Real estate financing - the jungle of offers ...

4. What does that mean? Your last tip was, as I understood it, to save money in case I can no longer work. You are probably about the same age as I am – please read through my penultimate post, I wrote a few things there.

That means you wrote so much around the topic that it’s hardly possible to see the actual question/concern.

As for the missing information. There are very few people here who want to sit in front of Excel all day to track financing. So please try to fill out the different things based on the following schema. From offer 2 onwards there wasn’t even enough info for the repayment rate.

[*]Loan amount

[*]Type of loan (e.g., annuity loan, bullet loan, etc...)

[*]Interest rate (p.a. nominal, otherwise effective)

[*]Fixed interest period

[*]Remaining debt at the end of the fixed interest period

[*]Fictitious total term until full repayment

[*]Initial repayment rate

[*]Monthly installment

[*]Special repayments possible? (Specify amount)

[*]Repayment rate change possible? (Specify conditions like number, repayment rate range)

[*]For preliminary, interim or TA loans with building savings contracts please provide details on the building savings contract (contract amount, credit interest rate, minimum saving rate, minimum saving target, planned saving rate, Riester premiums, expected allocation date, later loan installment, loan interest rate, etc...)

plus KfW product (homeownership subsidy – 50,000 euros); the KfW product is always set for 10 years in every model here

You probably didn’t understand that correctly. The fixed interest period is indeed 10 years, but the calculated loan term can be up to 25 years. Also, you can choose between 1-3 years of repayment-free start years.

Also see above again; the complete figures.

Furthermore, a suggestion for a simple capital procurement was made with the note that fewer formalities apply (difficult estimation of the value of the property to be acquired in its current state, certified listing of renovation costs by an expert, etc.).

??? Rob the bank or what is a simple capital procurement?

- Built-in kitchen

By the way, kitchens can hardly be financed via a mortgage loan normally; since they are not value-increasing.

And again for understanding; is the equity you bring in zero?

approx. 50,000 via KfW spread over two products not further specified to me with an interest rate of 0.78 % and 0.93 %. Amount is still to

Which one? And yes, through KfW you can also promote or subsidize individual measures; not only fully energy-efficient building/renovation.

??? Rob a bank or what is a simple capital procurement?

Pledge existing real estate and have the money paid out.
This would have the advantage that the financing of the properties would not be directly linked to each other. Not a stupid idea imho

Pledge existing real estate and have the money paid out.
This would have the advantage that the financing of the properties would not be directly linked to each other. Not a bad idea imho

Exactly right. Pledge the apartment, have the money paid out. According to the real estate agent, depending on the bank, no information sometimes has to be given regarding the use; otherwise "house purchase," "Porsche," "around the world trip" is sufficient.
For me, the appeal would be that the money is not earmarked, so I could, for example, replace a kitchen appliance if something doesn’t fit, I’m not so tied to a specific, previously calculated cost estimate, which can still shift during the process (heating more expensive, bathroom cheaper, who knows).

I will get offers on Monday regarding this. And as for the term – that is how it was called there, so for me it was a fixed term without questioning it further or googling it.

So try to fill out the different things according to the following scheme. With offer 2, the repayment rate wasn’t even enough.

You probably didn’t understand that correctly. The fixed interest rate is indeed 10 years, but the calculated term can be up to 25 years. Also, you can choose 1-3 years of repayment-free start-up years.

Also see above again; the complete numbers.

By the way, it’s usually difficult to finance kitchens via real estate loans; they are not value-increasing.

And again, for understanding; the equity you are bringing in is 0?

Which one? And yes, you can also have individual measures subsidized or funded via the KfW; not only complete energy-efficient construction/renovation

Except for offer 4, which is not precise but rather a first "sketch," I have not yet received a single offer in writing. Why? Because I haven’t been inside the property with the agent yet and therefore it’s not finally clarified whether this will be the object. But: if everything is confirmed, I will commit to the property on Tuesday under reservation and then still enter with appraisers, experts, etc. before signing.

