Forward loan planned incorrectly, disadvantages - experiences?

2023-08-26 11:27:39

I will calculate later what the interest burden will cost me at the old bank if I reduce the repayment back to the planned remaining amount.

2023-08-28 17:09:23

We will be in the identical position in 2024. We have taken out a forward loan of 180,000 EUR, but according to today's estimate, we will only need between 150 and 160 K. At the time, we calculated based on safety. We didn’t want to calculate so tightly that we would have had to make the special repayment.

A query with the bank revealed that there is no possibility to change the contract. The surplus will be transferred to our account. We will then make the first special repayment in full amount from that. There will still be a lot of money left.

What we will do with it, I don’t know yet exactly. Either we build a fixed-term deposit ladder based on the annual maximum special repayment amount and thus have the special repayments fixed for a few years in advance, or the money goes into our securities account. We will make the final decision in September 2024 when the money is credited to our account.

If not done yet, I would invest the money sensibly. Something like photovoltaic, electric car, anything that saves money in the long term. Securities account is of course also an option. But leaving money idle in the current interest rate environment and current inflation is of course never wise.

2023-08-28 17:47:15

It is about 3% more interest on the total amount due to the delayed repayment. Actually okay… so better not take the risk, right? On the phone, the bank said I could choose whether the money should simply be transferred to my checking account. I would have signed the [AGBs] in which this is stated. The fact is, I just think that the loan must be taken in full, as well as a clause that it must be used specifically for the purchase of a property.

2023-08-30 07:08:37

If it hasn't happened yet, I would invest the money sensibly. Something like photovoltaic, e-car, anything that saves money in the long run. A portfolio is of course also possible. However, leaving money idle is never wise in the current interest rate environment and inflation.

I actually don't want to spend it. That would be one of the last options for me. Especially since photovoltaic is not feasible for us and a private car, whether electric or combustion engine, is not needed.

2023-08-30 07:20:34

You can mortgage your property against a land charge however you want. The money from it is not earmarked. That means if you take out a (Fordward) loan, you can sensibly use it to repay an old loan that is due. If you have taken out more credit than you need for this purpose, you can basically do whatever you want with it. The catch is that unused money still costs interest, if applicable. For example, if contractually agreed, you could make an early repayment as soon as possible, invest/renovate the house further, or invest the amount.

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Forward loan planned incorrectly, disadvantages - experiences?

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