Financing Conversion: How Home Owners Choose the Right Loan

It’s nice to have your own home. But even if it is the personal dream house and it seems to be perfect, it is only a matter of time until a change is pending.

It can take many years for this wish to come up. But he comes – the reasons can be many. For example, it is not uncommon for owners to change their usage over time. The children are out of the house, suddenly there is more space available. Or it behaves the other way around: one of the children decides to permanently inhabit part of the building. Others want to rebuild their own home in an age appropriate manner to be able to permanently inhabit it.

No matter what the real reason is, all planned renovation projects have one thing in common, namely high costs. Mostly it is important to invest sums. For example, if you want to expand the attic and expand it with dormer windows, you’ll end up in the six-digit cost range. Even smaller projects can easily cost 50,000 euros or more.

Given such high conversion costs, it is not surprising that many owners are looking for financing. However, they like to make mistakes that sometimes cost them dearly. For those who want to finance a conversion, we have collected important tips below.


Real estate loan or installment loan?

nstallment loan?

A very important point is the choice of the right loan. Essentially, a distinction must be made between real estate loans (collateralised over land charges) and installment loans (eg as modernization loans). Which type of loan is better, can not say flat rate. Above all, the required loan amount and the expected duration of financing decide about it.

Classic real estate loans are especially convincing in the interest rate. It attracts excellent conditions, with the collateral over land charges, of course, is a prerequisite. In addition, most banks give real estate loans for a conversion only from a loan amount of 50,000 euros. Smaller measures can not or are difficult to finance this way.

The installment credit in turn scores on the loan amount. Smaller renovation projects can be well financed with him. Especially since the conditions have improved significantly in recent years. There are now several installment loans that are ideal for modernization and renovation projects.


Compare conditions online

loan types

It is not enough to choose one of the two loan types. Both the real estate loans and the installment loans, the interest rate differences are large. Many banks are active in the market and stir loudly in the advertising drum. But no homeowner should blindly trust the advertising promises of the banks.

If you want to finance your conversion with low interest, you can not avoid a comparison. Only with a closer look at different loan offers can one say, where the best conditions and thus also the lowest interest rates for the financing lure. But do not worry, finding the right loan is easy. Our independent property financing specialists are at your disposal. A request is of course without obligation and free of charge.


Who will be the borrower?

Who will be the borrower?

Another aspect that is important in many renovation projects, but is often hidden, is the responsibility over the loan. This topic is always relevant if homeowners do not rebuild their property for themselves. If, for example, one of the children wishes to move in, the question must be asked as to who pays the installments and is liable for the loan.

At the same time, it is also necessary to clarify the ownership situation. Assuming one of the children finances the conversion – is he then also a part of the property? All these questions should be clarified in advance, so that it does not come later to unnecessary disputes.

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