Category Archives: Finance

Renovate, refurbish, modernize – how does the financing differ?

Repainting the façade, repairing the leaky roof or insulating the exterior walls – for most homeowners, work on their own home will sooner or later come to their aid. In everyday life, the terms renovate, refurbish and modernize are often used interchangeably. But what exactly is the difference now? In order to finally find the right support for your project, you will learn in our blog post today how the three terms differ and what this means for your financing .

Renovate – beautify the home

Renovate - beautify the home

The living room can once again tolerate a new color and the painting of the window frames also needs a refresher. Optical beautification measures such as these fall under the term ” renovate “. Here, work is done that is not absolutely necessary, but primarily helps to make you feel better in your own four walls. Reason for this are usually wear and tear or the personal desire for change. Renovation works are also referred to as beauty repairs and can usually be done by any homeowner himself . These are simple works that do not require expert knowledge.

Typical renovations include:

  • Painting work, such as re-painting the facade or room walls
  • Replacement of the flooring
  • Wallpaper the walls

Refurbish – repair damages

Refurbish - repair damages

In contrast to the renovation, major damage to the house is eliminated during renovation. A repair repairs defects and restores the original condition of the building. Renovation is synonymous with the term ” repair “. For home improvements, inexperienced homeowners often need technical assistance , as the work is more complex and difficult than simple renovation. The elaborate work requires some of the intervention in the fabric of the house. Calling in experts is highly recommended here as they can help with their many years of experience and expertise, without causing any errors or further damage.

Typical refurbishment works are for example:

  • Elimination of mold
  • Replacement of defective water pipes
  • Repair of a leaky roof
  • Removal of pollutants like asbestos
  • Draining a cellar

Modernize – bring up to date

Modernize - bring up to date

Modernizing is about bringing your home up to date with a variety of measures. There must therefore be no serious damage for this. Modernization work should adapt the building again and again to the contemporary structural standards and also increase its utility value . So you can sell your modernized house more expensive than a house where only the bare necessities have been repaired for years. In addition, owners who regularly modernize their home can save costs, for example in the energy or water sector.

What includes a modernization is specified by law in §555b BGB. Accordingly, modernization measures are structural changes that must meet one of the following criteria:

  • Energy can be saved sustainably
  • Non-renewable primary energy (eg oil, coal, natural gas) can be saved or the climate sustainably protected
  • Water consumption is sustainably reduced
  • The general living conditions will be permanently improved
  • The utility value of the property is increased
  • The measures must be carried out on the basis of circumstances which the landlord is not responsible for and do not constitute conservation measures pursuant to 555a BGB
  • It will create new housing

Typical modernization works are for example:

  • Insert heat protection window
  • Replacement of a heating system – installation of a modern, more efficient heating
  • Modernization of the electrical system – installation of a smart home
  • Insulation of roofs or exterior walls

As a rule, modernizations are carried out on a voluntary basis. However, there are also modernization measures that are required by law . These include, for example, certain fire safety regulations that must be complied with.

Renovation, renovation, modernization – promotion and financing

Renovation, renovation, modernization - promotion and financing

To finance the renovation, refurbishment or modernization of your home, you can, for example, receive renovation or reorganization loans from some banks, as well as traditional real estate loans. These are regular installment loans, but these are earmarked. This means that the borrower can not freely decide what the loan will be used for. The bank has previously agreed to a loan agreement with a specified purpose. In return, the loan is cheaper than a normal installment loan.

Funding by Bank

The development Bank also supports refurbishment and modernization with various subsidy programs. It offers funding for energy renovation and age-appropriate conversion measures.

Bank promotional products:

  • Energy Efficient Refurbishment – Credit: Credit for an energetic partial or complete renovation of living space or the purchase of refurbished living space.
  • Energy Efficient Refurbishment – Investment Grant : The grant may be from private owners for an energetic renovation of living space or when buying refurbished living space.
  • Energy Efficient Refurbishment – Subsidy Construction Supervision: Grant for qualified construction supervision by an independent energy efficiency expert.
  • Energy efficient refurbishment – fuel cell subsidy: subsidy for the installation of stationary fuel cell systems in new or existing buildings.
  • Age-appropriate Rebuilding – Credit: Credit for renovations that promote living comfort or protect the house from burglaries.
  • Barrier Reduction – Investment Grant : The grant is intended to help private individuals to convert their home barrier-free and thus to increase living comfort.
  • Burglary protection – Investment subsidy: The subsidy promotes measures to protect a building against burglaries.

