Mortgage lending: shorten the repayment period with funds

A lifetime to pay for your own house? With the right strategy that is not necessary.

Despite the stock market turmoil: the number of shares fans in Germany is increasing. Not without reason, because even if prices have not just given last year to cheer about: the long term is likely to continue to bring the best returns shares. One result: more and more homeowners and real estate investors build mutual funds into their financial strategies.

How it works: Instead repay the bank loans as in the traditional financing, this rate is applied either entirely or partially in good equity funds. Such savings plans offer almost all investment companies, cheaper is via a direct bank, which calls for significantly lower sales load, usually. The in funds accumulated assets are returned in its entirety to the lending bank to repay the loan according to an agreed maturity. Due to this delay function of this model is therefore also known as amortization exposure to mutual funds or savings fund.

Four Realty Fund financing

Not every fund company

One advantage of this approach: who, whether home or rental property finances its property, including through mutual funds, can be relatively quickly debt. At least earlier than with conventional credit strategies in which a bank mortgage is repaid to speak at a snail’s pace. Since it usually takes around 30 years to repay the loan last mark. With a good fund is to create circumstances after 15 or 20 years.

But not for long, each Fund is as a vehicle for the construction financing in question. Either because some funds are too risky, others throw off too little return. Walter Stern, investment advisors at financial groups Nowinta from Aalen, therefore, recommends principle ” default funds in which the shares are exclusively composed of large companies.”

Not underestimate risks

the risks investment funds, in general, should once recover now, can not be neglected from sheer anticipation for the early repayment. Therefore, a kind of return and risk-check should be only the beginning. Especially if investors or lenders rely exclusively on equity funds.

Before the future Property owners So opt for the fund financing, it should look carefully and analyze its fund Favorites carefully. Who does not want to do it yourself, can prefer brings different offers from banks and independent financial service providers to be able to compare.

The most important requirement: The return opportunities should be maximized. In any case, higher than the interest rate the bank loans. Second Default: While some risks in the equity investment are simply not ruled out in principle. But precisely because these should remain calculable. Therefore, stay away from extremely risky stock funds, for example, where the money is invested exclusively in companies in the high-tech industry or from so-called emerging markets. Which are maximum suitable for real estate finance as a smaller part of an overall strategy?

Against too high expectations but was warned. For while equity funds are all long-term experience, the most attractive form of investment. But a guarantee does not exist.