Home financing - low initial rates / rapid increase?

2016-03-19 12:38:46

Now don’t get so hung up on the inflation compensation/salary increase thing. In principle, he is not wrong, and the fundamental question concerns every "young" person who wants to build. The bank usually only looks at the current income, but pretty much everyone who got financing "back then" earns significantly more today. Whether through collective agreements, contractually agreed increases, job changes, further training, etc. This is rarely guaranteed, but it actually applies always.

Certainly, part of this salary increase is lost again to price increases and lifestyle, but the installment is fixed and thus takes up a proportionally smaller share of total expenses over the years. He now wants to know how he can optimize his financing with regard to this "problem." So to structure the installment so that it represents a fixed percentage of income, instead of a fixed absolute amount.

I also wouldn’t know whether it would basically be possible to, for example, calculate with a higher residual debt after the term ends and then just agree to a short term of 15 years "for now." Or do you start with a low repayment rate that is increased later? Or do you then only work with special repayments towards the end? Or are there still products, similar to the previously offered capital life insurance, which are saved in parallel (with installments that adjust to the salary) to then pay off the residual debt at the end of the term? It’s not an uninteresting consideration...

That’s exactly what I wanted to get at =)

2016-03-19 12:43:57

As a young person – but this also applies to us older generations – you first have to see what you can actually afford RIGHT NOW. 1.) Entry, for example with a condominium 2.) Financing with a long term (= low repayment, but then preferably a long fixed interest period) 3.) Saving for a few years to have more equity for a larger/more expensive property 4.) GUARANTEED salary increase (for example, if you have completed further training) can of course be taken into account – but the bank does not do this! What I consider completely wrong, however, is to SPECULATE on salary increases. A job at a large company does not necessarily mean that you can stay there until retirement and live worry-free. Downsizing, restructuring, discontinuation of business areas, etc. can quickly lead to the good job being gone and you having to look for a new, possibly lower paid job.

2016-03-19 12:51:43

Well, it was phrased a bit harshly. But it seems like Steffen80 has rubbed off a little. I'm surprised he hasn't written anything here yet. But Yvonne is basically right, maybe you're approaching the matter a bit too optimistically right now. You should first pick off the eggshells and take my commentary, especially regarding equity, to heart.

Then your idea can really turn into something nice, but take one moment or another. In the end, you'll laugh about it.

Thanks for the flowers I actually missed this thread.

To the OP..It seems to me that for the first time he earns a bit more and gets a little carried away. Why that's quite reckless has been sufficiently explained. I don't need to go into that anymore.

I've never heard of a builder aligning their construction project to future higher income. That's really quite....... The other way around is the rule. You align your project to when an income disappears..

2016-03-19 13:08:29

Well, that is precisely the point: The question of what one can afford does not strictly depend solely on the current net income, but on the amount one was actually able to have available monthly over the term of the financing. Of course, you cannot anticipate this in detail, but why shouldn’t certain factors, such as a certain salary development beyond inflation adjustment, be taken into account? This certainly does not correspond to the propagated security mindset, but no opinions were asked for here, rather a very specific question was posed. Of course, one can also attach advice to the answer, but please not in that tone. Then he might as well inquire in the "green forum".

2016-03-19 13:42:47

Well, that's exactly the crucial point: The question of what one can afford doesn't strictly depend only on the current net income, but rather on the amount one could actually have available monthly over the term of the financing.

I see it differently. The crucial point is that Neu-Bau-Ling is a career beginner, as introduced in his start thread. And as a career beginner, one should first look at their own development before considering their salary progression. The latter is not set in stone, and the advertising by unions as well as large companies to attract newcomers resembles product advertisements as well as promises made by politicians. Therefore, one should first establish themselves in their profession before planning the calculated ratios.

I think everyone has sat down at some point and calculated their salary after successful collective bargaining agreements for the next few years. But that doesn’t mean anyone is suddenly leasing a Q5, because one simply knows it’s better to wait until the salary actually lands in the bank account. A salary increase of a few percent is hardly noticeable – as mentioned above – the desire grows, so first vacations are taken, Ikea furniture is replaced. As a career beginner, insurances should be reconsidered, etc. Costs rise!

2800 is a very nice and high starter salary... the years should then bring a good savings buffer.

2016-03-19 13:59:05

As already said, advice can always be given, but I think if he wanted to discuss his "Mündigkeit" here, he would have formulated the question differently

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Home financing - low initial rates / rapid increase?

Neu-Bau-Ling

nordanney

Steffen80

Vanben

ypg

Vanben