These products can also be used for modernization measures. Bank also supports the conversion of a home into a smart home with loans or grants. For this one can use either the financing offer “age-appropriate conversion” or “energy-efficient renovation”. With smart optimization , lighting and heating systems can be individually and energy-efficiently controlled.

Bank offers a number of loans and subsidies, especially in the area of ​​energy efficiency in refurbishments and new buildings. If you want to learn more about sustainable building , read our blog post on Green Buildings.


Find the right funding

In some cases it makes sense to combine the Bank promotional products. For example, if you want to refurbish both energy and barrier-free or you want to make your home burglar-proof, you can use the loans “energy-efficient renovation” and “age-appropriate conversion” together.

The funding measures in the field of ” Energy Efficient Refurbishment ” are:

  • Insulation of exterior walls and sunscreen
  • Renewal of the windows and sunscreen
  • Installation or renewal of a ventilation system
  • Insulation of the roof surfaces and the basement ceiling
  • Replacement of the heating
  • Installation of a photovoltaic system or a solar thermal system for the roof
  • Energetic specialist planning and construction supervision

The loan promotes the following measures in the areas of home comfort and burglary protection:

  • Wide paths and age-appropriate parking spaces
  • input ranges
  • Overcoming stairs and steps
  • Optimized room layout
  • Construction of a balcony, a loggia or a terrace
  • Remodeling of the bath
  • Intelligent assistance systems
  • Support from housing consultants, architects or craftsmen
  • Installation or retrofitting of doors
  • Securing windows and balcony and patio doors
  • Illumination of windows and doors
  • Installation of alarm systems
  • Installation of wide-angle spies, intercoms and video cameras

Divorce Costs – These divorce costs are financially yours

Divorce costs are composed of various financial items. These include the monthly income of the divorcing couple as well as the assets (house, land, interests in real estate or other assets). The compensation for spouses and the maintenance of custodial children is also included in the calculation.

What are the minimum costs for a divorce?

What are the minimum costs for a divorce?

Legislators have set the minimum fees for divorce under the Lawyers Compensation Act and Family Court Expenses Act. These laws are designed to prevent both lawyers from divorcing on “dumping prices” or mandating to negotiate too low a fee with a divorce lawyer.

Anyone who finds advertisements that say “cheap divorces” or “low-cost divorces” on the internet or a newspaper ad pays the fixed minimum fees. A fall below this is prohibited by law. The use of such words is legitimate, as the advertising ban for lawyers has fallen. Restrictions on outdoor advertising arise from the Bundesrechtsanwalts-Verordnung.

Note: When selecting a foreign divorce lawyer, it must be ensured that he provides proof of the ability to act on German territory.

How is the process value for divorce determined?

How is the process value for divorce determined?

For the value in dispute (method value ) the monthly net income of the spouses is summarized and then multiplied by the value 3. Furthermore, a credit of 10% of the existing pension equalization takes place.

Example calculation for the divorce costs

  • The spouse earns a monthly net income of 2,500 euros and the wife of 1,600 euros. This results in the following procedure value in the first step:

4,100 x 3 = 12,300 euros

If one of the two spouses refuses to indicate their income, an estimate is made by the divorce court. As a result, the procedural value is generally higher than the real income of both spouses.

  • In the second step, the supply equalization is used. If the spouse and the spouse have a pension of € 10,000 each, both married couples collectively receive a value of € 20,000. Here the court counts 10%.

The total amount is 14,300 euros, which is 12,300 euros net income and 2,000 euros compensation.

The divorce court (family court) increases the value to be awarded if two divorce lawyers of the clients to be represented determine different procedural values. In addition, the court has the right to seek assets, even if the spouses are uncontroversial on this point.

Which values ​​are still decisive for the calculation of the divorce costs?

Which values ​​are still decisive for the calculation of the divorce costs?

A procedural value increases as a result of other controversial situations, such as spouse or child support, a shared condominium or other assets. If the spouses have a separate predisposition in their marriage, each spouse will only take what they have earned or acquired before or during the marriage.

Increasing effect also the child benefit and the child support or parental allowance for the parent who relates it.

Reduce the amount in dispute if existing loans are repaid. However, this benefits only the spouse who has concluded the credit agreement.

There is a misconception that in marriage both partners are liable for the other or gain advantages. Only a jointly concluded loan agreement can reduce income in equal proportions.

What happens if there is no income and assets?

What happens if there is no income and assets?

