Construction financing - we are disillusioned

My husband and I are considering building a house – the main reason is that we currently live as tenants in the middle of the city and pay a correspondingly high cold rent. This money is just "gone." It seems safer and more sensible to us to acquire property and thereby also acquire an asset.

I myself have a net monthly income of 2300 euros. My husband became self-employed a year ago – and it’s going well. Nevertheless, you can’t expect financial miracles at the beginning. At the moment, his "net income" is between 900-1200 euros. If things continue to improve, of course we hope that it will soon be significantly higher.

However, Sparda no longer grants loans to the self-employed. Is that generally the case or can we expect more at another bank?

Unfortunately, we don’t have much equity, about 20,000 euros and a building savings contract that is not yet ready for allocation, but you could probably get about 10,000 euros out of that.

We have in mind a property that would cost us about 320,000 euros all in all. For a monthly installment of 1000 euros, we would probably, with Kfw already included, get a loan of 230,000. But that would not be enough :( :(

Since the loan would only be based on my salary, I don’t even know if we would get the 230,000 at all? The lady mentioned that with a monthly income of 850 euros you would get a loan of 190,000, but with that we wouldn’t get anything :( :(

So the ladies and gentlemen of the bank are not entirely wrong. I spoke with the bankers in the family just a few days ago and realistically, you currently pay about €500 monthly for a €100,000 loan.

The question then is whether you get a loan at all. Basically, it depends on the amount of equity. The higher it is, the higher the chance of getting a loan. The rest then depends on the amount of income and the sum you are willing / able to pay monthly. You can then calculate that with the above-mentioned rate.

I would advise against building due to the double burden of rent - construction period interest. Better to look for an existing property. With your husband's short period of self-employment, his income will certainly not be taken into account. It is also important what you understand by "net." Have income taxes and health insurance contributions already been deducted?

A 320K property with that ridiculous income and comparatively meager equity. What are you actually dreaming about at night?

A 320K property with that laughable income and comparatively meager equity. What exactly do you dream about at night?

Definitely not of you, one could also say kindly.

Definitely not from you, one could say that politely

Kindness is not always appropriate when it comes to bringing someone down to the harsh ground of reality.
Better an end with pain than pain without end...