Austrian Mortgage Guide

Even though you are legally employed during parental leave, banks often treat you as not actively employed.

👉 Therefore, your income is usually not counted.

Exception:

• If you can provide a confirmation of re-employment (Wiedereinstellungszusage):
• future income may be considered
• even parental allowance can be partially counted

Mortgage in Austria for Entrepreneurs

– What Every Business Owner Needs to Know

Buying an apartment or house in Austria as an entrepreneur comes with additional challenges. Many business owners and freelancers struggle with the fact that banks tend to treat non-salaried income with uncertainty.

In this section, I summarize what entrepreneurs should pay attention to when applying for a loan and how they can increase their chances of securing a stable, long-term mortgage.

 

Why is it more difficult for entrepreneurs to get a loan?

Banks primarily look for stable and predictable income. As an employee, this is straightforward: there are payslips and an employment relationship without a probation period.

As an entrepreneur, however, the bank needs to verify several factors:

• Tax returns from the past 2–3 years
• Annual profit and loss
• Regular bank account activity
• Contracts and client base – proof of sustainable income

👉 Therefore, proper documentation and preparation are crucial.

 

What documents will you need?

Banks typically require the following:

• Proof of income: tax assessments (Einkommensteuerbescheid) from the past 2–3 years
• Accounting statements (Einnahmen-Ausgaben-Rechnung)
• Bank statements – demonstrating regular income
• Articles of association / company registration documents

💡 Tip: The more organized your accounting is, the faster the loan approval process will be.

 

Fixed or variable interest rates for entrepreneurs?

As an entrepreneur, security and predictability are especially important:

• Fixed interest rate: stable monthly payments, predictable costs, protection against rising interest rates
• Variable interest rate: lower initial payments, but uncertain future

👉 Our expert recommendation: choose a fixed rate for as long as possible to ensure predictable financial planning for your business.

 

How can you improve your chances of approval?

• Stable business history – at least 2–3 years of operation
• Well-organized finances – accounting and bank records
• Higher down payment – 20–30% reduces the bank’s risk
• Planned repayment – your income is proportional to the loan installment
• Professional support – we help you understand bank requirements in your native language

 

Common mistakes entrepreneurs make

• Not preparing complete documentation – we guide you through what each bank requires
• Underestimating the required down payment or interest rate risks – we can advise you on this
• Relying on variable interest rates in an uncertain market – we strongly caution against this
• Applying to multiple banks at the same time, complicating the process instead of working with us to manage it efficiently – with our help, this won’t happen to you 🙂

Fixed vs. Variable Interest Rates in Austria

– Why Conscious Clients Choose Security

Many clients initially lean toward a variable interest rate because it seems cheaper. But is it really?

In this section, I’ll show the real differences and risks, and explain why more and more people in Austria are choosing long-term fixed interest rates.

What do fixed and variable interest rates mean?

Fixed interest rate (Fixzins): 

• The interest rate is set in advance (e.g., for 10, 15, 20, or even 30 years)
• Your monthly repayment does not change
• Provides complete security

Variable interest rate (Variabler Zinssatz):

• The interest rate is tied to market rates (e.g., Euribor)
• Your monthly repayment can rise or fall
• Usually lower at the beginning
•  

Why does a variable rate seem attractive?

Simple: it’s often cheaper at the start.

👉 Lower initial repayments and 👉 lower monthly expenses early on

But this is only half the story.

 

The reality: interest rates fluctuate – and not always downward, in fact!

 

One of the key lessons from recent years:

👉 Interest rates can rise quickly and significantly. For this reason, we always recommend our clients opt for long-term fixed interest rates.

Many borrowers in Austria who chose variable rates have unfortunately experienced:

• Suddenly paying hundreds of euros more per month
• Their financial situation becoming uncertain
• This is not theoretical – it really happens.

Fixed rate: predictability in an uncertain world

 

The biggest advantage of a long-term fixed rate:

👉 You know exactly how much you will pay 10–20 years from now

This is particularly important if:

• You have a family
• You plan to stay in Austria long-term
• You do not want to take financial risks

 

Why do we, as experts, recommend long-term fixed rates?

We advise most of our clients to choose this option – and not without reason, for three main reasons:

• Protection against rising interest rates: If rates increase, you are protected.
• Predictable future: No surprises. No stress.
• Peace of mind: Often underestimated, but invaluable in the long term.

 

Are there disadvantages to fixed rates?

Yes – and it’s important to see this clearly:

Repayments can be slightly higher at the start

If interest rates fall, you won’t automatically benefit

👉 But the question is not: “What is the cheapest option today?”
It is: What is the safest choice for the next 10–20 years?

 

Who might benefit from a variable rate? Honestly: it’s not always a bad choice.

A variable rate can be an option if:

• You are planning short-term
• You have high financial reserves and can manage the risk

👉 But for most families, this represents too much uncertainty.

What do conscious borrowers in Austria do today?

The trend is clear: 👉 more and more choose long-term fixed rates (15–30 years)

Why?

• They want a predictable financial environment
• They have learned from recent years’ interest rate increases
• They do not want to take interest rate risk.

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