Finance the property now or continue saving equity?

I just realize that I am still totally clueless. I have been following along here for a while but mostly in the financing section. But before I actually start planning, my equity first has to be secured and I need to secure financing? Then I start planning? So originally we intended to buy an older house. We received a non-binding financing offer with a self-imposed maximum of €2200 for the installment. The first 5 years €2200, after that the installment can be reduced to €1700 with a term of 20 years. 4.97% interest rate. Equity contribution €50,000 and loan amount about €290,000. The offer is a “worst case scenario”. Now, however, we decided against it because houses in that price range require renovation and we currently lack the equity for that. The idea then was eventually new construction and building up equity so at least you do it right from the start and without nasty surprises. And now we have found the plot. I have now written again to my financial advisor and will discuss with her again this week what actually makes sense.

No, the exact opposite is actually the case. In order for the bank to finance you, they want to see relatively detailed information about what exactly they are financing. That means you need a calculation from the construction company or architect, floor plans, section drawings, etc. At least our bank wanted to have all that for review...

It doesn't work on the motto "We need 500,000 EUR for a house." "Okay, send us pictures when it's finished."

PS: I would do it the other way around. First a low rate and the option to increase it later. Especially in the first few years, you spend absurdly more money than you planned... just for blinds for 14 windows, you can quickly spend 1,000 EUR. Nobody has that on their radar, the money slips through your fingers like sand. I assume that we won't be able to save significantly again until at least 2 or 3 years from now. We're moving in the week after next...

And the contractor doesn’t schedule you for the week after next either. Maybe has a tip for people financing with foreigners?

When it comes to the US military, I’m unfortunately out of the loop. For us, it was that my husband and I got married here to stay and live here. I have a friend who married a US soldier in a higher rank. But they always had to leave from time to time and were stationed abroad for years. Also difficult, since you never know what is happening politically. As long as nothing significant changes in the world situation, I don’t believe the US will withdraw their troops here. But a few years ago, things looked quite different. Therefore, I could imagine that banks are cautious when it comes to financing. Especially since most of the household net income depends on the husband (or did I misinterpret that here?).

Our difficulty back then was the still missing permanent residence permit. We only lacked the condition of the length of residence, and it was more of a formality since my husband already had a child here. Still, we had more luck with local banks where we could introduce ourselves personally. An online bank was out for us back then; we fell through the cracks there.

How it looks here with the TE’s possibility to prove that the main income cannot/must not migrate to a third country, I don’t know.

Speaking of the world situation... an invasion of Taiwan by China has never been as realistic as it is now... And Trump has more than once hinted that if he is re-elected, the strong US presence in Europe (and especially in Germany) would probably come to an end quickly. This would generally apply to the election of a Republican, also with DeSantis.

To be honest, the USA has not been able to afford its military apparatus for decades.

But then there is an interest surcharge. Even a senior physician with 10,000 EUR net might get the idea the day after tomorrow "My wife is stupid, I'll go to Bolivia alone..."

Apparently a loan has already been requested, which the bank had no problems with.

In fact, it is true that most banks probably do not grant loans to US military personnel. However, it is not impossible. We work with a finance consultant who has relationships with the local banks and assists with translations, etc. (specialized in home financing for Americans in areas where the military is present). They of course take 1% of the house purchase. Financing is tied to certain conditions such as an address in DE, SOFA status…

Actually, it is true that most banks probably do not grant loans to US military personnel. However, it is not impossible. We are working with a finance consultant who has connections with local banks and helps with translations, etc. (specialized in home financing for Americans in areas where the military is present). Of course, they charge 1% of the house purchase. Financing is tied to certain conditions such as an address in DE, SOFA status…

Do you already have references for that? Or do you know someone who has been financed like this? The bank is interested in a long-term business relationship. That’s why they are so reserved about it. Is it clear for your husband that he can stay in Germany long-term? I only know from my friend that he was "deployed" abroad from time to time, then she stayed in Germany with the kids. Several times during the marriage, however, they also moved to the USA with the whole family for a while and then came back to Germany, often to a city 100 km away. I know it like this: US military families often rent. Not rarely in their own settlements.