.svg)
When can you purchase an OwnGuarantee?
You can purchase an OwnGuarantee to secure a loan that will be used to buy or renovate a property that:
- will serve as your or your family’s permanent residence, and
- is located in Finland.
OwnGuarantee as collateral
The collateral value of a property is usually 75% of the property’s value determined by the sales price. If the loan amount you need exceeds the collateral value, you can purchase an OwnGuarantee to serve as additional collateral. The maximum OwnGuarantee amount is 15% of the loan amount (20% for first-time home buyers).
The remaining 5 to 10% of the sales price must be covered with personal savings or other forms of additional collateral.
Read about collateral for a home loan
Read about self-financing share
How does the OwnGuarantee work?
The OwnGuarantee serves as additional collateral towards us when the amount of the home loan exceeds the collateral value of the home.
The maximum amount of a loan including an OwnGuarantee is 500,000 euros.
Our partner in OwnGuarantees is the insurance company Arch (Arch Mortgage Insurance Designated Activity Company).
The insurance company that issues the OwnGuarantee will pay us a compensation equalling at maximum the guarantee you have purchased:
- if you as the borrower can’t repay your home loan, and
- the sales price of the home pledged as collateral won’t suffice to cover the remaining home loan.
Cost
The cost of an OwnGuarantee depends on how big your home loan is and how much additional collateral is required.
Example: You want to buy a home for 100,000 euros. You have 10,000 euros and will need a loan of 90,000 euros. The collateral value of the new home will be 75,000 euros, so you will need an OwnGuarantee for 15,000 euros. In this case, the cost is 720 euros.
You will find out the exact cost of the OwnGuarantee you need when you negotiate on the loan with us.
