loan ends within six months, the current low interest rates for the remainder of the financing can be secured with the help of an instant loan. This will pay off the balance of the expiring loan.
Expiration of fixed interest rates in seven to 36 months: forward loan
"With a forward loan, borrowers can secure today's low interest rates up to three years in advance," explains schwabisch hall expert eib. The conditions of the loan are fixed for the entire term of the loan. However, an interest surcharge is due for each month until the loan is paid off. This is usually between 0.02 and 0.04 percentage points per month.
Expiration of fixed interest rate in a few years: home loan agreement
With a building savings contract for the amount of the expected remaining debt, the property owner secures a loan at today's low interest rates for his follow-up financing due in a few years' time. In contrast to the forward loan, there is no interest surcharge on the home savings contract and no obligation to take out the loan. Securing low interest rates pays off: "even a difference of 0.5 percent on a loan amount of 200.000 euros and a ten-year term, an additional monthly burden of around 100 euros," says the schwabisch hall expert.
Use state subsidies
Also with the follow-up financing – no matter in which form – it is worthwhile to use the national promotions housing premium, employee savings allowance and wohn-riester. This means borrowers can be debt-free more quickly. Calculations by bausparkasse schwabisch hall show the advantages offered by wohn-riester, for example: A family of four, which brings wohn-riester into the financing of a remaining debt over 110.000, is free of debt more than four years earlier and saves almost 10 percent compared with the unsubsidized variant.000 euros, already including the downstream taxation.