Formulation of the financing confirmation

  • Erstellt am 2015-10-20 12:57:54

Lionelle

2015-10-20 12:57:54
  • #1
Hello everyone,

the other day we received a template for the financing confirmation that our home construction company would like to have signed by the bank and us.
I knew something like this would come from the home construction contract, but (a bit naively - I know) I didn’t pay much attention to the exact wording. I also assumed that it was more or less just something like "the bank confirms that enough money is available and we are not going on vacation or similar with it."

The template now looks a bit different:

Financing Confirmation

Client: ....
Address: ....
Building location: ....
Contract conclusion date: ....
Purchase contract sum: XXX € (pure house costs only, without land/ancillary building costs)
Address of financing bank: ....


The purchase contract sum is financed or backed by equity capital at the signed financing institution. The client hereby assigns installments 10-16 (these are the last 7 installments according to the payment plan) according to the payment schedule in the amount of XXX € (slightly less than 1/3 of the purchase contract sum) of the general contractor XXX. The release is carried out by the client and will be transferred within the assigned claim and according to the terms of the construction contract, against invoice submission to XXX to the following account.


Now I am unsure what this wording means legally.
Is this really just a financing confirmation, or does it already lean towards a bank guarantee? We would be reluctant to have to spend money on that.
What about the assigned amount? Do I understand correctly that I still have control there, to withhold the money in case of defects?

It would be nice if you could write something about this from your experience.

Thanks!
 

toxicmolotof

2015-10-21 00:59:34
  • #2
This is an assignment of payment! With this, you assign the payment claim of the loan or equity to the construction company and it goes beyond the scope of a simple financing confirmation. In other words: You can no longer freely dispose of this amount yourself.

A financing confirmation ends immediately after the word "hinterlegt".

Of course, I do not know the rest of the contract, but you should seek professional advice before it goes wrong or turns out differently than you expected.
 

Lionelle

2015-10-21 13:29:19
  • #3


Thank you for your answer. Unfortunately, that's how I interpreted it as well. Although the contract for work provides that payment can be withheld in case of defects, I don't really know how this applies to the assigned part.



We will now have the loan specialist from our financing bank review it. He recently built with a comparable company himself and hopefully has good advice. Our future neighbors, who are building with the same developer, apparently just signed the form or had it signed without costs. But I simply do not like the assignment part.

Let's wait and see...
 

oleda222

2015-10-21 13:53:20
  • #4
What exactly is stated in the contract? If you only agreed on a financing confirmation, just provide that and ignore the wrong form from the construction company. Maybe they just "grabbed the wrong form."
 

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