Credit without land register entry
Not every loan has to be secured by a land register. A loan without a land register entry is more the rule. Even in the context of housing renovation, there are now many loan offers that do not require a land register hedging.
Credit without a land register entry – what is usual?
The loan without land register entry is the rule. Only those who want to take advantage of particularly favorable interest rate offers or very high credit sums, can hardly prevent the mortgage. Prominent examples of this would be the new financing or the purchase of a used property.
A distinction is made between senior land charges and subordinate land charges. Who stands in the first place in the land register, which has the highest capital security. Only when this requirement is satisfied, the subordinate entries are served. Extremely favorable interest rates are therefore usually only to be expected for first-rate hedging. If this place is already burdened with a pre-charge, then hardly any special interest rates are to be expected. The credit without a land register entry is therefore not necessarily more expensive than with a land register entry.
Advantages and disadvantages of the land register hedging
The advantages can be summarized in a few words. It is always about the extension of the creditworthiness, if it is to be secured in the land register. Possible background is as described a very high loan amount. Another possibility may be the applicant’s lack of creditworthiness for normal loan amounts. His salary is insufficient to secure the loan. It is then possible the help of a guarantor or security.
The disadvantages can be summarized just as compact. Each land registry entry adds extra cost and time. For land register matters always a notary must be endeavored. With the signature under the loan agreement alone, as with the deposit of the motor vehicle letter, it is not done. In addition to the notary, the registration costs must be paid and later also the cancellation. All in all, the whole thing is a complicated process that should be avoided.
Credit for housing renovation
The renovation of the living space is closely related to the property and is also very expensive. The obligation to register a mortgage security would therefore be at least understandable. Nevertheless, there are many offers on the market, which allow the credit for the housing rehabilitation without a land register entry.
In principle, the loan without land register entry is therefore a normal installment loan. Alone through the earmarking it is offered at particularly favorable interest rates. Anyone who comprehensively renovates their living space is down-to-earth and usually pays their credit obligations. Local credit providers offer this credit only in part if the work is commissioned by a craft business from the region.
The offers for credit without a land register entry are usually in a credit line of 5,000 – 50,000 USD. In a loan comparison with other installment loans without earmarking, the offer for housing rehabilitation should be significantly cheaper. If it is not, then a normal installment loan, which is fully usable, is usually the better choice.