Buy house/property, financing possible? Interest rates?

Hello,
We are new here and we hope you can help us a little.

We are both 26 years old and want to buy a property soon. About us: we are both working and my girlfriend is also doing further training (finished at the end of June). We currently earn 3400€ net together (+bonus), from June probably 3800€ (+bonus). So far we have saved 35k in equity. I also have a Wohnriester and my partner has a Bausparvertrag. We can save a lot at the moment because our apartment is quite cheap but also relatively small, 50sqm. Now we want to buy a house because we want to have children in the next few years. The house should cost between 200k-250k. We are aware that additional purchase costs of about 10% will apply. What do you think, do we have a chance with equity of 35k and our income to get a loan or will the banks reject us? We wanted to talk to the banks from April, but for now it is important to me that my girlfriend finishes her training. Therefore, I first wanted to hear your opinion and get some comparison values before we go there. We want to be well prepared. Which bank can you recommend? What kind of interest rates should we expect? We would like to take out a loan for 15-20 years.
We would appreciate your answers
Best regards

Hello,

Your questions are hardly answerable reliably without further information.

Interest conditions and possible loan amount depend on many different factors, such as:

- Income (you had listed)
- Equity (you had listed)
- Mortgage lending value of the building
- Credit score of the borrowers
- Job security of the borrowers
- Desired installment amount
- Desired special repayment option
- Desired repayment adjustments
- ...

Roughly speaking, you can expect a monthly burden of about EUR 500.00 for every EUR 100,000 loan. However, this value can change significantly in both directions depending on the above-mentioned data.

I would therefore recommend that you make a non-binding appointment at your house bank under the keyword "Real estate financing - What can we afford". After that, you will already have a rough overview of your possibilities.

Before this appointment, you should consider:

- How much do we want to pay monthly?
- How much do we want to pay monthly?
- What does our dream property cost approximately?
- ...

In addition, you should consider whether it should be a new building or a used property and inform yourself about actual objects in the desired location - often, wishes and reality unfortunately differ greatly when it comes to real estate prices.

Regards,

Dirk

From now on, it is best to create a strict household budget.
What expenses do you have monthly?
* Food + hygiene
* Car (2?) - gasoline, costs for inspections, workshop, etc. etc.
* Insurance & retirement provision
* Telephone, mobile & internet
* Activities
* Travel
.... etc.

Children mean that you miss about 32% of your salary during parental leave (if more than 1 year then even more %!!)
After parental leave, part-time work is sure to follow.

I am not familiar with the other facts (equity). Other users can surely give you more reliable statements.

Hello,
We are new here and we hope you can help us a bit.

We are both 26 years old and want to get a property soon. About us: we are both working and my girlfriend is also doing a further education (finished at the end of June). We currently earn a combined €3400 net (+bonus), probably €3800 (+bonus) from June. So far, we have saved €35k in equity. I also have a Wohnriester and my partner has a building savings contract. We can save a lot at the moment because our apartment is quite cheap but also relatively small, 50 sqm. Now we want to buy a house because we want to have children in the next few years. The house should cost between €200k-250k. We know that additional purchase costs of about 10% will apply. What do you think, do we have a chance of getting a loan with an equity of €35k and our income or will the banks reject us? We wanted to talk to the banks from April, but right now it is important to me that my girlfriend finishes her further education. That’s why I wanted to hear your opinions first and get some comparison values before we go there. We want to be well prepared. Which bank can you recommend? What kind of interest rates should we expect? We would like to take out a loan for 15-20 years.
We would be happy about answers.
Best regards

10% additional construction costs will definitely be tight. Your already saved equity is good. There is probably room for more. The income is not that high... but it fits your expectation of €200-250k for a house. This certainly concerns an existing property and not a new build. At 26 and with a desire for children, I would save a bit more. In your early 30s and already having parental leave behind... everything looks more relaxed. We don’t live in the house yet, but I am sure it was the right decision to wait until mid-30s. We were able to save for many years and enjoy life without the responsibility of a house.

Hello you two,

the essentials have already been said.
For me, it has probably been a while since I financed something.

But back then, there were always two rules of thumb:

1. The financing amount should not be greater than one-third of the net income
2. Prove before (!) a contract that you can manage with the money you will have available after (!) the contract.

So try to live with number 2 for a while.

Also keep in mind that a house requires higher expenses than a small apartment, such as property tax, energy and water, maintenance, modernization, etc.

Considering your plans for children, you should also know beforehand how much net money you have left if only one earner remains.
And live through that too, not just on paper.

Sometimes wishful thinking is the father of the thought. Be honest with yourselves and don’t listen to the banks. They always get their money...

Regards
Frenzi

- How much do we want to pay monthly?
- How much do we want to pay at most monthly?
- How much does our dream property cost approximately?
- ...

Edit: Forgot a word...