Coop Bank Made Home Loans Even More Affordable for Teachers

A year ago, the domestic Coop Bank began offering teachers favorable terms for home loans, resulting in one out of every ten home loans issued by the bank last year going to education workers. This year, the bank is making housing loans for teachers even more favorable.

If the teacher's home loan interest at Coop Bank started at 1.60% last year, this year it begins at 1.49%, to which 6-month euribor is added. In addition to the more favorable loan margin, the bank waives the loan agreement fee for teachers and covers home insurance payments of up to 100 euros in the first year of the loan through insurance arranged via Coop Insurance Broker. The bank also reimburses the teacher for the cost of real estate expert appraisal after the loan is issued and offers a free payment package for one year.

Karin Ossipova, head of Coop Bank's home loan business line, said that teachers have responded well to the bank's offering and have been active loan applicants. "Last year, one out of every ten new home loan contracts at Coop Bank was concluded with a general education school or kindergarten teacher," said Ossipova.

Teacher home loans were issued in all counties, but most, or 42% of contracts, were concluded with teachers in Tallinn and Harjumaa. In Tartu and Tartumaa, 18% of all teacher home loan contracts were concluded.

The average loan amount last year was 94,000 euros and the loan term was 19 years. In Harjumaa, this was 130,000 euros and in Ida-Virumaa, 33,000 euros. According to Ossipova, average loan amounts in different regions correlate with the general real estate price levels in those regions.

Last year, 23% of teachers also used the guarantee from the Enterprise and Innovation Foundation (EIS) for home acquisition, including the EIS rural area housing loan guarantee. EIS guarantees are intended for those who wish to take a loan to purchase a new home or renovate an existing one and reduce their down payment obligation. The rural area housing loan guarantee allows you to purchase and renovate a home outside growth centers.

Karin Ossipova said that the bank's offered benefits are designed to make home building for teachers as easy as possible. "Last year was certainly not easy for teachers, and negotiations regarding working conditions have not yielded the expected results for everyone. The ongoing concern about teacher workload and the compensation commensurate with their role affects all of society. As a bank, we cannot ignore the gap between teacher workload, responsibility, and the compensation they receive for their work, but we can help them build a home they dream of and deserve," said Ossipova, explaining why the bank decided to continue offering favorable home loan terms to education workers this year.

Coop Bank's teacher home loan can be applied for by all kindergarten and general education school teachers, including teaching assistants and support specialists, teacher assistants, school psychologists, special education teachers, social pedagogues, educational advisors, heads of studies, and heads of educational institutions. The loan can be used for purchasing, building, renovating a home, as well as refinancing an existing home loan.

A teacher can be either the primary loan applicant or a co-applicant, and a teacher home loan can be applied for together with EIS housing loan guarantees, which help significantly reduce the down payment for a home loan. "The most popular ones include, for example, the young specialist guarantee, the young family guarantee, and the large family guarantee. Teachers living outside growth centers can also use the EIS guarantee to reduce their down payment, which is intended for home buyers in rural areas, and the additional loan offered by the Rural Development Foundation (MES)," said Ossipova. Source: cooppank.ee