This was explained to us as follows: The bank can reserve the conditions with KfW for two weeks, after which it must present the online confirmation - otherwise, you only get the loan at the then-current interest rates. So if the interest rates change, the bank cannot give you a binding commitment without the forms (unless it bears the interest rate change risk).
That is basically correct. Of course, in the end the bank can give you the conditions as offered weeks ago. Whether it wants to is another matter. Once everything has been compiled, the bank will ideally make you a concrete offer, and you say yes or no. But as I wrote above, the documents for the KfW are completely unnecessary in advance. It’s roughly like having to contractually buy the car first so that the car dealer then confirms that the car actually starts and that the bank wants to give you the money for it. For a bank, it’s actually no problem to issue a financing confirmation with acceptance of the KfW and to request the KfW documents afterwards. If, contrary to expectations, no KfW loan comes about, the bank can still make changes. For the customer, this is definitely much friendlier.
Basically, the whole thing is only trivial if you are very sure that the bank will give you the money. Anyone with 20% equity and looking for a reasonable installment at 25% of the household net income and being employed indefinitely will get their financing. But the main business is more likely those without equity and 40% household financing. And they have a real problem here.
If they obtain the required documents for a fee (depending on the provider/house type, architect fees apply) and receive a no, they are probably almost bankrupt and don’t even benefit from it...