Whether apartment, house, land, etc. – financing a dream home from your own savings is often difficult. In addition, the search for the right product is made more difficult by non-transparent bank conditions and product names.
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The house can be financed in austria from your own funds, at the cost of provincial subsidies, or by financing a bank or building society. The most popular options for austrians to realize their dream home are mortgage and construction loans.
At this point, we would like to give you an overview of the basic costs of a mortgage loan:
- Mortgage security (entry in the land register)
- Loan rates (variable or fixed)
- Possible term up to 40 years
- Currently low interest rates
- Flexible structuring options (special payments, interest limits, repayment refund)
- Depending on the interest rate indicator (usually EURIBOR), the interest rates for mortgage loans are adjusted to the market interest rate every three, six or twelve months.
When comparing mortgage loans in austria, in addition to the additional costs, all of these factors should be considered.
The composition of the monthly payment
The loan rate consists of interest and repayment of the loan amount. At the beginning of the term, the interest rate is of considerable interest. Only over time, the interest rate percentage decreases and the repayment percentage of the loan amount increases. In austria, an insurance system is common where the monthly interest rate remains constant for a period of time until the interest rate changes.
Mortgage and mortgage differences
While a mortgage loan is a bank product, a building society loan is a building society product.
On the other hand there is no upper limit for interest rates. If you wish to receive bank loans with hedged interest rates, this is possible in the form of an additional product. Such a hedge, on the other hand, is automatically provided for housing loans at 6%.
Austrian banks offer longer terms than building societies. Currently, terms of up to 40 years are possible, the maximum term of the construction and loan partnership is 35 years.
Comparison of austrian home loans for buying a home and building a house
Use the comparison calculator to find out how to maximize your mortgage loan and where to get the lowest mortgage rates in austria in 2020.
Or simply enter your projected housing or construction costs and find out what monthly loan payments you should expect at different interest rates on your real estate loan.
Tip: get current construction financing offers from several banks and providers from the expert for construction financing interhyp by filling out our forms!
Mortgage loan calculator for austria
Get an individual loan offer. Free, fast and without obligation!
Comparison of mortgage loans from over 60 banks
Good comparison portals compare offers from over 60 banks for you throughout austria. They compare the mortgage loans offered to get the best loan rates and the best conditions for them. Enter your housing financing needs and your data – then they will provide you with a personalized offer – free of charge!
Tip: request current construction loan offers directly from the expert interhyp using our free form – with free personal advice!
Financing request process
- Find out the amount. Enter the desired loan rate and term into the financial calculator until the desired loan amount is displayed. (the default rate is 3%, so you will have no problems with the interest rates – the real interest rate should be lower)!)
- Enter the details for your financing request [form – step 2]
purchase of real estate, construction, remodeling / repair / conversion, restructuring of an existing loan for real estate; own funds, financing needs, federal land.
- Your contact details and other requests / information [form – step 3]
send them additional information or financing applications and submit your request. You assume no obligations and no costs!
Initial consultation and telephone clarification
The advisors contact you by telephone and clarify all unclear questions about your loan application as well as your goals and wishes. In the contact form you can indicate the best time to reach you.
Personal consultation at your home
Some loan brokers will draw up an individual financing concept for you, without obligation and free of charge, and discuss it with you in a meeting at your home. You risk nothing and it is definitely worth it!
Your loan broker in austria
To compare mortgage loans, most portals work with a team of loan brokers in vienna, lower austria, upper austria, carinthia, styria, burgenland, salzburg, tyrol and vorarlberg. You know the interest rates, terms and conditions and tricks of banks and are therefore able to compare accurately. You compare different offers from banks and agree on the best conditions.
A preliminary analysis of loan brokers also saves the banks a lot of work, and thanks to prepared contracts and standardized processes, the bank's expenses and loan fees, as well as notaries, loan agreements, building accounts, mortgage applications, etc., can be reduced. Further reduced.
In addition, the banks not only know that they are losing the customer with high mortgage rates, but also a large number of builders and home buyers in austria who are looking to compare home loans for the most favorable mortgage rates.
The lending partners usually have many years of business experience and more than 107 million euros in loans. With a mortgage calculator you can also use this experience and knowledge!
What is actually a mortgage loan?
