Basic / Home Financing Split?

Hello, I would also try to do a short term. However, an experienced bank will not agree to that. Subordinated financing can/must not be more expensive. Parental home is an option. Is Bank1 really that much more expensive than the market? Another alternative; fixed for 5 years and then do a forward loan in 2 years. I don't think we will see 4.?75 in the next few years.

Hello, I would also try to go for a short term. However, an experienced bank won't go along with that. Subordinated financing can/must not necessarily be more expensive. Parental home is an option. Is Bank1 really that much more expensive than the market? Another alternative; fixed for 5 years and then do a forward loan in 2 years. I don’t think we will see 4,?75 in the next few years

Thanks for the feedback. The fact is that we both live in Munich and for understandable reasons cannot build here. So it’s about the metropolitan area around Munich and prices are already quite steep there. Ergo, every 0.1% on an amount of €750,000 helps over the decades. Hence the combination with parental home land charge, KfW energy-efficient building (KfW 40+ house), KfW homeownership subsidy, equity capital, and further subsidies for photovoltaics, energy storage, etc. We are still waiting for the offer. It should come in the next 1-2 days. Then I will give feedback here. Currently, they could be in the range of 1.09-1.2%.

I would do the land purchase with Bank 1 - but not for 15 years, instead for a maximum of two years. Or are you tied to a long-term financing? Then you could plan calmly and negotiate the overall package with Bank 2.

They probably won’t agree to a variable financing?! That would be your optimum.

They probably won't agree to a variable financing?! That would be your optimum.

I was just about to suggest that.

Why don’t you just bridge the whole thing with a variable rate and then repay the loan?

We are in a similar situation, visited 5 different banks, and 2 banks offered us a variable loan because the banks wanted to get the contract for the 2nd loan as well. The other 3 banks were not interested, or it was probably too much effort and too little profit for them.

We got a variable interest rate of 0.98% now, which is very, very good.

Just a thought for you... Find a bank that does that!

Thank you for your feedback! Yesterday's phone call sounded very good regarding the conditions, and suddenly 25 years is possible. I am still waiting for the written offer, but everything between 1.1% and 1.3% fixed for 25 years seems very good to me, or am I wrong? I mean, the interest rate is currently low, but what if it goes up to 2% or more in 15 years? That would be considerably worse. Maybe I am thinking too conservatively. Please enlighten me.

Thank you for your feedback! Yesterday's phone call sounded very good in terms of conditions and suddenly 25 years is possible. I am still waiting for the written offer but I consider anything between 1.1% and 1.3% fixed for 25 years to be very good, or am I wrong? I mean currently the interest rate is low but what if in 15 years it goes up to 2% or more, then it is already significantly worse. Maybe I am thinking too conservatively. Please enlighten me

Yes, up to 1.5% the offer is still okay.

We split our financing. KfW with 10 years, then another "smaller" part with good conditions at the bank also for 10 years and then a large amount long-term with 25 years fixed interest.