Financing new construction and residual debt financing for the land

Good evening,

as already described in the subject, this concerns the financing of a new building and the residual debt financing of our property.

I will try to structure my questions clearly:

The plot was financed through the local Sparkasse as of 01.01.2013.
Loan amount €65,000, with a monthly repayment of €1,000.

Our repayment for 2013 was as follows: 12x €1,000 + €4,000 special repayment = €16,000 (repayment including interest)
Our repayment for 2014 is expected to be as follows: 12x €1,000 + €6,000 special repayment = €18,000,

thus a residual debt of approx. €30,000 (property)

Our planning has changed in such a way that instead of starting in 2016, we want to begin the new building already in 2015.
A fixed interest rate until 30.09.2015 was agreed with the Sparkasse.

Question 1: Since I will probably have to take out a new loan in March 2015 to finance my new building, is it possible at all to get out of my "property loan agreement" earlier and include the residual debt "with" the large loan!?

The life insurance policies of myself and my partner were used as collateral for the financing of the property.

Question 2:
For the financing of the residual debt of the property and the financing of the new building, can I also use these and then still count about half of the property as equity?!

Question 3:
If we now assume a loan amount of max. €300,000 including the residual debt of the property, a loan-to-value ratio between 80%-100% will definitely apply, right?!

[B]Question to the expert(s):
Regarding our current financial situation, I can say that we pay €1,000 per month for the property and €1,000 warm rent, so I assume that a loan with a monthly repayment of €1,350 should work?!
And this with a fixed interest rate for 30 years.
How about a KfW loan?! It will definitely be an Efficiency House 70?![/B]

So, I hope I was able to convey it clearly and look forward to your suggested solutions and approaches.
Oh, and if someone can recommend a good "financer" to me, just let me know....

Thank you in advance for your contributions.

Martin

Question 1: yes, we do it that way as well

Question 2: yes, I see nothing against it. Everything is put into a loan, and the life insurances then serve as collateral

Question 3: yes, seems so. I don’t know the house construction costs.

Bonus question: your financial advisor should calculate the installment for you, who will ask you for much more data.
[KfW] exists.

Hello and thank you for your post klblb,

to question 1: Aren't prepayment penalties then incurred?! Or "penalty interest" or something like that?! Or is there no such thing with a "such" loan?!

This is a loan from DSL Bank with a variable nominal interest rate. It can be fully repaid at any time free of charge. We chose this type of loan when purchasing the property to be flexible with the larger loan for the house. "Classic" annuity loans are not as flexible and the costs you mentioned could occur if you want to terminate the loan early. This needs to be discussed in detail with your financial advisor.

Yes no, we did not want something like that. We have firmly 2.1 percent until 30.09.2015. Therefore, it will probably be difficult to get out earlier and repay the loan.

Does anyone else among the members have a good idea for problem solving :-)

Regards and thanks

1: Yes, it would be possible. The new bank will probably offer you a new financing + follow-up financing (30k).

2: Yes, 60k would be assumed as the value of the property. The 30k simply financed together. Every new bank wants to be in first lien in the land register. So the Sparkasse must be taken out.

3: Yes, 60k will be set. House construction value + property in relation to the total loan.

4: Kfw 70 is a must, with a 300k loan and a 1350 € installment you will repay about 2-2.5%, which corresponds to a total term of about 30 years regardless of the special repayment.

In your case, a capable broker would be recommended. It is a mix of new + follow-up financing. The land charge must also be either in second lien or assigned when changing banks. That should also be the focus!