Attic Extension Financing

Hello everyone,

we (a family of 4) would like to convert the attic at my parents' house.

The costs amount to approximately 80,000 Euros.

I earn 2,200 Euros net, my wife 1,000 Euros.

Child benefit for the 2 children amounts to 380 Euros.

There are the following existing loans:

20,000 Euros over 7 years at 275 Euros per month.

17,000 Euro car loan over 10 years at approx. 170 Euros per month.

Is a loan of 80,000 - 100,000 Euros realistic under these conditions?

Do we need a mortgage on the house for this, or are there other ways to realize this?

Thanks in advance!

Do we need a mortgage on the house for that, or are there other ways to get it realized?

Anything over 30K-50K only works through registration in the land register.

Depending on how it is currently mortgaged or not, the conditions are of course good.

17,000 euro car loan over 10 years at about 170 euros per month.

This is only indirectly a tip: With that term, I would reconsider the car. It is likely that in the 10th year you will be paying off a car that no longer exists. Or you will pay more for repairs and the like than it is still worth. The loan is not economical at all.

Ideally, your parents renovate the attic and rent it to you for relatively little money. Thinking a bit more economically doesn't hurt. Maybe keep a household budget book?

With the loans (term, installment amount), it seems like you can't afford 80,000. I assume the bank might be thinking the same.

Regarding the loans (term, installment amount), it seems as if you can't afford 80,000. I assume the bank might think the same.

Why is that?

The @OP only lists the income side. In other words, 3580 coming in, and 2 loans for 445€ going out.

Everything else is unknown, but that's less important for the bank and more important for the OP, whether the whole thing is balanced and sustainable.
For example, is rent being paid today, or will that no longer be the case? How high are the additional costs/house fees that the OP has to pay, etc...

As long as 80K can go as a mortgage on the house (or how high existing mortgages are), there are few banks that would not support this.

If all goes well, 80K with a 25-year full repayment is possible for 345€ monthly.

Why is that?

The @TE only lists the income side. In other words, 3580 in, and 2 loans totaling €445 out.

Everything else is unknown, but that's less important for the bank and more for the TE, whether the whole thing is balanced and sustainable. For example, is rent being paid today, or will it no longer be due? How high are the additional costs/house fees that the TE has to pay, etc...

As long as the €80K can go as a land charge on the house (or how high existing land charges are), there are few banks that would not support that.

If it goes well, the €80K could be fully repaid over 25 years for a monthly payment of €345.

That's true, with a land charge it probably doesn't matter further.