Bridge financing / variable loan

Hello everyone,

I have a few questions about possible approaches to financing our house construction.

Currently, the land allocation is being handled by the municipality, and we expect the award in December/January. How quickly the purchase must then be completed is still unclear.

Our liquid equity is not enough to buy the land completely. We are missing about 50,000 euros. The majority of our equity is tied up in the form of an apartment that we currently occupy ourselves. This is supposed to remain the case until the house is completed. There is still a land charge of 50,000 euros registered on the apartment, but it has already been paid.

We have now had the first talks regarding possible financing. It was clarified that a loan in the necessary amount would basically not be a problem. To access the tied-up equity, a bridge loan would be possible, which, however, costs about 3.5 percent.

We have not yet spoken to any architects or construction companies, so there is no detailed planning of the house yet, as this also depends on the plot. So, we have no idea how long the lead time will be before we can start building.

Can you give me tips on the best way to proceed with the financing?

Thank you very much in advance!

hello, why should a zwfi 3.5 & cost ?? who says that ?

Banks sometimes offer one-year loans as bridge financing, which due to the one-year fixed interest rate are actually relatively expensive. A completely variable bridge financing should be cheaper. Or: Your bank sees the opportunity for a nice side income ...

We have just finished this game. Our old property served as equity for the new house, so a bridging loan was necessary for the construction phase (in the amount of the purchase price of the old property.)

We then received a variable loan with 2.75 percent relatively easily from our house bank, which was later adjusted to 2.6 percent.

Bridging loans are always significantly more expensive due to very short terms. Likewise, the bank has no collateral in the form of a land charge, which is understandable.

One more note: If a land charge is actually registered, it is in first position – which means for you during the house construction that other banks practically no longer finance or only with surcharges!

We have also parked our equity in an apartment. That means we also need a loan in between. We have signed a contract for 2 years at 0.95%.

Thanks in advance for the answers. Given the unclear timeline, does it make sense to first take out a loan for the remaining amount for the land purchase? Or would you tackle the entire financing right away?

How exactly does the whole process work in the first case?