Assessment for interim financing desired

Hello dear forum,

we are a small family with one child. The condominium is becoming too small, so we need the house.

Salary 1: 2,800 net + 500 net from a side job
Salary 2: 800 net part-time
Cars were newly bought just last year and there are no other loans except for the loan on the condo.

Currently, we have a terraced mid-terrace house from 2005 reserved for €270,000.
The value of our condominium is estimated at around €200,000. Conservatively estimated sale price €170,000.

Financing need is €250,000 plus €80,000 as bridging finance.

Now to the problem: We are tied to Bank A because there is an outstanding loan on the condo of €72,000.
Early repayment fee (VFE) is about €5,000.

Bank A offers to transfer the €72,000 (interest rate 2.01%) and to provide a new loan for the remaining amount of €178,000 with an interest rate of 1.77%. Bank B offered us a loan for the full amount with an interest rate of 1.61%.

Bank A is currently obstructing the bridging finance and does not want to finance the €80,000. The bank’s lending value is €180,000.

First of all, I find Bank A’s offer really bad, but no matter how I calculate it, I come out cheaper if I accept the worse conditions than to pay the early repayment fee. Why is there resistance for bridging finance?

I am a bit at a loss and don’t really know what to do (ok, it’s not that bad, but maybe someone has ideas)

Many thanks

Jan

With this salary and the required financing amount, I do not understand the problems with your bank. Either you had trouble paying the installments or something is missing here.

PS. Vfe can be waived by a bank if you stay with them.

Why do you have to arrange interim financing, the house is already standing so there is no risk when moving in. Schedule appointments cleverly and include a rental clause in the sale of the condominium.

Thank you for the quick response.

So, we have always paid everything and nothing is missing. Possibly a loan for further education, but that has been paid off for 4 months.

Thema VFE: The bank knows that and that's why the interest rate is so bad.

Bridge financing:

We have to bridge finance because the house will be bought soon and the apartment is not yet offered for sale.

How quickly the condo will sell is also questionable. Some say it will sell quickly because it is so nice. I am rather cautious because it is on the 2nd floor without an elevator.

Of course, I would also prefer to sell the condo first and then buy the house. Then I would even get the Baukindergeld again. But it’s just not that easy.

Alright, Bank B remains and swallows the 5 k VFE. Where is the problem? What makes me suspicious is that your ETW is worth almost as much as the house? Is it the age? I would also always calculate the sale proceeds more conservatively and possibly put the additional proceeds into special repayment.

Why do you want to sell the condo? Would it be an option to cover the old financing with the rental income?

@ HilfeHilfe

Well, there is still a 70,000€ difference between the apartment and the house. The apartment is located in the more sought-after neighborhood and is effectively 5 sqm larger than the house without usable space.

The house has just under 100 sqm + a converted attic of about 29 sqm (however, you can stand on the sides except for the last 1.5-2m, reminds me of my childhood room) + basement.



Calculated it and it’s really not worth it and too risky for me with an apartment of 100 sqm.
I’d rather have less loan and less work