Hello dear forum,
We are about to finalize our financing.
However, it seems that the kitchen will likely not be accepted.
Is this different from bank to bank?
We would like to include it in the main loan.
What options are available? Are there any at all?
I hope you can help.
Best regards
Steffen
We are about to finalize our financing.
However, it seems that the kitchen will likely not be accepted.
Is this different from bank to bank?
We would like to include it in the main loan.
What options are available? Are there any at all?
I hope you can help.
Best regards
Steffen
H
HilfeHilfe26 Jul 2020 10:23Ybias78 schrieb:
I’ll ask directly. How is it with ING? It’s our main bank and currently our favorite with 1.1% (about 75% financing; 20 years fixed interest). From your experience, is it a problem if, for example, €20,000 cannot be documented?If it cannot be documented, it is not considered equity capital.HilfeHilfe schrieb:
If you cannot prove it, it is not considered equity. I expressed myself incorrectly. For example, if you take out a loan of €450,000 (approx. $470,000) but only have invoices for €430,000 (approx. $450,000), can you then spend the remaining €20,000 (approx. $21,000) on other things?
Ybias78 schrieb:
I misspoke. For example, if you take out a loan of €450,000 but only have invoices totaling €430,000, is it then possible to spend the remaining €20,000 on other things? Yes, that shouldn’t be a problem and is quite common. You can also adjust your budget by rounding up generously or include features like a fireplace that you might later decide not to install. The leftover money can then be used for the kitchen.
ypg schrieb:
Yes, that shouldn’t be a problem and is quite normal.
You can also fine-tune the estimate by rounding up generously and/or including a fireplace in the calculation that you then… oops… don’t actually build. You can then use the leftover budget for the kitchen. For us, it’s not about the kitchen. We are financing that from our own equity. The point is to have around €20,000–30,000 (about $22,000–33,000) reserved in case additional costs arise. If that money remains unused, we would probably use it for special financing.
What is special financing?
At least in the contracts I have read so far, you can only start making special repayments after one year. Until then, you pay interest on the “surplus” money. That’s why I always think it’s important to create as accurate a calculation as possible, because having too little money is really inconvenient, but having too much also costs unnecessary interest (both due to the delayed repayment and the higher loan-to-value ratio, which typically leads to a higher interest rate).
At least in the contracts I have read so far, you can only start making special repayments after one year. Until then, you pay interest on the “surplus” money. That’s why I always think it’s important to create as accurate a calculation as possible, because having too little money is really inconvenient, but having too much also costs unnecessary interest (both due to the delayed repayment and the higher loan-to-value ratio, which typically leads to a higher interest rate).
Ybias78 schrieb:
We are not concerned about the kitchen.It doesn't matter what you use the money for then. The original poster will use it for the kitchen, and you for your other things.