Institutions mainly use the Reference rate bank, but it is not quite as frequently requested by private customers.
In order to make its advantages work for you, you should be constantly informed about its values and, above all, its development so that you can react in time to interest rate changes (especially upwards).
Home loan quick comparison
Term ranging from 1 week to 12 months. The most common Reference rate bank interest rates are for 3 months and 6 months.
These are used primarily in the area of construction loans. A loan with a variable interest rate is agreed, which is based on the Reference rate bank.
- As long as the Reference rate bank is low, construction financing on its basis can make sense. However, if it rises sharply, the total cost of the building loan can quickly lead to problems for the borrower, because the monthly rate can also rise significantly. Anyone who has taken out such a loan with variable interest rates can speak to the lending bank in order to convert the previous loan into a loan with fixed interest rates no later than 3 months after an interest rate change. Many banks offer such a switch.
Interest rate in order to minimize the risk
Most banks charge 1 to 15 percent more interest in addition to the Reference rate bank interest rate in order to minimize the risk for themselves and to generate profit despite the low reference interest rate.
Home savings loans are granted in the course of a building society contract. If you would like to save money for a house with a home savings contract, you can initially negotiate an optional home loan that you can use after a certain saving period. The interest is fixed when the building society contract is agreed, so that you can secure cheap interest. The home loan is a repayment loan.