Construction financing - is it possible to reduce the interest rate?

That can't be worth it at all, Alex.

So if it were worth it, the bank would be making a huge mistake in the calculation.

Purely mathematically, both should ultimately lead to approximately the same result.

Anything else would be nonsense.

That can't possibly be worthwhile, Alex.

If it were worthwhile, the bank would be making a huge mistake in the calculation.

Purely mathematically, both should lead to roughly the same result overall.

Anything else would be nonsense.

especially since the financing bank would have to agree to an early repayment. You don't have a right (except for the sale of the property).

Anyone could just come along and want to repay early.

The problem is probably the termination option, yes. The rest has to be calculated, compared to the forward.

Then do the math, Alex.

My job tells me: No.

Because otherwise either the forward would be too cheap or the VFE too low.

The prepayment penalty is tied to the old interest rate level. It can never be worth it, so I didn't mention it (although I briefly considered it).

Here you should repay, repay, repay. Where else do you get such high interest rates? Yes yes, stocks, shipping containers, drugs ...

Here one should repay, repay, repay. Where else do you get such high interest rates? Yes yes, stocks, shipping containers, drugs ...

You forgot Bitcoin & Co. :-D