What Counts as Eigenkapital? All Equity Sources Banks Accept

"When a German bank assesses your Eigenkapital (equity), it doesn't simply ask 'how much money do you have?' It evaluates each source by liquidity, certainty of value, and accessibility. Some assets are credited at full value, others are discounted significantly, and some are not recognised at all. Understanding these distinctions is critical for structuring your financing effectively — and for knowing exactly where you stand before approaching a bank.",

Tier 1: Fully Accepted at Face Value

"These sources are treated as 'real' equity with no discount. Banks will credit them at 100 % of their current balance:",

Cash in German bank accounts (Girokonto, Tagesgeld, Festgeld): The gold standard. Banks verify balances through statements.
Bausparvertrag balance: Fully accepted, especially if held at a partner Bausparkasse.
Documented family gifts: Accepted at full value when accompanied by a Schenkungsbestätigung (gift letter) confirming the gift is unconditional and non-repayable.
Proceeds from property sale: If you've sold another property and the funds are in your bank account, they count fully.

"The key factor is that these assets are liquid, denominated in euros, and verifiable through official statements. The fewer steps between the asset and the bank's account, the better.",

Tier 2: Accepted at Discounted Value

"These assets are recognised but valued below their market price to account for volatility or conversion risk:",

Securities and ETF Portfolios (50–80 % valuation)

"Stocks, bonds, and ETFs in a German depot are accepted, but banks apply a haircut to reflect market risk. A €100,000 portfolio might be credited as €50,000–€80,000 of Eigenkapital depending on the bank and asset type. Conservative bond funds receive a higher valuation than volatile individual stocks. Many borrowers choose to liquidate their portfolio and deposit the proceeds before applying, thereby receiving 100 % credit.",

Foreign Bank Accounts (80–100 % valuation)

"Cash held in reputable foreign banks (US, UK, other EU countries) is generally accepted but may require evidence of transferability. Some banks discount by 5–10 % for currency-conversion risk or simply require you to transfer the funds to a German account before closing. Accounts in non-OECD countries may receive lower valuations or be rejected entirely.",

Life Insurance Surrender Value (80–95 % valuation)

"The Rückkaufswert (surrender value) of a Lebensversicherung or Rentenversicherung is widely accepted. Banks may require assignment of the policy as additional security rather than liquidation. The valuation depends on the insurer's financial strength and the contract's terms.",

Existing Property Equity (bank-determined valuation)

"If you already own property, the free equity (market value minus outstanding mortgage) can count towards your Eigenkapital. However, the bank will value the existing property using its own conservative Beleihungswertermittlung, which typically yields 10–20 % below market value. You may also be asked to provide a Grundbuchauszug and recent valuation.",

Tier 3: Conditionally Accepted

"These sources may be considered by some banks under specific circumstances but are not universally accepted:",

Employer-provided loans: Some banks treat these as equity if the terms are very favourable (zero interest, long repayment). Others treat them as existing debt, which reduces borrowing capacity.
Gold and precious metals: A few banks will consider physical gold at market value with a significant haircut (30–50 %). Most mainstream banks don't.
Muskelhypothek (sweat equity): Your own construction or renovation labour can be credited as equity, typically €15,000–€30,000. Mainly relevant for new-build or major renovation projects.
Vested stock options (publicly traded): Accepted by some banks at a discounted value, but you'll need to demonstrate they're exercisable and liquid.

Tier 4: Generally Not Accepted

"Banks almost universally reject the following as Eigenkapital:",

Cryptocurrency: Too volatile and regulatory uncertainty. Even if you hold €200,000 in Bitcoin, no mainstream German bank will count it. Liquidate and deposit the proceeds if you want to use it.
Unvested stock options or RSUs: Not yet your property — banks won't speculate on future vesting.
Expected inheritance: No matter how certain, it's not money you have today.
Future bonuses or commissions: Banks assess based on documented past income, not future expectations.
Borrowed money presented as equity: Banks check the origin of large deposits. A personal loan repackaged as 'savings' will be flagged as Fremdmittel (borrowed funds) and reduce your borrowing capacity rather than increase equity.
Company equity in private firms: Unless the company is publicly listed and your shares are freely tradable, banks can't assign a reliable value.

How Banks Verify Your Equity

"Banks typically require 3–6 months of account statements for each equity source. They look for:",

Consistency: Is the balance stable or growing, or does it spike suspiciously just before the application?
Origin of large deposits: Any deposit above a few thousand euros will be questioned. Be prepared to explain the source (salary, gift, sale proceeds, etc.).
Seasoning: The longer money has been in your account, the better. Banks prefer to see equity that's been held for at least 3 months.
Gift documentation: Family gifts require a written Schenkungsbestätigung. Verbal commitments are not sufficient.

Structuring Your Equity for Maximum Impact

"Knowing how banks value different sources allows you to optimise your presentation. Practical steps:",

Liquidate securities into a German bank account 3+ months before applying. This converts a 50–80 % valued asset into a 100 % valued one.
Transfer foreign-held cash to Germany well in advance. This removes currency and transfer-risk discounts.
Document family gifts early: have the gift letter signed and the transfer completed months before application.
If using a life insurance surrender value, request a current Rückkaufswert statement from the insurer.
Consolidate accounts: fewer statements mean a cleaner, faster application process.

Key Takeaways

"German banks classify equity sources into tiers based on liquidity and certainty. Cash in German accounts and documented gifts receive full credit; securities and foreign accounts are discounted; crypto and unvested options are rejected. Strategically restructuring your assets before applying — liquidating, transferring, and documenting — can meaningfully increase your recognised Eigenkapital and unlock better rates.",