Real estate loan with high collateral but low ongoing income

  • Erstellt am 2019-04-13 01:15:55

Minitrump

2019-04-20 04:00:19
  • #1
: thank you very much for the useful information. Below are further uncertainties.

1.
What does partial crediting of dividends/interest income mean? With what specific rate?

2.
If living expenses of 700-2,000 € are assumed. Why was your first assessment that I would not get a loan with a monthly (pension) income of 1,500 €? This amount is significantly above the average of this range.

3.
If I receive interest or dividend income, I usually reinvest it soon, so I do not have more money in my wallet. For example, if I have an accumulating bond fund, the interest income is credited internally. I could immediately sell shares in the amount of the interest income, and the remaining shares would have exactly the same value as the starting position before the interest period. And whether I physically receive interest payments or sell shares, it effectively amounts to the same thing. Therefore, I cannot understand the regulation, but I take note if this is how it is handled in your bank (or presumably in general).

SPV:
4.
It was new to me that 20% of the purchase price AND ancillary costs have to/should be covered by equity. I always thought that 20% equity from the total of purchase price + ancillary costs is sufficient. Then of course with a correspondingly higher interest surcharge.
I cannot understand that the operating costs are so low.
Are administrative costs for accounting etc. included? Is vacancy loss also calculated in, or is it simply assumed that the rental rate is 100%?

5.
Every company must have started with an SPV at some point. If every bank only works with initiators experienced in establishment, there would never have been an SPV, so at some point you have to start, right???
Yes, at least the idea has been presented to me to set up something like this.
Sure, there are many normal companies that use such SPVs. But there are also purely non-commercial investors who initiate something like this. Where would they have a chance to get such a thing established?

:
Even if I repeat it often: I only contact my bank when I have sufficient knowledge about lending practices (thanks to nordanney I have already learned quite a bit). Also, I want to wait until I receive a final pension notice and maybe can show the bank more pension payments.
The core question in this thread is: what is real income?
Salary can just as easily disappear as rental income or payments received from private individuals. It is not safer than any other sources of income such as capital gains from securities or payments from acquaintances.

:
No, I certainly won’t read through those brochures. What I was interested in was: What are the legal requirements and what are internal bank rules. Because legal requirements cannot be questioned. They must be met without ifs or buts. But with internal bank rules, one can sometimes achieve deviations from the usual regulations by arguing.
 

nordanney

2019-04-20 07:23:54
  • #2
As already said in the other thread, if you know what you're doing, you don't need our answers or ask YOUR bank about the KfW calculation. I can only tell you that after your first (totally incomplete) post you would not be considered able to service the capital for us. Period.
 

HilfeHilfe

2019-04-20 13:05:22
  • #3

Same here
 

Tassimat

2019-04-20 13:08:31
  • #4
A couple of short quotes:



Ah. 7-figure balance sheet total, numerous properties, 20% equity returns and then this:



Honestly.... you’re just talking complete ****.
The thread is now only good for general amusement at your house of cards.
 

aero2016

2019-04-20 14:10:12
  • #5
These are the legal requirements... your reading comprehension is not exactly well developed, is it?
 

Minitrump

2019-04-22 23:09:59
  • #6
:

I have an idea of which properties one should invest in, what the financing should look like, I don’t need support for that (but I am happy to discuss it on a factual level, which - few except you - does not seem to be possible in this forum). However, what I have (too) little knowledge about is: under what conditions do banks even grant loans? So far I have always gotten them without any problems and never looked into it more closely. But now the situation is different. One issue has nothing to do with the other. The clarification of this loan granting question is the reason why I registered here.

I enter into negotiations with a bank only when I know the framework conditions well enough or can make any necessary adjustments in advance (and also still receive a definitive pension statement). Thanks to you, I have gained some new information, but it is still not enough to adequately assess the situation, because I will end up with roughly a 6% annuity and therefore every single aspect matters as to whether it will be enough or not.

What is unclear to me above all are the following essential points:

1.

For some properties, the current rent is (in part significantly) below the market price level. A real estate agent had pointed out to me that the rent should be increased, which would also be legally possible immediately.

Question:

Which value is relevant for the bank? The rent achievable on the market or the current actual rent amount?

For example:

Current rent €900.

Rent for comparable properties €1,000.

Would the bank then calculate €800 or only €720?

2.

What happens if a fixed interest rate until final maturity, i.e. until complete repayment, is agreed upon for financing? Is a 6% annuity then required for such financing even though theoretically it cannot come to that?

3.

If I pledge liquid securities to the bank, can they not be proportionally allocated over the term?

For example:

The average remaining loan term is 30 years. I pledge the bank securities worth €30,000. Would this then generate an additional contribution of €1,000 per year (=30,000/30) for the determination of ongoing income, or a quota corresponding to the risk level, e.g. 50% for stocks, so then €500, or 80% for bonds, so €800?

4.

Is this annuity regulation a strict criterion with you or are loans also sometimes granted to someone who only manages an annuity of 5.8% (but for example brings in more equity than usual)?

:

I don’t care at all what other people - who are not close to me - think of me. To me, I can be a homeless bankrupt if that makes you feel better. By the way, your behavior is very typical; most Germans do not wish someone financial success (sometimes even (former) closer friends) or cannot cope with others being financially more successful than themselves. Americans are different. They take it as motivation, but Germans then try to boost their ego by looking for some flimsy arguments about what the other did wrong or try to convince themselves that the other person’s actions were only invented; however, they rarely come up with the idea to change their own mindset, which is strange. But I have long been used to such behavior.

aero2016:

Yes, I understand that these brochures are the legal requirements. But I neither have the desire nor the health strength to read through them completely, but thank you for the note anyway.
 

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