Quick answer
Important
1. Mortgage vocabulary
Compare effective annual cost and contractual flexibility, not only the headline Sollzins.
The German words you will see
- Eigenkapital
- Your own funds used for price or acquisition costs.
- Sollzins
- The contractual borrowing interest rate.
- Effektiver Jahreszins
- Annual percentage including specified credit costs for comparison.
- Tilgung
- Repayment of loan principal.
- Zinsbindung
- Period for which the borrowing rate is fixed.
- Restschuld
- Principal remaining at the end of the fixed period.
- Sondertilgung
- Contractually permitted extra repayment.
- Beleihungsauslauf
- Loan relative to the lender’s mortgage lending value.
2. How a payment is formed
For a €300,000 loan, illustrative 3.5% interest plus 2% initial repayment gives an initial annual payment around 5.5% of the loan, or €1,375 monthly. The interest portion falls and principal portion rises over time in an annuity structure. This is not a current rate quote.
Example
Illustrative mortgage
Excludes acquisition costs, fees and future refinancing.
3. How much equity is needed?
No single legal percentage applies. Some banks may finance a high share, but lenders commonly prefer buyers to cover acquisition costs and may price more favourably when additional equity reduces risk. Keep emergency and repair reserves instead of committing every euro.
4. What lenders assess
Expect proof of income, employment or business accounts, existing debts, SCHUFA, equity, residence status and property documents. SCHUFA is one factor, not the whole decision. The bank’s property value may be lower than the price.
Official source
Independent information on mortgage offers, effective interest, repayment and affordability risks.
Federal Financial Supervisory Authority (BaFin)
5. Compare the full offer
- Effective annual interest and fixed-rate period
- Initial repayment and projected residual debt
- Sondertilgung and repayment-rate changes
- Commitment interest and drawdown schedule
- Land-charge and valuation costs
- Affordability after rate reset, repairs and ownership costs
6. Frequently asked questions
No. Bank criteria differ, and acquisition costs, income, property value and risk all matter.
No. It is one factor alongside affordability, debts, equity, residence and the property.
Not necessarily. Compare the effective rate, residual debt, flexibility, fees and fixed period.
Official information
Rules and amounts change. Always verify current requirements using official sources.
Related guides
Amounts and legal requirements can change. We verify this information against official sources and show when each figure was last checked, but always confirm important requirements with the responsible authority before you apply.
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