Subsequent change of the lending value - What happens?

I know an agent from Braunschweig who also likes to sell his buddy service. This also includes signed construction progress reports

What are construction progress reports anyway? I send photos to my bank when I feel like it. 260k has been drawn now. Not once has there been any request so far.

Most of the trades are still estimated.

Will that stay the case until you have completed the financing? Because then the loan-to-value ratio is your smallest problem with single trade awarding, since: 1) The architect will definitely miscalculate 2) You will upgrade unexpectedly 3) There will be things that were forgotten 4) Unforeseen circumstances I know what I'm talking about! You are currently getting worked up about 10k€ and all 4 points listed will cost you more than 10k€ Otherwise, the statement by applies

1) The architect will definitely miscalculate 2) You will upgrade beyond the plan 3) There will be things forgotten 4) Unforeseen circumstances

I know what I'm talking about!

You are currently getting worked up over €10k and all 4 points listed will cost you more than €10k

I think the core of my inquiry wasn’t entirely clear. Of course, costs can be higher for various reasons. That’s exactly what it’s about. Therefore, it would be all the more annoying if you don’t plan for this from the start, since you could have achieved a better cost-benefit ratio, wouldn’t you agree? Suppose the costs end up being €20k higher and you compensate for that by saving on inventory or through personal contributions, etc. Then it would have been more sensible to have estimated the €20k in construction costs from the beginning and thereby achieved a better cost-benefit ratio.

Well, apparently I’m worrying unnecessarily about things most builders haven’t thought about. It’s simply because I like to be informed about everything I can influence myself, so I won’t later have to say, “Oh, if only I had known earlier.” Your assessments definitely help me. Thank you very much for that!

Every bank is different.

I had to submit receipts for payment requests, although advances of 30K€ without security were no problem. As soon as completion and occupancy were reported, I also drew the remaining loan of about 60K€ without security and that was it. They also understand that exterior works come later or some craftsmen submit invoices very late. For example, the water connection with us is only billed after completion of the new development area, meaning that 4K€ are now sitting here waiting, possibly for years, for invoicing. Until then, however, no one wants to accompany the project, and without full disbursement there is no start of repayment.

Don’t worry.

I think the core of my inquiry wasn’t made entirely clear. Of course, the costs can end up being higher for various reasons. That’s exactly what it’s about. Therefore, it would be all the more annoying if you don’t plan for that from the start, since you could have achieved a better loan-to-value ratio (LTV), or not? Suppose the costs are subsequently 20k higher and you compensate by savings on inventory or through own work, etc. Then it would have been more sensible to estimate the 20k from the beginning in the construction costs and thus achieve a better LTV. Well, apparently I’m worrying a lot unnecessarily, which most builders haven’t done. It’s simply because I like to be informed about everything I can influence myself so that later I don’t have to say “oh, if only I had known that earlier.” Your assessments definitely help me. Thanks a lot for that!

Again for my understanding. You have amount x as a loan and amount y as equity. Both are fixed at the time of financing. The equity reduces your loan-to-value ratio. If the construction sum increases, you will either have to refinance or raise more equity. The refinancing will be at worse conditions as soon as the loan-to-value limit of 60% is exceeded. Therefore, I don’t understand why you believe that an increase in the construction sum improves the loan-to-value ratio? With fixed equity and an increase in the construction sum, your loan-to-value ratio worsens at the time of the initial financing and not the other way around.

What are progress reports? I send my bank photos whenever I feel like it. Withdrawn are now 260k. Not once has anyone asked so far. Will it stay that way until you finish the financing? Because then the loan-to-value ratio is your smallest problem in single trade contracts, since: 1) The architect will definitely miscalculate 2) You will upgrade unexpectedly 3) There will be things that were forgotten 4) Unexpected issues I know what I'm talking about! You are stressing over 10k€ and all 4 points listed will cost you more than 10k€ Otherwise, the statement from applies

Progress report signed by the site manager / general contractor. Ideally, it should match the invoice.

Construction status signed by the site manager / general contractor. Ideally, it should match the invoice

I am the site manager for my individual trade contracts and approve the invoices.