Housing company loans add flexibility to buying an apartment
When buying a new apartment, you can choose whether to purchase it in full (debt-free price) or pay part of the price (sales price) and make use of the housing company loan by paying off the remainder in the form of a monthly financial consideration.
The terms of the housing company loan are negotiated in advance, and the apartment’s share of the housing company loan generally does not require additional collateral. A housing company loan gives you the opportunity to buy your own apartment with less capital required up front.
Differences between a housing company loan and a private home loan:
- A pre-negotiated payment plan, which often involves paying only interest in the beginning (depends on the housing company, see housing company information pages for more details)
- The interest is not deductible in your own taxation
- Competing offers have already been invited from banks
- The loan terms are fixed
- No commitment to a personal bank loan
- Separate collateral is usually not required
- Selling the apartment later on may be easier if it still has a share of the housing company loan. This means potential buyers are not eliminated because of their inability to obtain a sufficient personal loan from the bank.
- You can pay your share of the housing company loan in part or in full. Additional instalments can usually be paid 1 or 2 times per year, depending on the terms of the loan