Financing of a plot of land

Hello,

I have reserved a plot of land (875 sqm) and would like to buy it. There is a building commitment, which means I would have to start building a house on the plot within 4 years. I would like to buy now and then build in 2-3 years. However, I am not yet sure how I will arrange the financing for the plot.

Currently, I have the following offer.

Bridge financing for the plot
Loan amount: €117,600
Fixed interest rate: 3 years
Interest: 1.68%
Payment: €162.68 monthly without repayment

I have the option to temporarily park the plot until the main financing.

I also have the possibility to secure the plot in my parents' land register (house is paid off) with €117,600.
My question now is, if I secure the plot (€117,600) in my parents' land register now and take out the follow-up financing for the future house in 2-3 years, which land register would be paid off first in a worst-case scenario after building the house? This is not something I plan to do but I want to keep the risk for my parents as low as possible. Everything would go through a bank.
What do you think about that?

Thank you in advance.
Best regards

Hello,

I have reserved a plot of land (875 sqm) and would like to buy it. There is a building obligation, meaning I have to start building a house on the plot within 4 years. I would like to buy now and then build in 2-3 years. However, I am still unsure how to handle the financing of the plot.

Currently, I have the following offer.

Bridge financing for the plot
Loan amount: €117,600
Fixed interest period: 3 years
Interest: 1.68%
Rate: €162.68 monthly without repayment

I have the option to park the plot until the main financing.

But I also have the option to secure the plot in the land register of my parents (the house is paid off) with €117,600.
My question now is, if I secure the plot (€117,600) in my parents' land register now and only take out the follow-up financing for the upcoming house in 2-3 years, which land register would be paid off first in the worst-case scenario after building the house? This is not meant to look like I am planning it that way. I just want to keep the risk for my parents as low as possible. Everything would be done through a bank.
What do you think?

Thank you in advance.
Best regards

Caution: My opinion.
1. Keep your parents out of it. It is your plot and your house. To risk your parents' equity for this is, to put it mildly, unwise.
2. Can you even afford a house? It seems as if no equity is available. Of course, I could be wrong.
3. I would probably take a variable interest rate. If you want to build earlier anyway, the fixed interest period will cause you some problems (own experience).

Hey,
Thank you for your opinion. I can afford to finance it.
Income: approx. €3500 - €4000 net
Equity: €43,000
I did not want to use the equity yet.
What problems do you mean exactly?
Best regards

Finance flexibly and repay the maximum.

Hey, Thanks for your opinion. I can afford it. Income: approx. 3500 - 4000€ net Equity: 43,000€ I didn't want to use the equity yet. What exact problems do you mean? Regards

The selection of banks will be very limited because one is already in the first rank in the land register. 3,500 - 4,000 € is hardly enough for the land and house construction.

I can afford to finance it. Income: approx. 3500 - 4000€ net Equity: 43,000€

Do you have a partner? Otherwise, it will basically be tight with the total financing: the bank rarely takes on someone alone. At least not with such an amount (land and house).