Private or professional circumstances may necessitate a change of residence. Brokerage, renovation, new furniture and moving vans – with the change of home, many expenses come to consumers. A relocation loan ties in with this and provides the financial means that are required to smoothly manage the move. However, in order to receive the necessary support from a bank, the future borrower must enter into an installment payment agreement. He pays for the repayment of the loan granted in predictable and constant installments. The following article shows how the move can be financed despite low equity and what needs to be considered when taking out a loan.
The most important thing in the overview:
- The moving loan is suitable for private individuals who are about to change apartments and who do not have enough savings.
- The average moving costs with a moving company for a one-room apartment are between 500 and 1,000 dollars.
- A moving loan comparison helps to find the cheapest financing offer.
Who needs a moving loan?
If you want to change your apartment, you have to consider a few things. A lot of organization is necessary to quickly and safely transport all the belongings to the new home. In addition, every move is always associated with financial expenses, which may be higher than your own savings allow. The purchase of new furniture can be postponed in an emergency, but there are expenses that arise with or before the move date.
There is a moving loan for consumers who cannot cover these costs from their assets. With the financial support of the lender, borrowers can set up their new home according to their wishes, organize the safe transport of their property and, if necessary, do renovation work in the old or new home.
Note: Students who have little or no income also benefit from a loan for the move. The loan enables them to move to a new home near the university without the financial support of their parents.
What expenses are incurred when moving?
The expenses incurred when moving relate to your own circumstances and wishes. For example, those who already have a large home furnishings and do not have to make any new purchases move cheaper than people who also have to invest in new furniture. In addition, a distinction must be made as to whether the move is local or whether the property needs to be transported further, for example across national borders. In this case, the costs add up to a significant value.
Consumers need to calculate the following costs for their move, regardless of whether a carrier is hired or not:
- Deposit for the new apartment (up to three months’ rent)
- Possibly double rental charges
- Brokerage commission (two to seven percent of the purchase price or a maximum of two months’ rent)
- Renovation costs for both apartments
- Acquisition of new furniture and expenses for its delivery
- Costs for re-registration and change of address of documents (30 to 100 dollars)
- Reregistration of electricity, gas and internet (20 to 70 dollars)
- Other expenses, for example for the forwarding order (from 20 dollars)
That’s how much a moving company costs
In principle, the following average moving costs can be expected if a moving company changes its regional residence:
|Square meters of living space so far||Average moving costs|
|Up to 35 square meters||500 to 1,000 dollars|
|35 to 60 square meters||700 to 1,200 dollars|
|60 to 85 square meters||1,050 to 1,450 dollars|
|85 to 120 square meters||1,200 to 2,000 dollars|
Composition of costs
Transporter : In most cases, customers receive a complete offer from the moving company that does not explicitly break down the costs for the transporter. It is important for consumers to pay attention to whether the petrol expenses are already included in the offer.
Remuneration of the employees : The most expensive point when changing house by a moving company is the wages of the employees. Even if this seems very high, consumers should keep in mind that these are professional employees who can load the property quickly and with targeted actions. While moving on your own can take a day or even several days, moving companies can usually move within a few hours.
Packaging material : As a rule, the customer receives the packaging material from the moving company. If he is unable to store his property himself, the company’s employees will take care of it. However, it is cheaper to take care of the packaging of the items yourself, so that the moving company is only responsible for the transport and the clearing out of the apartments.
Tip – save taxes when changing apartments: If you hire a professional moving company, you can claim part of the expenses for household services. Consumers who change their place of residence for work-related reasons and move closer to their workplace benefit even more.
If you move without a moving company, you can save significantly more money and keep the loan amount for the moving loan lower. In addition to the independent costs such as the deposit, the following expenses must be taken into account:
Transporter : If you don’t have a large vehicle, you have to rent a van from a rental car company. This is expected to cost between 150 and 250 dollars per day, plus petrol and insurance. It is usually cheaper to rent the vehicle during the week because the prices are higher on weekends.
