Impact of tax class on creditworthiness

Must not play a role for the bank. The tax class only changes the interim payout from your employer. After the tax return at the end of the year, you have exactly the same net amount as before. So of course switch and collect parental allowance.

Thank you very much for all the helpful feedback!

I tend to feel encouraged to switch from tax class IV to tax class V, which reduces my net income, despite the intended house purchase as a higher earner, so that my wife (in the then chosen tax class III) can receive more parental allowance.

Since we only got married this year, we are exceptionally able to make the tax class change retroactively to the month of marriage. This means that the period I have to spend next year in tax class V will not be too long, and the net deficit regarding this year’s period can at least be balanced out by mid-next year with the 2020 tax return. Immediately at or after the birth, I will then switch to tax class III, which increases my net income again.

What seems decisive to us is especially the fact that we have not found a concrete purchase object yet and the further search (without us wanting it) may possibly continue well beyond the birth.

If we find something before the birth and thus during my time in tax class V, I will explain to the bank that the net income is only temporarily reduced and hope for their understanding / benevolent assessment of my creditworthiness. After all, the temporary switch means that, (albeit with a delay) we will ultimately have more money overall than without the change due to the increased parental allowance.

Once again, many thanks to everyone for the support in our decision-making!

It must not play a role for the bank.
The tax class only changes your employer’s monthly payout.
After the tax return at the end of the year, you have exactly the same net amount as before.
So of course switch and collect parental allowance.

says who? The bank is not a tax advisor and simply inputs net income.

Even parental allowance is a problem for some.

I was just about to say that. Parental allowance is a wage replacement benefit and as a rule, banks do not take them into account. Exceptions prove the rule...

What does parental allowance have to do with the tax class? Parental allowance is a replacement benefit and not sustainable. If you can prove continued employment after parental allowance, then it is not an issue. Every bank employee who reviews loans must know that the tax class has no influence on the amount of the annual net income. So if that should become a problem, you are already at the wrong bank.

What does parental allowance have to do with the tax class? Parental allowance is a substitute benefit and not sustainable. If you can prove continued employment after parental allowance, then it is not an issue. Every bank employee who checks loans must know that the tax class has no influence on the amount of the annual net income. So if that becomes a problem, you are at the wrong bank anyway.

It's not that simple after all. There are dozens of experience reports here in the forum (I myself have also had negative experiences) that banks switch from "green" in preliminary discussions to "red" at the last step. Simply because the risk assessment is ultimately computer-controlled. In most cases, you also do not get a 100% clear answer as to what it was ultimately due to. The bankers then only suspect... And I do not believe that you know all the risk parameters including the weighting of every bank. But the original poster is sensitized and a banker can certainly still adjust and evaluate... Maybe not ING. They work almost entirely on IT-based evaluation.