When taking out a mortgage loan at a financial institution, certain conditions apply which must be met by the mortgage borrower. One of these concerns the ratio of the customer's own resources to the purchase price of the property. This ratio is called loan-to-value ratio. Usually, at least 20% of the purchase price of the property must be borne by the customer. This means that financial institutions only grant mortgages covering a maximum of 80% of the value of the property, or in other words, the loan-to-value ratio may not exceed 80%. However, this maximum value requires the inclusion of two mortgages: the first mortgage usually covers 65%, while the second mortgage covers the remaining 15%. For persons over 65 years of age, the upper limit of the loan is normally only 65%.
Own funds of the mortgage borrower: these are funds that can be used to finance the property. Such funds include the following sources: savings (eg. bank accounts), sale of securities, inheritance advance, private loans and withdrawal of funds from pillar 3a. Funds from the sources listed are referred to as "real own funds". These must cover at least 10% of the purchase price. The other half of the own funds required may be financed through a pledge or advance withdrawal of pension funds for self-inhabited residential properties.
With our loan-to-value calculator, you only need to enter the value of your dream property and your own resources, and you will find out whether your loan-to-value ratio meets the requirements of mortgage lenders. For a detailed all-round consultation on your mortgage, it is worthwhile to arrange a personal advisory meeting in one of our branches. Our experienced advisors will find the best solution from the offerings of more than 100 providers and define, together with you, the optimal financing strategy for your individual situation. If you would like to benefit from professional, independent mortgage advice, please do not hesitate to contact us! Request advice now.