In this respect, I wrote down everything as I had noted it – unfortunately inadequately, yes. The repayment rates of offers 2 & 3 were about 3%, offer 4 was estimated at 3%. Honestly, that wasn’t so important to me at the beginning since you can change the repayment rate at any time AND special repayments were possible with all offers.

And no, I am not bringing any equity, absolutely correct. Where would it come from and how? Not an optimal starting point, of course. That was actually why I mentioned my illness first – because otherwise, my approach might not seem understandable. Apart from that, I just wanted to emphasize flexibility – if nothing else is possible, the apartment will be sold, that would be very quick in this area.

I hoped, and still hope here for advice, tips – maybe I haven’t come across some kind of handling yet. Although I don’t want to tell anyone what to answer and am certainly open to criticism, a comment like "in this situation you should rather save" is really depressing and certainly not constructive.

Regarding the KfW issue, it was about 124, 151, 152.

The thing with the kitchen is clear.

You mean an expert who advises you regarding defects. That is what Caspar meant with his question about the surveyor

Architect is "there", various craftsmen, building experts indirectly as well. I still have to look for an energy consultant and chimney sweep on site.

To be honest, that wasn't so important to me at first, since you can change the repayment rate at any time

Sure? That often costs something extra and is not possible an unlimited number of times

you just sell the apartment, that would be quick in this area.

Mistake in thinking; you won’t get the incidental purchase costs back that quickly. Meaning if it goes badly, you’re stuck with a loan but no place.

Same with the renovation costs.

This is not just about buying a new fridge.

All your options (the one with 1.5% is the worst) mean a term of around 28-30 years.

Good luck on your further journey!

Sure? Often costs extra and can’t be done unlimited times

Thinking error; you won’t get the incidental purchase costs back again that quickly. Meaning if things go wrong, you have a loan hanging over you but no property.

The same goes for the renovation costs.

This is not about just buying a new refrigerator.

All your options (the one with 1.5% is the worst) mean a term of around 28-30 years.

Good luck on your further path!

To be honest, I don’t understand your posts – but okay. It’s criticism, but not constructive. The tone is – well.

I have “laid my cards on the table” here and also said that I have no idea about financing etc. That’s why I ended up here. Asking for help. I would even pay someone for that, it’s not like that.

I don’t know what you want to tell me with your answers? Forget it, won’t work? It’s a stupid idea?

The incidental purchase costs amount to about 10,000 euros – for the property I am aiming at. What does that have to do with selling our apartment? What is naive about the fact that I currently have something in mind that fits in terms of distance etc., am looking around for financing for my situation, always keeping in mind that I could sell an existing property immediately, but consider that a last option? That I want to involve experts of all kinds before the final purchase to get a precise overview of whether the renovation costs preliminarily estimated by a not entirely inexperienced architect are realistic? That our apartment is estimated to be worth at least 70,000 euros more than the property I want including roughly estimated renovation?

By the way – I have written several times that a) I will increase my working hours at the latest in one year – with the corresponding salary adjustment or increase (my job goes back to student days) and/or a new job, offers are on the table, b) I have substantial additional income with which I can make special repayments, which can also be increased if I actively pursue it, c) my family financially supports me as long as they… yes, crudely said, live and d) I am the sole heir and with near certainty there will also be a bit left over. A really awkward topic and I hope my parents will be around for a long time, but – fact is fact.

The repayment of 1.5% is, if at all, only scheduled for one year. And even then I will certainly be able to make good special repayments. Changing the repayment rate was completely free at some banks, at others free 2-5 times, afterwards with processing fees which I requested for all offers from the brokers.

So it should become clear that a repayment of at least 3% soon, rather more, is targeted – depending on the fixed interest rate period and, yes… there was also the question: No idea what makes sense. Beyond that, special repayments are to be expected. Ultimately I already have the option, if I restrict myself hard, to contribute a maximum of 1000 euros per month. But I would rather aim for 600 – and see further in a year or increase again thoroughly. Considering the purchase price and the existing real estate property, I don’t think that is terribly little, let alone a suicide mission. Since I… again: have no idea, I just wanted to ask here once.

Your “good luck” I can only take ironically. And I really can’t understand your motives for it or the content of your posts, sorry.