It is more difficult for pensioners to get a home loan than for employees. The problem with this is that the lending bank assumes that it will not receive sufficient collateral or a collateral for the loan.
How do seniors get credit anyway? Are there any special points that you, as a pensioner, should pay attention to before completing the construction loan?
Creditworthiness often did not give pensioners approval for the building loan. In the meantime, a change of course is at least partially indicated. If the general conditions are right, banks will definitely lend money to senior citizens as a home loan.
Securing building money has to plan very carefully.
Capital contracts are often due before retirement. These can be used as repayments. Banks offer final loans for which there is no repayment during the term.
Instead, the home loan is simply replaced with the life insurance. Another option – especially with a higher equity ratio – would be short-term mortgage lending. For example, ten years is enough to return 100,000 USD to 3.50 percent (effective) in monthly installments of just under 990 USD.
- It does not always have to be a house loan from the house bank. Today, support programs offer support in realizing the dream of owning a home.
A home loan for pensioners is possible today. Due to the special circumstances in life, it is advisable to think before the first consultation, such as how the project is to be financed – and how to make the bank aware of the fact that the mortgage is sufficient.
Interim financing, a model in which the bank grants a cheap loan over a few years.
The special thing about this: there is no monthly repayment and at the end of the term the costs are charged in one fell swoop.
Of course, this model is only worthwhile for retirees who already own a property and can sell it after moving without stress or time pressure. So you get money, you can buy or build the new property, move in peace, then look for a buyer for the old property without pressure and then finally trigger the loan.
The construction loan for pensioners: the process of a new home
- take out a short-term loan (up to 2 years) via interim financing
- build new property
- Selling the old apartment / house
- Pay off the loan
Interim financing: a suitable building loan for pensioners?
With interim financing, pensioners become very liquid for a short time and can build and move into their new home in peace. Of course you need a value that you can sell to redeem the loan.
- The interim financing is only suitable as a ‘building loan’ for people who already own a property of the same value as the loan