2 (dream) properties - financing unclear. Save equity?

The property was purchased 3 years ago. It is financed through ING. Remaining debt: €41k. The standard land value has tripled in the meantime. Therefore, we would like to apply approximately €130k in added value as equity. According to several financiers, this is not a problem. However, we will know for sure when we apply for the financing.

Do you still have an interest rate lock with ING, or can you simply switch banks for the entire financing?

I would rather leave the equity on the account despite the crisis than in the cookie jar in the kitchen..

Would you then also prefer to use less equity?

We are currently considering using only as much equity as necessary and acquiring an apartment abroad for the rest, which we would basically have paid off immediately.. Such an opportunity doesn't come around every day....

Would you then also use less equity? We are currently considering using only as much equity as necessary and acquiring an apartment abroad for the rest, which we would have basically paid for directly.. Such an opportunity doesn't come around every day....

That was just a pun – Ybias invests the "free" equity in a kitchen – it’s not just sitting around. From an accounting perspective more consumption than investment, but oddly enough you sometimes do need a kitchen..

Whether it makes sense to invest now in a cheap property abroad is up to you. The domestic market is crazy enough for me already. Tell us a few more details about why this is such a good opportunity right now. During a global pandemic, where it's pretty bleak almost everywhere in Europe and all the analysts have to admit that they seriously didn't account for the winter in their models, I find it hard to identify clear, safe opportunities. There probably won’t be any bargains at peak prices in the current cycle?

On the contrary, since a lack of equity reserve can cause quite a few problems during construction, I would only consider further steps after moving in. With financing, you have to make sure to take advantage of the favorable interest rate jumps. Beyond that, you can consider holding back quite a bit of equity and, if necessary, making high special repayments yearly later on.

We recently had a conversation at Interhyp. ING, for example, has apparently tightened its requirements due to Corona.

We also have 5k net and the lady said that currently ING would finance us between 350-400k..

Were there similar responses from other banks as well?

Do you still have an interest rate lock with InG or can you simply change the bank for the entire financing?

Unfortunately, we have a 5-year interest rate lock. That was my mistake. But since ING has been our house bank for over 10 years, it is our favorite.

However, there has already been an offer from, among others, Allianz with a forward loan for the plot. But nothing definite yet. Since we still have to wait a few months with the financing. Hopefully, the building application will be submitted at the end of the month.

Bargains will hardly be available at all-time highs in the current cycle?

By the opportunity I did not mean that there is a bargain property, but that one has the money for a holiday apartment without further financing.

Were there similar answers from other banks as well?

No, that referred explicitly to ING, since that was the best offer from them. Therefore, we did not ask whether it was the same/would be the same at other banks.