Social benefits such as social allowance or unemployment benefit or Hartz-4 are not recognized as a value in dispute. If both spouses are in receipt of social benefits and there is no pension equalization, the method value amounts to € 0.00.


If both spouses disagree, each spouse is required to secure the funding of a divorce lawyer:

  1. The lawyer estimates at least 15 euros for the initial consultation according to statutory ordinance.
  2. Up to a procedural value of 3,000 euros, the legal fees per attorney amount to about 621.78 euros.
  3. In addition, there are 216 euros court costs.

Total: 837.78 euros

If the value of the procedure is less than € 6,000, the legal aid is usually granted and the costs of divorce are charged to the State.

Who pays for the divorce costs in advance?

Who pays for the divorce costs in advance?

Each of the two couples is obliged to pay for the initial consultation immediately. If, as a result, actual divorce occurs, a divorce lawyer makes the procedural fee and the on-time fee when submitting the divorce petition to the competent court. These are then lapsed if the client is granted a procedural cost subsidy.

How much does an expert / assessor for divorces cost?

How much does an expert / assessor for divorces cost?

In a few cases, spouses face serious disputes over assets. Especially for luxury goods and real estate, for which the divorce court appoints an expert or appraiser. The financial compensation results from the regional compensation, the asset, expenses and value added tax. There are specially experts or appraisers for each industry. As a rule, a real estate appraiser is not allowed to act as a car expert unless he has special training.

In divorce and family law negotiations, medical, pedagogical or psychological assessors who assess the best interests of the child are used in individual cases. This occurs when, for example, one of the two parents applies for sole custody and the other parent objects. The costs are charged to the parent who launches the appeal.

Each spouse has the right to commission their own expert or appraiser in advance, but bears the full cost of this alone.

An expert or expert will be rejected by the court or the opposing party if there is a reasonable suspicion of bias.

Facts at a glance:

  • Minimum fees are governed by the Lawyers Compensation Act and the Family Court Law
  • The method value is calculated from the monthly net income of both spouses and the asset equalization
  • Other economic assets have a negative or negative impact on the method value
  • The method value is set at € 0.00 if both spouses neither earn taxable income nor own a fortune
  • solvent spouses have to pay in advance for legal fees and court costs
  • it is possible to appoint experts or appraisers of one, two or the court
  • the costs are to be borne by the principal or by the petitioner, who appeals against a countermotion

What does (kind) unity and disagreement mean in a divorce?

If both spouses fully agree to the divorce, there is a friendly agreement. One of the two spouses submits to a divorce lawyer for divorce. The other spouse signs that the divorce is mutually agreed. The legal costs both bear equal shares.
– Unless one of the two spouses agrees to pay the full cost of the divorce. This makes sense if only one of the spouses has achieved a monthly net income or one of the two has a low income.

The commissioned divorce lawyer immediately requests that the court reduce the divorce costs by 25% and reduce the procedural value accordingly. The court does not have to grant that and can fully credit the procedure value. These are absolute exceptions. As a rule, in the case of a consensual divorce, the court follows the legal value of a lawyer.

Comparison of consensual and unanimous divorce:
If spouses dispute the consent of divorce and assets, significantly higher legal and court costs are incurred. In addition there are costs for experts and appraisers, as well as child maintenance and other factors. With a friendly agreement on all costs of divorce, the costs are lower and the divorce process is completed faster.

Is a lawyer’s office obligatory?
In front of a family court, which is responsible for divorce proceedings, the representation by a lawyer is necessary for at least one party. This does not mean that he / she may stay away from divorce during divorce proceedings. The other spouse may waive legal representation. In this respect, a divorce without a lawyer for a page is possible. This makes sense if both parties divorce by mutual agreement.

Facts at a glance:

  • The consensual divorce is cheaper and faster to perform than a disputed divorce
  • Procedural value of a consensual divorce is reduced by up to 25% by the divorce court
  • Divorce without a lawyer is possible for one of the spouses if divorce is by mutual agreement

Divorce costs and the tax

Divorce costs and the tax

Until the income tax return in 2012, divorce costs including separation and child maintenance were deductible as a special burden. At the beginning of 2013, the legislator ensured that the financial expenses incurred for a legal dispute were no longer deductible. The only exception: the taxpayer got into an existential danger as a result of the extra effort and can no longer guarantee the vital expenses as a result.

