The latest developments on the interest rate market arouse incredulous amazement even among proven experts. Anyone who can should therefore seek the greatest possible security for (follow-up) financing for real estate – the best way is with a full repayment loan, advise the experts at FMH.
It was to be expected that after years of low and negative interest rates things would pick up again at some point. However, it was not foreseeable at what rate construction financing would become more expensive. This becomes particularly clear with the example of full repayment loans.
These loans offer customers maximum security, since the entire (residual) debt is paid off during the term of the loan. Customers therefore do not have to worry about any jumps in interest rates in the future, but retain the conditions once agreed for the entire term.
On behalf of ntv, FMH-Finanzberatung has researched which providers are currently offering the best full repayment loans for construction financing – for terms of 30, 20, 15 and 10 years. The results are ambiguous.
There are still a number of very good providers in this area. However, the rates of the frontrunners have increased by a whole 40 percent compared to the previous year’s ranking, with the same loan amount and the same property value. Since the beginning of the year, interest rates have shot up from an average of 1.25 to more than 4 percent for 15 years. And there is no end in sight to this development.
Against this background, everyone who needs financing and can afford it should think about a full repayment loan.
Let’s assume that a buyer financed ten years ago with a ten-year fixed interest rate. The house cost 350,000 euros. He received his loan of 280,000 euros at an effective interest rate of 2.8 percent and 2 percent repayment. He paid about 1150 euros per month for this. Follow-up financing for the remaining debt of EUR 215,000 is now pending.
If our customer relies on a full repayment loan from the best provider in comparison, he is currently paying an impressive 3.77 percent interest over a period of 20 years. However, the monthly rate of 1250 euros is only slightly higher than before – and the customer can be sure that he will be debt-free after the term has expired without any interest rate risk. An important point. Because currently nobody knows how long and how high interest rates will continue to rise.
A good full repayment loan should not only be as cheap as possible, but also offer customers the greatest possible flexibility. The comparison of the best offers therefore also includes whether a bank allows special repayment options and the possibility of changing the repayment. These flexible options are possible again today because only very few banks still grant a discount for full eradication. However, a large mortgage bank even charges a surcharge if a customer wants this security option of full repayment.
For customers who want to take out a full repayment loan as follow-up financing (or are extremely well-heeled), FMH has also researched the best full repayment loans for the different terms.
Allianz, Santander, BBBank eG and Sparda-Bank West occupy the top spots among nationwide providers for a ten-year term. They all offer very good full repayment loans in this segment. Among the regional banks, PSD-Bank Munich, PSD Bank RheinNeckarSaar, Sparda-Bank Hessen and also VR Bank Dreieich-Offenbach received the best rating.
At 15 years, Allianz, PSD Bank Nuremberg and Sparda-Bank West make it onto the podium. The same applies to Sparda-Bank BW and Sparda-Bank Hessen, Sparkasse Fürstenfeldbruck and VR Bank Dreieich-Offenbach.
Customers who want to take out a full repayment loan for 20 years will find the best offers at Allianz and PSD Bank Nürnberg. Regionally, the two Stuttgart banks are recommended: PSD Bank RheinNeckarSaar and Sparda-Bank BW.
Anyone who needs planning security for three decades can contact Allianz again or use the nationwide offer of the HypoVereinsbank.
If you are looking for the best Volltilger offers for your project, you will find them individually in the ntv Baugeld comparison.
