Funding for Self-Occupied Residential Property and Cooperative Living – New Construction (Hessen Loan New Construction)

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Who is Funded

This program is aimed at private individuals and cooperative living projects in Hesse who wish to build or acquire self-occupied residential property for the first time. It aims to enable access to adequate housing, especially for families with children, households with disabled family members, or those with other special needs, provided certain income limits are met.

What is Funded

The program promotes the new construction or acquisition of initial, self-occupied residential property, including single- or two-family houses and condominiums. The expansion or extension of existing self-occupied single- and two-family houses for the housing provision of relatives is also eligible for funding. The measures must serve for permanent housing provision and can also include modernization and maintenance costs.

Type and Scope of Funding

The funding is provided as a low-interest construction loan. The loan amount for new constructions varies between 160,000 Euro and 200,000 Euro, depending on local land prices, and can be increased by an additional 20,000 Euro if the Efficiency House Standard 40 is achieved. For the acquisition of used properties, the loan is up to 200,000 Euro. The maximum funding rate is 50 percent of the total costs, with a fixed interest rate of 0.6 percent for 20 years.

Conditions and Requirements

To receive funding, applicants must meet certain legal and financial requirements, including adherence to income limits and the use of at least 10 percent equity of the total costs. Projects must permanently serve housing provision, and the monthly burden from financing must be at least 400 Euro. Cooperative living projects have additional requirements regarding their legal constitution and planning.

Application Procedure

The application procedure for the Hessen Loan New Construction is two-stage. The application is first submitted to the responsible housing promotion office of the city or district administration, which forwards it to the Wirtschafts- und Infrastrukturbank Hessen (WIBank). Alternatively, digital submission directly via the WIBank's customer portal is possible. A preliminary funding commitment can be granted under certain conditions to ensure financing security and allow for an early start of construction.

Legal Basis

The legal basis for the Hessen Loan New Construction is the Guideline of the State of Hesse for the Promotion of Self-Occupied Residential Property and Cooperative Living dated May 4, 2023. This guideline is based on the Hessian Housing Promotion Act (HWoFG) and the Hessian State Budget Code (LHO).