Mortgage broker in Germany: what independent advice does for your property loan
Your main bank assesses your application against just one set of lending guidelines: its own. A rejection therefore says nothing about whether another bank would approve the same application. A finance broker, on the other hand, assesses it against the guidelines of many different institutions.
Mortgage brokers: What do they do, how much do they cost, and when is it worth using one?
A mortgage broker arranges mortgages and finds the lender whose lending criteria match your circumstances. As a rule, the bank pays the fee, so there are no upfront costs (Vorabkosten) for you. It’s worth using one if a particular detail falls outside the standard criteria – such as living abroad or having an income in a foreign currency – but not if you’re looking for straightforward, standard financing.
What does a mortgage broker do that your own bank doesn't?
A mortgage broker assesses your situation against the lending criteria of many banks and looks for the bank whose criteria match your circumstances. Your own bank can only assess you against its own criteria.
Mortgage advice: What does a mortgage broker do that your own bank doesn’t? A mortgage broker assesses your application against the lending criteria of many banks, whereas your own bank only assesses it against one: its own. If it doesn’t meet those criteria, the result is a ‘no’ — and that ‘no’ says nothing about whether another bank would approve the same application.
A mortgage broker turns this on its head: they are familiar with the criteria of many lenders and look for the lender whose criteria match your situation. That is the real work, not the tenth of a percentage point difference in interest rates. They are authorised as a mortgage broker under Section 34i of the Trade Regulation Act, are registered in the brokers’ register, and are liable for the advice they provide.
A mortgage broker is usually paid by the bank drawing up the contract — so there are no upfront costs for you. Anyone who needs straightforward, standard financing, is on a permanent German salary and is in good hands with their bank does not need one. A mortgage broker is worth the cost where a particular aspect of the case falls outside the usual parameters: residence abroad, income in a foreign currency, cross-border commuters, or a property type that not every lender assesses.
How much does it cost? As a rule, the bank that draws up the contract pays. There are no upfront costs for you. Agency fee.
When is it not worth it? In the case of straightforward standard financing backed by a German salary with no fixed term, if your own bank offers you a good deal.
A bank has a lending policy. This sets out the types of income it recognises, the types of residence, the types of employment, the types of property and the maximum loan-to-value ratio. Your adviser cannot deviate from this — he can only assess your case against this single set of criteria.
A mortgage broker works the other way round: they assess your situation, identify the specific issue that’s causing a problem, and look for banks that meet the criteria for that very issue. The number of banks they work with is of secondary importance. What matters is whether, amongst them, there is that one bank that fits your situation.
Property finance advisers: How much does a mortgage broker cost?
Usually nothing — the fee is generally paid by the bank that draws up the contract. You won’t incur any upfront costs or be charged a fee for the assessment. This is standard practice in the property mortgage brokerage sector in Germany.
Where a different fee is agreed in a specific case, this must be set out in writing before the work begins — not afterwards. This is explained in detail under Fees for the agency.
Financial intermediaries, brokers, advisers: What do these terms mean?
The terms are often used interchangeably. From a legal perspective, however, a distinction is important: anyone who acts as an intermediary for property loans to consumers requires a licence under Section 34i of the Trade Regulation Act. Anyone who merely acts as an intermediary for property is covered by Section 34c. Both categories are publicly available in the register of intermediaries.
A finance broker without a 34i licence is not permitted to arrange property loans for consumers — that is where the two concepts diverge.
Are you an estate agent, property developer or insurance broker? Partner with a property finance broker.
Mortgage advisers: how they differ from bank advisers: A bank adviser is an employee of their bank. They advise on their bank’s products and are assessed on that basis. An independent mortgage adviser is not tied to any particular bank and is personally liable for the advice they give — to do so, they require authorisation under Section 34i, professional indemnity insurance (Berufshaftpflichtversicherung) and a certificate of competence.
The difference isn’t apparent when comparing interest rates, but rather when a particular case doesn’t fit the mould. You can find out which banks these are under Banks Compared.
Section 34i of the Trade Regulation Act (GewO): what the licence entails: The licence under Section 34i requires professional competence, sound financial standing and professional indemnity insurance. It is granted by the competent authority and entered in the register of intermediaries; the entry can be checked online.
This is the basis of the adviser’s liability: the adviser is liable for the advice they give and the documentation they provide. This is what distinguishes them from a comparison website, which merely displays terms and conditions. Olga Nikushkina holds a licence under Section 34i and Section 34c of the Trade Regulation Act (GewO).
When it’s not worth going through a mortgage broker: when the case is straightforward. A permanent German salary, German residence, a standard property, solid equity, and your own bank is offering a good deal — in that case, the process is quick and the outcome is fine.
