House construction project with terrible credit rating and almost zero equity capital :-)

So when I look at the income, I only see €3,300 of actual income. The rest is 5 times child benefit + care allowance. If these items disappear because the children move out or the need for care ceases, how is the house supposed to be paid off then?

The only chance I see (to buy a property) is to save a lot of money for a long time(!). If these savings rates are correct, that would be €100,000 in 5 years. But on the other hand, you would have to buy something now because there isn’t enough space and because now a nice €60,000 [Baukindergeld] is available.

Honestly? Forget the nonsense about the house and rent something bigger. With the supposed savings of €2,200-€2,600 + the current rent, something really nice is possible.

But on the other hand, you would have to buy something now because there isn’t enough space and because now a nice €60,000 Baukindergeld is available.

Did the OP write that? There is nothing available at all. The Baukindergeld expires in exactly 12 months. Until then, there will be no building permit and therefore no Baukindergeld.

Did the OP write that? There is no waving at all. The Baukindergeld expires in exactly 12 months. Until then, there will be no building permit & therefore no Baukindergeld.

Existing property.

Existing property.

If you can't get another rental apartment because of a bad credit rating, then you also won't get a loan for an existing property. But if the situation were different and you found something for €200k, then that would be a very good option.

There are 5 children, not 7. And even with only 3 or 4 children's rooms, it should result in a better living situation than currently.

Building is nonsense. Sorry. That simply won't work. And 100% financing will hardly be possible. Let's assume 80%.

But as already mentioned: buy existing properties. And renovate or extend bit by bit.

But rather buy now if you get something. Would the parents or in-laws or their properties act as guarantors or provide a subordinated loan? Because then (and probably only then) a loan might be conceivable.

At least 20,000 euros for incidental acquisition costs should definitely be available. From wherever. 500 euros child benefit for the first 10 years plus 1,500 repayment makes 2,000 euros annuity.

That means taking up 220,000 euros and even being able to repay it in 10 years. Put the rest of the annuity into a subordinated family loan – it would be nice if this were repayable flexibly. With repayment over, say, 20 years, you can split the bank loan into two terms, then the bank might even grant around 400,000 euros. However, you would then need more from the family again (the other 20%).

At 80% financing by the bank, that's around 265,000 euros purchase price (plus incidental costs) or 500,000 euros with 20 years.

Whether and how much you get for it can only be said once we know the region. But in at least the first of these two cases, you will still have to put in a lot of work.

Nothing works without guarantors.

PS: Don’t necessarily get hung up on the 5 children's rooms; such things are hard to find in existing properties. If anything, I would look for a two-family house (one apartment downstairs, one upstairs) and then convert it. These multi-generational houses are no longer so popular today and are therefore relatively inexpensive!

Unfortunately, the OP leaves the questions unanswered. Depending on where he lives, you can't even get a plot of land for 400k. Land plus new construction plus additional costs will almost certainly not be feasible. Looking for an existing property is, in my opinion, a good tip. If you are handy as indicated, you can surely make something nice out of it. I think you are being partially criticized here because it is not entirely clear from your initial post whether these are your own children with disabilities (that's how I interpret the care level) or foster children.