Forward loan
Lock in today the interest rate for your follow-up financing in 1–5 years. Sensible when rates are rising — you pay a small interest surcharge in return for planning certainty.
Follow-up financing
Refinancing German property loans: switch banks or extend with your lender?
Forward loans can be arranged up to 66 months before your fixed-rate period ends. If you have moved abroad since taking out the loan, your existing bank may not extend — a problem to solve two years early, not two months. Also for buy-to-let and special situations. Housing loan interest rates in Germany move independently of a borrower's country of residence.
When refinancing German property loans, does switching banks pay off?
When refinancing German property loans, switching banks is often cheaper than extending with your existing lender. Even 0.3 to 0.5 % less can save €10,000 or more over the remaining term. Your existing bank rarely offers the best terms, and the choice between extending, switching and a forward loan should be made in good time.
Follow-up financing or refinancing (Umschuldung)?
Follow-up financing is the regular new loan after the fixed-rate period ends — plannable, with no early-repayment penalty. Refinancing during a running fixed period usually triggers an early-repayment penalty at the old bank.
A forward loan locks today's rate up to 66 months ahead
It locks today's rate for a follow-up financing 1 to 66 months ahead. You pay a small surcharge per month of lead time in exchange for planning certainty — sensible when rates are expected to rise.
Switching banks usually pays: 0.3–0.5 % can save €10,000+
Usually yes. Even 0.3–0.5% less can save €10,000 or more over the remaining term. Your existing bank rarely offers the best terms — Perini compares 650+ banks, the first consultation is free and the fee is, as a rule, paid by the bank.
What matters when refinancing German property loans?
When refinancing German property loans, what matters most is choosing in good time between extending, switching banks and a forward loan — this is where you can save or lose the most. There are three routes. A prolongation with your existing bank is convenient, but rarely the cheapest. Refinancing to another bank is often cheaper and costs some effort to transfer the security.
A forward loan lets you lock in today's rate up to a few years ahead. Act only just before expiry and you lose both choice and negotiating position; take out a forward loan too early and you pay a premium.
The costliest mistake is doing nothing — after the deadline the loan usually rolls automatically into the more expensive variable rate. Which option works depends on the remaining balance, the fixed-rate term and market conditions; we run the numbers. Not legal or tax advice.
Key facts
Follow-up financing at a glance
Three ways out of the interest trap
Restructuring & switching banks
Instead of accepting the house-bank prolongation — compare other banks. On €200,000 remaining debt, a 0.3% rate difference can mean €10,000+ over the remaining term.
Follow-up financing when self-employed, near retirement or after earlier credit issues
Self-employed, near retirement, earlier credit restrictions — many banks decline across the board. With the right bank partner, follow-up financing is still possible.
Timeline
When is the right time?
The timing runs in stages: 3–5 years before the fixed-rate period ends consider a forward loan, 2 years before start the bank comparison, 6–12 months before obtain binding offers; after 10 years the special termination right under §489 BGB applies.
- 3–5 years before the fixed-rate period ends: consider a forward loan — lock in rates, small surcharge
- 2 years before the fixed-rate period ends: start the bank comparison — even if you sign nothing yet
- 6–12 months before the fixed-rate period ends: obtain binding offers, negotiate with the house bank
- After 10 years of fixed rate: special termination right §489 BGB — you can terminate, even under a longer agreement
What we check specifically
- Current remaining debt + repayment plan of the existing bank
- Market comparison across 650+ banks — whatever your starting point
- Early-repayment penalty when switching banks — where relevant
- Check the special termination right (§489 BGB)
- Negotiation using house-bank terms as a comparison basis
Model calculationRestructuring
Example: what can a restructuring after the fixed-rate period look like?
In the example, remaining debt of €180,000 moves from a previous rate of 3.2% to a new rate under 4% with a new 10-year fixed-rate period, compared across 6–10 banks within 3–10 working days.
Restructuring after the fixed-rate period
| Item | Amount |
|---|---|
| Remaining debt | €180,000 |
| Previous rate | 3.2% |
| New rate | under 4% |
| New fixed-rate period | 10 years |
| Comparison | 6–10 banks |
| Process | 3–10 working days |
Terms change daily and depend on credit standing.
Model calculations without guarantee. Not binding offers. Terms vary depending on credit profile, property and bank. No tax or legal advice.
Frequently asked questions
Is switching banks worthwhile for follow-up financing?
In most cases yes. Even a 0.3–0.5% rate difference often saves €10,000+ over the remaining term. The existing bank rarely offers the best terms — it knows that many clients prolong out of convenience. Our market comparison is free.
What is a forward loan?
A forward loan locks in today the interest rate for your follow-up financing in 1–66 months. You pay an interest surcharge (between 0.01 and 0.03% per month of lead time) in return for planning certainty. Sensible when rates are expected to rise.
What does switching banks cost?
Notary/land register for the assignment of the land charge: about 0.15–0.25% of the loan amount. The new bank often pays this. An early-repayment penalty does not arise on a normal schedule — only on early termination outside the §489 special termination right.
Request a financing analysis
Free, non-binding initial consultation — the commission is, as a rule, paid by the bank. we check 650+ banks plus all state development programmes for your situation.
Related pages
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.