Purchase of a single-family house - Financing

I see absolutely no reason to trust Volksbank with these two offers. Bad, ill-considered offers, sorry.

Can someone please tell me why the local bank should appear as a sensible partner for mortgage loans? Especially since these offers are usually worse?

What exactly should be changed about the offers?

As I said, we were also at Interhyp. There we only received one offer, and we would only get our desired loan amount if we additionally took at least €15,000 through KFW. But this also increases our total loan again...

Agreed. Advantage house bank. We know each other. After good advice, they give me as much as I need. Not as much as possible. Banks are swimming in money. They like to get rid of as much as possible, with debtors whom they trust to repay. But my interest is: as much as necessary, not as much as possible. Advice is therefore more trustworthy at the house bank. I don’t know those KFW shenanigans and such at our Volksbank. And: It is not forbidden and quite possible as a good customer to improve by one or two tenths of a percent. You just have to talk. The banker of smaller regional banks has competencies and leeway.

I cannot understand why, at today's interest rate level, for example, one should pay 3.7% on 84,000 euros (I assume this is the effective interest rate over the entire term) on a bullet loan, as well as 2.78% on the annuity loan in variant 2 for 15 years!

With the bullet loan, they pay interest only for 14 years (the amount of the preliminary loan is not stated), while in the building savings contract they only receive 0.1%!!!! credit interest. The loan interest after allocation of probably 2.15% (possibly also 1.40% or 2.85%) is very expensive here, very expensive.

I also consider the 20-year condition with 2.45% to be too expensive.

The value of the property after carrying out the intended modernizations and renovations is of course decisive. My assumption, however, is that Volksbank uses the purchase price and does not fully consider the modernization and renovation as value-increasing. Since I have to assume that your parents did not sell the property to you at an overpriced rate, rather at a discount, I see the conditions as 100% conditions and that – I suspect – would be too expensive and not right for me.

By the way, the KfW loan can be repaid cost-neutral; no prepayment penalty applies. You can then take out this loan again in the course of the purchase, no more expensive than what KfW originally offered. Especially since the remaining fixed interest rate period of the current KfW loan cannot be more than 10 years anymore.

Of course, one would have to look in detail whether my assumptions are correct. If they are, significantly better conditions are possible. If not, somewhat better conditions are possible assuming 100%, but especially other models, and if already bullet loan against building savings, then with the F60 tariff from Signal (instead of the Fox tariff from Schwäbisch Hall) with 1% credit interest, 2% loan interest, and a very low savings rate of 30%. The latter is enormously important if one wants to adhere to the basic rule of building savings: "to limit the largest loan with the smallest payments."

How long have people known each other? Until it comes to money, and by the way, I would have to know the director by now if I really want to be able to count on sustainable help and support someday, which the foreign bank wouldn’t have to provide or refuse at first; the emergency situation would have arisen, and that would be the reason why the house bank should be the better choice.

By the way, if people know each other, and have known each other for a long time, then I expect a top interest rate; I absolutely don’t see that here with the OP, not even remotely!

No bank wants to enforce third-party liquidation. The emergency case only occurs legally after 3 accumulated missed installments; before that, the bank has had many opportunities to bridge and endure the difficult situation. If it still didn’t succeed with the other banks, then it won’t succeed with the house bank that one supposedly knows for so long either, because none of the smiling people in ties signing the financing will pay the interest and repayment rates for the customer, not even the banker who is my buddy from football and the fire department.

Whoever was not my friend at the beginning regarding the conditions definitely won’t be one from a friendship perspective when something goes wrong later! It’s the bank, but for other – selfish – reasons.

Most third-party liquidations are carried out because usually, due to illness, divorce, or job loss, the non-performing loan had not been brought back into order for a longer period. Much more crucial, however, is that many consumers no longer wanted to get help. Bird/ostrich tactic, cover your head with a blanket, no longer read letters. Then even the buddy banker can’t help anymore. And let’s be honest, how strong is my personal bond to the banker at the house bank, if he’s not from the family or the circle of friends—and above all, where is that even the case?

I see no advantage in the house bank; to be honest, I even see a disadvantage, considering that this bank knows my entire financial situation, can access my account, and can even harass me in managing the account since the home financing has higher priority!

To offer an umbrella when the sun shines—but then also with great conditions if I need such a large sum for my life investment—but pull it away when it rains. This may be a cliché, maybe a stupid one, but it’s not without reason that it exists. If I get into financial trouble, I absolutely do not want to have my account with the bank where my existentially important home financing is domiciled, definitely not. But that is everyone’s own business; by the way, I’m writing all this as an ex-banker, one from a bank that today itself depends on help.

Don’t let anyone fool you, today is today; I want the best (not cheapest) conditions, and tomorrow is tomorrow, and most likely I won’t need any support then, and if I do, the other banks won’t let me down so quickly—not because we are friends, but because it’s about money and the bank doesn’t want to lose money in a foreclosure.