New construction financing single-family house 150 - 160 sqm

Morning,
I don't understand why you take the Kfw124 for your offer 1 and only the grant for KfW55 ee?
The loan for KfW55 has significantly better interest rates.... Kfw124 should be undercut by any house bank... That was still the case for us in December...

We consciously decided on the grant months ago (the interest rate was also somewhat lower then), because the KfW loan is too inflexible for us.
For KFW 55 EE, it's a €150k loan, after 10 years without special repayments a good sum remains for which a follow-up financing must be arranged.
But you're right, actually the bank could also offer a loan of €100k / 10 years / 5% special repayments.
Through the special repayments, I could ensure that the remaining debt after the 10-year fixed interest period remains manageable.

The financing is now becoming concrete. We have obtained different offers, and the decision will be made this week.
Everything is basically fixed, there are 2 offers on the table.

Framework conditions:
Total costs: €577k
Equity capital: €107k
Financing: €470k
monthly income (joint): €5k (see further details in the initial post)

Option 1: 20Y + 15 Y fixed interest rate + bullet loan

[*
Bank loan 1: €320k / 1.41% effective / 2% repayment / 20Y fixed interest rate / €5,000 special repayment
[LIST]
[*]Outstanding debt after the fixed interest period: €88,000* --> follow-up financing necessary


[*]Bank loan 2: €110k / 1.39% effective / 3% repayment / 15Y fixed interest rate / €5,000 special repayment


[*]Outstanding debt after the fixed interest period: €20,000* (can be repaid with existing building savings contracts)


[*]Bullet loan: €40,000 / 1.11% effective --> will be fully repaid at once after receiving the KfW subsidy together with remaining equity capital
[*]Monthly installment: €1,305

Option 2: 25Y + 15Y fixed interest rate + bullet loan

[*
Bank loan 1: €320k / 1.55% effective / 2% repayment / 25Y fixed interest rate / €5,000 special repayment
[LIST]
[*]Outstanding debt after the fixed interest period: €10,000* --> can be repaid without follow-up financing


[*]Bank loan 2: €110k / 1.39% effective / 3% repayment / 15Y fixed interest rate / €5,000 special repayment


[*]Outstanding debt after the fixed interest period: €20,000* (can be repaid with existing building savings contracts)


[*]Bullet loan: €40,000 / 1.11% effective --> will be fully repaid at once after receiving the KfW subsidy together with remaining equity capital
[*]Monthly installment: €1,340

*The planned special repayments are already included in the still outstanding residual debt

I am currently still considering whether the 25Y (1.55% effective interest) fixed rate makes sense compared to the 20Y (1.41% effective interest) fixed rate?

[*]According to my calculation, the interest rate could be at max. 5% in 20Y for option 1 to have lower total costs until full repayment compared to option 2.
[*]If the interest rate in 20Y rises above 5%, option 2 (25Y fixed interest) would be cheaper in terms of total costs.
[*](I do not see a financial risk, even if the interest rate in 20Y should be 8%, the residual amount of €88,000 can still be financed. However, the total costs until full repayment would then be about €12,000 higher than option 2.)
[*]Info: In 20Y I will be 50 years old, so still a bit of time before retirement

How do you evaluate this?

Since our conditions are 90 percent the same (age, planned parental leave, jobs/salary) and even the planned construction costs and equity are similar, I'll give my assessment.

I would choose option 1 and possibly increase the rate to 1400. With the current salary, which still has potential to increase, it is under 30 percent of the household income.
20 years is a sufficient fixed interest period and the risk afterwards is manageable. With the slightly higher rate/repayment, you could reduce the interest a bit more.
Negotiate an additional flexible repayment change for parental leave, because that (as in our calculation) is the only bottleneck.

But basically a very solid situation. And honestly: if you can’t build a nice house at our age with these conditions, a lot is going wrong in the market.

New update, financing is now complete:
1. Loan: €340k / 25 years fixed interest / 1.51% effective / 2% repayment / €5k special repayment option
2. Loan: €105k / 15 years fixed interest / 1.39% effective / 3% repayment / €5k special repayment option
3. Variable: €25k --> will be repaid with [KfW] subsidy

Results in a monthly burden of €1,380 and should still be manageable for us.
With the 20 years fixed interest, about €140k would have remained outstanding after the period, the 25 years had a 0.1% interest surcharge.
We went for the safer option and therefore chose the 25 years.

Next up is the sample selection and building application.

That sounds good, then already good luck and a pleasant construction period! I find your financing offers good and feasible. May I ask what house price you ended up with? We currently also have offers and are already coming very close to 3000€/m² + additional construction costs etc. Our project with 150sqm is quickly at 530,000, but unfortunately those are the current prices. When the time comes, I would appreciate an update on the final cost breakdown!

Previous cost breakdown:
Land (400 sqm): €55k
House (162 sqm) including base slab + earthworks in KFW 55: €344k
Masonry double garage (50 sqm) including foundation: €30k
Additional photovoltaic 6kwp: €10k
Central controlled residential ventilation: €17k
Upgrades + special requests: €26k
Floors in EL: €10k
Painting work in EL: €5k
Kitchen: €17k
Interior fittings: €17k
House connections: €8k
Outdoor facilities (partly in EL): €15k
Terrace: €5k
Energy consultant: €6k
Cistern: €4k
Construction water / construction electricity / financing costs: €7k
Notary / surveying costs: €5k

Total: €581k

Reductions:
Savings through EL: -€7,000
Omission of chimney flue: -€3,000

Total costs minus reductions: €571k

Additions:

[*]The house is heated via district heating; connection costs amount to €10k (included in the house price). No heat pump
[*]Underfloor heating on ground floor and upper floor
[*]Increase of raw construction floor height on ground floor to 2.76m
[*]Necessary earthworks are already included in the house price
[*]The house has two full floors with a hipped roof. Basic dimensions 10.3 x 10.3m
[*]On the ground floor there is a small bay window (0.6m deep) for a seating window
[*]Buffer amounting to €20k equity capital is still available