What is the interest rate lock period in construction financing?

But then you surely don’t have only Kfw and in the overall package it’s under 2%?

Yep, but to me it sounded like it was impossible as soon as Kfw was somehow involved. I probably misunderstood.

Intuitively, I am on 's side. There are experts who invest their savings rate and hope to get more out of it in x years than by repaying through higher installments or special repayments. All completely legitimate. But... the experts are in the minority. I would even say under 1%. Most people who choose a lower repayment consciously opt for the lower repayment because a) consumption takes priority over repayment, b) they simply can’t afford more, c) there is no intention to pay off the house at all, d) they are hoping for an inheritance, e) they have no plan, or f) they have the idea in their head that the increase in value will take care of everything. Feel free to combine options a) to f) as well.

Most people who choose a lower repayment do so consciously because a) consumption takes priority over repayment, b) it simply cannot be more, c) there is no intention to pay off the house, d) they are hoping for an inheritance, e) they have no plan, or f) the idea in their head is that the appreciation will take care of everything.

Also freely combinable between a) and f)

Or (I know, unimaginable) people decide for completely logical and understandable reasons.
For example: at the beginning of the repayment period one partner is on parental leave, you are still quite young, income is expected to rise because of being a civil servant, the interest rate lock-in on the big loan is 30 years... And so on and so forth. :)

The option to invest instead of repay makes sense financially if, after taxes and possibly other costs (e.g. broker), you generate more return than the interest costs you.

Thank you very much for the detailed explanation!!

yes, obviously^^ they repay so little because that’s how it’s offered and loan amounts keep getting higher. I don't know anyone in my circle of acquaintances who repays 1% and invests heavily for it.

The safest and best return currently is repaying the debt. Risk-free and well-interest-bearing

Honestly, I personally don’t know anyone either, just had the feeling that quite a few people do it here.

I think we will also stick to our previous plan. Use equity and set repayment rate high.

I will do it that way too.

I will repay the bank loan at 2 - 2.5% and invest the rest that remains, about 200-400€ per month

Because I am convinced to easily achieve more than 1% return after taxes

We currently have a repayment rate of 2.5% with the right to make special repayments on top and an interest rate fixed for the entire term. In addition to our installment, we save about 500 euros in ETFs and another 400 euros in conservative investment forms, which also yield a higher return than the interest we currently pay on the loan.

To be honest, I am not worried about our financing. Thanks to our reserves, we now have a decent cushion. Our salaries are also increasing due to the annual tariff increases and the partially still pending step increases in the coming years. At the moment, the media is again spreading the specter of inflation. If this really comes as expected at 3% p.a., that is great. In the past 20 years, tariff increases in my industry have almost always been above inflation – so my real wage is rising =)