Do you have the desire to live completely self-sufficient and in the middle of nature? Then a tiny house might be something for you. There is only one obstacle, a tiny house is mobile and not brick. Taking out a mortgage is therefore not an option. Fortunately, you can easily finance a tiny house with a loan. There are, however, a number of things that you should pay attention to.
Finance Tiny House, choose loan form
If you borrow money for a tiny house, you can actually choose from two different loan forms; a personal loan and the revolving credit.
• You choose a personal loan if you know in advance how much the tiny house will cost you. You then borrow an amount and pay it off in fixed installments and at a fixed interest rate.
• If you do not yet know exactly how much the targeted tiny house will cost, then it is better to take out a revolving credit . You can then withdraw and repay unlimited amounts up to a pre-agreed limit. The great thing about this is that you only pay interest on the part actually taken up.
Compare loan providers for financing Tiny house
Do you know which loan type you prefer? Then do not go directly to your regular bank, but first compare the largest range of lenders on interest and conditions. They ensure that the loan turns out to be more expensive or cheaper than expected.
Tiny house financing – Pay attention to the conditions!
Many people do not look critically at the conditions that lenders apply. This often causes them to face unexpected costs. For example, always pay attention to whether you can make additional interim repayments free of charge and whether the remaining loan amount is waived or not in the event of death.
Go for the shortest term financing Tiny house
Finally, it is still smart to look critically at the term of the loans. The longer the term, the lower the monthly charges. This seems beneficial, but it is not. You pay less interest, but you do pay over a longer period. This always works out more expensive. Choose rather the shortest possible duration with an acceptable interest rate.
Pay attention! The difference in interest rates between the cheapest and most expensive lender can just amount to more than 4 percent! Comparing really pays off!
Financing tiny house, how much to borrow?
Exactly how much you have to borrow for a tiny house depends on whether you build the tiny house yourself or have it built. Are you going to build a tiny house yourself, then sometimes you are already finished with 20,000 euros. Of course, it depends on how large and luxurious you make the tiny house. If you prefer to have a tiny house built, the costs are suddenly a lot higher. Then think of a minimum price of 50,000 euros.