Building savings contracts with two banks, financing new construction with two banks?

Hi everyone,

my girlfriend and I have building savings contracts with two different banks, which we want to use for a new construction. In addition to the building savings contracts, we also need a regular loan.

Is it possible to get a loan from our building savings contract at Bank A and B for the same new construction project and then borrow the amount that is still missing besides the building savings contracts from Bank A or B or even a third Bank C?

Is it possible to get a loan from our building savings contract at bank A and B for the same new construction project and then borrow the amount that is still missing besides the building savings contracts at bank A or B or even a third bank C?

Depends. Do the building societies want land charges? What maturities? The answer will be no 99% of the time, as long as the building societies require land charges.

We do not know that yet, we are still at the beginning of the process. So as a rough rule of thumb, usually you can only register a mortgage on the construction project with one bank, correct?

We don't know that yet, we're still at the beginning of the process. So as a rough rule of thumb, usually you can only register a land charge on the construction project with one bank, correct?

Basically correct. It has to do with the security. Whoever is first in the land register is in the first rank and gets their money first in the event of a forced auction. Only 60% of the lending value (not the purchase price or costs) is the security that a bank has. But hardly anyone finances that little (50% equity required). So a second or third bank, which should finance subordinately, will say no. Because then they have no or no real security. They would practically give you a loan based on your creditworthiness, but not on the house. This is called an unsecured loan. These tend to have interest rates around 8% for long terms – if you even get one. But as I said, you need concrete data for that.

Smaller building savings loans are available without a land register entry. I once heard something about 30,000.---, which together with the saved equity capital would then be 120,000.--

Thank you, that was exactly what I wanted to know, have a nice day everyone :)