German mortgage FAQ: broker costs, KfW funding and financing for expats

Usually not. Under the Money Laundering Act, you must document the origin of the funds without gaps, back to salary, sale proceeds, an inheritance or a gift. A balance alone shows only that the money exists. Missing evidence is the most common reason an agreed loan stalls shortly before disbursement. We assemble the evidence before submitting the enquiry.

We compare 650+ banks at once — your own bank only knows its own products. For investment properties in particular (listed buildings, QNG new builds), the choice of bank is decisive, because not every bank finances such objects. We know the specialist banks — and which ones to avoid.

The KfW application must be submitted before the purchase contract — this is the most common and most expensive mistake. We coordinate the correct order: KfW application first, then the purchase contract. One widespread misconception: a repayment grant exists only in refurbishment (KfW 261).

For new builds, programmes 297/298 and 300 work through reduced interest rates rather than repayment grants. Programmes 297/298 provide up to €150,000 per residential unit with QNG, or up to €100,000 without it. Programme 300 has separate family-based limits of up to €270,000. It cannot be combined with 297/298 for the same unit.

For investors, doctors and clients with very good credit standing who want to keep their equity working — it is no substitute for missing equity. The bank finances the purchase price; you contribute the transaction costs from own funds — depending on the federal state, 8–15 % (property transfer tax, notary, land registry). Bavaria is particularly favourable at 3.5 % transfer tax. Requirement: very good creditworthiness and a household income that carries the instalment long term.

Yes — in many cases the listed-building depreciation (§7i EStG) and the KfW energy loan 261 are combinable. This increases the financing advantage considerably: tax savings through depreciation + a low-interest KfW loan + a possible repayment grant. The exact combination depends on the property — we check this for you.

Yes — almost all federal states have their own development banks with programmes that are often combinable with KfW: L-Bank in Baden-Württemberg, BayernLabo in Bavaria, NRW.BANK in North Rhine-Westphalia, WIBank in Hesse, SAB in Saxony (especially relevant for listed buildings in Leipzig/Dresden), IFB Hamburg, NBank in Lower Saxony and others. Combining both pots — KfW + state funding — can save considerably more. We check for each property which programmes apply and submit the applications in the right order.

The bank’s lending policy must allow your income currency. Some banks reject foreign-currency income, while others accept specified currencies. Accepted income is converted and discounted for safety rather than counted in full. Your combination of income currency and country of residence must be covered by the policy. A high salary alone cannot prevent a refusal.

Yes. There is no ban, and the land register entry is open to everyone. What narrows down the range of banks is your tax residence, not your nationality: anyone who has neither a domicile nor a habitual residence in Germany (Sections 8 and 9 of the German Fiscal Code (AO)) is subject to limited tax liability — in banking jargon, a ‘non-resident for tax purposes’. This affects the applicable law, the means of service and the requirements for credit checks. Some banks therefore reject applications across the board. Plenty of others do not — they simply cannot be found via comparison websites.

No, but it is the central question. The bank finances over twenty years, your permit may be valid for three — almost all refusals arise from this asymmetry. Some banks require a settlement permit, others accept the EU Blue Card, and a few examine fixed-term permits case by case on the basis of sector, contract term and renewal practice. This is not a legal question but a decision by each bank — and therefore a question of choosing the right one.

Once the loan has been committed, the bank keeps the money available for you. If it is not drawn down — for example because construction is delayed or the renovation stalls — the bank charges a fee for this after a commitment-fee-free period. This period is negotiable but rarely negotiated, because nobody is interested in it when signing. For new builds, prefabricated houses and full refurbishments it is one of the most important points in the contract: it costs nothing as long as you agree it for long enough.

Within the fixed-rate period only to a limited extent — and usually against a prepayment penalty, which compensates the bank for its interest loss. There are exceptions: ten years after full disbursement there is a statutory right of termination with six months' notice (§ 489 BGB), regardless of how long the fixed-rate period still runs. Repayment is also possible when the property is sold — but then against a penalty. A rough calculation shows the order of magnitude.

More important than it looks in a comparison — and mostly free of charge. A customary special repayment allowance permits one additional payment per year without a prepayment penalty. For anyone with fluctuating income (self-employed, bonus payments, variable pay) it is the most important flexibility element of all: it reduces the remaining debt at the end of the fixed-rate period without raising the monthly instalment. Anyone who does not negotiate it gives it away.

No — it is the right time. Up to five years before expiry you can take out a forward loan: you secure today's terms for later, in return for a premium. Whether this is worthwhile is a weighing-up and not a calculation with a clear-cut result.

For a certain group of people, however, the question is more urgent than for others: anyone who now lives abroad, has become self-employed or is retiring may have a smaller circle of banks in three years than today. Then it is not about the interest rate but about whether anyone will extend the loan at all.

With complete documentation, a financing commitment usually takes 3 to 10 working days. We prepare the documents and submit them to the appropriate bank. For a time-critical purchase, we can also arrange a fast preliminary enquiry.

Nothing — our advice, the bank comparison and the financing enquiry are, as a rule, free of charge for you. The commission is normally paid by the financing bank, not by you. This is regulated by law and transparent.