0,01% Mortgage From German KfW Bank For Energy-Efficient Properties
In this blog post, we are explaining in detail how you can secure the 150.000€ mortgage with a 0,01% interest rate from KfW and how it will help you when buying or building a property here in Germany.
Key Takeaways
- KFW is the credit institution for reconstruction. It was founded by the German government and supports real estate, for example.
- Everyone can apply for the KFW mortgage, but there are certain criteria that your property must meet in order to get the loan.
- In order to secure the 0,01% mortgage rate, there are two options for residential buildings and non-residential buildings to consider.
- Your exact profit from KfW financing depends on the energy efficiency of the building and also on your individual financial situation.
- The KfW mortgage will help higher earners by lowering their interest rates. It will hardly help families with average incomes.
Introduction: 0,01% mortgage from KfW bank
Are you dreaming of owning a property in Germany? Imagine securing a 150.000€ mortgage with an unbelievably low 0,01% interest rate. It may sound too good to be true, but it’s possible with the KfW mortgage program. In this comprehensive guide, we’ll delve into the details of this remarkable opportunity and show you how you can benefit from it. In particular, we will explain the following:
- Why is KfW giving out free money?
- Who can get a 150.000€ mortgage?
- How can you get 0,01% interest?
- What’s your exact profit?
- Will this mortgage actually help you?
Why Is KfW Giving Out Basically Free Money?
KFW, short for “Kreditanstalt für Wiederaufbau“, is the credit institute for reconstruction established by the German government after World War II. Today, we’ll focus on their largest business segment, which involves providing subsidies and highly affordable mortgages for energy-efficient and sustainable buildings.
The new KfW program we’re discussing is part of the German government’s climate protection act, highlighting its ongoing commitment to fostering environmentally friendly initiatives. Interestingly, the previous KfW program gained immense popularity and was abruptly discontinued after distributing a staggering 14.2 billion in subsidies. Given that the current KfW program has a budget of 750 million, it’s crucial to act swiftly when submitting your application to secure your spot.
Who Can Get A 150.000€ Mortgage From KfW?
Are you wondering how to obtain a virtually free 150.000€ mortgage with a 0.01% interest rate? The process involves applying for a KfW mortgage through either yourself or your mortgage broker. While it may sound straightforward, there are specific criteria that your property must meet. The great news is that anyone can apply for the KfW mortgage, regardless of whether you’re a future homeowner or a real estate investor.
At our Marketplace, we’re actively applying for KfW mortgages for the properties we offer, ensuring that investors can also benefit from reduced mortgage interest rates. If you’re unable to apply directly with your property, we invite you to explore the properties listed on our website to maximize your returns through the subsidy.
To qualify for the KfW mortgage, your property needs to comply with the energy standard EH40. This means that your property should have only 40% of the primary energy consumption compared to the reference property outlined in the German Building Energy Act. Meeting the EH40 standard makes you eligible for a 100.000€ mortgage from KfW. Moreover, if your property also receives the QNG quality label for Sustainable Building, you can secure a 150.000€ mortgage from KfW. While the terminology may seem unfamiliar, your architect or property developer can provide detailed information on whether your property fulfills these requirements. Be assured, our focus is on sustainable properties that align with these standards.
Remember, understanding the eligibility criteria and the benefits of a KfW mortgage is essential to make the most of this opportunity. By securing a mortgage with favorable terms and reduced interest rates, you can significantly enhance your investment returns. Act now to explore sustainable properties and seize the potential advantages offered by the KfW mortgage program.
You can invest in our Real Estate Security Tokens while building capital to buy a property. Our property development tokens usually have a short run time and give you both a nice interest rate and profit share
How Can You Secure 0,01% Mortgage Rate From KfW?
Let’s uncover the details of obtaining a KfW mortgage. Now, you might be wondering about the interest rate and how to secure a mortgage rate as low as 0.01%, essentially free money. There are two options to consider.
- Firstly, for residential buildings, everyone is eligible for the 0.01% mortgage rate, regardless of risk or personal financial situation. It’s truly remarkable when you think about it. The only requirement is a fixed interest rate for a duration of 10 years. This opportunity is simply incredible.