Moving boxes and packaging material: Moving boxes and packaging material are available in any hardware store. In terms of costs, consumers should calculate 30 dollars per room. Often acquaintances still have to hand in boxes and crates.
Catering of helpers: If friends and family members help with the move, they should be tasted accordingly. This includes providing drinks as well as food. Basically, you can expect 5 to 8 dollars per person.
Parking permit: Especially when moving to the city, it may be necessary to request a parking permit. This ensures that there is enough space for loading and unloading on the day of the move. However, consumers do not receive the permit free of charge, setting up a private stopping ban costs between 80 and 170 dollars.
What loan amount is required to finance the move?
Consumers can apply for a moving loan from a bank to cover the expenses associated with moving home. How high these will be approximately can be calculated using the average moving costs or a list of all expenses incurred:
Relocation-related expenses: moving companies, transporters, packaging material, food for the helpers
+ Housing- related expenses: brokerage fee, deposit, rent, re-registration, purchase of new furnishings
= Cost of moving
Finally, borrowers should review what financial resources are available to them. Savings must be taken into account, as well as the deposit, which will be repaid by the previous landlord. Consumers shouldn’t factor in all of their savings for moving so they still have reserves when needed.
Own financial resources (less reserves) – expenses for the move = required loan amount
Fund the move: what are the options?
As a rule, consumers use a classic installment loan to finance the move. They receive the desired loan amount from the bank and pay it back in installments over a specified period. The following applies: the longer the term, the more expensive the interest and thus the loan. Therefore, borrowers should strive for a quick repayment to keep the cost of the loan as low as possible. Since the conventional installment loan is not earmarked, borrowers can finance all the costs of moving with the loan. You do not have to provide proof of expenses to the bank.
Tip – Compare conditions: In order to finance the move cheaply, consumers should compare different lenders. The loan calculator from Across Lender makes it possible to compare different offers based on the amount of financing required and the desired term. With the move loan comparison, borrowers can quickly and easily find the cheapest bank.
Moving credit for students
Many students leave their homeland and have to finance a move because of their studies. But in university cities like Munich, Cologne or Heidelberg, the rental prices are high, so there is hardly enough money left for the new home. In addition, students have little or no income, which is a potential risk for banks.
But students who have to finance a move because of their studies can also get an installment loan without income. This is possible if they ask their parents for a guarantee. In this case, one parent or both will step in if the student can no longer pay the installments themselves. Income from a part-time job can also be used as security.
Some tenants want to take out a loan to pay the deposit. For them, the deposit guarantee is a good alternative to an installment loan. The customer does not take out a loan for this, but has the deposit secured by an insurance company or the bank. If the deposit is due upon moving out, the depositor bears the costs. Until then, the customer pays the company a fixed amount each year.
What needs to be considered with the moving loan?
Anyone wondering how to finance the move will likely consider a loan. However, the need for financing should not be neglected, since a moving loan is always associated with additional costs. It is cheapest to finance the change of residence with your own savings or with the help of friends or family members.
Adjust rates to financial options
In principle, it should be in the borrower’s interest to repay the move loan as soon as possible in order to benefit from low interest rates. However, he should choose the monthly installments in a ratio that corresponds to his financial possibilities. Overly high rates can lead to financial bottlenecks and threaten the existence of the borrower.
Check contract contents
Many banks offer their borrowers conditions that allow them to make their contract more flexible. For example, they give them the opportunity to temporarily suspend repayment in the event of payment difficulties. Since a moving loan is mostly a manageable loan amount, free repayments are particularly interesting for borrowers. These allow them to pay a fixed amount annually in addition to the monthly repayment in order to pay off the loan more quickly.
Compare offers and take out moving loans
If you are planning your move and would like to take out a loan for financing, you can use the Across Lender loan comparison to compare offers from various banks free of charge and anonymously. Afterwards it is possible to get professional telephone advice again. Together with a credit advisor, the financing needs can be precisely planned and the appropriate moving loan can be taken out.