Moving is associated with high costs and most people only have to borrow it. While moving companies often offer installment payments, borrowing is essential for the brokerage commission and the rental deposit.
The legislator expressly provides for the possibility of paying the deposit in three installments, but many landlords only sign the rental agreement if their new tenant pays the entire deposit in one sum before the start of the rental period. The broker commission naturally does not apply if the tenant finds a new apartment without the help of a broker. However, this is not only less and less possible due to the lack of housing, but also because of the increasing convenience of landlords.
Moving loan or a separate loan for the brokerage commission and the rental deposit?
A separate loan for the deposit and the commission is required if the direct removal costs are financed through an installment payment agreed with the moving company. If this is not possible, it is advisable to take out a single loan for all the costs associated with the move, which in addition to the bill of the moving company and the rent deposit as well as the brokerage commission also includes the renovation costs for the old and new apartment, provided that the moving person she has to wear in both cases.
If the tenant only needs a loan for the deposit and the commission, the use of the overdraft facility appears reasonable. The deposit amounts to a maximum of three months ‘rent, while the brokerage commission may be two months’ rent plus sales tax. This means that a loan for a deposit and the commission can be used to finance five months’ rent.
This amount can be offset within a few months if the earnings are good and the rent is not excessively high, especially since the tenant usually receives the security deposit of the old apartment after six months at the latest.
Deposit insurance as an alternative to borrowing?
The promotion of taking out surety insurance instead of borrowing to pay the rent deposit is increasing. Basically, the idea of not having to use the required credit for bail and commission alike is tempting. If insurance is taken out instead of borrowing for the rental deposit, the loan amount is reduced and, as a result, the monthly burden on the loan is reduced. However, while the tenant receives the deposit with interest after the move – except in the case of justified complaints – the insurance premiums to be paid for a deposit insurance are lost.
In addition, in the case of long-term rental contracts, they reach a higher sum than the deposit actually to be deposited, because the obligation to pay remains until the end of the rental contract. In addition, the so-called deposit insurance is not really insurance. Rather, it is a guarantee loan.
If the landlord makes claims from the deposit insurance after moving out, the tenant must repay these to the insurer in addition to the premiums already paid, so that a loan for the deposit and the commission is cheaper than the conclusion of the insurance contract.