Financing option - Which one is better?

I did some calculations; whether this is possible (conditions remain the same) I don’t know, but maybe it’s worth considering:

- Term of the L-Bank loan only 10 years, then 0.90% interest, rate 482 €, remaining debt 0,-
- Cancellation of the housing construction loan
- The precautionary loan is increased to 200,000 €, conditions remain the same

During the first ten years, the precautionary loan is only repaid very slowly, as the rate for the subsidy loan is accordingly higher. The initial repayment rate is under 1% (0.85%), which is possible with variant 2 as well, but there only with a loan amount of 55,000 €. Possibly the repayment rate can be raised to 1%, it shouldn’t be much.

The two special repayments flow into the precautionary loan.

After ten years, the L-Bank loan is completely repaid, and the full 1,190 € can then flow into the precautionary loan. -> You are completely debt-free in less than 25 years.

Oh yes, as so often, the loans with the lowest interest rate are to be repaid the most, while the one with the highest rate falls short.

And then after 25 years, there is still a remaining debt of over 40,000 or 60,000 € left?! Somehow I find that ... nonsensical.

One more post from me ... I really miss the edit function. :o

Are you aware that there is a repayment grant for Kfw55?

Hello backbone23,

thanks for your posts.

Regarding post 1:
Basically, that doesn’t sound bad. We will probably have some financing examples recalculated during the bank appointment. However, I still have to say (I probably forgot in the first post) that we want to keep the monthly burden under 1,100. So purely mathematically, with the big chunk, the first 10 years would only be 0.30% repayment (if the interest rate remains at 3.40%).

Regarding post 2:
Sorry, but somehow I either don’t get it at all ;-) or you mean it ironically. Could you possibly explain it to me again?

Regarding post 3:
Yes, that’s known. For a KFW55, there is 5% of the loan amount (50,000, so 2,500).

P.S. If we are debt-free after 26 or 27 years, that’s completely fine too :-)

Regarding 1:
With my proposal, maybe also consider an interest rate fixed for over 20 years, then the rate could work. There would still be €45,000 outstanding, but not only after 25 years like in your variant 2 (or even €67k like in variant 2).

Regarding 2:
You repay the cheaper borrowed money faster than the more expensive borrowed money. The other way around would be better, then you save interest.

Regarding "PS":
Can you manage to pay off a residual debt of €45k or €67k in 1-2 years? ;)

@ backbone23

Regarding 2: Then I did have it right in mind or had understood you correctly.
Regarding P.S.: If we WERE to play the lottery and then actually WIN something -> maybe ;). But of course not like this.

Thanks already for the food for thought. Will have variants recalculated again.