Opinion on Financing Wonnigster or Annuity Loan

Good morning,


we are about to finalize the financing for our construction project.


We can now mainly choose between 2 variants that are interesting for us.


I would like to have your opinion on our project.


Here are the key data:


Costs for house construction (turnkey) and land €300,000 Kitchen etc. are included in the total.


Income just under €4000 net as a family with one child (half a year). Both around 30 years old.


Variant 1 ([Wohnriester] with advance loan)


€50,000 equity


€50,000 [KFW 153] 1% interest


€200,000 WR €100,000 per spouse


13 years advance loan at effective 1.79%


11 years [Wohnriester] loan at 2.4%


Monthly [Kfw] and WR approx. €1000 for 13 years then approx. €140 more.


Prepayment 5% possible in the advance loan, afterwards everything can be fully repaid.


After 24 years WR paid off. [KFW] is calculated over 30 years.


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Variant 2:


30 years annuity loan full repayment


€50,000 equity


€50,000 [KFW 153] 1%


€200,000 loan


Interest rate for 30 years effective 3.03%


Monthly €1023


Prepayment 5%


Repayment change possible 3 times.


Well, currently we clearly tend towards variant 1. Are we overlooking something?


Looking forward to reading your opinion.


Best regards


Daniel

The disadvantages of Wohnriester are known?

As long as special repayments are realistically planned, option 2 is also completely nonsensical. Rather 15 or 20 years fixed interest with much better conditions.

Yes, we are already somewhat familiar. However, we still need to make good use of the weekend to weigh the pros and cons of wohnriester. Therefore, I would also very much appreciate hearing the cons of wohn Riester and the pros. So far, I find it clearly pro WR and only have the con of taxation in old age. This was estimated by the advisor at about €60 per person.

wohnriester basically means that you have to pay it back when you actually no longer have it. Normally, you buy/build a home to be done with it as a retiree and to get by with less. With Riester, this effect is exactly reversed :) of course, you can also save up with Riester beforehand and then pay from it in retirement.
30 years fixed interest rate is nonsense. 20 years should be enough with a better interest rate. Otherwise, you only pay the interest for the last 10 years, which would never have been incurred with 20 years (and a better interest rate).
You really have to calculate it sharply. A longer fixed interest period actually means that for the longer time, you partly only cover it through the extra interest. With 20 years fixed interest, you haven’t paid off twice as much as with 10 years, but depending on the conditions about ~1.5 times.

From whom did you get the 30-year? Insurance company?

I would also have 15 or 20 years calculated again. Have you asked an agent?

When I start the Intrehyp calculator I get 2.71% effective, so almost the same as Wohnriester.

I would be cautious with these model calculations for tax with Riester. They are models. We have also consciously decided against integrating Riester.

30 years are Münchener Hypothekenbank. We have not used intermediaries so far. Only regional banks. We still have an offer for 15 years fixed interest at 2.45% with a term of 30 years.

The short term in the WR is already interesting. It is just the question how it will become more expensive later in old age, right? WR 13 years with 1.79 effective, then 2.4% for the loan.

Difficult...