Understanding problem: When does the installment start?

Hello everyone.

I am glad to have come across this forum and have already read quite a bit. Unfortunately, I still have a fundamental uncertainty regarding financing: when is the first "repayment installment" or the first payment to the bank actually due?

Short background:
Existing house built around 1900 is to be completely renovated.
The architectural plans, structural engineering, and building permit are available.
Bank discussions have also already taken place.
However, these never addressed when the first installment is due, only that no commitment fees are to be paid for 12 months.

If the construction project is to last 12 months and start on 01.01.2012; with 1/12 of the amount to be paid out each month, would the first payment to the bank then be due on 01.01.2012 or on 01.01.2013?

Thank you in advance for your answers.
Roland

Hello Rolando,

As soon as you receive a payout of an amount x, the bank charges you interest on this amount. If you have chosen immediate repayment, this will also be applied, but this can often be individually agreed with the bank.
With us, the installments are collected every month.

Thank you very much for the quick response!

All right, so interest will then be charged on the withdrawn amount.
It would therefore be possible to agree with the bank that the installment payments start only after the completion of the construction project.

Best regards
Roland

Hello,

the repayment usually takes place one month after the full disbursement of the loan.
The interest payments are always made for the loan amount that has already been disbursed.
The rest of the loan remains free as long as the interest-free commitment period is running.
Only after that must the agreed commitment interest also be paid for this amount that has not yet been drawn.

Best regards