Intestate succession

In principle, the topic of “inheritance and estate” is always in good hands with a (specialist) lawyer. The construction of pre- and post-heirs is complicated. Nevertheless, there are a few easy-to-understand principles that every property owner should know and can also easily implement themselves. Here are some questions that come up again and again and which we will answer in the following.

• Pre-heir and post-heir – what is it all about?
• My mother is the previous heir. Is she allowed to sell her part of the house so easily?
• Is the owner (previous heir) entitled to sell the house without the consent of the subsequent heir or does the latter have to agree to the sale?
• I’m heir apparent, now what?
• House sale despite succession?

Pre-heir – post-heir: what does it mean?

Anyone who wants to bequeath something is free to determine the heirs and can therefore also transfer his or her inheritance to several persons in a staggered manner. The subsequent heir is then the person who receives the inheritance only after another person – the so-called previous heir – has previously inherited. The testator can, for example, choose an occasion or a point in time for the succession to occur, such as coming of age or passing the master’s examination.

The previous and subsequent heirs are both legal successors of the testator. However, they do not form a community of heirs in which they would inherit at the same time, but inherit one after the other due to the instigation of the testator.

Pre- and post-heirs for married couples – safeguarding assets in the family

The inheritance regulation by means of a pre- and post-heir is often used by married couples. In this way, they can ensure that all their joint assets remain in their own family. For this purpose, the spouses each name the other as a pre-heir and the joint children as a post-heir. Even in the event of remarriage after the death of one spouse, the assets cannot be inherited by the new spouse.

Pre-heirs – tasks, duties and rights

Pre-heirs are also referred to as ‘temporary heirs’. This is because they only have limited power of disposal over the estate. Particularly in the case of inherited real estate, this situation has consequences for both sides – i.e. the previous and subsequent heirs. First of all there is the inheritance tax. This is always payable initially by the previous heir.

• The previous heir must pay the inheritance tax from the funds of the previous inheritance.
• The previous heir is only the heir until the next of kin occurs.
• If a property is inherited and occupied by the previous and subsequent heirs themselves, no inheritance tax is payable
• The property must be owner-occupied for at least ten years after acceptance of the inheritance
• The owner-occupied living space must not exceed 200 sqm.
• Only then no inheritance tax is due

Statistics – Heritage in Germany

Read more facts and figures here: Real Estate Statistics. We also have other interesting studies, surveys and statistics on the topic: Inheritance in Germany.

Restriction of disposition – exceptions and rights of the previous heirs in real estate transactions

The previous heir cannot dispose freely of the estate. Inheritance law imposes certain restrictions on the disposal of the estate by the previous heir, because in the event of a subsequent inheritance, the assets should accrue to the subsequent heir undiminished. For example, the previous heir may not sell or give away any property from the estate without the consent of the subsequent heir. The previous heir may use other inheritance items for himself, but he is obliged to compensate the successor for the value of the item after the succession has occurred.

However, the testator may exempt the predecessor from many of these restrictions. This is then referred to as an exempt preheir. The “exempt estate” – which may then also include real estate – may be sold by the exempt previous heir alone, without having to obtain the consent of the subsequent heir.

Pre-inheritance & post-inheritance – advice from a lawyer

Broker tip: Watch out when buying inherited real estate

If a property from an estate is to be sold, there are many details to consider – for the seller and also for the buyer. At the latest here – after a lawyer has also been consulted for advice – the broker should come into play. The experts at Lukinski – Lukinski – have the necessary expertise to help with these complex issues.

Especially important: the real estate agent has the necessary distance to accurately determine the value of an inherited property. With inherited houses, money is often given away unnecessarily because the heir wants to get rid of his inherited property quickly. The opposite is also possible: so many memories and emotions are attached to the inherited house that the value is set too high. The property is then difficult to sell.

Find a broker as a pre-heir

Finding a broker as a pre-heir means paying attention to very special services. This is because the broker must be very familiar with the legal intricacies of succession and the connections between the pre- and post-heir.

