TA loan - your opinion

Hello everyone,

I have just read some forum posts regarding the TA loan with subsequent home savings contract and I think I have understood it quite well.

Now I have an offer myself, which seems very lucrative to me, but I want to make sure I haven’t overlooked anything.

The financing sum amounts to €340,000, which is divided into 2 parts:
1. Annuity loan: €100,000
2. TA loan (10 years) with subsequent home savings contract (10 years): €240,000.

Component 1 can be paid off to zero during the term.

Component 2 is interesting for me. (see attachment)

I have traced the bank’s calculation here and come up with total costs of about €32,000.
This also matches the bank documents.
All effective interest rates are given as 1.23%. That is also correct if I choose the installments in years 1-10 and the installments in years 11-20 accordingly.

I compared the whole thing with a 20-year loan at the same rate and here I would have to get an interest rate of about 1.7% over 20 years for it to be lucrative for me, and I do not get that for the total amount...

So the offer seems consistent and sensible and above all very lucrative to me...

Therefore, I have the following questions:
1. Have I missed or misunderstood anything?
2. If I pay the installments as agreed, can the home savings bank refuse me the home savings loan, or stall me? The contract states that upon allocation of the home savings contract the TA loan is replaced by the home savings contract.
3. The fixed interest rate for the TA loan according to the offer is 10 years. The term of the loan is 10 years + 1 month... so there is a gap of one month in terms of interest rate protection?!?!

I look forward to your feedback.

Thank you very much!!!

PS: If I have forgotten any information, please let me know!!

Total costs of 32,000 but without the interest costs for the 100,000 euro loan. What interest rate do you have for that? You want to pay it back in 10 years? That would then also be about 850 euros in installments. So, the first 10 years around 1950 to 1980 euros per month? Building savings contract, interest on the TA loan, and installment on the annuity loan. And, really only 0.6% interest for the 10 years TA loan?

Hello,

the interest rate is 1.6% and we have included special repayments here, which we receive from a property sale... so the installment is manageable for us...

Yes, I also raised an eyebrow at the 0.6%... but that's the offer.

I have gone through the bank's calculation here and come to total costs of about €32,000. This also matches the bank documents. All effective interest rates are stated as 1.23%. This is also correct if I choose the installments in years 1-10 and the installments in years 11-20 accordingly. 1. Have I overlooked or misunderstood anything? 2. If I pay the installments as agreed, can the building society refuse me the building loan or stall me? The contract states that upon allocation of the building savings contract, the TA loan is redeemed by the building savings contract. 3. The fixed interest rate for the TA loan is 10 years according to the offer. Loan term 10 years + 1 month... does this not create a gap of one month in terms of interest rate security?!?!

I currently cannot see any mistake in your calculation. The only thing: You mention an effective interest rate of 1.23% – the building savings contract has a nominal interest rate of 2.15%: What does the effective interest rate refer to? Also: The monthly installment after repayment is about €200 higher than during the saving phase. However, since you have already stated the monthly burden, I assume you have seen and accepted this. Tip regarding allocation of the building savings contract: I handled it so that I always transferred a small amount more to the building savings contract (e.g., in your case €900 instead of €893). Then, although it was slightly overfunded in the end, the allocation was secured by the higher sum. Fixed interest rate 10 years instead of 10 years and 1 month: Bring this up again. Not so much because a "rate increase" in the one month would break your neck, but rather because a time gap arises between the expiry of the fixed rate and the repayment of the TA loan. By the way, possibly with the additional €7 per month saving, you could have also eliminated this point, since this normally could lead to somewhat faster allocation.

Thank you for the feedback.

The 1.23% effective interest rate refers to the entire package, i.e. 0.6% TA loan and 2.15% building savings contract.

Thanks also for the tip about the multiple transfer... we will do exactly that.

I just thought of another question:
I take out the TA loan with the building savings contract and owe the 240,000 to the building savings contract... what if I do not want to draw the loan upon allocation of the building savings contract, but rather a bank loan (maybe the conditions are better). Wouldn't this block the building savings contract?

As a rule, you do not have to use the loan from the [Bausparvertrag] and can instead have the balance paid out to you. If you then take the loan directly from the bank, the mortgage will probably have to be released. That, in turn, costs a few euros. Whether it is worth it then depends on the interest rate.