Pay off land privately?

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

Even without knowing your financial situation in detail, I stick to my basic statement: If you don't manage to mostly pay off the 40k by the start of construction, you should reconsider building a house.

You probably already have the majority saved up anyway. Then transfer the money, have the land transferred to you, put everything possible into paying off the remaining 40k, gladly with a contract, but without banks.

Maybe it will be a bit tighter in the near future – but that is good preparation for building a house! From then on, it will only get more expensive.

Even without knowing your financial situation in detail, I stick to my basic statement: If you can't mostly have the 40k paid off by the start of construction, you should reconsider building a house. You probably already have most of it saved anyway. Then transfer the money, have the land title transferred to you, put everything possible into paying off the remaining 40k, gladly with a contract, but without banks. Maybe it will be a bit tighter in the near future – but that is good preparation for building a house! From then on, it will only get more expensive.

I still don't really understand (because a) you don't know how long it will take until construction starts – we don't know that ourselves yet – and b) you don't know how high our current rent is and even less what's financially possible right now), but thanks anyway for your suggestions.

Gladly. Maybe it’s a point to ponder.

Briefly on point b): From zero to start of construction in under two years would currently be a very respectable achievement. And at the start of construction, you definitely don’t pay off the loan in full yet.

PS: Good handling of my assertive tone. You will get far in this forum!

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

Why? I think they mean the same thing.

I do not see the statements as contradictory, even if both may be greatly simplified. For the bank, the loan-to-value ratio is important so that in case of emergency the bank gets its money back first. The private lenders then end up empty-handed in case of doubt.

One more small thing that interests me personally: Did I read correctly that you are not married? How does it actually work with the real estate transfer tax for the partner who is not related to the sellers? Is anything due there?

Gladly. Maybe it’s a food for thought.

Briefly on point b): From zero to start of construction in under two years would currently be a very respectable achievement. And at the start of construction, you definitely don’t pay off the loan fully yet.

PS: Good handling of my assertive tone. You will go far in this forum!

Thanks for the compliment
No, seriously. We are currently looking at prefab house providers and have also contacted a regional carpenter on the side. If everything goes well (which of course it won’t, but one can dream) construction could begin next autumn according to the current status.
Until then, we won’t pay back 40,000. I have to be that realistic

Why? I think they mean the same thing.

I don’t see the statements as contradictory, even if both may be heavily simplified. For the bank, the loan-to-value ratio is important so that in case of emergency, the bank gets its money back first. Private lenders would then potentially lose out.

Another small thing that interests me personally: Did I read correctly that you are not married? How does that actually work with the real estate transfer tax for the partner who is not related to the sellers? Is something still due there?

But in my mind, it’s not the same.
As an example:

Option A: We get the property deeded to us and agree on the payment on day X. We go to the bank and say: “We need 360,000 euros for construction and also 60,000 for the property.” That makes a total of 420,000. The property then logically can’t be counted as equity because the bank has to finance it - right?

That would be okay and doable, but in my mind there’s still Option B:
We get the property deeded to us and agree on a monthly payment to the grandparents. We go to the bank and say: “We need 360,000 for construction and we own a property worth 60,000 euros.” That makes a total of 360,000 with equity of 60,000. When checking liquidity, of course the private debt must be factored in and declared. Overall, the installment for construction and the installment for the property, because of the equity, would still be significantly lower than in Option A.

Presumably that is a fundamental thinking error, but I would like to understand it!

Regarding the real estate transfer tax - another good question. But I suspect we will avoid it by having the property deeded to my boyfriend. The wedding is planned for next year anyway (or one just waits until then).