Financing options for a rather high-priced single-family house

If the houses are pledged as collateral with the bank, what exactly are the consequences? Simply that the bank has to agree to a sale? What practical effects does this have (possibly on the achievable price)?

As long as you pay your installments, nothing happens. If you fall behind, there will be a forced auction – if necessary, of all houses (depending on value and encumbrance). But of course, the bank doesn't want that, it's simply a hassle. So you can also sell one or more houses privately. The bank will cooperate as long as you don't sell them off cheaply.

With Dr. Klein I sometimes see 0.5-0.6% for 20 years fixed interest and 4% repayment.

Those are the conditions for the very best credit ratings with the lowest loan-to-value ratios. Without additional collateral, these are not available to you. So you only improve in the direction you mentioned (even though I don't know anyone who has actually received this condition currently).

I have read that up to 5% prepayment per year is often possible without additional costs.

No, the costs are included in the condition. There are also plenty of banks that openly state the price for every extra payment.

- Is there generally anything against a higher repayment rate from the start, except that the installment becomes higher?

No.

.... At Dr. Klein ....

A little tip: If you have a loan offer with conditions from any broker, then ask the specified bank directly and specifically about the condition again.

It is not uncommon that the condition is more favorable at the same bank than through the broker/comparison portal, simply because no (increased) portions for commissions or similar are included here.

Yes, of course, we will get various offers anyway.

: What interest rate would you realistically expect? More like 1%, 1.5%?

One more question: The existing houses are from the 50s/60s - what about potential depreciation over the next 30 years - then they will be approaching 100 years old, does that have any impact? Or is it negligible?

Depreciation of value of course occurs, but that is what reserves are planned for in order to carry out necessary maintenance work on the houses.

With Dr. Klein I sometimes get shown 0.5-0.6% for 20 years fixed interest and 4% repayment. By how much could one still improve with the security (rough estimate)?

What interest rate would you realistically see? More like 1%, 1.5%?

So even without having your mega creditworthiness and luxury problems, in initial talks with banks we have always ended up below 1% (15-20 years), around 0.9% for 10 years. I have to say that 0.5% already sounds very extreme, but that is not within my "experience world"

- On special repayments: there will eventually be inheritances. But that can also certainly only happen after 20 years have passed.

"We have several houses, 200k€ cash lying around and will certainly inherit more (e.g. two more houses)" may well still fall into that category, but it is certainly a very interesting definition of...

....we both come from the middle class

Even if you are planning in a not exactly inexpensive area, concluding a great financing for a sufficiently large place with high-quality fittings should be no obstacle.

Please consider: If you "only" sell one of your houses estimated at 300k€, you already have easily 600k€ equity with the family subsidy. So even with a million for the house you have 60% equity and still 1-3 houses in reserve!?!

Basically, you don't really need a loan. Your equity of 200k€ and the two existing houses worth 600k€ together "cover" your new home in the 800k€ range.

How you arrange this specifically now, either with a loan and keeping the existing properties, or by selling the latter and essentially "paying cash" for the new house, is up to you. There can hardly be any general advice on this. The least stressful option is to sell the other houses. You live debt-free, have no rental management effort, and no risk anymore.

Middle class? For me, you are clearly above that, so you belong to the top percentile in wealth distribution, at best the second highest. That's very nice for you, so just enjoy life.

I also don't fully understand why people go into debt when they could actually pay for everything with equity. Sure, the houses would be gone. But at the same time, so would the worries about rental defaults, reserves for maintenance, etc. You would have the most relaxed life!