Mortgages in Germany

For Russian citizens, the purchase of real estate in Germany is attractive due to its geographical proximity, optimal transport links, the presence of a large Russian diaspora, a developed network of Russian-speaking enterprises and businesses, as well as a high standard of living. According to experts, buying real estate with a mortgage in Germany is now more than ever profitable not only for local residents, but also for foreign citizens. The demand for the purchase of real estate using a mortgage is growing due to a combination of low interest rates, the possibility of early repayment in some cases of lending, as well as various options for refinancing a loan through other banks. Experts believe that in Germany, especially in Berlin , real estate is undervalued. Now its value is constantly growing and, according to forecasts, prices will rise further, so investing in the German real estate market is now quite profitable. A mortgage in Germany can be obtained for projects under construction, for commercial or residential real estate. As for residential real estate, now finding an object for rent is an optional condition. If the bank agrees to issue a mortgage on the constructed commercial or residential real estate, the entire amount is issued to the borrower immediately. Funds are allocated for the facilities under construction in stages, that is, when the foundation is laid, one part of the loan is issued, to complete the construction of the main part of the building and the roof - the next part of the loan, and when the finishing is carried out - the last part of the loan is paid.

Mortgages in Germany for foreigners

Recently, the procedure for obtaining a mortgage for non-residents in some banks in Germany has become somewhat complicated. This is due to several reasons. First of all, this is an increase in demand for mortgages from residents of Germany. The increase in rental rates for housing and the low interest on mortgages stimulate the indigenous people of Germany to purchase their own homes. Since Russia is not part of a single European space, there are no specific documentation standards. Therefore, it is sometimes rather difficult to compare Russian documents with German standard papers. In addition, it is problematic to assess the solvency of a borrower who is not in Germany or in the European Union. That is why for some banks a prerequisite for financing is the presence of a residence permit - a permit for an indefinite stay in Germany (unbefristete Aufenthaltserlaubnis). The lack of such permission can become the main restriction on obtaining a mortgage for non-residents. There are banks that specialize in lending specifically to Russian-speaking clients. In such banks, a residence permit is not required. For non-residents, it is recommended to have an initial payment of 50%, the higher the amount of the initial payment, the more favorable the conditions for the borrower. The interest rate on the loan will be 3-5%, the minimum amount of financing is from 50,000 euros. This means that the object must cost at least approximately 100,000 euros. It should be remembered that the conditions for all German banks are different - some can issue a loan without a residence permit, but from 50,000 euros, while others are considering the possibility of lending in the presence of a residence permit already from the amount of 25,000 euros. When buying real estate in Germany, Russian buyers can take out a mortgage only from banks in Germany. Exceptions are when the buyer is a customer of a German bank branch. Then you need to find out the conditions for issuing a loan at a branch of this bank and, perhaps, the buyer will be able to get a loan without leaving the country.

General requirements of banks and terms for making a decision

After choosing a property, all the necessary documents are submitted to the bank and the notary. It is necessary to find out in advance the conditions for each specific application in several banks so that the borrower can choose the most optimal conditions. Obtaining a mortgage is considered in each case individually. However, there are general requirements that the large banks in Germany adhere to. It should be noted that the requirements of banks of different federal states may differ slightly. There are two categories of loan recipients: private and legal. Given the specifics of each category, the requirements for them differ. To apply for a loan from a private person , the following documents are required: - foreign passport; - confirmation of receipt of salary (documents confirming this from the bank for the last three months are required); - certificate from the place of work on the amount of salary for the last three months; - the latest income tax return; - data about the object (description). If the acquired property is leased, then 75% of the cold lease (Kaltmiete) is added to salary or income. (Cold rent is what the owner receives from the tenant for living in his apartment, but this is not net income, since the landlord still pays a certain amount for the services of the manager, etc.) The legal entity must provide the bank with: - balance sheet over the past two years; - the last tax return; - business valuation for the current date - production and economic analysis (Betriebswirtschaftliche Auswertung, abbreviated BWA); - data about the object (description). It is preferable that the borrower's annual income is from 20,000 euros per year, that is, from about 1,500 euros per month. The minimum amount of a mortgage loan in some German banks is from 25,000 euros. Monthly installments on the loan are transferred to a special bank account, which will be opened specifically for the borrower. Bank and account details are specified in the loan agreement. At the same time, monthly payments on a loan should not exceed 35% of the borrower's monthly income. Consideration of a loan decision takes approximately two weeks, in some cases - less than two weeks.

Additional costs when buying real estate

When buying real estate in Germany, the following additional costs are paid: - Real estate acquisition tax (Grunderwerbsteuer) in each federal state is different and varies from 3.5% to 5% of the value of the object; - Realtor's commission (Maklercourtage) - from 3.57% to 7.14% of the property value; - Notary fee (Notarkosten) - about 1.5% of the value of the object. It should be noted that these costs are not funded by the bank, that is, if the bank agrees to issue a loan, the buyer pays these costs himself. Many German banks make their own appraisal of a property worth up to 500,000 euros. If you need to appraise real estate worth more than 500,000 euros, then an appraiser is involved, and the cost of his services in this case will average 300-600 euros. Alena Stolze, CEO of West Realtor West Realtor is a real estate agency in Germany specializing in the sale of residential and commercial real estate. Provides a full range of services for the acquisition of real estate in Germany, including with the involvement of mortgage lending. HomesOverseas.ru