Ask a tax advisor on the topic of Other questions to tax advisors

Taking out a mortgage

January 13, 2011 | 40,00 EUR | answered by Steuerbera Georg Stahn

I have purchased a 2-room apartment for rent for 110,000 euros and have already paid for it.

Now I would like to take out a mortgage (for renovation and for tax reasons) over 10 years, and then sell the apartment again.
My income (tax class 1) consists of a pension of over 1600 euros net plus 500 euros immediate annuity, with the rent intended to supplement my income.
Is it tax-wise to take out a mortgage of 40,000 euros with 2% repayment or one of 50,000 euros with 1% repayment; each with possible additional repayments.

Steuerbera Georg Stahn

Hello and thank you for your inquiry.

I would recommend taking out the loan with a 1% repayment rate to keep the monthly burden as low as possible. Additionally, there is the tax savings from the higher interest expenses.

For further questions, I am happy to assist you at any time at georgstahn@t-online.de.

Best regards,

Georg Stahn
(Tax consultant)