Loan amount interest Redemption Special repayment To calculate
Especially in city locations – regardless of whether in the center or on the outskirts – affordable housing is often expensive, which affects your own four walls. The project faces particular challenges when families think about the new building.
It’s no wonder that many households in cities choose to own a condominium. How does this decision affect the building loan? Or is there no difference in financing between the condominium and the house construction?
Condominium versus house: the similarities
If you look at the housing and construction loan, various aspects become apparent. In many areas, the general conditions of the loans are the same.
This applies, for example, to collateral, special conditions and ancillary purchase costs.
Regardless of whether a household chooses the house or the condominium, there are always costs for the notary, the land register entry, the land transfer tax and the land charge.
But also in connection with the importance of term and special repayment on the interest charge, both the building loan and the home loan are comparable. Where are the differences?
Condominium versus house: the differences
Details separate the financing for an apartment and a house from each other. For example, some mortgage lenders are only willing to provide a housing loan if they are not large residential complexes or high-rise buildings with a fixed number of floors.
At the same time, there are differences between the two financing models with regard to the documents that prospective property owners must submit to their bank.
In connection with condominiums, credit institutions generally want to:
- Declaration of division
- Ancillary living costs calculation
- Usable area calculation
- as well as evidence of building insurance
see. The topic of buying a house is about the building application, the cadastral map or the cubature calculation.
- The lower the amount of financing, the lower the burden on the land purchase through the ordered lien. In practice, bringing in higher amounts of equity pays off with the lower loan-to-value ratio, even when it comes to interest rates – if the bank demands lower debit rates. At one point or another, federal and state funding can help to save.
Compare construction money – no matter whether house or apartment
There are differences in the financing of apartments and houses. But : One fact always applies. Only when households compare the available credit options calmly and thoroughly can they decide on the optimal loan.