How much of my own money do I need to buy a property?
As a rule of thumb, the purchase costs plus part of the price should come from your own funds – often around 20 per cent. Bank requirements change.
How much of your own money is needed
How much of your own money you need to buy a property depends on the bank, your income situation and the property itself. As a rough rule of thumb, at least the purchase costs and part of the price should come from your own funds.
A rough guide
A share of around 20 per cent of the purchase price is often quoted, in addition to the purchase costs. That is not a fixed rule but a guide. Which costs arise is shown in the article on purchase costs.
Why banks look at your own funds
The more of your own money you put in, the lower the risk for the bank and the better the terms usually are. Your own funds reduce the monthly instalment and the total cost of the financing. Anyone with little of their own money generally pays higher interest.
The requirements change
Requirements for own funds, term and instalment have been adjusted several times in recent years and differ from bank to bank. So do not rely on old rules of thumb, but obtain current financing advice. We are glad to refer you to dependable financing partners.
What else counts
Besides your own funds, banks look at your ongoing income and your other commitments. A solid, honest calculation is the basis for financing you can carry in the long term. How the purchase then proceeds is set out in the article on the buying process.
Topping up your own funds
If your own funds fall short, there are sometimes ways to top them up, for example through additional security, another property or support from the family. Whether that makes sense depends on the individual case and should be discussed with a financing specialist. What matters is being able to carry the monthly burden permanently, rather than stretching the financing to its limit and running into difficulty at the first change in interest rates.
We help with the planning
We discuss with you which property suits your budget and put you in touch with suitable financing partners. That way you start your search realistically. Arrange a conversation and we will help you assess your options.