Current experiences with interest rate conditions

Hello everyone,

I am currently looking for good interest rates for my financing.

We currently have an interest rate of 2.97% (3.02% effective) from the Commerzbank.

5% special repayment p.a. and interest rate fixed for 10 years.

In addition, there are Kfw funds (Prg. 153) also for 10 years at 1.86%.

The property is being built in Ostholstein.

Does anyone have an interesting suggestion for optimization? The only requirement is a pure annuity loan as financing. Everything else is out of the question for us.

Best regards
Ostsee

Without knowing how much equity you have, it is hard to assess.
With the interest rate, I assume it is over 40%, which is the relatively best interest rate you get at most banks.
About 1-2 months ago, I concluded a deal with PSD Bank at 2.89 (2.94), which still has the same conditions.
However, there isn’t exactly a branch on every corner (online is of course also possible, but for such a contract I preferred to go to the branch).
Otherwise, that sounds pretty good.

Hello Baltic Sea

with today's conditions, I definitely would not agree to only a 10-year fixed interest period...

Why is only an annuity loan an option for you?

Well, I have secured the interest rates for the entire term - 3.2% nominal (TA loan with building savings contract)
I am happy to accept this slight interest premium - in 10 years the interest rates will certainly not be lower than today.

Regards
Micha :cool:

We have also signed for a 30-year commitment. If the interest rate is still low in 10 years, I will have lost 12,000 EUR. I think that is a small investment for the following 20 years.

Hello Baltic Sea

well, with today's conditions I would definitely not agree on only 10 years fixed interest rate...

Why is only an annuity loan an option for you?

Well, I secured the interest rates over the entire term - 3.2% nominal (TA loan with building savings contract)
I gladly accept this slight interest surcharge - in 10 years the interest rates will certainly not be lower than today.

Regards
Micha :cool:

Moin!

Well - I would be a bit cautious with that tip. Apart from the fact that I have already had unpleasant experiences with allocation dates (and thus costs of interim financing), such an annuity loan is wonderfully clear:

For every euro that I pay as (special) repayment, of course I no longer pay interest! Different with the building savings contract - I continue to pay interest of over 3% and receive a credit interest of how much currently? 1%?

And how high is the annuity after allocation? Up to 12%? You have to be able to afford that!

Best regards,
TomTom.

Hello Tom

[...] that I have already had unpleasant experiences with allocation dates (and thus costs of interim financing), [...]

What kind of unpleasant experiences? The allocation date is set in advance anyway. It can only be delayed if you do not pay the savings contributions to the building savings contract as agreed?
Could you please explain this statement in more detail?!?!

an annuity loan is wonderfully clear:

Well, clarity is a bit of a matter of opinion – some people lose track as soon as they have more than two things at the same time, while others keep an overview even in the most complicated situations – you can’t generalize this; everyone has to know that for themselves.

For every euro that I (pre)pay, I of course no longer pay interest!

That’s true, but it’s a question of prepayment options. If you expect that you can make prepayments, then you have to agree on a corresponding contract; if you don’t expect that, then the right is of no use to you...

Furthermore, the question is whether you want to prepay. And that depends on how you assess the future interest rate situation.
If interest rates rise significantly again – e.g., (caution: just an example) in 2008 the overnight deposit rates were around 4% – then I’m not so stupid as to end my cheap loan that also gives me tax benefits...

I don’t even want to start with the discounting effects due to inflation here...

It’s different with the building savings contract – I still pay interest of over 3% and currently receive a credit interest rate of how much? 1%?

Yes, the credit interest rate is currently at 1%.
Sure, I have a higher interest rate than with an annuity loan, but I still have it in 10 years and in 20 years.
If I have to renegotiate in 10 years: 10 years ago, interest was above 5%!
What good is it to save now if I don’t know whether I can still afford the installments in 10 years...
As I said, it depends entirely on how each person personally expects the further interest rate development...

And how high is the annuity after allocation? Up to 12 %? You have to be able to afford that!

I don’t understand that now?!?!
Could you please explain this statement in more detail?
I don’t know the repayment rate after allocation by heart, but the monthly burden remains the same!
Besides, in this second phase (repayment phase of the building savings contract), you can always make prepayments in any amount – not just 5% p.a.

But which model is best for which individual financial and financing situation cannot be judged generally anyway.

Regards
Micha