3 financing options for 300,000 euros: Which is the best?

Assumption: We want to borrow 300,000 Euros because our project requires a total cost of 400,000 Euros. We have between 95,000 - 100,000 as equity in the form of a plot of land (45,000) and cash (50,000).

1st offer
- Annuity loan 200,000; 2% repayment; 3.40 nominal interest; 5% special repayment; fixed interest period 15 years; remaining debt after 15 years: 121,871.75
- KFW Kind 50,000; 1.92% repayment; 2.35 nominal interest; no special repayment; fixed interest period 10 years; remaining debt after 10 years: 40,388.38
- KfW Energie 50,000; 2.97% repayment; 1.00 nominal interest; no special repayment; fixed interest period 10 years; remaining debt after 10 years: 36,020.88

2nd offer
- Annuity loan 200,000; 2% repayment; 3.36 nominal interest; 5% special repayment; fixed interest period 20 years; remaining debt after 20 years: 86,154.38
- KfW Kind 50,000; 1.83% repayment; 2.60 nominal interest; no special repayment; fixed interest period 10 years; remaining debt after 10 years: 40,733.46
- KfW Energie 50,000; 2.86% repayment; 1.25 nominal interest; no special repayment; fixed interest period 10 years; remaining debt after 10 years: 36,385.67

3rd offer
- Fuchs Wohnbau 50,000; ???; 2.70 nominal interest; fixed for the entire term
- Construction loan MHB 155; 2.50% repayment; 3.3710 bedroom; fixed interest period 20 years; remaining debt after 20 years: 55,071.95
- KfW Kind 50,000; 2.33% repayment; 2.55 nominal interest; no special repayment; fixed interest period 10 years; remaining debt after 10 years: 38,215.36
- KfW Energie 50,000; 3.02% repayment; 0.90 nominal interest; no special repayment; fixed interest period 10 years; remaining debt after 10 years: 35,853.66

The first two offers are from an independent agency/broker, the third from the local bank. No. 1 and 2 differ only in the interest lock-in period (15 and 20 years), which accordingly has an impact.

The information is still vague, we probably do not need the full 300,000 Euros. But if something unforeseen happens now (my wife goes alone to the kitchen studio and buys something), then we have 30,000 + X as a buffer... so far!

I know it’s a torment for non-bankers to understand all of the above and quickly calculate. Nevertheless, I would appreciate honest opinions. Has anyone gotten a better loan? Or better ideas?

Best regards,

Leon

Hello Leon,
I have just also completed financing in a similar constellation. KFW + MHB, MHB has just launched a quota "Take 30 pay 20". There you get the 30-year fixed interest rate at the price of a 20-year fixed interest rate.
For us, this simply settled the question of the financing structure. 0.1% more or less on a EUR 200,000 loan, for example, is (now please don’t scold) irrelevant. We are then talking about 17 EUR per month. In the current situation, I prefer a fixed interest rate for as long as possible and don’t have to worry much for the rest of my life.
As a banker, I am not convinced by building savings variants and would keep away from them.
My conclusion (without calculating in EUR): Financing as long as possible (with or without special repayment is rather irrelevant for at least 20 years) including KfW = option 2
Try to talk again with the local Volksbank/Raiffeisenbank about the MHB loan.

Regards
Nordanney

P.S. KfW loans can be taken without damage if you have a somewhat lower need.

I did the math:

In the first 15 years, you pay about €1,500 more in interest with option 2 than with option 1 for five additional years of interest rate security on the main loan.

By the way, I got slightly different remaining balances, but there are no big differences.

I find the remaining balances quite high, and relatively speaking, the cheaper loans are paid off faster. How this can be influenced with the KfW, I don’t know.

Option 3: Well, there you immediately pay 1% closing fees again, and according to the Schw. Hall website, the interest rate of the building loan is not so great either; the 2.7% likely only applies to the interest-only loan.

Hello Leon, to be honest, your posts surprise me. Why not L-Bank now?

I am very inflexible with the Z15 loan. Our house will now be approximately 185 + X sqm. The L-Bank does not go along with that. The aforementioned options are not even offers; they are recommendations. I wanted to know from the banks and brokers "what if" - and this is what came out of it. We do not yet have an overall cost breakdown. That was initial information. We would now be short on time regarding the Z15. In every thread here, the advice is: compare, don’t be fooled, and be open to other options... I have taken that to heart!

I hope you will have an overview of everything then.