Real estate loan providers do not have much to laugh about at the moment, as the trend of recent years has continued inexorably and even intensified as a result of the economic crisis.
The mortgage lending business is in sharp decline. Accordingly, it is all the more important for individual banks, insurers and building societies to win every single prospective customer.
Here, the providers are more than ever on a personal advice and the preparation of individual financing concepts.
But sometimes these financing concepts are even too individual. A current trend, for example, is to split the loans into several parts of the loan (so-called tranches) and to agree on different interest rates for each individual part of the loan. The idea is that with shorter maturities even better interest rates can be achieved.
However, because it pays to fix the currently low interest rates for as long as possible, a split is made: a small part of the loan is concluded with a short fixed interest rate, the remainder with a long interest rate lock. Mostly about 20,000 to 50,000 euros are taken up with a fixed interest rate of 5 years, the remainder with a term of 20 years.
At first glance, such loan structures are extremely attractive, after all, the interest burden can indeed be reduced. However, the agreement of several fixed interest rates carries a high risk: The borrower inevitably binds himself to the lender.
The fixed interest rates always run out at different times, which is why subsequent follow-up financing must be made by the same provider. This is thus able to dictate the interest rates for subsequent follow-up financing freely.