Experience with modernization loans from Schwäbisch Hall?

Hello everyone,

my girlfriend and I have finally found a suitable property that meets our expectations. Now it’s time for the financing. We aim to plan the financing as thoroughly as possible. We had the idea to split the financing. The pure costs of the house purchase with a suitable bank (20-30 years) and the renovation/modernization (possibly including a new roof) through the so-called "Modernisierungskredit" of Schwäbisch Hall with a 30-year term. Has anyone ever dealt with this loan and can share their experiences?

Best regards

We had the idea to split the financing. The pure costs of purchasing the house with a suitable bank (20-30 years) and the renovation/modernization (possibly including a new roof) through the so-called "modernization loan" from Schwäbisch Hall with a 30-year term.

Why? That doesn't make any sense. Just finance it normally.

Exactly. Just give the product a cool name and it becomes interesting. It's like with the cancer insurance nowadays, that's also just a disguised term life insurance with prior payout in case of a claim.

@TE just split your loan into several tranches with different maturities at the same bank. keep it simple!

The idea behind this thought was that, for example, if the house bank only offers a loan with a term of 20 years, to finance only the house with it and to carry out the modernization/renovation through the [SH] with a term of 30 years. In addition, to conclude a building savings contract, with which you secure the interest rates for the remaining years from the 21st year of the financing and so basically live off the previous (effective) interest rate until the 30th year. However, I am also open to suggestions in this direction.

Proposal: ten years fixed interest on a loan and repay as much as possible.