New cars in particular, but also good used cars, are so expensive that financing is being considered. According to statistics, more than half of the new cars are financed. The costs should not be underestimated. It is often not considered, especially when a later construction financing is due, that hundreds of USD often have to be paid in installments.
Most borrowers have no problem paying for the financing of their car. But if the dream of owning a home comes up, things look different. High credit rates to be paid for a car could then burst the dream of owning a home. Real estate financing can only succeed if the borrower can pay both installments.
Car loan despite mortgage lending – plan carefully
The impact of two loans on the monthly budget should not be underestimated. Under certain circumstances, the household bill may not allow mortgage lending. Banks examine the customer’s financial situation very carefully. This enables them to determine whether additional real estate financing can be paid at all.
By the way, you can not drop the car financing under the table. On the one hand, information must be provided correctly when applying for building finance, and on the other hand, the car loan entered there is made visible by the credit bureau query.
Therefore, people who are planning to finance the construction should not buy an expensive car. At least it should be checked whether an additional loan can then be paid.
Car loan despite construction financing – what is the financing like?
Many consumers are wondering what to do to get mortgage lending even though a car loan already exists. In general there is to say that a mortgage is cheaper than a car loan.
The reason is to be found in the pledge that the bank receives with a property or a home. Also with regard to the long term of mortgage lending and the resulting increased interest income, it is a worthwhile thing for the bank to reward it with low interest.
But what if the building finance has to be financed over 100% or even 140-150%. At first glance, this may seem strange and many experts advise against taking out another loan.
Car loan despite mortgage lending – prerequisites
A new mortgage loan can make sense, especially when interest rates are low. For example, one can assume that the car loan has a remaining amount of 5000 USD. The real estate loan has a remaining amount of 50,000 USD. The current value of the car is set at 15,000 USD and the property is worth 75,000 USD.
This creates the case that both loans offer higher collateral than the outstanding balance. So there can be banks that take the debt – car loan and mortgage lending. finance together.
The deposit she has has more value and she gets her money back in an emergency sale. If there is still income from two secure salaries and there is a profession that has a future and a rate that covers the repayment and the interest on the building loan can also be paid, the bank can definitely agree to a new construction loan.
Car loan despite mortgage lending – which way is the right one?
Bringing a car loan and a home loan under one roof is not easy. It is possible to take out a car loan and construction finance separately.
But then there must be the possibility that both credit installments can be paid, which requires a good credit rating. A building loan often has a term of up to 30 years. Of course, other investments are also made during this time. A new car can also be part of these purchases. Borrowers then have the option of financing the car from the dealer or opting for a bank.
In order to find the best possible loan that can also be paid with a mortgage, a loan comparison should be made.
Car loan despite mortgage lending – loan comparison paves the way
In general, a loan comparison is not just about cheap financing. The framework must match the borrower. The focus should not only be on the interest rate, but also on additional benefits. These can be free special repayments or installment breaks.
A change in the loan rate during the term is also part of a cheap and flexible car loan. But it should also be important that a loan can possibly be increased. There can always be financial bottlenecks that require a few thousand USD. Basically, the whole package of the loan should suit the borrower. If everything has been taken into account, such as adjusting the installment payment to income, a loan will not pose any problems either.
What requirements should the borrower have?
Anyone who applies for a loan must of course have the necessary prerequisites. This includes sufficient income that can pay for both a car loan and construction finance. The income should have a garnishable share. With a car loan despite mortgage lending, banks like to see a second
Applicant joins the loan agreement. Both people secure the loans, which can cause the bank to provide favorable terms.
In addition to income, permanent employment should be guaranteed, it must not have a fixed-term job or a trial period. The unencumbered credit bureau is very important and must not have any negative entries. The borrower should check their income and expenditure against each other using a household account. Ideally, there is a surplus so that a car loan is not a problem despite building finance.