Lukinski will perform for you as a pre-heir:

• The neutral valuation of your inherited property
• The professional sifting and arrangement of all documents from the inheritance necessary for the sale
• The professional and sales-promoting staging of your object (photos/videos)
• Your emotional state is given special consideration
• The proper creation of an appealing sales exposé
• The discreet placement of your property in all relevant media
• The analysis of our extensive customer file for suitable buyers
• The discreet organisation and execution of viewing appointments
• The discreet conduct of negotiations with prospective buyers (if desired, without your presence)
• Finalization of the purchase contract in cooperation with notaries

When will the broker be paid?

A reputable agent and real estate salesperson will only be paid upon a successful closing and will discuss their fee rate right at the beginning of the sales process. Openness and transparency are therefore fundamental criteria by which the house seller recognizes the good broker.

How much is inherited in Germany?

Here you can see inheritances and gifts in Germany. The survey ranges from 2008 to 2018 and shows that over 110,000 inheritances are distributed each year. Great potential for dispute if the community of heirs does not agree. Here you can find more interesting studies, surveys and statistics on the topic: Inheritance in Germany.

You can find more statistics at Statista

How much money is inherited?

Since 2014, Hamburg in particular has been at the top in Germany. Hamburg is currently at the top with 167.80 euros. In no other city is so much inherited. With a population share 2.19% of total Germany (1.82 million out of 82.79 million), a total volume of 305,731,600 euros is inherited annually.

• Population share Hamburg 2.19%
• Inheritance in Germany (comparison year) 109,635; statistically 2,401 inheritances in Hamburg
• Total inheritance (Hamburg / year) 305.731.600 Euro

You can find more statistics at Statista

The facts – building society contracts, the three phases & the building societies

Taking out a building savings contract can make sense in many situations. However, there are many facts that need to be considered. From the right building society to the exact sums and interest rates that are recorded in the contract to the start of the three phases. We will provide you with all the important facts:

The most important at a glance

• Different building societies offer different tariffs for building savers
• The comparison of the building societies is worthwhile for every building saver due to the different offers
• Building savings banks function with the help of payers and payees
• The building societies provide a flow of money and earn the same from the interest.
• A certain amount is saved in the savings phase
• Once the minimum amount has been saved, the loan can be disbursed.
• In the loan phase, the loan is repaid with monthly payments

Find out more about building savings in our big guide to building savings!

The building savings contract – various tariffs of the building savings banks

Different building societies sometimes have significantly different tariffs. A comparison in the search for the best building savings contract is therefore highly advisable. When making a comparison, various key figures must be taken into account, such as the interest rate on the loan. But other factors are also important, such as the interest rate on the credit balance and other important key points of the contract.

However, the comparison is not easy in any case, as different interest rates are combined with different savings and redemption periods. These key data must then be matched with the wishes and individual situation of the saver. It may well be that an offer with a significantly higher loan interest rate is the better choice, as the time to allotment is shorter than with the other variants. Tip: Obtain various offers from different providers for a building savings sum and compare them on the basis of the key figures mentioned.

• Different building societies offer different tariffs for building savers
• The comparison of the building societies is worthwhile for every building saver due to the different offers

The building societies – this is how the principle works

Building societies specialise in issuing building savings contracts. There are different parts that work together to make the principle of bauspar work. The three phases play an important role here. Building savings banks always have depositors and payers. The payers, who pay in so-called savings rates during the savings phase and the payers, who repay the bauspar loan during the loan phase.

The payers are those in the allocation phase who both receive their saved assets and can draw the loan. The money in a bausparkasse thus flows back and forth from the depositors to the disbursers. The bausparkasse itself earns its money from interest paid by the bauspar customers at various stages.

• Building savings banks function with the help of payers and payees
• The building societies provide a flow of money and earn the same from the interest.

The three phases – savings, allocation and loan phase

In the savings phase, a certain amount is first saved. This usually corresponds to 30-50% of the volume of the building savings contract. For this purpose, the building savings amount, the loan interest rate and the repayment amount must be determined. Only when this sum has been saved in full is the contract ready for allocation and the loan can be disbursed.

In the allotment phase, home loan and savings customers have two options. The credit balance and the state premiums can be paid out or the bauspar loan can be used for home ownership. In the latter case, the building society pays out both the savings balance and the loan, i.e. the entire bauspar sum.

