Low-interest rates back up early: real estate loans

Connection loans for home financing, there is currently very low cost. With the right offer over 10,000 euros can be saved. Even if you need to connect credit only in a few years, can secure low-interest rates now.

Homeowners can make crisis-proof by until full repayment of its loan to commit low interest financing their connection now. The peak offers the effective interest rate for a 100,000-euro loan with ten years fixed interest rate currently stands at less than 4 percent a year.

Owners who need their connection credit for another few years, low-interest rates can book at many banks with a lead time of up to five years – with so-called forward loans. This costs a premium. Who then a fixed rate until full repayment of the loan agreement, is a protected once and for all against rising interest rates.

The financial test has compared the rates of 62 providers of interest-secure connection loans and forward loans. The loan amount of the model case was 100,000 euros. As the interest rate should be fixed once and for all, which rates are calculated so that the credit at the end of the fixed interest rate of 10, 15, or 20 years has been repaid. The longer the fixed interest rates and the lead time, the more expensive the connection credit.

There are huge differences between the offers: For a secure interest forward loans with three years lead time and 15 years interest rates, the distance between most favorable and most expensive offer for the entire term of a whopping 10,600 euros. therefore worth comparing. Credit intermediaries as Interhyp and Accedo, but also direct banks as Comdirect or Cortal Consors currently offer peak rates. Regional banks like the Sparda banks Nuremberg and West, as well as the PSD Koblenz, are for loans with fixed interest rate with ten years ahead.

Forward loans cost more

Compared to loans that are paid immediately, borrowers have to pay an interest premium for the forward loans – the longer the lead time, the higher the premium. Costs forward loans with ten years fixed interest rate and a lead time of one year on average been 0.22 percentage points, the impact already increased at an interval of four years to an average of 1.04 percentage points. So much the interest on conventional connector loans must rise first so that the forward loans still worthwhile.

Forward loans with an exit right

Basically, borrowers need to remove a forward loan at the agreed interest rate. Are interest rates now fallen, they are left with an expensive loan. However, help forward loans with a cancellation option.

The security comes at a price. To the usual forward pictures is a supplement of 0.3 to 0.5 percentage points for redemption rights. Good flexibility is the offer of the insurer Swiss Life. The customer can pay back the loan for the next quarter. He has to call, do not pay prepayment penalty and did not even notice any reasons. Slightly cheaper, but less flexible, the callable forward loans Volksbank Dusseldorf Neuss.

Offers. Always bring several deals on the follow-up financing one – even if you want to stay with your old bank. Many institutes speculate on the fear of their existing customers to change banks and offer initially on rather bad terms for the follow-up financing. Put in this case your old lender a cheaper deal of competition on the table. Maybe it makes you a better deal then.

Bank drafts. Do not hold by allegedly high switching costs by switching to a cheaper bank. The transfer of the mortgage on the new bank usually costs no more than 0.3 percent of the loan amount. Then, the change worth it when the new bank is one-tenth of a percentage point cheaper. Sometimes even the new bank will replace the cost of the mortgage transfer.

Deployment. Does the fixed interest rate of your loan off within a year, you may not need a forward loan. You can also enter a normal loan that you only get the end of the fixed interest rate of your old loan. Many banks waive until then with the usual commitment interest, some even up to a period of 13 months. The fixed interest rate begins to contract even when you get the loan until a year later.

Connection loan. If the fixed interest rate of your loan ends only in the next few years, you can secure low-interest loans with a forward now. Advantage: to protect yourself from a possible rise in interest rates. Disadvantage: If rates fall, you are stuck with an expensive loan.

Repayment option. They want to protect against both rising and falling interest rates so? Then connect loans are ideal, you can cancel at an interest rate premium in the short term. If interest rates go down, you can refinance to a more favorable loan.

Debt restructuring. As an alternative to forwarding loans, you can refinance immediately. They take on a new loan that allows you to replace the old ones. Problem: the old Bank of redemption must agree before the end of the fixed interest rate. They can usually only if you pay a prepayment penalty, and to sign a new loan agreement with her. Then the debt restructuring is no longer worth the most.

Fixed interest rate. Calculate the Excel computer fixed interest rate, which fixed interest rates is favorable for you. A long fixed interest rate of 15 or 20 years is more secure because of the interest premium for the longer duration but usually more expensive than a loan with a shorter fixed interest rate.