- Secondly, for non-residential buildings, the interest rate varies based on your risk classification, and the fixed interest rate period is five years. It’s evident that the government aims to support the construction of more living spaces, a pressing need at present. We discussed this topic in a recent article.
It’s important to note that KfW recalculates the interest rate nearly every day, so the exact rate may differ from the time you read this article. To stay updated, here is a link to the currently valid KfW interest rate. This ensures you have the most accurate information to guide your decision-making process.
What Is Your Exact Profit From This KfW Mortgage?
Are you interested in the possibility of obtaining 150.000€ practically for free? However, this amount alone may not be sufficient to purchase or construct a property or apartment in Germany. So, let’s delve into how much you can genuinely benefit from the KfW mortgage program. Let’s assume you have a property in mind valued at 500.000€. Due to the specific energy standards required to qualify for a KfW mortgage, your property may cost slightly more—let’s say 550.000€ as an illustrative example. Please note that the figures mentioned here are purely for demonstration purposes to help you understand the potential impact of a KfW mortgage on your personal circumstances.
To acquire the property, you’ll require a regular mortgage of 400.000€, which typically carries an interest rate of around four percent in today’s market (May 2023). Depending on your financial situation and the property itself, you might secure a slightly lower rate, perhaps 3,8 or 3,9%. For the remaining 150.000€, you can benefit from the KfW mortgage with a 0.01% interest rate, or let’s assume it’s zero percent for this example.
Considering the scenario outlined above, a standard mortgage would entail a mixed interest rate of 2,91%. This would require a monthly mortgage payment of 2.250€ to the bank. However, with the KfW mortgage, your interest rate is significantly lower, resulting in savings of 500€ per month compared to a flat interest rate of four percent. Over the fixed 10-year interest period of your KfW mortgage, the accumulated savings in interest amount to over 48.000€. That is undeniably a considerable amount of money.
How Will The KfW Mortgage Help You?
The new KfW mortgage appears to be a great opportunity for aspiring property buyers and builders in Germany. However, the effectiveness of the assistance for the individual ultimately depends on the individual financial situation. We have doubts about whether the KfW mortgage will truly benefit the intended target audience. In recent years, skyrocketing property prices and mortgage rates have increasingly excluded average earners from the real estate market.
While saving 500€, as demonstrated in our earlier example, is certainly advantageous, it falls short of addressing the core issue faced by average-income families—difficulty in securing a mortgage and affording a home. This program primarily benefits above-average and high earners who are already capable of purchasing property, with or without the assistance of KfW. It’s worth noting that KfW is reportedly developing a new program aimed at families with children and a maximum household income of 60.000€ per year. However, even with an attractive interest rate, it remains unlikely that a family earning a maximum of 60.000€ annually would be able to afford a property in most parts of Germany.
If the objective is to assist average earners in acquiring property, alternative measures might be more effective. For instance, abolishing the ground purchasing tax could be considered. This tax, amounting to up to 6.5% of the property value, requires individuals to pay taxes on money they have already been taxed on. It seems unreasonable to subject individuals to double taxation on the funds used for property purchases.
Nevertheless, we hope that the new KfW mortgage proves helpful to those seeking to buy property in Germany. Happy investing to everyone!
Conclusion
The opportunity to secure a 150.000€ mortgage with a 0,01% interest rate from KfW is an incredible chance for aspiring property owners and investors. While it may seem too good to pass up, it’s important to assess how it aligns with your personal financial situation and real estate goals. The KfW mortgage program primarily benefits above-average and high earners. However, keep an eye out for future programs that may cater to average earners in their quest to enter the real estate market.
Remember, the clock is ticking, and the availability of funds for the KfW mortgage program is limited. Don’t miss out on this exceptional opportunity to secure your dream property with an unprecedentedly low-interest rate. Visit our website germanreal.estate to explore the properties listed on our marketplace and take the first step towards profiting from reduced mortgage interest rates.
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