FAQ · Financing German property from abroad
Financing a German property from abroad — your questions, clearly answered
Your home, workplace or income is abroad — and the property is in Germany? Here you will find precise answers on non-residents, cross-border commuters, foreign currency, creditworthiness and documents. Brief, factual, and without interest-rate promises. Every individual case is decided by a personal assessment. A non resident mortgage works differently here: the bank looks at income and equity, not your postcode.
Can I get a German mortgage if I live abroad?
Yes. A rejection from the first bank is almost never a statement about your creditworthiness — it is a statement about that bank's internal process, and other institutions have established procedures for exactly these cases. German banks call anyone whose residence or centre of life lies outside Germany a non-resident borrower, regardless of where tax is actually paid. That must be kept separate from the cross-border commuter, who lives in Germany but earns abroad: for banks these are two different categories, and an institution may finance one but not the other. In both cases the property itself has to be in Germany, because the loan is secured by a land charge on the German object. Your own residence may lie outside, including outside the EU — the assessment then depends more heavily on country, income currency, employer and property, and the circle of suitable banks narrows. There is no automatic interest surcharge for living abroad.
German banks often struggle with an overseas link — not because the clients are poor risks, but because of the extra effort, internal policies and uncertainty involved. This is exactly where I focus: knowing the banks that handle such cases cleanly. The answers below are general information and are no substitute for legal or tax advice.
Basics
Non-residents, cross-border commuters & how banks behave
What does "non-resident" mean in bank language?
Banks usually mean simply people whose residence or centre of life lies outside Germany — regardless of where they actually pay tax. The term is imprecise and is often used interchangeably with "non-domiciled" or "non-resident".
Why do German banks so often turn down clients living abroad?
Rarely because of creditworthiness. It is usually about extra effort and uncertainty: which consumer law applies, a more involved review, internal and regulatory requirements, foreign-currency issues, and simply missing processes. Many banks avoid the effort across the board — even though the case would be financeable.
Does a rejection mean I am not creditworthy?
No. A rejection from the first bank is usually a statement about its internal process, not about you. Other banks have established procedures for exactly these situations.
What is the difference between a non-resident and a cross-border commuter?
Non-residents have their residence abroad. Cross-border commuters live in Germany but earn their income abroad. For banks these are two different boxes — some finance cross-border commuters but not non-residents, and vice versa.
Is financing possible with a residence outside the EU too?
Yes, it is possible. The review then depends more strongly on the specific country, the income currency, the employer, creditworthiness and the property. The pool of suitable banks is smaller, but it exists.
Who is easy to finance — and who only with difficulty?
Easy: verifiable, stable income, a property in Germany, a solid equity base. Difficult: no provable income, pure private investors, or someone who already holds several of their own properties — here the range of banks is limited.
Does the property have to be in Germany?
For classic German property financing, yes — it is secured by a land charge (Grundschuld) on the property located in Germany. Your own residence may be abroad.
Do I automatically pay more with a residence abroad?
Usually not: most banks active in this business apply no surcharges. Some justify a surcharge with the higher processing effort. Concrete conditions always result only from your individual situation.
Countries
Switzerland, UK, USA, Austria, UAE
Switzerland: can I finance a German property while living in Switzerland?
Yes. Even if you have heard it "no longer works" — there are banks that finance German property despite a Swiss residence and income in francs. The requirement is a land-charge-secured property loan.
Switzerland: what employment do the banks expect?
The choice of banks is widest with a permanent employment contract. Self-employment in Switzerland is possible, but then the equity requirements are noticeably higher.
Switzerland: I live in Germany and earn in Switzerland — what applies?
From a bank's perspective you then count as a cross-border commuter (regardless of the tax definition). The suitable pool of banks is a different, somewhat smaller one, but financing is regularly quite feasible.
Switzerland: should I be cautious about tenanted flats being offered to me?
Yes. Some sales operations sell Swiss buyers supposedly cheap, already-tenanted flats. The fact that a bank finances such a flat at a high level does not mean it is worth the price — an independent assessment before buying is worthwhile here.
United Kingdom: who is financeable?
Typically: residence in the UK, income in any currency, a permanent employment contract and clean creditworthiness. The self-employed are possible with restrictions.
United Kingdom: do I need German-language skills or German citizenship?
With some banks it makes things easier; for couples it is usually enough if one person brings adequate German-language skills or German citizenship. It is not mandatory everywhere — it depends on the bank.
USA/Canada: is financing possible?
Yes. As a non-EU residence, the review depends more strongly on country, currency, employer and creditworthiness, and the pool of banks is narrower — but there are houses that handle this routinely.
