Financing - first bank has declined

Hello,

On Friday, I received information from my financial advisor that the first bank declined my financing. The reason he gave was that the bank valued the property at just over €500,000. The financing requirement is €579,500 and total costs approximately €725,000. We have now inquired with 2 other banks, but I am skeptical whether it will work out, and the latest feedback date given to me is March 24th. Now I am considering whether it might be worthwhile to visit the bank here locally again; I have already been there but declined due to high interest rates. (since the others obviously had better conditions)

Can I sign multiple financing proposals from different advisors without entering into any obligation? I would like to inquire again at the local bank, hoping that the bank will not be so critical about the property value.

What do you think?

Proposals / requests for loan conditions are usually not a problem. Of course, you should only sign a proper loan agreement.

Whether too many inquiries about real estate loans have a negative effect on the credit report is a matter of debate. Personally, I can't really imagine that – it makes sense and doesn't indicate any wrongdoing to obtain several offers – but I don't actually know. Probably no one does, as the credit bureau keeps its procedures quite secret.

Are you still convinced of your property? So does the bank's assessment not make you uneasy regarding the property's value? I would feel uncomfortable if the bank assessed the property much lower, in terms of a possible resale if necessary.

Are you still convinced of your property? So the bank’s assessment regarding the property value doesn’t make you suspicious? I would get a bad feeling if the bank estimates the property so much lower in terms of a possible resale if necessary.

We certainly won’t be able to sell the house at the cost we built it for, the wages here are simply too low for that. The local bank has assessed the location as good, so I am basically optimistic that we could sell the property again for at least 80% of the construction costs! However, I also know that interest rates continue to rise and that could put pressure on the selling price.

But we don’t want to sell. ;)

With us, Deutsche Bank valued the property at only €50k (which is a joke), for example, while Sparkasse approved the purchase price of €130k without much fuss. So it depends on the bank. You should therefore obtain several offers.

With us, the bank also initially declined because the property was still listed as agricultural land-BRW in their database for the new development area... However, our intermediary really put in a lot of effort and appealed against the rejection. They reviewed the whole thing again, and then it went smoothly. What I mean is: Sometimes it's worth questioning :)

But we do not want to sell.

This is inherent in the nature of the case of realization, that it usually occurs unplanned.