Financing request single-family house price €365,000

Why don't they have to do that with the big loan as well? Because they are not involved there.

Because they only pledge the house for the small loan... with the big one they are not involved. That’s none of their business.

Okay, I understand. Signing along. Why don’t you have to do that with the big loan then? Because you’re not listed there.

Because with the big loan your house to be purchased is used as the collateral, and the mortgage is secured on it. You will become the owners, so the parents have nothing to do with it.

Because they are only pledging the house for the small loan... for the big one they are out of the picture. That doesn't concern them.

Okay, I understand. Thank you very much for the patient explanation!

are we not also entitled to such a 100k loan from KfW just through the purchase of the house alone?

The KfW conditions jumped around quite a bit last week. They were temporarily around 4%, then down to 3.6x%, then up to about 3.8x% or so. Depending on when your advisor put the offers together, it might simply not have been a real advantage. And maybe he also thought he could get more out of you with the loan on the parents’ house. KfW as a third component would probably also be possible, but that would then mean another interest rate lock-in period (10 years) and could become overly complicated? Of course, if you say you no longer want the loan on the parents’ house, it might still slip back into the next proposal.
Overall, based on the fluctuating KfW conditions, you can also see: interest rates are currently very volatile. So even if nothing really suits you yet, gathering all the documents in advance is something you can already do. They will be similar at other banks too, and then you can react quickly when you feel it fits.

That means you are ending up with a very high loan-to-value ratio, if not even a 100% financing.

Is it higher…?

But for me the question is still open whether the parents then take out this 100,000€ loan in their name or we do.

You take it out, they would secure it with their house. Are the windows really that terrible? Can't the bathrooms be spruced up a bit over time with minimal costs? Does it have to be a 100,000€ modernization right away? Edit: it is not uncommon for the bank to split the loan into 2 or 3 parts

No, KfW can only be part of another loan.

That is true for KFW124, but regarding the renovation stuff, I’m not sure right now.