Is it possible to involve the bank later due to a gift/financing?

Hello,

We want to buy a single-family house in the Berlin metropolitan area.
We are in the luxurious position that we will receive a loan from my father.
To make it clear that it is not a gift, the loan should be repaid in 20 years, when my father is 81. We calculate 2000×12×20=480,000€.
The problem is that in the area, you can also pay 1 million for a normal single-family house, which is why we would realistically borrow 650,000-700,000€.
If we assume no special payments or gifts, we would then still have 170-220 thousand euros outstanding. Could a bank theoretically be involved for this "bullet payment"? Do banks do that retrospectively?

Best regards
Goldelse

As a supplement: The gift tax exemption limit was used 9 years ago with company shares, which is why the loan must not be considered a gift. Further gifts are likely in the coming years; in the event of my father's premature death, I would inherit the claims on my house. A property has not yet been found.

Can't say much about the view of banks, would think it doesn't really matter and I would just prefer to involve the bank earlier for security reasons. Especially since with a lot of equity (which a private loan basically is) you surely get better conditions.

Regarding gifting, better to incorporate a current market interest rate (e.g. 0.6%) now and draw up a written loan agreement.

Could one theoretically involve a bank for this "bullet payment"? Do banks do such things afterwards?

Afterwards to what? You now need an amount that you cannot fully cover with the family loan. So you also need bank financing now. And the bank will relatively easily give you the money, unless your debt service capability is a disaster. But from now on, the bank will also want to agree on repayments. Make concrete considerations when you have concrete numbers (= property).

In follow-up to what?
You now need an amount that you cannot fully cover through the family loan. So you also need bank financing now. And the bank will give you the money relatively easily, unless your debt service capacity is a disaster. But the bank will also want to agree on repayments from now on.

Think concretely when you have concrete numbers (= property).

A higher loan from my father would not be a problem, but we do not want to plan for more than €2000 monthly installments. We are still under 30, have no children yet, and don’t know how our incomes and expenses will change in the coming years. Currently, €10,000/year extra payments would be no problem and later perhaps also a higher rate.

We would prefer to do it without a bank and only involve the bank in 20 years in case of emergency.
As an "emergency fund," I own company shares worth around €1.5 million. However, these should of course not be (just) sold (family business). Furthermore, there is always the possibility to work in the company.

Theoretically, a longer term would also not be a problem, but maybe the tax office considers it unrealistic that he will live to be 90, so we want to record a realistic repayment plan in the contract.

Since the ECB key interest rate is at 0%, we thought we could take that. My father doesn’t want any interest; he is rather glad to invest the money somehow.

We understand that more can only be said once the property is fixed, but for budgeting, it would be good to know.

We would prefer to do it without a bank and only involve the bank as a last resort in 20 years.

We understand that one can say more only when the property is fixed, but for budgeting it would be good to know.

I still don’t understand what you want. Either you need money now, then private loan and/or bank. What will happen in 20 years doesn’t matter to anyone right now.

If we assume no special payments or gifts, we would still have 170-220 thousand euros outstanding. Could a bank theoretically be involved for this "bullet payment" later on? Do banks do this retrospectively?

It is probably about this. Part of the purchase price is not to be paid immediately but is to be paid to the father only after 20 years. To ensure that this does not look like a gift, an appropriate bullet loan is to be taken out now.

No idea whether this is necessary or sensible. Such a thing is basically possible (often in connection with home savings contracts).