Sole house construction on joint property

Do you possibly have a negative Schufa entry? Ever checked?

The interest rates are great because no one else offers us that.

Is this one of those constructions with a bullet loan for 15-20 years (paying interest only + zero repayment) at first, and instead of repaying, you save into a home savings contract that then redeems the loan afterwards? If yes, I would definitely have the costs (interest + closing fees) for the entire duration calculated and compare that with a normal annuity loan at another bank. I don’t know the technical term right now, but you can also get a comparison interest rate calculated over the entire duration to better compare it with an annuity loan.

The catch with such constructions is usually: you pay nothing off for quite a while, meaning that even if the interest rate is lower, it applies (up until the redemption by the home savings contract) the entire time to the full loan amount. With an annuity loan, on the other hand, you start repaying immediately after full disbursement. Even if the interest rate is higher, after a few years your remaining debt is already lower, meaning interest no longer applies to the full amount. The higher you set the initial repayment (and/or if you make special repayments), the stronger this effect is. Ultimately, you have a compound interest effect through the repayment. With the home savings contract, you do have that as well, strictly speaking, but at first only through the savings interest in the home savings contract itself, which is usually significantly lower than the loan interest.

It may be that you actually come out cheaper with the home savings contract currently, but definitely have it calculated again or compare it with an annuity loan from another bank (I believe LBS does not do this). Just because the interest rate seems lower initially does not mean you actually pay less interest overall. As absurd as that may sound at first...

The advantage of home savings contracts is usually that you can cover the entire loan term more easily (with annuity loans, long fixed interest periods come with extra charges - although those are currently not that high). The disadvantage is that the whole thing is a bit less flexible... does the allocation all work out (is it "full" in time)? Ten years after full disbursement, you also have a special termination right with the loans and could refinance. You can do that with the home savings contract as well (you can also terminate it), but it's a bit more complicated and the advantages are actually lost there.

Ultimately, besides the costs over the total duration, it is of course first important that you can currently afford it—that the monthly burden fits. You have to check that for both options to see whether one or the other offers you an advantage.

Have a complete repayment schedule shown for the TA loan. Then get an offer for a 20-year fixed interest period and see how many years of advantage you gain with it. For me, the annuity loan at 10 years is about where the TA structure is after 14 years. Even with a follow-up financing at multiple times the interest rate, that is not economical. Now even less so, because the years in which you save into the building savings contract, you lose a saving of about 4% on each payment.

What speaks against getting married? That can be done quickly... If by chance you were both born where you live, you could even do it spontaneously after shopping (provided the registry office does not require appointments). Otherwise, it’s nothing big. It would be done within a few weeks anyway. That would solve your problems most easily. But there are also plenty of banks that don’t make such strange requirements.