Construction financing feasible

Hello,

we are planning the construction of a semi-detached house together with my brother and are currently working on the financing plan. Our key data:

We expect the house to cost approximately €300,000 + outdoor facilities. (KFW70)

We already have the plot and it does not need to be financed. (Value €100,000)

Together, we have a total income of €3,700 net/month plus a 13th monthly salary for both of us and are employed in the public sector. (no outstanding )loans
We have total equity of €35,000, of which €25,000 will be used for financing.
Both of us are relatively new to our careers and children are planned no earlier than in 2 years.

Our financing plan includes a rate of €1,200. We have estimated additional costs at €300. Is that realistic? No special repayments are planned for the first 5 years but then for the last 5 years. How is it with you, have you ever used/been able to use the special repayment option at all?

Do you think the financing is feasible?

We are planning initially for 10 years.

Thanks for your opinion.

Regards
Baufuchs der erste

I would rather choose an interest rate lock for 15 or 20 years. It costs more but offers considerably more security. Above all, you can cancel the contract after 10 years and take out a new one if the interest rates are significantly better. The remaining debt after 10 years would be far too high for me to take on an interest rate risk.

Just to avoid misunderstandings: The €300,000 only refers to your semi-detached house? The plot of land valued at €100,000 is solely yours or will it still be divided (2x €50,000)?

What is included in the €300,000? Basement? Additional construction costs?

Whether other forum members were able to make special repayments or not is completely irrelevant to you.

And in times of low interest rates, one should plan long-term, but then the interest rate goes up and probably the installment would be too expensive?!

@ backbone23 The 300,000 only refers to our half, the property is already divided so it is worth 100,000. The amount includes everything, so double garage, basement, ancillary construction costs. We have calculated the interest rate several times for 10 and 15 years, the interest jump is so high that the interest rate would have to rise to 4.7 for the 15-year term to be worthwhile.

And 20 years?

Well, what do you want to know now? ;)

According to my calculations (2.5% regular loan, Kfw 1.41% and 3% repayment, remaining repayment regular loan) you will still have over €180,000 outstanding after 10 years (without special repayments). Whether you want to take that on and whether you really can manage the €1,200 in the future (children) is something you have to decide. With the property, you definitely have a reasonable equity and a rate of €1,200 is not bad either.