Do I need equity? In theory, it is possible to buy an apartment or a house even without equity. In practice, however, you will pay for this purchase for the rest of your life. Serious banks therefore recommend that you finance at least 10, better 20, of the purchase amount in the form of equity. Maybe you have a savings account, have shares or securities or a building savings contract? But maybe you already own a plot of land and can now build a house on it. Your assets make it easy to determine how much the property is and how much the monthly charge can be.

A detailed invoice for revenue and expenditure must be prepared in the next step. After all, it is important that, in addition to the instalment payments to the bank, you can continue to make a living. The bank also charges a certain amount per person to cover the cost of living. Income, of course, is primarily income. State benefits such as child benefit or parental allowance also count into the bills. Expenditure is now included in all commitments incurred on a monthly or regular basis. Other instalment payments or loans, contributions to the GEZ, various telephone bills and internet bills are included here. Maintenance or other expenses are included and are important for the invoice.

Now you can calculate your financial viability. At best, you have now calculated a surplus in the revenue-surplus calculation. You will count this together with your current rent and deduct the monthly operating costs for your future home. The operating costs can be calculated at around 300 euros, but this is rather generously determined. If, for example, you have around 1000 euros left, you can calculate interest and repayment on it.

Caution: Don’t forget the additional purchase costs. They increase the actual purchase price again, as this includes the real estate transfer tax, commissions for brokers and notaries and other incidental costs. So, in order for them to be able to repay the instalments, you should consider these initial expenses. At best, you do not have to co-finance these costs, but have them together in advance.

Benefit from low interest rates. At present, interest rates in Germany are almost historically low. Try to tie them to your loan for as long as possible. Some only offer a 10-year fixed rate, others guarantee the interest rate at 20 years. You can use the favorable conditions directly as a higher repayment or pay additionally into the special repayments.