House purchase with construction loan repayment rate

Hi, I have two questions for you: 1. How do you evaluate our financing idea and 2. What is the best way to approach the financing?

Regarding 1.:

We, father (40), mother (35), child (1), want to buy a house that costs €500,000. Equity capital in the amount of €160,000 is available. Furthermore, a government loan of €160,000, which is considered equity capital by the banks.

The household net income is currently around €3,300 (of which €204 is child benefit and €280 is parental allowance). In addition, there will be a cold rent of around €500 from the future rented granny flat. Together, at 80% of the calculated cold rent (€400), this would be about €3,700 income.

Another child will also be born in a few years.

The government loan will be repaid with €440/month over 34 years. Additionally, €220,000 is needed from a bank, term around 30 years (will be reduced to max. 25 years with special repayments). The installment should be €660. This means the repayment rate will be around €1,100 and will decrease to €440 upon the father's retirement.

So, €2,600 would still remain per month. Subtracting €200 as a reserve and €500 for additional costs, €1,900 would remain for everything else.

What do you think of the plan?

And then the second question:

When the project becomes concrete: what is the process? I can call 10 loan brokers and have them make me offers, but these will be invalid the next day anyway because interest rates may have changed. That means one has to commit at some point without maybe having the best offer. Or I get all 10 offers on one day and then accept one of them at the end of the day. How do you handle this smartly?

Thanks for your opinions!

PS: I forgot to completely fill in the subject before sending. It should have said: "House purchase with a repayment rate of 30% of net income."

The lenders are bound to the offer for a certain period (between 10-14 days). At the moment, it's a bit like a lottery. You never know whether it will get better or worse in the next few days. Still, you have to strike at some point! Ideally, never compare again after that.

I would safely leave the rental income from the granny flat out of the financing plan! Besides, you also have to pay taxes on it...

The lenders are bound to the offer for a certain period (between 10-14 days).

Yes, but only after a concrete inquiry has been made at this bank and they have all the documents and have confirmed (or corrected) the first offer from the broker, right? Seen that way, the nice overview of the offers from the individual banks that the broker shows me is probably only the best one you "could" get. Or am I misunderstanding that?

Regarding rental income: Why exclude it completely? Also, purchase costs, interest payments, and expenses for the granny flat can be deducted, so I think not many taxes will be due for a long time.

Until the signature, I only had the intermediary as a contact person.
He clarifies all the details with you and submits the required documents on your behalf.
I even renegotiated the interest rate with my intermediary.
That means: Everything the intermediary serves you is as if you were dealing directly with the bank. No fees or commissions will be charged to you.

Because the rent can sometimes fail due to vacancy or insolvent tenants, etc...
I would not calculate with that but be happy if it comes on top.

If I only stay with one broker, I can imagine it just as well. Looking at the current [Finanztest], I see that there can also be big differences between brokers. That is why I would like to contact several brokers.

Furthermore, a government loan of €160,000, which is considered equity by the banks.

Can you reveal what kind of loan this is that the bank accepts as equity?

That means you have to commit at some point without maybe having the best offer.

How do you know what the best offer is? You simply obtain several and then decide. Usually, most offers head in the same direction. However, I have no idea how your government loan affects this.

Positively, there is the existing apartment, which can be additionally borrowed against or even sold.