Austria/EU: is a euro income easier?
Somewhat, because the foreign-currency issue drops away. But even the residence abroad or an employer outside Germany is a knock-out criterion for many banks — even with a euro income. It is nonetheless solvable.
UAE/Dubai: can I finance while living in the Emirates?
Yes, this occurs in practice. What matters is provable income, employer and equity; the suitable pool of banks is a specialised one, but it exists.
Foreign currency & law
Foreign currency, conversion right & §503 BGB
What is a foreign-currency loan?
Colloquially, a property loan in which your income arises in a currency other than the loan currency — for example francs, dollars or pounds against a euro loan. This creates an exchange-rate issue that banks assess. Legally (§503 BGB) the test is a different one: what counts there is the national currency of your country of residence.
What does the conversion right under §503 BGB say?
§503 of the German Civil Code (BGB) concerns foreign-currency loans and, under certain conditions, gives consumers the right to convert the loan into another currency in order to limit the exchange-rate risk. Banks like to cite this rule as a reason for rejection. The details are a legal question — for that, a specialist lawyer is responsible.
Who does the conversion right affect in practice?
It attaches to residence: it affects consumers who, at contract conclusion, live in an EU country without the euro (e.g. Denmark, Sweden, Poland) — even where the salary is paid in euros. Anyone resident outside the EU (Switzerland, UK, USA, UAE) is not affected, not even with a foreign-currency salary. Whether it affects your case we clarify in advance — it is often less dramatic than the rejecting bank makes it out to be.
Is my income in francs, dollars or pounds a problem?
For many banks, yes — for the right ones, no. What matters is the stability and verifiability of the income, plus a bank that maps foreign currency cleanly into its process.
Do banks count my foreign-currency income in full?
Not always. Some banks apply a safety discount to cushion exchange-rate fluctuations. How large varies from bank to bank — another reason to select the right one deliberately.
How do I deal with the exchange-rate risk?
Sensible steps are an equity buffer, a suitable repayment rate, and choosing a bank with fair recognition of income. Concrete hedging strategies are individual — we look at them together in conversation.
Creditworthiness
SCHUFA, residence permit & proofs
I have no SCHUFA history in Germany — is that still workable?
Yes. Anyone who has lived abroad for a long time often has no, or only a thin, SCHUFA history (Germany's main credit bureau). Banks then rely more heavily on income statements, bank statements, existing obligations and the overall situation. It takes a bank that accepts this.
How do I prove my creditworthiness while living abroad?
Through income statements (employment contract, payslips, tax assessments where applicable), bank statements and evidence of existing assets. For foreign documents, translations or explanations are sometimes required.
Do I need a German bank account?
Not necessarily at the start, but it makes the process considerably easier. For the ongoing instalment payment a SEPA-capable account is practical — that can be arranged during the process.
Does a temporary residence permit count against me?
It is a factor for some banks, but not a fundamental exclusion criterion. What matters more is income, prospects and the right bank; for skilled workers with a Blue Card there are established routes.
Am I financeable as a foreign citizen?
In principle, yes. Citizenship alone is not decisive; what counts is the overall situation of income, residence, residence permit and property.
What applies if I am self-employed abroad?
Self-employment is financeable, but generally requires more proofs (several years of accounts, tax documents) and often more equity. The pool of banks is narrower, but it exists.
Equity & lending value
Equity, unsecured portion & full financing
How much equity do I need as a non-resident?
As a rule of thumb, at least the transaction costs should come from equity. With a residence abroad, foreign currency or an investment property, banks tend to expect somewhat more equity than in the standard case — how much depends on the situation.
What is the unsecured portion (Blankoanteil)?
The part of the loan not covered by the property value — that is, the difference between the loan and the lending value. German banks usually accept only a limited share here; the higher the unsecured portion, the more difficult and expensive the financing.
Can I finance without equity or at 100%?
In principle this is possible with a very strong overall situation, but comparatively expensive and not available at every bank. It is advisable to cover at least the transaction costs yourself. Whether full financing makes sense depends on the individual case.
What are the transaction costs and do I have to pay them myself?
Property transfer tax, notary, land registry and, where applicable, an estate agent — depending on the federal state, roughly 8–13% of the purchase price. Banks usually do not co-finance them, so they should come from equity. You can estimate the exact amount with the transaction-cost calculator.
What is the lending value and why does it differ from the purchase price?
The lending value is the value the bank assigns to the property on a lasting basis — deliberately more cautious than the purchase price. If it is below the purchase price, you have to make up the difference with equity.
Do banks finance tenanted investment properties for clients abroad?
