Which providers convince?: Modernization loans without KfW support

Which providers convince?
Modernization loans without KfW support

Anyone who wants to renovate or modernize their property often hopes in vain for government support. But there are also good and cheap loans that do not require a KfW subsidy and land register security. This was examined by FMH financial advice.

Anyone who owns a house or apartment knows the problem: there is always something to do, always something to improve. Whether it is the desire for a modern, barrier-free bathroom or a new rain gutter is needed because the old one has rusted through: repairs, renovations and modernizations quickly devour a medium five-digit sum.

Many owners have saved up a nest egg for such cases over the years. In view of the exploding material and tradesman costs, however, the construction work can only rarely be financed without a loan.

If, as is so often the case, KfW funding is not possible, the question arises as to which providers offer particularly cheap loans for modernization and renovation. On behalf of ntv, FMH-Finanzberatung in Frankfurt took a closer look at the offers from banks and building societies – with pleasing results. There are a number of very good providers in both segments – total failures are rare, according to FMH. In the area of ​​building societies, however, one would wish for more transparency from many providers, according to the experts.

Bausparkassen: Some don’t let their cards be looked at

Building societies are traditionally a collection point for modernization reserves – it is therefore a good idea to contact them for a loan. This is all the more true as Wüstenrot & Co. offer very attractive conditions for credit terms of ten to 15 years, according to FMH.

And this is how it works: Customers immediately receive the loan for their renovation from their building society. Instead of repaying the loan directly, however, they save up a new home savings contract. If this is then allocated after years, the debts are paid with it and the customer repays the home loan from now on. In most cases, the monthly rate is designed in such a way that the same rate has to be paid over the entire period.

Unfortunately, out of nine private building societies, only five companies have agreed to disclose their conditions to FMH – whether the offers of the other market participants are competitive or not therefore remains speculative, according to FMH. The two winners – Wüstenrot and BHW – are the best in the two loan periods examined.

Regional banks with very good offers

However, property owners who are planning modernization or renovation should also ask traditional banks for a loan offer: they usually offer lower interest rates for modernization loans than for normal installment loans. This is due to the fact that the risk of default is lower, even without land register protection. Anyone who owns a property and invests 30,000 euros for the renovation work will, with an extremely high probability, repay their loan as agreed.

The evaluation by the FMH shows that many regional institutes do very well here if the loan is to be repaid within seven years. The best list is headed by PSD Bank West, PSD Bank Munich and PSD Bank RheinNeckarSaar, alongside Sparda-Bank Hessen and Sparda-Bank Munich.

But the commercial banks Commerzbank and BBBank are also at the forefront.

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