Is this feasible?

Hello dear house-building community,

firstly about us, my boyfriend (28) and I (25) want to build a house in the near future.

My question now,

I don’t really have any equity. My boyfriend has quite well-off and frugal parents and he expects a starting help of 50,000 from them. (possibly even more)

However, I have three insurance policies with capital accumulation for old age + my boyfriend also has two.
Does that count somehow as collateral with the bank?

Now about our income
we both work in Switzerland and have a net income after current exchange rate (taxes, health insurance deducted) of €4844 (from this only life insurances, pension insurances and disability insurances, car insurances are deducted)
what remains is a total net of: 4400 (and a few cents) (our current rent of €610 warm I have not deducted here)

Is it possible to get a loan of 300,000 with this income (50,000 is equity after all)?

We want a prefab house, 1.5 stories with about 150-160 sqm, double garage.

Plots of land are quite expensive here, therefore so much money (230 €/sqm)
the plot should cost max 120,000 (so it should be about 450-520 sqm)

We plan to have 2 children,
however I can continue to do my job from home in the home office, meaning the income would remain,
(the first year I would not work at all and would be entitled to the maximum amount of parental allowance.)

Now to the experienced among you.

Are we dreaming too big?
Or is this possible?

We have calculated and a repayment of 1000 € would be no problem. Even with only my boyfriend’s income 800 € is easily doable, but we also want to save on the side for possible bad luck (we had enough of that in my family and I am very cautious here) as well as for repairs which will certainly come sooner or later.

Hello

The bank is best suited to calculate whether you have a shortfall or sufficient income.

Make it practical: You can certainly calculate yourself what kind of lifestyle you have and want to maintain. If you want to continue having a new car, new clothes, nice meals, and lots of holidays, your expenses for the house should not be higher than now.

If you are someone who says Ok, I have experienced a lot, now it’s time for the house, then you can spend more. From both calculations, you can quickly figure out what you want to spend, and based on this monthly expenditure, the bank can very quickly tell you how much you can borrow.

That’s how it was for us. I told them "this and that amount, not a penny more," and from that, based on the interest rate and the desired repayment, the loan amount was determined...

"My friend is counting on.." => First, I would clarify whether you will even get the 50k EUR promised by your parents-in-law

Then I would simply ask myself (no accusation!), why you haven’t managed to build up equity with 4400 EUR net so far or how you intend to repay the loan later?! You still need to save a certain monthly amount as a reserve for unplanned expenses.

How do you come up with the 300,000 EUR loan? For 150-160 sqm + double garage, I would realistically estimate construction costs at around 300,000 EUR. Adding the plot at 120,000 EUR, we’re looking at roughly 420,000 EUR as a rough estimate.

Even if you reduce your living space to 120-130 sqm and manage with the 300,000 EUR loan, this results, at 2% repayment (in my opinion currently the absolute minimum!), in a rate of 1200-1300 EUR per month.

So we will definitely get something from his parents, his mother just doesn’t tell him exactly how much it will be, but his father once said they would pay for the land. (therefore we are assuming at least 50,000 for sure) His mom always stashes 20,000 AT HOME in the closet for hard times, so I think 50,000 is already fixed.

Why we don’t have any equity yet. (The question is obvious with such an income)

I have only been working in Switzerland for just under 1.5 years and bought a new car in Sep 2011 and well, that 14,000 € had to be paid off first (I finished the loan in Dec. 2012).

The same goes for my boyfriend, he has been in CH for 11 months, before that he worked in DE as well and you simply don’t earn the same there.
He also bought a new car and had to pay it off first (we both had old 15-year-old junkers and thought we would get the car out of the way before starting with property).

In addition, we only moved in together 19 months ago, deposit, commission, furniture + equity also had their price.

That should give you roughly an idea why we have little or no savings.

We want to build or have a prefabricated house built, but without a basement; with 160 sqm a utility room and a pantry – as well as a small garden shed and the garage should provide enough storage space.

Since neither of us has any craftsmanship skills and hardly anyone in our circle of friends can help (except a landscaper in the family), we definitely want the house to be almost turnkey (floor coverings, walls to be done by ourselves or outsourced).

We also browsed numerous catalogs and no expansion house we like costs more than 115,000 T.
In most cases the foundation slab is even included.
What will it cost to get it finished to the point that only floor and wall coverings still need to be done?

1.) Separate yourself from catalog prices. 2.) Ausbauhaus means, by the way, to build it yourself. How do you want to do that without craftsmanship skills and friends? 3.) For every 100,000€ loan, you can roughly calculate with a 500€ installment.

Hello

I can understand that as career starters you have little equity. I don’t want to take away your dream, but you should consider the following:

- You talk about the exchange rate. Are you cross-border commuters or do you live in Switzerland? In both cases, the German banks will have problems. Besides the later house (real security), personal liability is important to the banks. A later wage garnishment abroad is difficult to impossible. So you should inquire at banks near the border. Ideally the house bank. Swiss banks, on the other hand, have difficulties financing an object in Germany :)

- Basically, you should inquire more about the parents' equity, observe gift tax limits (otherwise the nasty tax office will come around). Ask if they want securities (e.g. a land charge?). Every bank will also want proof of equity for the overall financing. At the latest then the parents have to get involved. And well, cash and proximity to the border... So even the 20k in cash could cause a problem in terms of proof -

Good luck!