Evaluation Offer Financing

Hello,

who can evaluate the following offer for me:

Purchase price 120,000 EUR
Additional costs: 10,000 EUR
Renovation costs: 70,000 EUR (90,000 EUR of which 20,000 EUR own contribution)
Equity capital: 20,000 EUR
Loan amount: 180,000 EUR

Loan in connection with [Bausparer]

Step 1: Annuity loan 13 years - 1.55% interest - monthly rate 232.50 (interest only) + almost 13 years 525 EUR monthly into the [Bausparer] (savings interest 0.25%)

Step 2: Repayment of annuity loan - approx. 13 years 720 EUR into the drawn [Bausparvertrag] at about 2.75%

Afterwards loan repaid. Effective costs shown by [Bausparkasse] - approx. 235,500 EUR (= 55,500 costs).

Get an offer from an insurance company for 20(25) years as a full repayer. I could imagine that this would be overall better (cheaper) for you.

Insurance could be tight: Assuming 40% of the renovation is recognized as value-enhancing, we expect €120,000 + 0.4*€90,000 = €156,000. The desired loan would therefore be > 100% of the property value --> not a case for insurance. But it’s all guesswork, depends on the valuation of the property.

even the Sparkasse now offers 20 years fixed interest rates. go to the right bank. as already said, the increase in value should not really be factored in here. after all, you want 150% financing. not quite easy. this tinkering with [bausparern] etc. should set off alarm bells.

The Sparkasse does not exist. It may be that the local Sparkasse also offers 20 years, but it may also not. The same applies to the Volksbank.

Thank you very much for the feedback. The financing is now complete and the notary contract has been signed.

: Please do not generalize, but rather consider the offer individually.

A friend who is a "finance expert" calculated an effective interest rate of about 2.20% over the entire term (26 years and x months) based on all incurred costs - I think that's great for the initial situation!

-> Why didn't my "finance expert" take on the risk but the Sparkasse did? My finance expert had difficulties placing the risk (120,000 purchase price and 90,000 EUR renovation costs) on the market - keyword "what is valued as value-enhancing at what percentage." The local Sparkasse finds this easier and grants high unsecured portions.