House purchase, renovation and financing - How to proceed best?

  • Erstellt am 2011-07-04 17:35:13

Marc86

2011-07-04 17:35:13
  • #1
Good day,
I am not a big writer, so directly the facts:

-house (built 1939) including land 50,000 (my parents' house, therefore so cheap, the land price alone would be significantly higher)

-renovation/rebuilding: external thermal insulation, complete heating system (there is none, only a fireplace in the living room), new windows (to save heating costs), complete renovation/refurbishment of all rooms including internal thermal insulation (installation of heating), conversion of a "registered" shed into living space (bath/dining room)

the renovation is mostly done by myself except the electrical and gas work 30-40,000 max.

net income married 3 children 2700€ NO equity (I am 25 and did my apprenticeship a bit later and will receive my journeyman's certificate in 16 days)

how do I manage to get the right financing? I mean, it’s not even 100k€, the installment amount should not exceed my current rent of 750€

the net income amount depends on my new employer starting August as well as the income of my then wife & child benefits as well as housing allowance or cost compensation the whole project should take place next summer.
how do I proceed best? I don’t want to wander cluelessly through various banks. I’ve been told I should take 2 loans: one for the house purchase and one for the renovation since these can be subsidized separately.
 

Stein auf Stein

2011-07-06 11:55:35
  • #2
Hello Marc86,

the sale of a property within a family is rated very positively by some institutions. That means a market value is determined and not the purchase price applied. This should help you to get a good financing with this equity (market value - purchase price).

Installment amount €700, €100,000 loan term, approx. 20-22 years. Should work like this!

Best regards

Stein auf Stein
 

Marc86

2011-07-06 13:24:35
  • #3
why so long? that would be around €170,000 and that would be quite an exaggerated interest rate, right? ideally, I would have paid it all off within 15 years....

because the background thought: 40/41 years old, youngest child 18...... homeowner... :D

a small side question, do vermögenswirksame leistungen possibly have a positive effect as well?
 

Stein auf Stein

2011-07-06 13:33:53
  • #4
Hello Marc86,

you can also pay more to finish faster.

The financing model is a standard model with a fixed rate and special repayment options starting from the 10th year.

Individual calculations and advice are not possible here. I just wanted to show you that it works.

You can integrate prepayments, reducing your debits from the account.

Best regards

Stein auf Stein
 

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