Real estate purchase three financing proposals

I would like to inquire with a broker, but my husband is totally against it. The offers are from our main banks, building society, and an insurance company.

I wouldn’t care at all if the dear gentleman is against it. You’re not buying a pack of pasta at the supermarket, but want to take on debt for the next decades. So as long as you are also a borrower, I would inform myself accordingly.

Thank you very much for your responses. We still have two appointments tomorrow, one at his main bank (they wanted to offer us a better deal than my main bank) and in the evening at the Allianz. I will still call a broker. Unfortunately, time is tight, even though one should take it. We only got the house reserved for two weeks and last week we were really busy with the four banks.

Such a new offer, my head is buzzing.

Loan 340,000
Fixed interest period 13 years
Interest rate 1.98%, effective 2.01%
Only interest per month 561 euros

this will then be redeemed after 13 years by the [Bausparer]:

Interest rate: 2.00%, effective 2.51%
Savings rate for 13 years 760 euros

Overall for the first 13 years 1,321 euros.

Afterwards, for another 15 years, repayment and interest rate 1,400 euros.

My fears: What happens if the [Bausparer] does not become immediately allocable after the 13 years? Then the main loan will be charged a high interest rate if interest rates rise until then? Does anyone have experience how often/how long the allocation phase can be delayed?

Otherwise, this offer is really good.

My fears: What happens if the building savings contract is not immediately eligible for allocation after 13 years? Then the main loan will be expensive if interest rates rise until then? Does anyone have experience with how often/how long the allocation phase can be delayed?

It depends on the specific offer. I had such a construct with the combination of Sparkasse+LBS, where the interest rate fixation of the TA loan was explicitly "until allocation." Another building savings combo offer from Volksbanken+SchwäbischHall does not include this assurance; there, the interest rate fixation is only for the agreed period (regardless of allocation). Best to ask.

Expenses: Private health insurance 250 euros No other liabilities, only the usual insurances (liability, car insurance...) Equity 50,000 euros (almost entirely used up for incidental costs)

Do you not pay rent? No retirement provision? The car(s) also depreciate in value, which you have to take into account if you want to be precise, because during the time you "depreciate" the value of a car, you basically have to save up the same amount in parallel again, otherwise you jump from one car loan to another. But anyway, that’s not the topic.

This is complicated. Feeling-wise, I would prefer number 1.... everything is fixed and understandable for me there. Unfortunately, I find 2.8% interest rate quite high.

We didn't have much equity either and thus also had 100% financing with a loan amount lower by €120,000. So I would say, be glad about 2.8% – a few years ago, even those bringing in 50% equity would have popped a bottle of champagne out of joy over only 2.8%. You simply can’t expect much more given the circumstances. Our rate ended up being 2.6%.

My fears: What happens if the building society savings contract is not ready for allocation immediately after 13 years? Then the main loan will have expensive interest if interest rates have risen by then? Does anyone have experience with how often/how long the allocation phase can be delayed?

We asked our advisor the same question above (did you ask yours?) – as also said, our interest rate is guaranteed until allocation; there is no "uncertain" bridging phase.

Hello Buckwheat,
of course, we are still paying rent at the moment. That will stop after buying the house, I thought only the costs we have then count. The rent is 540 euros cold.
My husband has a retirement plan that is somehow deducted from his salary. So with the stated net salary it is already deducted. I hope my pension will still be good.
You are right about the car. Mine has been paid off since last year and hopefully will last a few more years. My husband drives a company car.
Now about the loan. The bank advisor said that a few years before the allocation you might have to increase the savings rate so that you definitely get the points at that time. Then the risk would not be high. But I have to say that I couldn’t sleep all night and the risk is just too high for me. I just need security. Unfortunately, the full repayment loan with 2.8% is almost 50,000 euros more expensive in total than the other offers.
Today we still have an appointment at the Volksbank. Let’s see.