Financing comparison - Now it's getting serious

Congratulations on the approval. They won’t back out. But you’re not making yourself popular either. You could at most bring up the 0.76% for 150,000 EUR analogous to KfW 261/262. I did that at our savings bank as well. The savings bank then improved the offer once more. We now have 550,000 at 0.94% (10.75 years) and 150,000 at 0.76% (10 years). This lowers the overall interest rate by at least 0.04% or the monthly burden by about 20 EUR ;)

Congratulations on the approval. They won’t back out. But you’re not making yourself popular either. You could at most bring up the 0.76% for 150,000 EUR analogous to KfW 261/262. I did that at our savings bank as well. The savings bank then improved the offer once more. We now have 550,000 at 0.94% (10.75 years) and 150,000 at 0.76% (10 years). This lowers the overall interest rate by at least 0.04% or the monthly burden by about 20 EUR ;)

Thanks for the tip. I don’t know if I’ll mention it, I don’t want to upset them. We have 494,000 EUR at 0.96% for 10 years. I don’t know if the KfW involvement would take too long. I think I’ll leave it as is, since we are theoretically expecting our building permit by the end of the month. Meanwhile, 7.5 months have passed since the building application was submitted. I’m so frustrated, unfortunately I can’t take it out on the authority/office. You just have to put up with everything :-(

I have a question. What actually happens if, for example, in 5 years the prices for plots of land and houses collapse? So with 100 percent financing, the properties would then be undercollateralized. Does the bank then actually demand more collateral, is there an additional contribution obligation or something similar? Or can they terminate the loan? I would be interested to know. So if interest rates rise massively, prices would probably also tumble.

That is factored into the conditions. That is why you get worse terms with 100% loan-to-value than with 60%, although the loan is not immediately defaulted on just because of plummeting property prices.

I don't know if the integration of KfW would take too long.

Savings banks issue the KfW loans from their own funds without involving KfW. Therefore, that would not be a problem.

But if you already have the loan agreements, the savings bank will not change that anyway, as they are not obliged to do so.

The higher the loan-to-value ratio, the higher the interest rate. I assume that the loan is being properly serviced, as incomes usually remain the same.

But if the interest rate were to rise to 8 percent and the loan-to-value ratio were to, let's say, collapse to 40 percent. Basically, this would be no problem at first.

Most people have a fixed interest rate.
But what about the provided and devalued collateral of the house and land? Are there any statements or clauses regarding this in the loan agreements?

The higher the loan-to-value ratio, the higher the interest rate. I assume that the loan is being serviced properly, as incomes usually remain the same.

But if the interest rate were to rise to 8 percent and the loan-to-value ratio, say, collapsed to 40 percent. In principle, that is not a problem at first.

Most have a fixed interest rate.
But what about the pledged and depreciated collateral, house and land? Are there any details or clauses about this in the loan agreements?

Even if the problems do (already) not occur during the term—what happens with the typical 10-year fixed-rate financing with minimal repayment? When the amount repaid so far is "eaten up" by the decline in the book value of the house?