Basically, there are two ways in which the process of your building loan can take place. If you buy an existing property, the approved total amount is paid out in a single amount after the purchase has been notarized. The notary assumes a trustee function here and forwards the amount to the seller. If you are building a house, the building financing procedure provides for payment in installments after the craftsmen's invoices have been submitted.
Before you apply for a building loan, you can make non-binding condition inquiries and find out about your options this way. It is important that you do not make a credit inquiry, as this will be noted in the Schufa and could stand in your way at the time of the necessary loan application. The right time is when you have made all the preparations, decided on a house provider or construction company and can start immediately after receiving the bank's confirmation.
To ensure that the building loan process runs smoothly, you should be well prepared and equipped with all the necessary documents. This includes a detailed exposé of the property you want to finance. Make sure that no documents are missing and that you do not leave an unserious impression due to an unintentional oversight.
What else is needed besides your proof of income, property details and proof of equity? Here, every lender has different ideas, which are also based on your professional activity, for example. To avoid delaying the construction financing process, it's best to ask your favored lender which documents they specifically want and what you should bring to the appointment.
With your tax and income statements neatly filed in a folder, the bank statements and the cost offer as well as the exposé for the house construction, you are prepared for the appointment with the bank.
If you are an employee or a staff member, you bring the proof of salary with you to the bank appointment. The procedure for building loans for freelancers and self-employed persons differs with regard to the proof of financial security. Depending on the bank, you will need to provide proof of the last two to three years of employment based on your business management evaluation and tax assessment notices from the tax office. An additional listing of all other liabilities may be necessary in the case of lower income and may be a prerequisite for obtaining building loans.
After you have all the documents in your hands and, at best, have concluded a non-binding preliminary agreement with the construction company, the bank appointment should no longer be far off. Since the credit counseling in the process of building loans may well take two hours, you should plan the appointment so that you are not in a hurry in the conversation.
The consultation and the negotiation of conditions form a combination in the process of obtaining building loans. On the day of the bank consultation, the application is usually submitted. This means that you will now be informed about the interest rate advantages possible in your case, about special contractual agreements and about the term and the monthly installment. If you have any questions or are not satisfied with any point, communicate your concerns at this point in the building loan process. Once you have signed the loan application, it means you agree to the terms and the building loan process so far.
Tip: Have you already received a verbal commitment and know that the bank will accompany your house construction and provide the financial resources? Then you could have a pre-financing confirmation issued in the next process of building loans. This is not a fixed loan commitment, but a security for the seller that you are solvent and in the further course of the construction financing will receive a legally valid confirmation.
Depending on the bank and loan volume, processing takes between 10 days and 3 weeks. You can not speed up the process of the building loan, so it is better to refrain from continuous inquiries about the processing status. If the loan is approved, you will receive a new appointment to sign the contract and go home that day with the 100% security of the bank's support. Now is the right time for the notarization, as the bank will no longer cancel your building loan. With the payout, you can complete the real estate purchase or the construction contract and become the owner.