Yes, this is a common case. What matters is a realistic assessment of the property and the rent, plus a bank that accepts investment properties with a residence abroad. You should calculate the rental yield net in advance.
Can I use the financing to raise capital for other purposes too?
In certain cases, yes — for example to pay out co-heirs or for further projects, secured against the German property. This depends on the situation and should be reviewed individually.
Documents
What the bank wants to see
Which documents do I generally need?
An identity document, income statements, proof of equity and the property documents (listing, floor plan, living-area calculation and more). The exact list depends on country, type of income and bank — a structured checklist saves a lot of time here.
Do foreign documents have to be translated?
Often, yes — some banks require certified translations or supplementary explanations. This can be organised; we say in advance what the respective bank actually needs, so nothing is done twice.
How current must my ID be?
Your passport or identity card should still be valid for long enough — as a guide, at least six months. Expired documents delay the review.
Which income proofs do banks accept for income earned abroad?
Typical are the employment contract, recent payslips and bank statements; for the self-employed, several years of accounts and tax documents. With foreign currency, banks additionally look at stability and conversion.
What do I need additionally as a self-employed person?
Usually the last two to three annual accounts or income-surplus statements, current business analyses (BWA) and the tax assessments. The clearer the earnings position, the smoother the review.
Which property documents are needed?
The listing, floor plans, living/usable-area calculation, photos; for freehold flats the declaration of division and minutes; for existing buildings, an energy certificate where applicable. What exactly is missing is seen fastest with the listing check.
Funding
KfW & funding with a residence abroad
Can I use KfW funding as a non-resident?
That depends on the programme. Programmes for building owner-occupied housing require owner-occupation — for a pure investment property with a residence abroad they usually do not apply. Building-related programmes (e.g. energy-efficient refurbishment) are more independent of residence. We review this with you in the individual case.
Which types of funding are eligible at all?
Depending on the project: KfW programmes for new builds (QNG) or refurbishment, family funding and, in part, state-level programmes. What fits results from the property, its use and your situation — see KfW funding.
Is there state-level funding with a residence abroad too?
Partly — the state programmes have their own requirements, often tied to owner-occupation. This is to be reviewed in the individual case; one should not rule it out across the board.
Do I have to apply for funding before signing the contract?
For many programmes, yes — the application must be in place before the measure or contract begins. That is why the funding question belongs at the start of the planning, not at the end.
Follow-up financing
Debt restructuring & follow-up financing from abroad
Can I restructure my current financing from abroad?
Yes. Even from abroad you can switch banks for the follow-up financing. The process resembles the initial financing, but is often leaner because the property is already known.
What is a forward loan?
A loan with which you secure the follow-up conditions today for a later point in time — useful if your fixed-interest period ends within the next few years and you want planning certainty.
Is switching banks worthwhile for the follow-up financing?
Often, yes. Banks count on clients conveniently accepting the prolongation offer — a comparison can save noticeably over the remaining term. You can work out the remaining debt for this with the repayment calculator.
What does switching banks cost?
Essentially the cost of assigning or re-registering the land charge — usually modest relative to the possible saving. We make the exact calculation transparent in advance.
What is the "prolongation trap"?
The convenient extension offer from your own bank, which people sign without checking — even though a switch would often be cheaper. Anyone who compares in good time avoids it.
Process
Advice & working together
Is an initial call worthwhile if I do not have a property yet?
Absolutely. In the initial call we clarify whether and at what level financing is feasible and what the process looks like. With this framework you search more precisely — and can commit quickly when the right property comes along.
How does a financing with an overseas link work with you?
An initial call and assessment, then compiling the documents in a structured way, selecting suitable banks, obtaining and comparing offers, and accompanying you through to the commitment. The overseas link is considered from the outset, not treated as a problem at the end.
What does your advice cost?
The financing advice is free for you; the commission is paid by the financing bank. I act as a property-loan broker under §34i GewO — this is not legal or tax advice.
Which markets do you work in?
The focus is financing German property for people with an overseas link — Germans abroad, non-residents, cross-border commuters and expats. Across three platforms I have a presence in Germany, Spain and Portugal.
From when do I pay the loan instalment?
Usually after the loan is disbursed. Until then — depending on the contract and construction progress — commitment interest may accrue. The exact terms are set out in your offer.
Do I need a valuation report?
Not always. In standard cases the bank's own valuation based on the documents is sufficient; a separate report is more of an issue for unusual properties.
Your question not here?
Every case with an overseas link is its own. Describe your situation to me in a free initial call — I will tell you honestly what is feasible and which bank fits.
Book a free consultationAdvice free · commission 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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