Financing project of a single-family house with hurdles and building blocks

what credit balance do you have with the building savings contract?

so purchase price financing + modernization? a total of 500+200k = 700k financing? hmm, quite ambitious. Because only very few banks fully consider the modernization costs, often only 50-70%. that means if you buy the house for 500k and modernize it with 200k, it is not automatically worth 700k.

thus the battle plan would look as follows: 1) choose banks that fully consider modernization, otherwise you end up with more than 100% financing = either not feasible by the banks or very, very expensive 2) KFW: 261/262 should be taken for the repayment subsidy, alternatively you can apply for the subsidy separately, i.e. without credit and it will be transferred to your account after modernization (this option has the advantage that you will have additional capital afterwards if the renovation costs more than 200k!) KfW-124: not always sensible, although somewhat cheaper than a regular loan, it has 3.50% repayment, no special repayment, and only 10 years fixed interest 3) existing building savings contract: that’s a good argument: what credit balance is there? can you access the full amount (100k) immediately? Because then you can use it as "equity," i.e.: 700k loan on 700k value = 100% financing 600k loan on 700k value = 85.71% financing (here it would be good to get to 85%!)

so going from 100% to 95% financing already makes a big difference to the interest rate, ideally at least getting to 90%. And sure, going from 80% to 70% financing hardly makes a difference. But the interest rate jumps from 100%-95%-90% make a big difference!

How do you see the main goal of the TE, to manage with a maximum installment of 2,000€? The best (almost) full financing is useless if you can't afford to pay it.

How do you see the main goal of the OP, to manage with a maximum installment of €2,000? The best (almost) full financing is useless if you can't afford to pay it.

It’s difficult if you take the "recommended repayment" from the bank, which is 3%, financing €400k is already difficult with 100% term... (with a monthly installment of €2,000)

The problem, as mentioned, is the high modernization costs, because the banks that are cheap tend to assess it poorly, meaning you are forced to use more equity to get the favorable conditions.

So here you should already expect about a 5% annuity to have an orientation; whether it ends up being €50-100 more or less will depend on the conditions. But €700k = €35,000 per year = almost €3,000 monthly installment. If I take the €700k with 1% repayment + a reasonably good interest rate, I quickly end up at about €2,600 monthly installment.

So if you want €2,000 as an installment, then financing of about €500k - €530k would probably be possible here, meaning you would have to pay €150k out of your own pocket for the modernization. WITHOUT modernization, of course, much less would be possible because the term would be higher = higher interest!

what credit balance do you have with the building savings contract?

so purchase price financing + modernization? in total 500+200k = 700k financing? hmm, quite ambitious. Because only very few banks consider the modernization 100%, often only 50-70% instead. i.e. if you buy the house for 500k and modernize it with 200k, it is not automatically worth 700k.

thus the battle plan would look as follows: 1) choose banks that consider the modernization 100%, otherwise you end up far over 100% financing = either not feasible by the banks or very, very expensive 2) KfW: 261/262 take already because of repayment grant, alternatively you can apply for the grant separately, i.e. without a loan and it will be transferred to your account after modernization (this option has the advantage that you have extra capital afterwards in case the renovation costs more than 200k!) KfW-124: not always meaningful, although slightly cheaper than a normal loan, with 3.50% repayment, no special repayment, and only 10 years fixed interest rate 3) Existing building savings contract: that’s a good argument: what credit balance do you have? can you access the full amount (100k) directly? Because then you can use it as "equity", i.e.: 700k loan at 700k value = 100% financing 600k loan at 700k value = 85.71% financing (here it would be good to get to 85%!)

so going from 100% to 95% financing already makes a big difference in the interest rate, ideally it should be at least 90%. And of course, going from 80% to 70% financing hardly makes a difference. But the interest rate jumps from 100%-95%-90% make a big difference!

Here as well, thanks for the concrete breakdown!

The building savings contract has 30k credit balance, so through additional allocation instead of 50k building savings amount, it would be 100k. Our idea was to cover the costs of the renovation through building savings contract and KfW and to contribute the incidental purchase costs plus x% (e.g. 10/15) of equity = approx. 450k loan for the house.

Is the construction of renovation costs with KfW and building savings contract possible like this?

It is possible to ask the question of what the monthly burden looks like.

Already asked the building society what the 100k (i.e. 30k equity/70k loan) means in terms of monthly rate?
Because then I would use it.

And please don’t forget this:
Even if you take out a KfW loan = the bank through which it runs is liable for it to the KfW =
If you take out 450k from the bank + 100k KfW = you have 550k loan
With most banks, the 550k is also taken into account as financing (even if 100k is from the KfW).

Our idea was to cover the renovation costs through building society savings contracts and KFW, and to contribute the ancillary costs plus x% (e.g., 10/15) of the equity for the house = approx. 450K loan

But you also have to repay KFW and building society savings, and that must be included in the monthly calculation. Or was your plan to pay 2k for the main loan and beyond that x for the building society savings and y for the smaller KfW loan? (The assumption here was initially no, the sum of the total burden should be 2k and then it simply doesn't add up)