How to get a mortgage in Germany for a Russian citizen
Real estate prices in Germany are steadily increasing. Germans can get mortgages at an interest rate that is ten times less than in Russia. Currently, an average interest rate in Germany is 1.5%.
The rate ranges from 0.9 to 1.8%, for 5-35 years, the down payment is from 25 to 45% (it mainly depends on a type of an object). Kaiser Estate agency is cooperating with Deutsche Bank, Commerzbank, and Hypovereinsbank (UniCredit).
If an applicant for a residence permit in Germany or for German citizenship has a mortgaged property, then this fact will speed up the process of obtaining the documents. To increase the likelihood of a mortgage application approval, it is recommended to consult professionals who will help to prepare the entire package of documents.
To get a German mortgage, a Russian citizen needs to start a company, find a suitable object, sign a contract. They will also have to pay 1.5% of a chosen real estate price and present an international passport.
For example, the profitability of a chosen property is 6% per annum. A mortgage will cost 2% per annum. The rest 4% is a kind of a financial instrument. Most Germans also take advantage of this opportunity, buying apartments and houses by instalment not only for personal use but also for earning money from leasing real estate.
There is another option of getting income from a mortgaged property in Germany: if you already have an apartment or a house, then you can take another object on the security of this property. Let’s say you own an apartment worth €500 thousand. Mortgaging it, you can get another apartment of the same price. Both properties will be on bail for 50%. This scheme is an excellent investment tool for increasing assets and providing heirs with housing.
A chart below shows the development of mortgage rates in Germany over the past twenty-odd years, since 1994.