Construction financing - How will it change in the future?

What exactly can the bank actually do then? Terminate the loan because the conditions have changed? What interest should banks have in that? If the borrower can no longer pay the installments of the new loan (with higher interest rates), the house will be sold and then it will be a loss-making deal for the bank.

My mother had to sell her house in 2008 due to unemployment. The sale of the house took over a year, but although the installments could no longer be fully paid long before, the bank kept its feet still because it knew exactly that a sale was difficult.

That is exactly the problem. When this case occurs, I see them falling like flies, the many people with their 100-120% financings sewn to the edge. In their place, I wouldn't have a peaceful second at all. Then it would really be about existence. No one gets away with just a black eye.

So IF it comes to that, it will be really bitter.

What kind of babble is that? Nothing is happening there. No bank wants to provoke a realization of the properties. They would lose money unnecessarily there.

What exactly can the bank actually do then? Cancel the loan because the conditions have changed?

As a rule, collateral reinforcement, partial repayment, or loan cancellation if the house value has changed negatively.

What interest should banks have in that?

None, as long as the installments are paid properly. Normally, the mortgage lending values, which are really in the minimal range (anything under a million), are no longer really looked at or checked.

the house is sold and the bank then makes a losing deal.

On average, the bank does not make a losing deal because banks in Germany finance extremely conservatively (and so do the customers). Other countries are much bolder in this respect, and long fixed interest periods only really exist here with us. By the way, the Pfandbrief also – that is why foreign countries envy us.

Usually collateral enhancement, partial repayment or loan termination if the house value changes negatively.

Can I then actually also terminate if the house value changes positively?

what kind of nonsense is that? Nothing is happening there. No bank wants to provoke a realization of the properties. They would lose money unnecessarily.

Oh, someone feels addressed.

Oh, someone is feeling addressed.

Now you actually made me have the first spontaneous loud laugh of the day. My house is paid off.