Mortgage loans (also mortgage loans, real estate loans, real estate loans, real estate credit) are the most popular form of real estate financing in the federal republic of austria. Whether you want to buy a house, renovate a house or build your own house and buy suitable real estate.
The word "mortgage" indicates that the housing bank or building society requires a lien on the land or house.
It is registered in most cases in the land register. In the loan agreement, it is important to familiarize yourself with the terms of the property seizure to avoid unpleasant surprises in case of late payment.
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Good loans with the best interest rates
The combination of own funds for financing real estate and the provision of other assets (real estate, shares, company shares, etc.) is a good idea.) as well as possible guarantees of a spouse or relatives in combination with the registration of a mortgage in the land register give the bank the necessary securities for which they are interested and offer you a mortgage loan.
To get a good offer, ideally 15-20% of the financing requirement should be available in the form of own funds.
A good salary or a secure salary of the borrower and the spouse are also very important factors for creditworthiness with the bank. In special cases, equity can also be lower, such as when there are other assets in the form of real estate, bonds, or company stocks and derivatives.
They can also be borrowed if the bank requires it as collateral.
But even with small equity of 5-10% of the property value, there are still good conditions for a mortgage loan or home loan, provided other values are possible, such as income and possibly a guarantor vote.
With no or very little equity, real estate financing is only exceptionally available on good terms. Some government employees are treated better here, in part because their jobs are considered relatively safe there. However, do not hesitate to submit your loan application – the loan brokers will search for the best interest rates and conditions in austria for each loan application!
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Fixed rate or variable rate mortgage loans
The current interest rates for loans are currently more favorable than ever before. The ECB's and EURIBOR's lending rates move along the 0% line, and the banks' spreads usually range between 1% and 2% per year, depending on their creditworthiness.
Interest rates of 4, 5 or 6 % are however historically possible. Therefore, many borrowers provide a fixed-rate loan. However, the bank charges a higher premium than it would if the rate were variable. The longer the fixed interest rate, the higher the premium!
As an alternative to fixed-rate real estate loans, you can also set an upper limit with the bank. This is also a form of insurance if the interest rate exceeds a certain threshold. The higher the interest rate for the cap, the cheaper the premium. In many cases, a secured loan can be a more favorable alternative to a loan with a fixed interest rate. It is worth comparing offers and weighing up your own financial options.
Mortgage loans are compared in austria
The mortgage loan is a very popular and affordable form of financing for mr. And mrs. Austrians. With this type of loan, you can finance large real estate amounts. Currently, an annuity loan, as the mortgage loan is called, is particularly popular because of the very low interest rates.
It should be noted that the terms of a variable-rate mortgage loan may change during the repayment period, which can result in significant additional charges. Now there is also the possibility of fixing the interest rates on loans for the long term. The loan comparison is still worthwhile.
Fee for registration in the cadastral land of a mortgage loan
For a mortgage loan, the bank creates a land register. This land title serves as a lien and is called a mortgage. During registration, an additional guarantee of up to 30% is often introduced. If you make an entry in the land register, it is often possible to make a deal with a bank, which reduces your additional financing costs. For more information, please contact your professional mortgage advisor.
This form of security is necessary in many cases, because the client has to spend too much capital, which is normally not available. Due to the pledge, the bank has the guarantee that the property cannot be sold, transferred or exchanged without the bank's consent to these legal transactions.
Mortgage loans are only permitted for customers with sufficient creditworthiness. Therefore, the income, assets and real estate to be financed are carefully analyzed.
In the case of real estate, the bank first checks the following parameters:
- Purchase price of real estate
- Location of the accommodation
- Year of construction
- Building equipment (garage, elevator, basement, garden, playground, …)
- Equipment of the accommodation (floors, wet rooms, kitchen, heating, …)
- Construction (solid / prefabricated)
- The mirror of the real estate prices: which square meters prices were obtained in the municipality?
- The higher the quality of the property and the better the location, the more favorable the loan will be.
The bank holds the property as collateral and offers low interest rates. Due to the lien, the bank has to raise less capital and can therefore offer a favorable interest rate.
If the borrower does not meet his loan obligations, the bank can enforce and exercise its right of lien. In the case of the so-called foreclosure, very often lower sales prices are achieved. The difference must still be paid by the borrower and therefore represents the most unfavorable situation for this project.
