Buy the plot separately or finance it together?

2022-09-04 14:08:33

2% consumer and 4% real estate? I can't believe it. (Even though the amounts and terms are obviously completely different.)

But that’s actually true. You can just check comparison sites.

2022-09-04 14:11:48

2% consumer and 4% real estate? I can't believe that. (Even if the amounts and terms are of course completely different.)

But it’s not really decisive anyway. Before building a house, it’s paid off one way or another.

2022-09-04 15:08:46

You couldn’t understand either because I expressed myself strangely. I meant purchase price minus equity equals "remaining debt". With two years, it really hardly matters how you finance it. The binding planning probably starts from the purchase. Several months will pass until the start of construction anyway. With 25k, I would want to waive a mortgage because it also causes costs. So buy and repay as quickly as possible.

2022-09-05 16:52:49

Thank you all very much for your feedback. Good to know what you don't know ;) I read the tenor that one should secure the plot and finance it individually, then proceed to the concrete house planning and with the financing need identified there, go into the house financing. Possibly including repayment of the land loan, if it has not yet been paid off by then.

Whether it then becomes a consumer loan or a variable or short-term mortgage loan, there are different opinions on that. So I would have to calculate it carefully once it gets serious.

Could it also make sense to finance the plot (almost) without equity contribution at 80-100% variable, and then repay the variable loan with an overall loan? Or is that perhaps even urgently necessary to keep the equity for parts of the house construction that cannot be financed (incidental building costs, kitchen, etc.)?

You write that with a variable financing the costs are higher than with a private loan. Is that generally the case or "only" your assumption due to the current interest rate development? Or because the land charge registration is also factored into this calculation, which is waived with the private loan?

I would assume a term of 18-24 months for a €25k loan. Unfortunately, I do not understand your second sentence in this context. The "remaining debts" would then be the mortgage financing for the house construction, which will logically be a normal annuity loan.

So a variable loan for construction financing is currently between 3% and 5%, depending on the bank. And then you have to register land charges at the notary + local court costs, so the total costs are way too high when you consider that you can also repay the amount quickly.

Then a private loan at 3% would be much cheaper. Even at 4% it would be cheaper.

Buy the plot separately or finance it together?

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