Current observations in the property market indicate a significant lengthening of processing times for financing inquiries. An increasing amount of time is passing between the submission of a financing application and the issuance of a loan commitment. This development has been noted by brokers within the Remax Germany property network and necessitates early and comprehensive engagement with the topic of financing on the part of prospective buyers.
Credit institutions are currently scrutinising the long-term viability of property financing in much greater detail. In addition to the borrower's income, monthly household budgets, regular and irregular expenses, existing equity, reserves, and future liabilities are increasingly being factored into the assessment. This means that prospective buyers of flats or houses must exercise greater patience until a final loan commitment is granted. Freelancers or self-employed individuals are particularly affected by this more intensive review, as banks analyse variable incomes more precisely. Fixed-term employment contracts, probationary periods, or generally rising living costs also influence the decision-making process and can lead to delays or even rejections.
Comprehensive Scrutiny of the Property as Security
In parallel with the creditworthiness check of the borrower, the valuation of the property as security for the loan has gained importance. Banks and financiers are therefore increasingly requesting detailed documentation, including land registry extracts, cadastral maps, living space calculations, and declarations of division. For older properties, the condition of the building is coming into sharper focus, making evidence of past modernisations relevant. In phases of low value appreciation or stagnating property prices, as well as uncertain demand development, banks are examining the actual building fabric of the properties more closely than before.
Loredana Scirè, Press Spokesperson for Remax Germany, emphasises that property brokerage and financing must be more closely intertwined. She advises buyers to realistically clarify their financial scope before commencing their property search. This also benefits sellers, as the financing on the part of prospective buyers is reliably prepared, and transactions can thus be expedited. Ms Scirè also views a thorough financing check positively: it can prevent buyers from entering into commitments that are too tightly calculated in the long term. Given high purchase prices and the long-term nature of property investments, solid household and financing planning is essential. Good preparation avoids unnecessary bureaucracy.
As financing processes often involve multiple parties, every query or document needing submission can prolong the procedure. For instance, if current payslips are missing or bank statements are unclear, the bank cannot complete its review. Remax Germany therefore recommends thorough and early preparation for the credit assessment. Where necessary, professional support from brokers with appropriate advisory expertise should be sought. The network of approximately 800 experts at Remax is trained in these processes.
