LHV has commenced providing home loans with KredEx sureties

15. april 2019

Previously, LHV only allowed a self-financing rate that is smaller than usual in the case of additional real estate collateral, but now, a surety by the KredEx Fund can also be used as additional collateral at LHV.

With the support of KredEx, it is now possible to apply for a home loan at LHV Pank by having a self-financing rate of at least 10 per cent. The KredEx surety is intended for people who wish to take out a loan for purchasing a new home or renovating an existing one and reduce their primary deposit obligation. To gain this surety, at least one of the loan applicants must belong to the target group of a young family, young specialist, tenant living in a returned dwelling, Veteran of the Defence Forces, or a person acquiring an energy-efficient dwelling. You can learn more about target groups on the KredEx website.

Utilising the KredEx surety is a very popular option on the home loan market, according to Marko Kiisa, Head of Retail Lending at LHV. “25% of real estate loans of households are concluded with the KredEx surety,” said Kiisa.

“LHV entered the home loan market two and a half years ago. Today, we offer home loans across Estonia and we have given out loans in the amount of over 125 million euros. In addition, we have always considered it to be important that the customer also contributes with a sufficient self-financing rate. At the same time, introducing the KredEx surety option enables us to expand the loan opportunities for customers with a lower ability for self-financing in the future,” said Marko Kiisa.

It must be kept in mind that every borrower can only have one valid KredEx surety; also, the real estate to be purchased or renovated must be their permanent place of residence. One is able to purchase an apartment, residential house, plot of land or summer house with the KredEx home loan surety. In this case, the aim for purchasing a plot of land must be the construction of a residential building, and in the case of purchasing a summer house, the aim must be the alteration thereof to allow year-round residence. The owner and user of the dwelling to be purchased or renovated must be the borrower. The dwelling is also allowed to be purchased into common ownership with a spouse or co-borrower. The fee for the provision of surety in the amount of 3% of the surety shall be paid as a one-off payment when entering into the contract. You can learn more about the terms and conditions on the KredEx website.

The LHV home loan is outstanding in the market as it is the most flexible home loan in Estonia. Early repayment of the loan is free of charge; LHV also offers the opportunity of a flexible grace period. The customer is also able to get an initial home loan offer from LHV more quickly than on average – within three working days. Additional information about the LHV home loan can be found on the LHV website.

LHV Group is the largest domestic financial group and capital provider in Estonia. LHV Group's key subsidiaries are LHV Pank and LHV Varahaldus. LHV employs over 400 people, and more than 166,000 customers use LHV’s banking services. Pension funds managed by LHV have more than 177,000 active clients.

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