Source of funds documented once, in full: €1,260,000 for a mixed-use building
“The money is there — but first we have to know where it comes from.” The investor had not expected this statement. This is a non-resident mortgage case — financed from Germany, not against it.
What was the obstacle in documenting the source of funds, and how was it solved?
The bank asked only about the origin of the equity: where the funds came from, when, from which accounts, and whether companies had been sold. We documented the entire wealth history without gaps, including property sales in the USA and securities portfolios, as one complete overview. Follow-up questions were resolved in advance, and the credit review proceeded much faster.
Why Germany was of interest
For almost twenty years he had invested successfully in residential property on the American east coast. His property holdings comprised several apartment buildings, plus stakes in two companies and an extensive securities portfolio.
Germany was to be the next step.
The investor had decided on a mixed residential and commercial building in North Rhine-Westphalia.
The economics were convincing.
The tenancy agreements ran long-term.
The purchase price was in line with the market.
The financing seemed a pure formality.
But instead of talking about conditions or repayment, the bank spoke almost exclusively about one thing:
The origin of the equity.
The investor wanted to spread his assets more broadly by geography.
The German property market seemed to him stable, transparent and legally predictable over the long term.
His aim was not a short-term resale.
He planned to hold the property for at least fifteen years.
The key figures:
Purchase price: 1,920,000 euros; Equity: 760,000 euros; Financing required: 1,260,000 euros.
The rental income covered a considerable part of the financing costs.
From an economic point of view, much spoke for the project.
The unexpected follow-up questions
The financing bank got in touch after just a few days.
But not because of the property.
Nor because of creditworthiness.
The questions concerned only the equity.
Where did the funds come from?
When were they earned?
Which accounts were involved?
Were there company sales?
Which assets had been disposed of in recent years?
To the investor these questions initially seemed unusual.
In the USA he had never had to provide comparable evidence.
Why international investors are reviewed more often
Extensive statutory requirements apply to cross-border financings.
Banks are obliged to document the origin of larger assets in a comprehensible way.
For international investors in particular this therefore often includes:
asset overviews; bank statements; sale contracts; company documents; tax evidence; documentation of larger asset movements.
These checks are not about the credit assessment.
They are part of the statutory compliance requirements.
The analysis
Together, all assets were documented in a structured way.
It became clear:
The equity came from several property sales.
In addition, there were considerable securities portfolios.
All asset movements could be traced without gaps.
The property being bought was convincing too.
The location was stable.
The tenancy agreements long-term.
The earnings position sustainable.
The decisive difference
Instead of submitting ever new documents one by one, the entire wealth history was prepared in a comprehensible way.
This gave the bank a complete overview.
Many follow-up questions were resolved in advance.
The actual credit review then proceeded much faster than expected.
The financing: After all checks were completed, the financing commitment followed.
The mixed residential and commercial building could be taken over as planned.
Just a few months later the actual rental income confirmed the original economic calculation.
What international investors can learn from this: Many wealthy buyers assume that only income and equity are decisive.
International financings, however, follow additional statutory requirements.
The better the origin, development and structure of the assets can be documented, the more smoothly the financing usually proceeds.
A US investor's financing did not fail on creditworthiness: This case shows that international property financings often do not fail because of creditworthiness.
With larger investments in particular, the quality of the documentation often decides.
Anyone who prepares the origin of their assets, income structure and property professionally creates the basis for a successful financing — even for cross-border investments drawing on several sources of income and assets.
Frequently asked questions
Can US citizens finance property in Germany?
Yes. Numerous banks handle international investors, provided all economic and statutory requirements are met.
Why does the bank ask about the origin of the equity?
Banks are legally obliged to document larger asset movements in a comprehensible way.
Is a high account balance enough?
No. What is decisive is that the origin of the funds can be plausibly evidenced.
Does the review take longer?
International investors should allow a little more time because of the additional documentation obligations.
Can larger investment properties be financed too?
Yes. What is decisive is property quality, creditworthiness, asset structure and complete documentation.
A similar situation? Let’s talk.
Every case with an overseas link is its own. In a free initial call we will tell you honestly what is feasible and which bank fits.
Anonymised individual case, not a guaranteeable statement for other projects · advice free · commission, as a rule, paid by the bank · §34i GewO · not legal or tax advice · no financing commitment; conditions depend on creditworthiness, lending value and bank
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Editorially responsible: Olga Nikushkina — owner, §34i GewO (German mortgage brokerage), adviser register D-W-132-ZUCB-95. Specialised in German property financing with an international dimension: non-residents, foreign-currency income, cross-border workers, expats. Siegfried Perini is entered in the German intermediary register under this licence as a person directly involved in brokerage and advice (§ 11a GewO), active in real estate since 1992. Not legal or tax advice.