It should therefore be borne in mind that this may lead to a default, as the defaulting borrower still has a debt outstanding, but no longer has the real estate at his disposal. For this reason, we always recommend that, in the worst case, you negotiate with the credit institution about a possible suspension of the loan.
An entry is always made in the land register in the amount of the agreed sum and increased, so that the bank's security can be guaranteed. In addition, the rating is registered in the land register. Usually the bank registers the first category in the land register.
Advantages of a secured loan
With a mortgage loan, you can finance real estate with little capital, since the real estate serves as a guarantee to the bank. With collateral you can negotiate favorable interest rates. The current low-interest phase offers customers the opportunity to save a lot of money with variable interest rates.
In addition, a fixed-rate loan is available for a period of 15 or even 20 years. The advantage of this long fixation is a clear and calculated repayment schedule. There is no danger of interest rates, and therefore loan interest rates, growing overnight compared to variable rate financing.
Variable loans offer the advantage of being able to take full advantage of favorable interest rates during the low interest rate period. In addition, you can repay the loan without any special fees by making special payments. This can be partially combined with a fixed-rate loan.
Favorable mortgage loans can be calculated with an online loan calculator with current low interest rates, and you can get complete and free advice from financing experts. Use this service and save time, money and nerves!
Mortgage loan options
The mortgage loan options are very versatile. The following three options are particularly popular with banks:
For a fixed rate mortgage, the loan term is one to ten years. A special feature is the fixed interest rate. Interest rates remain unchanged for the entire period. Thus, the risk of changes in the value of the loan can be excluded. Due to the low risk, a fixed rate mortgage is considered extremely low. If you want to cancel the contract within the time limit, you will have to pay a fine.
In the second method, variable mortgages, especially borrowers, benefit from lower interest rates. However, the risk is much higher than for a fixed-rate mortgage. Interest rates on loans are based on current market developments and can fall or rise depending on the situation. Among other things, they can buy the so-called interest rate limit. It covers the interest at a certain percentage rate.
The last method – libor mortgage. It moves in a variable and fixed mortgage space. In principle, this is a hybrid of the methods already mentioned, over a period of three to six years. Here, the interest rate is linked to the short-term trend.
The interest cost is made up of the cost of the libor and a fixed surcharge. Surcharge is often understood as margin and varies from bank to bank.
The type of mortgage you choose will ultimately depend on your personal situation. Security plays an important role for many. Previously, libor mortgage loans were considered particularly attractive and favorable. In the meantime, the values have increased by several percentage points. Borrowers should react to interest rate changes as quickly as possible so that they can pay off their debt without delay.
A libor loan or a variable mortgage is suitable for people who can count on a high cash flow over the term of the loan. Otherwise, the choice should be a fixed mortgage. Although the interest may increase over time, risks are avoided.
How to find a good mortgage loan?
There are several ways to find a favorable loan. The most common way is to run to the house bank. In addition, there are independent credit counselors. Advisors have the distinct advantage of being able to filter out the right offer because they are not bound to anything. By the way, he has a lot of experience and know-how and knows what is important.
Thanks to contacts and expert knowledge, he quickly finds the right loan. However, a private bank can only offer its own product. There are many comparison platforms on the internet that give a good overview.
Tips and tricks for a better credit interview
During the interview, all questions that concern you should be answered. To get good conditions, a good impression from alpha to omega is necessary. Appropriate and convincing arguments can lead to better conditions. They must be carefully prepared before the interview. The following points can play a role in the conversation:
- Sufficient capital: if you have more than 20 percent of your equity, you can hope for better conditions. Ultimately, the risk for the lender is reduced.
- Additional collateral: additional money in a bank account or life insurance policy shows the lender that sufficient collateral is available.
- Counteroffer: an offer can be made to the bank to obtain the best conditions. For example, transferring a securities account to the provider's account.
Once a decision is made, it comes to the conclusion. This includes items such as address, name, expiration date, type of loan, fees, terms and other elements.
Mortgage loans are suitable for securing a loan. It is registered in the land register to ensure the security of the lender. The loan has proven itself for a period of 20 to 30 years and offers various loan options. Fixed mortgages, variable mortgages and mortgages on the libor could turn out to be effective.