Families with many children now only need half of the previously required self-financing to buy a home

01.03.2022

Previously, a minimum 10% self-financing requirement applied to state-guaranteed home loans; however, starting today, 1 March, families with many children can apply for a KredEx guaranteed home loan with only half of the previously required self-financing requirement, i.e. 5%.

With the new conditions, the state wants to encourage families with many children to buy a home instead of renting. A family with many children is a family with at least three common children. It also applies to one parent with three children or to cohabiting families where one parent has at least three children.

Catlin Vatsel, Head of the Private Financing Department at LHV, said that families with many children have often found it difficult to buy a home because of the need to raise their self-financing.

‘Buying and owning your own home has a special meaning for everyone, especially for families with children. For families with many children, it is often the saving of the required deposit that has delayed the dream of owning a home, as the amount paid for a rented home is usually higher than the loan payments, making it difficult to collect the deposit. A self-financing requirement that is half the previous amount makes collecting the deposit easier, which is welcomed by clients. We are happy to help make their dreams come true with our best expertise and the fastest service,’ Vatsel said.

For example, this means that if you previously had to pay a minimum of 12,000 euros in self-financing when buying a home costing 120,000 euros, now with a KredEx guarantee a deposit of 6000 euros is enough.

For families with a child up to the age of three, the LHV home loan is also more flexible with the option to take up to 12 months’ grace period if they wish, so they can plan their lives more freely. ‘We encourage parents of young children to consider the grace period as an option, since additions to the family mean temporarily higher costs. In addition to buying children’s supplies, the need to replace your car or repair your home may arise, or you may need to cover paid childcare. In this case, it is good to know that you can temporarily pause your home loan payments at LHV, if you wish,’ Vatsel added.

LHV home loan stands out in the market with its flexibility and speed, as the initial loan offer is sent to the client within 24 hours. In addition, there is a green home loan for energy class-A detached houses and apartments with a fixed favourable interest rate.

LHV Group is the largest domestic financial group and capital provider in Estonia. LHV Group’s key subsidiaries are LHV Pank, LHV Varahaldus, and LHV Kindlustus. LHV employs over 650 people. As of the end of the year, LHV’s banking services are being used by 321,000 clients, the pension funds managed by LHV have 140,000 active clients, and LHV Kindlustus protects a total of 143,000 clients. LHV’s UK branch offers banking infrastructure to 180 international financial services companies, via which LHV’s payment services reach clients around the world.

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