Divorce costs are in no way equivalent to other litigation costs (legal costs). In a divorce, at least one of the divorced spouses is dependent on the representation of a divorce lawyer before the family court. Similarly, in many cases, expert’s fees are not averted, which is why they represent a special financial burden. The decisive factor is whether one of the two spouses instructs the appraiser himself or is appointed by the court. There are no costs incurred by the couple if a judge obtains an independent assessment from external specialists.

A divorce is always to be carried out before a proper family court. Accordingly, there is a legal compulsion of the financial extra charge for the divorced couple. The resulting costs by the legislature jeopardize the existence of one or both spouses, depending on income. Accordingly, all “ancillary costs” that are not necessarily caused by the family court should not be deductible. These include separation and child maintenance, profit sharing or follow-up procedures that do not directly affect the divorce proceedings.

A divorce is partially tax deductible, as long as it is only the necessary costs for a divorce lawyer and the fees charged by the family court. If a tax office rejects this deduction in the tax return, the taxpayer has 30 days to object.

Facts at a glance

  • Since 2013 divorce costs are no longer deductible in full
  • Several judicial rulings by financial courts indicate that the minimum costs for a lawyer and court are a particular burden
  • There is a legal compulsion to divorce before a family court, which causes additional costs

Financial help with the divorce costs

For a spouse with low financial resources, there are two ways to secure the costs of the procedure :

  • Advance of procedure costs ( process cost advance)
  • Legal aid ( legal aid )

The economic help depends on the assets of the other spouse. As a priority, the advance payment of the procedural costs must always be applied for . In doing so, both the assets and income of the applicant and the spouse to be divorced are determined. If the court finds that divorce costs are unreasonable for one of the spouses, the other spouse must provide a procedural advance.

The advance payment of the procedural costs must be made to the first counseling at a divorce lawyer. This determines the value on the basis of the method value and transfers the determination to the competent family court. The court is entitled, if all documents have been thoroughly examined, to issue an interim order. Thus, the family court ensures that the applicant can legally claim the advance costs from the spouse. This is possible even if he refuses to provide information about his assets and income.

The solvent spouse, who has to pay the procedural advance by interim order, may apply for a payment in installments . The advance payment must not lead to any existential hardship. In this case, a family court grants installment payments and sets the monthly installments.

Procedural advance by relatives

Needy spouses who are unable to cover the costs of divorce often enter into dialogue with liquid relatives. Another option is instant credit for divorce costs.

The legal aid (Legal Aid / PKH) is a state judicial loans. In family matters, all persons who have reached the age of 14 are admitted to the application. A PKH covers only the fees for a lawyer and the resulting court costs. All further costs for a specially commissioned expert or expert are to be borne by the PKH recipient himself. Depending on the future economic existence of the PKH beneficiary, the legal aid will be granted with or without reimbursement. If necessary, the applicant must, if so ordered, file a sworn statement valid for three years. It is necessary to disclose all income (also foreseeable in the future), profits, assets and cash benefits of third parties.


Attention to legal expenses insurance
If there is a legal protection insurance, legal aid will only be granted if the policy expressly excludes all or part of the divorce costs.

The billing of the lawyer fees takes place when the legal aid is taken over the state treasury. The fee is reduced as a result of a direct fee agreement with the client. Further claims by the lawyer representing one of the spouses in the divorce are still admissible. However, only if the client uses additional legal assistance that is not covered by the legal aid.

The leaflet of the legal aid expressly states that a form for the Beneficiary must be completed for any material change in economic and / or personal circumstances. The self- assessment must be submitted to the competent court cashier without delay. This results in the repayment of a PKH an adjustment of the information already provided. As a result, monthly repayment rates can be increased or decreased to a maximum of 48 installments.

If a spouse receives a legal aid with repayment due to her low income, this will be repaid between five and 48 monthly installments. If there is a financial improvement in the repayment period, the form must be collected, completed and submitted to the competent court cash desk. The court then decides how far the future installments will increase each month.

Facts in detail:

  • Advance payment of legal costs must be applied for before legal aid
  • Financial assistance is available on request from relatives or through a quick loan
  • Legal expenses insurance check to what extent divorce costs are covered
  • Any material change in financial or personal circumstances must be indicated or submitted with PKH authorization

Extra-economic help with divorce

Extra-economic help with divorce

Free counseling centers for women and families help with divorces. The same applies to spouses and fathers in order to safeguard their rights and promote dialogue between the departing spouses. In hardship cases of a divorce, where there are serious disputes and the child’s welfare is taken into account, the local youth welfare office is available as a guide.