This is the standard loan in real estate financing with monthly fixed repayments calculated on the basis of the interest rate and amortisation, running for a period of up to 40 years.
Complete amortisation loan – the carefree financing plan!
As with an annuity loan, constant monthly installments are paid, which are calculated from the interest rate and amortisation, but the installments are calculated according to the desired total term of the loan. So you know from the beginning what rate you will be paying and when, hence will not need follow-up financing.
With this form of real estate financing, you pay variable interest, which is based on the current EURIBOR money market interest rate every three months. There is always the option to convert to a loan with a fixed borrowing rate. This variant makes sense if there are low market interest rates or if it will be used for bridge financing (for example, for the purchase of a property).