Two financing offers / variants are available

Hello everyone,

I have been reading here for a while as we initially wanted to build, but now have ended up with a single-family house built in 1996. We now have two offers or two variants and would like to hear your opinion on them.

Our situation is as follows:

Income:
He (32 years) 100% 3100€ net
She (28 years) 46% 980€ net
Child (1.5 years)
Equity approx. 80,000 €, of which 75,000 € will be used

Our project
House 285,000 €
Additional purchase costs 15,675 €
Renovation and furniture 36,030 €
Total: 336,705 €

Financing requirement: 336,705 € - 75,000 € = 262,000 €

We have spoken with the house bank, an insurer, and a financial broker. The offers from the broker clearly have the better interest rates and are as follows:

Variant 1:
Repayment loan 262,000 €
20 years at 2.60% nominal and 2.66% effective
Repayment 2.75%
1,168 € / month, residual debt after 20 years 76,277 €
Total payment without interest for follow-up financing: 356,617 €

Variant 2:
Repayment loan 262,000 €
12 years at 1.95% nominal and 1.97% effective
Repayment 1%
Years 1-12 = 644 € / month, residual debt after 12 years 180,177 €

Building savings contract:
24 years 3 months total term at 0.25% credit interest and 2.50% nominal
Years 1-12 = 507 €, from year 13 = 1,225 €
Total payment until full repayment of the loan: 345,958 €

Variant 2 is clearly cheaper in terms of costs, but is a combination with a building savings contract also the better option?
We do have some doubts regarding the allocation, whether there could be problems there. In addition, in variant 2, the loan and the building savings contract are with different providers. Could there be problems in the 12th year when the loan is redeemed with the building savings contract?

Your opinion on both variants, perhaps also your experiences, would be very helpful. I would like to thank you in advance for that.

Best regards, Hans

How high is the closing fee (in %) for the [Bausparvertrag]? Will a loan fee then also be charged for the [Bausparvertrag-Darlehen] (approx. 110,000)? How long would the [Bausparvertrag-Kredit] run? What nominal interest rate and repayment rate apply to the [Bausparvertrag]? Are there regular account management fees or similar charges for the [Bausparvertrag] (every little bit counts)? When would you be finished with the annuity loan (although this certainly cannot be extended under these conditions in 20 years)? Generally clever again – due to different amounts between Variant 1 and Variant 2 (both accumulation phase and repayment phase), an absolute comparison is hardly possible. With approx. 4,000 net – is there any reason against increasing the repayment so that you could be finished, for example, after approx. 20 years?

And variant 2 simply with a higher repayment rate, so that the remaining debt after 12 years is lower and without a [Bausparvertrag]? For example, at 3 to 3.5% repayment? At 3.5% repayment (545 euros/month) there would roughly still be about 102,000 remaining debt after 12 years.

In the building savings option, allocation may not be granted after 12 years, and you may have to save longer and only pay the interest. I find the option with a 20-year fixed interest period and higher repayment to be the better alternative, and you definitely have planning security. Therefore, take out a full repayment loan for 20 years, with the repayment increasing by around 300.- Euro per month. (Simply have it calculated)