Would you like to buy a garage box? We recommend a personal loan . You then borrow the amount that the garage box costs and pay it back in fixed installments at a fixed interest.
You know in advance exactly where you stand and you will not be faced with financial surprises. However, it is smart to make a good comparison in advance. Pay particular attention to the amount of interest, the duration and the terms of the loan.
Financing garage box, what to pay attention to?
Our advice is therefore a personal loan. But if you want to find the most suitable loan, there are a number of things to look out for:
- Conditions – In addition to the interest, also take a good look at the conditions. In many cases, these ensure that the loan is more expensive than previously thought. Pay attention, for example, to whether you can make additional repayments in the meantime and whether the remaining debt is remitted or not in the event of death.
- Duration – Always choose the shortest possible duration for which the monthly charges are easy to bear. In general, the longer the term, the lower the monthly charges. This seems favorable. But with lower monthly payments, the loan runs longer. Below the line you are therefore more expensive.
Financing a garage, how much to borrow?
The price of a garage box differs per city. For example, in a somewhat smaller municipality you pay 10,000 dollars for a garage box, while in a larger city you quickly lose 50,000 dollars. Build a garage box on your own land? Then you must quickly take into account a price between 10,000 and 20,000 dollars, depending on the size and degree of insulation.
Garage box loan deductible
If you take out a loan to finance a garage box, the interest is deductible if the garage box is attached to your home or placed on the floor around your home. A garage box is an improvement of your home at that time and increases the value of your home. If the garage box is somewhere else, the tax benefit does not apply.
Tip! Is the garage box on your own property and does this immediately increase the value of your house? Then don’t forget to adjust your home insurance. On the Lite Lender comparison site you can immediately see which insurer offers the most advantageous insurance for your home.
Financing an alternative garage box
In addition to the personal loan, there are a few ways to finance the construction of a garage box:
Revolving credit: Build a garage box yourself, but you do not know exactly how much money you spend with it? Then a revolving credit may be a good option. With a revolving credit, you can withdraw and repay unlimited amounts up to an agreed amount. The great thing about this is that you only pay interest on the actually recorded part. If the construction of the garage box is cheaper, you will pay interest for a lower amount.
Pay attention! With a revolving credit, there is a strong temptation to use the credit for other purposes. The danger of borrowing too much and being tied to the loan for an unnecessarily long time is therefore certainly present. Self-discipline is therefore required.
Co-financing in mortgage: In addition to a personal loan and the revolving credit, there is another way to finance the garage box, namely through your mortgage. The advantage of this is that the interest is probably lower than with a loan. However, the disadvantage is that raising your mortgage costs entails and that you may not repay extra in the meantime.