A mortgage broker steps in where a particular circumstance presents a challenge: residence abroad, income in a foreign currency, cross-border commuters, self-employment with financial statements requiring explanation, or a type of property that not every lender values. And they won’t take on a case if the figures simply don’t add up — even the twentieth bank won’t be able to sort out an unsustainable financing arrangement.
Is your project financeable at all?
That depends less on what you earn than on how much borrowing your income can sustain in the long term after all regular commitments. If a project is not viable, we tell you just as frankly.
It is not the question ‘How much do you earn?’ that is the sole deciding factor. What matters is how much borrowing your income can sustain in the long term — after all your regular commitments have been deducted. A household with a net income of €6,000 and €500 in regular repayments has a completely different level of financial flexibility than one with a net income of €3,000 and the same repayments. That’s why we do the maths first and only then look for a bank.
Excellent starting position: Stable income · sufficient financial leeway after all commitments have been met · good credit rating · equity available or able to be put to good use · a specific property in mind or a realistic budget.
Of particular interest in certain circumstances: residence or income abroad · foreign currency · self-employment or balance sheets rather than payslips · variable remuneration · income from medical practice · a property that not every bank will accept · rejection by your own bank on one of these grounds.
Cannot be resolved in the following cases:
- persistently low income
- already high monthly debt
- no financial leeway after budgeting
- a purchase price that bears no realistic relation to income
- lack of funds for ancillary purchase costs (8–15 % depending on the federal state)
- poor credit rating
A situation that does not fit every lending guideline is not a reason for exclusion. However, we cannot provide a solution for financing that is not economically viable. Take two minutes to check in advance whether your project is on the right scale: Financing traffic light · Budget calculation · When a construction loan won’t work
When is a mortgage broker not worth it?
With straightforward, standard financing on a permanent German salary and a good offer from your own bank. It is worth it when part of your situation falls outside the usual parameters, such as living abroad or foreign-currency income.
Mortgage advice: What does a mortgage broker do that your own bank doesn’t? Your own bank assesses your case against just one set of lending criteria – its own. A mortgage broker identifies the specific criterion that doesn’t fit and looks for banks that accept that criterion.
Mortgage brokers: What licence do they require under Section 34i? Anyone who acts as an intermediary in arranging mortgage loans for consumers requires a licence under Section 34i of the Trade Regulation Act. This requires professional competence, sound financial standing and professional indemnity insurance, and is recorded in the brokers’ register, which can be checked online. Olga Nikushkina holds authorisation under Sections 34i and 34c of the Trade Regulation Act.
Frequently asked questions
When should you use a mortgage adviser rather than your own bank?
When some aspect of your situation falls outside your main bank’s usual parameters – such as living abroad or having an income in a foreign currency. An independent adviser is not tied to any particular bank and is personally liable for the advice they give. Anyone who needs straightforward, standard financing and is in good hands with their bank does not need one.
Is a mortgage broker the same as an adviser?
The terms are often used interchangeably; legally, however, a distinction is made. Anyone who acts as an intermediary for property loans to consumers requires authorisation under Section 34i; anyone who merely acts as an intermediary for property deals operates under Section 34c. An independent mortgage adviser must also have professional indemnity insurance and a certificate of competence.
Will I have to pay the mortgage broker?
Not usually. The fee is generally paid by the bank that draws up the contract; you will not incur any upfront costs. For details on what applies in individual cases, please see Brokerage Fees.
Is a broker better than my own bank?
Not necessarily. It’s a better option if your situation doesn’t fit the criteria of your usual bank — and that’s usually the only thing you’ll hear from them: a ‘no’ with no explanation.
How can I tell if a mortgage broker is registered?
The licence under Section 34i of the Trade Regulation Act and the entry in the register of intermediaries. Both are available for public inspection.
Will I get an offer through a mortgage broker?
No. The broker acts as an intermediary; the bank makes the final decision following its own assessment.
How many banks are needed?
The figure isn’t the point. You need the one lender whose lending criteria suit your situation.
Discuss your case — free of charge and with no obligation
Perini Finance & Property arranges property loans in accordance with Section 34i of the German Trade Regulation Act (GewO). We’ll tell you which lending policy is right for your situation — and if none of them are suitable, we’ll tell you that too.
Related pages
The mortgage application process
How long a mortgage takes: all the steps from application to disbursement — with realistic timeframes for each stage.
Bank comparison
Mortgage comparison: over 650 banks, ranging from Sparkasse and Volksbank to ING, DKB and specialists in mortgages for overseas residents.
Commission for the referral
Mortgage brokerage: As a general rule, the bank pays a commission, not you. If no mortgage is arranged, you will not incur any costs.
Mortgage comparison: why does financing differ from city to city?
In Frankfurt, banks differ not in the level of interest rates but in how they price the location and condition of a property. That decides the loan-to-value.
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.
