Single-family home financing through stocks

The borrower intends to repay as little as possible in order to invest the money freed up as a result. That's what a user here does as well, if I remember correctly?

I don't believe that an official transfer of the depot is meant. Rather, the repayment rate should simply be set as low as possible and "non-bindingly" invested in stocks.

We are 25+30, with 2 children. Net income husband + rental surplus (I rent out 2 apartments, 70k already paid off, due to KfW loan I unfortunately have to repay almost 800€/month currently) + child benefit = about 4000.

Income: I am permanently employed, income will certainly rise. In addition to the 4000 net, usually another 5000 annual bonus gross is added.

The 2nd post does not match the first. As already noted, the numbers need to be organized better:
- Net salary: xxx €
- Rental surplus yyy €
- Child benefit: 400 €
Total: 4000 € (or more?)

My advice: Before you speculate in stocks, do a "normal" financing with at least 2% repayment. Whatever remains can simply be saved. The 3% stock return is not far from reality, but the last years and especially the last weeks have been very volatile. This can end very badly if you don’t repay.

But how much should be invested in stocks per month?

And honestly, the difference is not that big anyway: 1% repayment + 2% savings plan vs 2% repayment + 1% savings plan does not make much difference in the overall interest. Especially since the interest rate of the financing will suffer.

I personally think the idea itself is good, but:

a fixed repayment is usually equivalent to "forced savings," meaning this amount is actually put into repayment every month without any ifs or buts. In the model mentioned by the OP, the greatest risk is not a volatile stock market or a crash just before the money is needed, but rather that the full amount is not saved into an ETF or anything else every month. I imagine situations like: a new washing machine is due, an unplanned more expensive vacation, a child goes on a class trip, an expensive car repair.

In such cases, the temptation is very high that with an already tight household budget, the savings rate is repeatedly suspended and thus the desired savings goal is missed and, in the end, the fixed interest period unexpectedly suddenly approaches.

The stock market is a great instrument for long-term wealth building and should always be seen as one of several instruments in terms of risk diversification. One of your chosen building blocks is clearly real estate. Due to risk diversification, I would advise against investing more money monthly here than into the repayment of the loan, given your income.

:

What do you think about the financing? Given the crazy conditions today (central banks printing money like there's no tomorrow; politicians promising to save everything and everyone - including homebuyers), take out as much credit as you can get and build yourself a nice house. A long time ago, it used to be said: interest is the price of money (an expression of value?). The association of money printers has been trying for years now to push exactly that price down to zero or even negative (money worth nothing anymore?). Now, through the "Corona crisis" - so far in DE, by the way, significantly fewer deaths than in the 2017/18 flu season; a knave who thinks evil of it - the last concerns and obstacles in this regard are falling. Trillions of dollars and euros are raining down on the world - make sure you get some of it at the lowest possible interest rate. Golden times for debtors. Your cash, as you yourself write to the stock market: the real estate, Blackstone, Vanguard of this world will somehow ensure long-term profits. Just join in and have patience during interim setbacks...

The OP intends to repay as little as possible in order to invest the freed-up money. Doesn't a user here do the same, if I remember correctly?

he can do that

2% minimum repayment, after that he can speculate

Apparently, my strategy is not that simple. In very simple terms: I do not want to contribute 200 or 300k as equity. Additionally, I can save about 42k without interest in the first 5 years. Instead, I want to repay as little as possible and let the capital markets work for me. The interim volatility (+2-7%) should not concern an investor. We are talking about investment horizons of at least 10, preferably 20 years. I think transferring the portfolio is nonsense. If I become insolvent, I will be liquidated and file for personal bankruptcy. The property will be liquidated.


My question was how the bank reacts to such financing or "what you need to bring."


My wish (I am currently leaning more towards my Alternative 2):
240k (2x 120k KFW, 96k must be repaid. 0.95%, 5 years repayment-free, term 30 years, burden with repayment 2x 396€)
260k bank loan, 20 years, 1% repayment, interest of 1% is possible according to the internet, burden with repayment 434€/month.


In total monthly burden 1226€/month after the 5 repayment-free years.
Remaining debt after 20 years 208k bank, 2x 38400 with KFW.