If the saver decides to take out the loan and use it for home ownership, the building society pays out the saved credit and the loan, i.e. the entire building society sum. Subsequently, the loan is repaid by the saver to the building society in monthly interest and redemption instalments.

• A certain amount is saved in the savings phase
• Once the minimum amount has been saved, the loan can be disbursed.
• In the loan phase, the loan is repaid with monthly payments

The advantages and disadvantages – predictability with high repayment rates

Building savings contracts also have their advantages and disadvantages. These can help you to assess your own situation when deciding for or against a building savings contract. However, whether a building savings contract is worthwhile depends largely on the individual situation and cannot be determined across the board. All advantages and disadvantages at a glance:

The advantages – predictability, security and low interest rates on loans

A building savings contract offers many advantages for people in different life situations. Particularly as partial financing for a property, building savings is ideal, as it promises predictability and security. The financial means are available to the saver when he needs them and the loan interest rates are comparatively low. All advantages at a glance:

• Building savings can be planned in advance and determine when money is available for financing construction, purchase, conversion or modernisation measures.
• Building savings is suitable for people who are looking for security in the long term
• It is possible to secure low interest rates on the loan for a long time and until the end of the repayment period
• A building savings contract is supported with many different state subsidies
• Building savings remain flexible for the saver despite the ability to plan
• Special payments are possible at any time
• The saver has limited freedom as to when the building savings sum can be used
• The financial resources are available to the saver when he needs them
• The loan interest rates for building savings contracts are usually very low

The disadvantages – low amounts, partial financing and high repayment rates.

However, the building savings contract also offers disadvantages and reasons why such a contract is not suitable for every situation. For example, the contract is not suitable for short-term real estate financing, since a certain amount must first be saved. In addition, a building savings contract is only suitable as partial financing, as it usually involves smaller amounts. All disadvantages at a glance:

• The building savings contracts are usually only for low amounts, so that the building savings banks can secure the favourable interest rates.
• Building savings are not suitable for short-term real estate financing
• The repayment instalments demanded by the building societies are comparatively high
• A building savings contract is not suitable for financing an entire property, but only as an additional financing sum.
• The fees at the conclusion of the contract are relatively high at building societies
• There is no absolute planning certainty, as the payout date depends on the savings portion.

The most important questions on the subject of building savings

The topic of building savings is not easy to understand and holds many technical terms and difficulties for inexperienced. So that no questions remain unanswered for you, the experts of Lukinski still answer all important questions around the topic of building savings.

How can I cash out my building savings contract?

Theoretically, a building savings contract can be paid out at any time. However, the payout depends on the phase the investor is in. In the loan phase, the sum is paid out automatically as soon as the minimum savings balance is reached. During the savings phase, however, the contract must first be terminated in order to receive the assets saved up to that point.

What is a building society contract?

A building savings contract is a savings contract between the investor and the building society. The building savings contract is a form of investment in which a fixed part of the sum is first saved before the loan sum is paid out. The building savings contract is therefore divided into two phases. The first is the savings phase, in which the minimum savings balance is saved. In the second phase, the loan phase, the loan amount is disbursed and gradually repaid by the investor.

What does a building society contract cost me?

The costs for the building savings contract vary from bank to bank. In addition to the costs for the interest on the loan, there are also costs for the conclusion and account management fee. These costs are an important indicator for comparing different tariffs.

What is the taxable income?

Taxable income is a term used in tax law. It describes the assessment basis for the tax assessment of income tax. It is calculated using a rather complicated formula and is therefore not easy to determine for laypersons.

What is the standard savings contribution?

The standard savings contribution describes the monthly amount to be paid and is based on the amount of the building savings sum. The contribution is specified in the building savings contract, but can be changed at any time depending on the contract.

Is it possible to transfer a building savings contract?

Yes, a building society contract can be transferred to a relative. In most cases, the previous conditions are simply retained and thus the rights and obligations are simply transferred to the relative. However, you have to agree with the building society in advance whether a transfer is possible in your contract.

How long do you pay into a building savings contract?

A term is agreed in the building savings contract, but this can usually be adjusted at any time. Often a minimum term of 18 months is agreed and the term is limited to a maximum of 20 years. How long is ultimately paid in depends on the sum and the repayment amount.