Current financing offer from the house bank

I hope that hauskauf1987 will still see it that way in 20 years, so in his mid-50s and with a follow-up financing of over 400k€.

So if there are 400k at the end, everything that can go wrong really has to go wrong (0 euros saved in 20 years, no inheritance received from the grandparents, etc.) When I think about it like that, I should probably just stay in my 1300 euro 80m2 rented apartment, which will still cost 1300 euros in 20 years :)

But apparently it's not that simple :D

It simply helps to assume that the other party is not stupid. Whether banks, building societies, or investors in the capital market, these are all people who professionally create or trade financial products. If they price things obviously massively wrong, they quickly go bankrupt. If something sounds too good to be true... then it is.

And especially building savings contracts... almost everyone has them and they come across so innocently. But if you look closely, they are one of the most complex financial products that a private individual deals with. Particularly in combination with other financial products or with large sums (keyword deposit insurance), various pitfalls await. In addition, due to the long term from the contract conclusion to the loan, there is a significant risk for the saver to have a claim to a cheap loan against an insolvent company.

So if it ends up being 400k, then everything that could possibly go wrong really must have gone wrong (0 euros saved in 20 years, no inheritance received from the grandparents, etc.) When I think about it like that, I should probably just stay in my 1300 euro 80m2 rental apartment, which will still cost 1300 euros in 20 years :)

And if it says 400k, then inflation has continued for 20 years. 400k in 20 years corresponds to a present value today (with 2% p.a. inflation) of 270,000 euros.

And especially building savings contracts... almost everyone has them and they seem so innocent. But if you look closely, they are one of the most complex financial products that private individuals deal with. Especially in combination with other financial products or with large sums (keyword deposit insurance), various pitfalls lurk. In addition, due to the long term from conclusion to the loan, there is a significant risk for the saver to have a claim to a cheap loan against an insolvent company.

Well... so I can certainly understand that many points are viewed critically, but this sounds almost as if building savings contracts were the devil's financial tool and would trigger the next financial crisis. It's not about the fact that there are pros and cons that one may point out... but the question is how they are presented.

I don't understand at all why people ever or currently take out a [Bausparvertrag]. For me, it's completely overpriced, non-transparent, and unnecessary.

Well... I can certainly understand that many points are met with skepticism, but it almost sounds as if building savings contracts were the devil’s financial instrument and would trigger the next financial crisis.

No, it’s definitely not that bad. But they do have some disadvantages that are definitely not well known to the general public. And especially if you’re speculating that interest rates will be much higher in 20 years, you have to ask yourself whether it’s realistic that the building societies will be able to economically meet all the cheap credit claims then.
With an annuity loan, the matter is much simpler. Once the loan has been paid out, you no longer have any risk if the bank goes bankrupt.