Follow-up financing rejected due to negative Schufa entry

I would not put it on the back burner. Eventually, the bank will terminate the entire business relationship. That helps no one.

: Are you allowed to do that? And if so, on what grounds? (Assuming the installments were/are paid on time)

For example, Terms and Conditions Sparkassen No. 26 (2) a and following...

And again: what is listed in the Schufa? No bank will do that for two euros fifty.

Thank you. Unfortunately, we don’t even know which bank yet. But if he were a Sparkasse customer, I don’t see a problem because:

For the Sparkasse, such a reason for termination is particularly given if, due to the following exemplary circumstances, the compliance with the customer’s payment obligations or the enforceability of the Sparkasse’s claims – including through the realization of any collateral – is endangered: a) if a significant deterioration or a considerable endangerment of the customer’s financial situation or in the value of the collateral provided for a loan occurs, especially if the customer stops payments or declares an intention to stop them, or if bills of exchange accepted by the customer are protested;

1. This is probably not to be expected at 150 to 350 2. At least he has not said to stop the payment.

if the customer does not comply with the obligation to provide or increase collateral (No. 22 paragraph 1) within a reasonable period after being requested by the Sparkasse;

Advising the customer to look for another bank was not yet a request to increase collateral.

if the customer has provided incorrect information about his financial circumstances;

That would only be a problem if it was when the mortgage was taken out. If after, then it is no problem.

if enforcement proceedings are initiated against the customer;

That is already a whole different level...

Exactly, you don't know any more details.