House purchase financing 100%

Hello user,

after reading along here for several months, fate caught up with us this weekend ;-)

Now to my question/problem:

We, married with no children, have been planning to build or buy for some time. As mentioned, fate took its course this weekend and we found our property:

Purchase price: 275,000€
monthly net income: 4,500€ - 5,000€
equity: 30,000€

Today I called the first banks about a construction loan. To my dismay, a few banks told me that they see little chance of financing because we do not have more than 20% equity. I always thought that with our "monthly financial strength" this shouldn’t actually be a problem. We actually wanted to finance 100% and use the 30,000€ to renovate the bathroom, paint, buy kitchen, etc. Do you have any tips?

So today I called the first banks regarding a construction loan. To my dismay, a few banks told me that they see hardly any chance of financing because we do not have more than 20% equity. I always thought that with our "monthly financial strength" that actually shouldn’t be a problem.

Yes, it is generally (rightly) said that builders should have 20-25% equity. That also proves the ability to save and thus the financing capability. One (the bank) naturally wonders why, given the mentioned income, there is not more equity available. Nevertheless, I consider such answers at least flippant!

Do you have any tips?

Tips? Gladly ;-) I have a few ideas. It’s doable, but... Where are you from?

Do I understand correctly that you want to buy a used property and want to use your equity for renovation/modernization?
Does the price you mentioned already include the ancillary costs? Property transfer tax/notary/court/real estate agent???
You realize it’s a bit more complex, the whole topic, and therefore not really suitable to figure out completely by yourself from the internet :(.

You can gladly send me your further information by PM as well.