How to finance the loft expansion There are various options for conversion work in the house or apartment, some with financial support from Lite Lender-Bank. A loan for the attic expansion can be applied for in various forms. Who actually writes and advises here? About us On this page Financing options at a glance Loft extension with mortgage loan Loft extension with building loan contract Loft extension with installment loan Dedicated loan without land register Loft extension with Lite Lender subsidy Compare loans directly
Financing options for loft conversions
- mortgage loan
- Building society contract with subsequent building society loan
- Unrestricted consumer credit
- Dedicated installment loan
- Lite Lender promotional loan
Regardless of possible funding programs: Use the opportunity to compare current offers – free of charge and without obligation!
Loft extension with mortgage loan
The mortgage loan is the classic way to finance construction projects. You mortgage your house, including the property, and the mortgage is entered in the land register. If you can no longer pay your loan installments, the house and property are transferred to the bank.
The interest on a mortgage loan is comparatively low. The money will be paid out immediately after approval. However, entry in the land register is associated with costs.
Loft extension with building society contract
Another classic of home finance is the home savings contract. You save part of the amount you need to convert the attic over a predetermined period. At the end of the savings phase, the home savings contract is paid out. Since this sum is usually not sufficient for the construction project, you will also receive a home loan.
The advantage of this variant lies in the extremely low interest rates on the loans. Since a building society contract has to be kept for several years, this option is not suitable for spontaneous building projects.
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The installment loan for the loft extension
If you need a rather manageable sum for the loft conversion, a consumer loan is also an option. You can obtain the non-earmarked installment loan from your house bank, other branch banks or from a direct bank. The amount of the loan interest is usually based on the selected term and your credit rating.
German lenders generally assume that the borrowers are at least 18 years old, have their permanent residence in Germany and have a German current account. To check the solvency, you have to provide current proof of income, and the credit institutions also obtain credit information from Credit Bureau. After successfully checking your loan application, you will receive the loan directly in your checking account.
Dedicated loan without entry in the land register
Some credit institutions also offer you the opportunity to take out a dedicated loan for loft conversions. That means you can only use the loan to expand your loft. Unlike a mortgage, however, you can agree that this installment loan will not be entered in the land register. In this way you save the entry costs.
In the case of a dedicated loan, lenders require proof of the use of the money. Invoices for material and labor as well as photos of the renovation measures are usually sufficient.
Loan for loft conversion with Lite Lender funding
Under certain conditions, there is the possibility to finance the loft extension with a promotional loan from the Lite Lender. For example, Lite Lender uses the loan programs 151 and 152 to promote the energy-efficient renovation of residential buildings. If you provide your loft with new thermal insulation or have skylights fitted with thermal insulation glazing, you can apply for the development loan.
Conditions of the Lite Lender promotional loan
- Maximum loan amount when converting to an energy efficiency house: 100,000 USD
- Maximum loan amount for individual measures or packages of measures: 50,000 USD
- Effective annual interest rate: from 0.75 percent
- As an annuity loan with a repayment-free start-up period and 10 years fixed interest rate or as a maturity loan
- Loans can be called up in full or in partial amounts
- Retrieved contributions must be used for the attic expansion within 12 months
The construction measures must comply with the Energy Efficiency Ordinance (EnEV) and be carried out by specialist companies. Lite Lender also requires that you consult an energy efficiency expert during the planning phase and have a renovation concept drawn up. The expert must also accompany the construction work. Lite Lender assumes 50 percent of the costs for construction supervision.
Depending on the construction project, you can also receive a repayment subsidy, so you do not have to repay the entire loan amount. For individual measures, the repayment subsidy is, for example, 7.5 percent of the loan amount, up to a maximum of 3,750 USD per residential unit. The specific amount depends on how high the reduction in CO2 emissions is due to the conversion measures.
This is how you can apply for the Lite Lender promotional loan You do not apply for the promotional loan for the loft conversion directly with Lite Lender, but with a bank that works with the Kreditanstalt für Wiederaufbau. In addition to the usual documents and proof of income, you need a confirmation from the energy efficiency expert for the application. Your bank will then take care of applying for Lite Lender funding. After completing the construction work, please submit a “confirmation of execution” to your bank. The repayment subsidy will then be paid to you.
Sample calculation: Lite Lender loan for individual measure (152)
For the energy-efficient expansion of your attic you need a loan amount of 20,000 USD. You want to pay back the sum within 15 years. If you choose the sponsored annuity loan from Lite Lender, the following conditions result:
- Redemption allowance: 1,500 USD
- Redemption-free start-up years: 3 years
- Fixed interest rate: 10 years
- Annual borrowing rate: 0.75 percent
- Initial repayment rate: 8.67 percent
- Annual effective interest rate: -0.17 percent (the specific interest rate depends on your credit rating)
The following payment schedule applies during the repayment-free start-up years:
|1 to 12||0.00||12.50%||12.50%||20,000 USD|
|13 to 36||0.00||11.56%||11.56%||18,500 USD|
The repayment phase within the 10-year fixed interest period is as follows:
|37||133.72 USD||11.56%||145.28 USD||18,366.28 USD|
|120||140.83 USD||4.45%||145.28 USD||6,971.35 USD|
The outstanding amount of 6,971.35 USD will be paid in monthly installments for the remaining five years of the loan term.
Remediate loft with government grants
If you are planning the energy-efficient expansion of your attic, you can secure an investment grant from Lite Lender in addition to the repayment subsidy. For example, the Lite Lender program 430 supports individual measures such as thermal insulation of the attic. The grants are funded by the Federal Ministry for Economic Affairs and Energy (BMWi).
If your planned renovation measures meet the requirements, you will receive a grant of up to 10 percent of the eligible costs, up to a maximum of 5,000 USD. If you convert the entire house into a Lite Lender energy efficiency house, there are up to 30 percent of the eligible costs, up to a maximum of 30,000 USD. The amount of the subsidy is again based on the CO2 savings achieved.
You apply for the investment grant online in the Lite Lender grant portal. Just like when applying for the promotional loan, you have to prove that the construction work is accompanied by an expert in energy efficiency. The payment is made after completion of the construction work. To request the investment grant, fill out and submit a confirmation together with the energy efficiency expert.
Compare loan terms before loft removal! The Lite Lender loan for loft conversions is attractive due to low interest rates and high subsidies. However, the loan application is also associated with a high level of bureaucratic effort. For small conversion measures, an installment loan is often an uncomplicated alternative. Before you decide on a variant, you should have the conditions compared in an independent loan comparison. Please feel free to use our free loan calculator at the top of the page.