As the owner of a house or condominium, you want to convert or modernize it sooner or later. There are always reasons for this, it is enough if you are expecting children and want to expand the attic in order to gain another room. Or the heating system is a bit older and you want to bring it up to date with the latest technology.
Then most of the time you can’t get around a loan for the conversion, since you are probably not one of the people who have a lot of money in the account or the savings book. After all, the renovation or modernization is expected to result in high costs that are hardly manageable without a loan. Then you can only consider a loan so that you can implement the value-adding measures.
Loan for remodeling is granted quite quickly and easily
If you have a loan for the renovation or modernization of your property, you can obtain a so-called modernization loan from the bank. This is given out by the banks quite unbureaucratically, for which it has a shorter term than mortgage lending. This is only possible from a sum of 50,000 dollars. For the application, you usually only need the last 3 salary slips and an adequate credit rating. The loan is granted promptly, so that you can dispose of this money more quickly than with mortgage lending.
The term of the loan is quite flexible, you can inform the bank of your desired term so that you will not have a high monthly repayment burden. You not only benefit from the low interest rates that you receive from 5 percent. Rather, you also increase the value of your house or condominium by converting or modernizing. A conversion is therefore a value-adding measure from which you benefit twice.
Credit-related interest rate on the loan for the renovation
If you choose a loan for your renovation, you can get this loan with a term of 12 months. The term of course also depends on the amount you need for the planned conversion. If you need a sum of 3,000.00 dollars, a short term also makes more sense than a relatively long term of up to 120 months, which are more for sums from 10,000 dollars.
The interest rate at almost all banks depends on creditworthiness and income. A good credit rating is a basic requirement for this loan. In addition to the creditworthiness, your monthly income also plays an important role in the calculation of the loan. After all, the bank has less risk with a high monthly incoming money than with a rather low income. However, if you still have to pay off a loan, it is usually worth applying for an increase in the loan.
The banks also check whether you own the property you want to convert or modernize. This is very important for a loan because it also gives you a lower interest rate than if you rented out the property again. You can apply for the loan yourself at the bank’s branch or online. Only the original salary slips are required by the banks in order to ensure adequate repayment.