Debt restructuring in construction financing

That is completely wrong in every respect! The low interest rates should definitely NOT be a reason for a "quick decision"! Renting is by no means wasted time! Paying rent can be and is in millions of cases very sensible. I do not regret a single euro of rent.

I want to contradict that, at least partially! I agree with you that one should not cultivate panic because of the interest rate situation right now and then approach the matter thoughtlessly. But besides that, we have already had the discussion about "price increases in real estate," "rental costs during the saving phase," and "interest rate risk in the future."

I think that in very few cases it is actually necessary to still save equity if you want to buy right now. The only really important point to consider is the over-indebtedness resulting from missing equity in the first 5-8 years. But I see less of a problem here thanks to the "security" provided by the family (parental company). Otherwise, it just gets a bit more expensive, but as long as you can and want to afford it... why not?

If the installments for the loan do not further burden your monthly budget, just pay it off quietly. Apart from a possible interest saving through refinancing, nothing changes for you and your situation.

I would like to disagree with that, at least partially! I agree with you that one should not cultivate a panic due to the current interest rate situation and then approach the matter rashly. But we have already had the discussion about "price increases in real estate," "rental costs during the saving phase," and "interest rate risk in the future."

I think that in very few cases it is actually necessary to save equity first if you want to buy now. The only really important point to consider is the overindebtedness resulting from the lack of equity in the first 5-8 years. However, I see less of a problem here thanks to the "security" provided by the family (parental business). Otherwise, it just becomes a bit more expensive, but as long as you can afford it and want to... why not?

We simply have different opinions :) Why a parental business should serve as security is completely beyond me. I simply assume the OP also has a not very high income, otherwise he probably wouldn't want to refinance 7000 EUR, right? The whole idea is just bad... end of story ;) You can write whatever you want. I have mentioned before... I have two cases of negative equity financing in my circle of acquaintances. Both went belly up.

Debt restructuring is simple because I thought that the banks would then be more willing or that we would get a higher loan. This is, please forgive me, my ignorance because I do not come from the field of finance. I think a net income of €2100 + 13th salary (at 75%) is not so bad for Mecklenburg-Vorpommern. My better half knows the downside, she receives minimum wage but is otherwise quite nice;) I see the parental business as a big advantage. Not because I can rest on it and brag, but because it gives a feeling of security. : I thought the same, just to continue servicing it, I just wanted to think about whether it makes sense in terms of interest to write this into subordinate debt (as a layman!)

(not to be confused with Steffen81 (is someone messing with you there, or has that one been around longer? :D)) I assume that Paddy007, not least as an employee, has enough insight into his parents' business to be able to assess whether it is "doing well" (otherwise he probably wouldn’t be so confident about his job). A healthy company (which he will presumably also (partly) take over later) with a secure job for himself should reduce the risk of personal bankruptcy due to over-indebtedness after a "forced sale" of the house to almost zero. Your opinion is yours to keep, but this is not about the individual "feel-good factor," but more or less hard facts. How Paddy ultimately assesses these facts is his decision and is not really our concern.

Theoretically, the bank shouldn’t care if another loan is being serviced as long as overall you still have enough to cover the mortgage loan. It doesn’t matter whether the 120 euros are debited together with the installment from the construction loan or separately – it’s not becoming less (aside from interest) just because the amount is on a new piece of paper.

Whether the bank minds in your case that you have a loan running at all, you have to ask the bankers here. But it should basically be irrelevant because you either “disclose” it anyway, and it either bothers them (and you won’t get the construction loan or the refinancing) or it doesn’t. And then you can just let it continue running as is.

Debt restructuring simply because I thought that the banks would then be more willing or we would get a higher loan. That is, please forgive me, my ignorance because I am not from the finance field. I think net €2100 + 13th salary (at 75%) is not so bad for Mecklenburg-Vorpommern. My better half knows the downside; she earns minimum wage but is otherwise quite nice;)

I see the parental business as a big advantage. Not because I can rest on it and show off, but because it gives a feeling of security.

What comes out of that? Under 3k, right? Kids there? Or planned? That might be okay for Mecklenburg, but it's rather little* income for prospective homeowners. That doesn't generally argue against building a house but strongly for equity. The €7000 here or there... You lack equity and not by a little. Or who pays incidental building costs and so on?

Steffen

*yeah yeah... I know it also depends on the size of the planned house.