Real estate financing based on a preliminary contract

Happy Sunday to everyone!

I have been quietly reading along in the forum for a while and have already picked up many good tips here, but I have a current concern, which is why I finally registered :) If I ended up in the wrong subforum, please just move this thread.

I have already searched the internet on this topic and consulted two financing advisors who gave contradictory statements. Maybe someone here is familiar with the topic and can provide some clarity.

Let's assume a property is to be sold in about 1.5 years because of the speculation tax and will be rented out to someone who wishes to buy the property afterwards with a prior oral agreement from the seller (a right of first refusal is embedded in the rental agreement). Would it theoretically be possible to enter into a notarized preliminary contract between the buyer and the seller and based on this preliminary contract conclude a real estate financing that includes a provision-free period of, say, 12 months after about three quarters of a year? As soon as the actual purchase contract is available and notarized, that is after the 1.5 years period, the mortgage is supposed to be drawn down within the provision-free period and the entire sum transferred to the seller. Do banks generally approve real estate financing on the basis of a preliminary contract? One financing advisor said this would be no problem, while the other completely rejected it. We are aware of the risks for both the seller and the buyer.

The background to the described approach is that family planning was actually planned for next year and this property practically fell into our laps. The property fully meets our location, features, and price preferences and offers a unique opportunity for us. The seller is not aiming for an exorbitant price and would also sign an appropriate preliminary contract if we bear the notary costs. Since parental allowance is known not to be counted and a visible pregnancy is not well received by banks, we see this approach as a way to nonetheless conclude financing. Unfortunately, my husband alone would not be approved for financing, although it is financially not an issue. Starting family planning only in 1.5 years and then concluding a corresponding property financing at the time of sale would be the clean solution. But since I am no longer the youngest, this would actually be a dealbreaker for us, which is why we would sadly decline. At the moment these are all just thoughts giving me some hope. However, I don’t know if it is really feasible. Does anyone here have experience with this?

Would it theoretically be possible to conclude a notarized preliminary contract between the buyer and the seller

What should be stated in the preliminary contract?

The basis of this preliminary contract is real estate financing, which includes an interest-free period of, say, 12 months, to be concluded after about three quarters of a year?

Basically, that is possible, because many purchase contracts are only concluded once the financing is in place. The purchase contract is then a condition for disbursement.

We are aware of the risks for both the seller and the buyer.

Are you sure?

Does anyone here have experience with this?

First of all, it is urgently advised to consult a lawyer. Because if you create a situation with the preliminary contract that objectively already leads to a contract-like state, the seller is already exposed to the speculation tax trap. So a lawyer is the first point of contact. And what is then drafted forms the basis for a discussion with the bank/agent. You alone bear the financial risk in the form of possible non-acceptance compensation at the bank. If interest rates drop significantly again, that will be very expensive tuition fees. The seller practically bears neither risk nor costs (you would bear those).

Do banks even approve real estate financing based on a preliminary contract?

Banks want security and a registration in the land register. A preliminary contract is no security, practically useless for the bank…

The property fully meets our expectations in terms of location, features, and price and offers a unique opportunity for us. The seller is not aiming for an exorbitant price and would also sign a corresponding preliminary contract with us if we cover the notary costs for it.

…Of course, not for you. Your later sale is confirmed to you by the landlord. Unfortunately, I can’t say anything about financing during pregnancy… But I would just wait and see if and when anything happens regarding that. An alternative would be that the landlord simply has the speculation tax calculated. Possibly you could pay it because it makes sense, even without rent, to buy now?!