Fixed interest rate no, because bank loans are more flexible? KFW 124 yes/no

Hello everyone,

I am planning a new construction (KFW55). The total loan will be around 400k€. KFW 153 is very flexible and of course will definitely be included.

The question is whether I include KFW124 or not. The loan cannot be repaid early within the fixed interest rate period. The financial advisor would recommend not to include KFW 124, because I am more flexible with the bank loan and with the longer fixed interest rate period I am on the safer side. I only partially accept more flexibility, since after 10 years I have a special right of termination anyway. But due to the longer fixed interest rate period (15 or even 20 years not yet decided) with the bank loan, I am probably safer in terms of interest rates.

At the moment I tend to include KFW 124. Possibly with a shorter term (15 or 20 years for example). I would then benefit from the lower interest rate for 10 years (1.55% instead of about 1.9% at 15 years or 2.2% at 20 years). I would always make special repayments on the more expensive bank loan.

What do you think?

Regards, Thomas

Hello

how much does the main bank loan cost?

If you want to use program 124, you should compare apples to apples. That means asking what the financing bank offers for the 50k and 10 years. It is quite common to split loan amounts by amount and term

Hi,

I wrote above. About 1.9% for 15 years or 2.2% for 20 years. There may still be room for negotiation. But I don't know.

Regards

Hi,

I wrote above. About 1.9% for 15 years or 2.2% for 20 years. There might still be room for negotiation. But I don't know.

Regards

I don't know the current KfW conditions. But as I described, you should compare 10 years fixed KfW against 10 years fixed house bank. Appeal against appeal.

You can get program 124 fixed for a maximum of 10 years.

Regards

Hi HilfeHilfe,

I will do that, thanks for the note. KFW 124 is currently 1.55% for 10 years fixed interest rate.

Thanks!

Regards,
Thomas

Hi HilfeHilfe,

I will do that, thanks for the note. KFW 124 is currently 1.55% with a 10-year fixed interest rate period.

Thanks!

Regards, Thomas

OK, then it makes sense to keep this rate for 50k with the house bank for 10 years. I believe you can repay the 124 program at any time without prepayment penalty. So another advantage if that is the case