Pay off land privately?

I would never finance the 40k over 15 years. What time horizon until the start of construction are we roughly talking about? 2 years or rather 5 years? How much is the property worth in total? If the targeted start of construction is within the next approx. 2 years, I would probably finance the whole thing variable. That way you stay flexible with your future construction financing and it doesn’t cost the earth.

The 15 years result from the fact that in the hypothetical case we would have to pay this installment at the same time as the installment for the house at some point – without this installment it would of course go a lot faster.

Do the grandparents have to sell it? Or wouldn’t there simply be the possibility to postpone the purchase to the point in time when you’re financing anyway? Sure, in the end the property would then be counted as equity and the outstanding amount would be offset against it. But if the grandparents don’t depend on it, wouldn’t it perhaps be easier to handle the whole thing in one go and, if arranged via a preliminary contract, that you get the property?

No, they don’t depend on it. They say they won’t touch the money anyway but will basically put it directly into the inheritance. However, such statements are easily made as long as one is not in need of care and the own house does not have to be converted to be accessible for the disabled or or or...

Or write payment in x years into the notary contract.

But that would completely destroy the property as equity for us, wouldn’t it?

It’s similar for us. In the event of inheritance, the property is credited to us and we then get less from the rest. So not a direct payment date but a credit against the total inheritance.

Total inheritance as grandchildren? Could be difficult.

You will have paid off the 40,000 by the start of construction, otherwise you couldn’t afford a house.

Please explain that connection to me, I don’t understand it.

You have to explain the connection to me, it doesn’t make sense to me.

So you are now considering buying a plot of land. That means it will take about two more years until construction starts. During these two years, you pay 1700,- € monthly to the grandparents, and the 40,000,- € that you still need are gone. After that, you then pay the 1700,- € to the bank (and possibly the utility companies, if you build cheaply).
Fits perfectly...

Or did I misunderstand something?

Should the bank (in your 15-year scenario) then go into the land register? And thus into the first rank? That way you are almost committing to one bank for the entire construction financing. Nobody wants to be in the second rank, and if so, probably only under worse conditions.

But you are not really giving any information.
How much is the property worth in total?
How much could you currently pay off (to get the 40k together as quickly as possible)?

"Or write the payment in x years into the notary contract."
But that would completely ruin the property as equity for us, right?

No matter what arrangement is made, the equity is always the same amount: money in the account + value of the property - remaining property mortgage. It doesn't matter here whether it is a bank loan or from a private party, or if the payment is due only in x years.

The important thing now is not to create an entry in the land register for a bank, because otherwise you are already binding yourself to a bank and they can then demand exorbitant prices for the house construction. Always finance everything together, or initially just the property without an entry in the land register.

Which option fits here must result from the framework conditions and wishes of all parties involved.

So you are now considering buying a plot of land. That means it will take about two more years until construction starts. During these two years you pay the grandparents €1,700 monthly and the €40,000 you still lack will be gone. After that, you then pay the €1,700 to the bank (and possibly to the utility providers if you build cheaply).
Fits perfectly...

Or did I misunderstand something?

Yes, I think you forget the fact that during those two hypothetical years until construction starts, we also have to pay something like rent on the side... Although you are right in that the rate could currently be higher than €250, but the amount was just a rough estimate.

Should the bank (in your 15-year scenario) then be registered in the land register? And thus in first rank? You are basically binding yourself to one bank for the entire construction financing. No one wants to be in second rank and if so, probably only under worse conditions.

But you don’t really give clear information.
How much is the plot worth in total?
How much could you currently pay off (to get the €40k together as quickly as possible)?

So, just to avoid misunderstandings (because somehow it feels like I wasn’t clear):

In the 15-year scenario, we would receive the plot directly and in return pay my boyfriend’s grandparents immediately (!) €250 per month, of course contractually agreed.
When we start building, the construction itself would still need to be financed; for this financing, the plot could theoretically be used as equity (since it would then already be in our ownership). When calculating the possible financing rate, the €250 obligation would of course have to be deducted.
At least that’s how I imagine it – and my question was whether that works or if it’s more like tassimo just wrote:

No matter what arrangement is made, the equity capital is always the same amount: money in the account + value of the plot - outstanding debt on the plot. It doesn’t make a difference here whether it’s a bank loan or from private parties, or the payment is due in x years.

Your other questions don’t really make sense to me in relation to the question, but: the plot is worth €65,000, we would pay €25,000 directly in advance and the rest then in installments.

The property then belongs to you and counts as equity. But the private loan would have to be declared because you have to repay amount X monthly.

No matter what arrangement is made, the equity is always the same: money in the account + value of the property - outstanding debt on the property. It makes no difference here whether it is a bank loan or from private, or if the payment is due only in x years.

These two statements contradict each other, that's what I actually wanted to point out.