# How much can the loan amount / purchase price be?

That depends primarily on your net household income and your existing equity. And of course the question of how much building finance you need to buy the house you want. The possible monthly rate and the maximum loan amount can first be calculated from your income. This then results in the purchase price of the property. We show you here how you can best do it.

## First step: calculate the monthly rate

The most important rule of thumb for this step is:

The monthly installment you will have to pay to repay the mortgage loan should not exceed 35 percent of your net household income.

The net household income is understood to mean all income of a household after deduction of taxes and social security contributions. Assume that your net household income is 4,000 dollars, then you can invest a maximum of 1,400 dollars a month in the repayment of the mortgage. The question now is how high the maximum purchase price can be and how you can calculate the required loan amount, ie how much money a bank would lend you at the most.

## Second step: calculate the loan amount

In this step, other factors have to be taken into account, namely the existing equity capital and not to forget the incidental purchase costs, because they also add to the purchase price. And a buffer for unforeseen events is not wrong either. As you can see, this is where it gets more complicated, and simple calculation formulas don’t get you very far.

Our budget calculator will help you here: Simply enter your monthly household net income and your equity. Then you can choose whether you really want to use the full 1,400 dollars as a monthly installment and as a result receive the maximum possible purchase price of the property and the associated loan amount.

With a monthly household net income of 4,000 dollars and a maximum monthly rate of 1,400 dollars, according to the budget calculator, you could afford a house with a purchase price of 360,857 dollars without equity. You can see in the results field of the budget calculator that the loan would then be a total of 420,000 dollars in order to be able to cover all additional costs. But be careful: construction financing without equity is possible with a very good credit rating and stable, high income, but it is risky. You should be able to pay at least the ancillary purchase costs of 10 to 15 percent of the purchase price out of your own pocket in order to keep the financing risk within limits.

## Calculate the loan amount with our specialists

It always makes sense to calculate the loan amount yourself in advance. After all, you have to get a first impression and also be clear about how much you can and can afford. Finding your own pain threshold and then adhering to it is extremely important, especially in times like these, when real estate prices are very high and current building rates are very low. In the next step, our specialists for construction finance will help you to put the financing plan on a stable foundation. If you have forgotten something (for example the buffer) or are still unsure how high the purchase price may actually be, our on-site consultants will help you to find out. They proceed very precisely and conscientiously and ultimately find the mortgage lending offers that best suit you.