FAQ

After working several years in the Real Estate industry, I decided to become a mortgage broker. 

From personal experience I noticed that it is still very complicated and often quite expensive to get good mortgage rates in the market, especially if you are not a native German. This is why I decided to fill that gap and help more people become a homeowner.

This is why you should choose me: 

I work on my own and can advise you remotely wherever you are in Germany. I can offer you the best rates since I don’t rent an impressive office building where my assistant would bring you fresh latte when you visit. With me, you get what you are looking for: The best rates in the market. And all the support to make it as easy as possible.

I work  transparently and if necessary very quickly to find and apply for the best mortgage, comparing rates from more than 400 banks. 

You want to know more about me? Find out on my about page.

1: Let’s get started: All you need to do is share some details about your situation and the desired property. Remember: my consultancy is free and non-binding. You should compare the rates I offer you with other brokers. I sincerely doubt you will find better conditions. If this is the push you need, get started now! 

I am available almost 24/7 via text and video here. (though I’d prefer to chat with you during business hours).

2: Comparison of mortgage rates  After receiving your request I will get back to you within 24 hours with the mortgage rates and options that are relevant for you. Again, comparisons of the mortgage rates I offer with competitors are encouraged.

3: We talk, you choose: After finding out my mortgage rates are the best and you really want to buy, lets talk. I will guide you through the German mortgage process and explain requirements. My job will be to make it as easy as possible for you. All you need to to is getting me documents I am asking for and choosing a mortgage option. Then I can apply officially to the bank for a mortgage.

4: Secure your mortgage:  I am doing all the paperwork now for you and keep you posted on any update in real- time. Once your mortgage is secured I will be at your side throughout the following process. This is not part of the job as a mortgage broker but I want to make sure you are in safe hands. Call me whenever you need me or have questions!

The short answer is: Yes! 

Most mortgage brokers in Germany are paid directly by the banks that offer the mortgage.

So am I. You will never get a bill from me.

You can be assured I will choose the rate that is best for you, not the bank that pays me more.

The fee is included in the mortgage rate and is a tiny share. After my mortgage rates are highly competitive you can be sure to get the best deal possible.

I have access to mortgage rates from more than 400 banks. From major German lenders, such as Deutsche Bank or Commerzbank, to small regional banks, I cover almost any bank that offers mortgages. Every bank offers different rates and certain banks prefer certain types of borrowers, so it is a good thing that, with me, you are able to “shop around” and compare to get the best rate available.

For communication you can call me by phone, send a text on whatsapp, schedule a meeting where I can call you, meet me on zoom or skype, send mail,… you name it. Just check out my contact page. In a hurry? Send a mail to hello@german-mortgage.de or a text to 0176-222 34 333

I get back to you within 24 hours.

If it is urgent, just send me a short text to +4917622234333 and I will call you back immediately.

I can get you a mortgage in 48 to max. 72 hours once you have given me all the documents that we need to apply.

Your personal situation is decisive for getting approved for a mortgage in Germany.

For example, having a lot of cash on hand for a big down payment is not a guarantee for approval. It is also not a pre-requisite!

There are some things you should consider when applying for a mortgage. I can help you understand how the process works and what is a good solution in your specific case.

In most cases, you only have to pay the “Nebenkosten” out of pocket as the minimum requirement.

It is around 8 % of the price of the property. 

But as soon as a real estate agent comes into play, you also need to pay them- which ups the amount to around 15 % in total that you have to pay out of pocket. The reason: banks in Germany will only lend you money with the property as collateral. The amount for “Nebenkosten” like paying a real estate agent’s fee is not secured by the worth of the property.

Still in some cases, even for this you can find some flexibility, for example if you buy real estate way under current market prices. In this seldom case, you can take out a mortgage that covers the entire costs without any down-payment or out of pocket expense.

That depends very much on the price of the property you want to buy. 

German banks won’t like it if your monthly mortgage rate amounts to, lets say, 80% of your net income. This is too risky for the bank, since any unforseen event in your financial situation could prevent you from fulfilling your side of the contract.

Banks in Germany like security, and are always interested in you paying back the mortgage.  Whereas in other countries it is a business model to speculate on the borrower defaulting on their loan (subpar lending), the cancellation of the contract and then subsequent  acquisition of the property, this is definitely not the case in Germany.

This is why banks in Germany are so strict when approving a mortgage.

These are some of the most important documents:

• Proof of equity
• Income tax assessments
• Last 3 Payslips
• Certificate of wage tax deduction
• Annual bank statements
  
• Property documents 
• Purchase contract

But don’t worry, I will guide you through the entire process comfortably.

“Mortgage” in German means “Immobiliendarlehen” or “Immobilienkredit”.

In the past it was also translated as “Hypothek” but today, this is technically not the right term to translate “mortgage”.

Great question:)

The “Annuitätendarlehen” is the most common type of mortgage for private individuals who buy property in Germany.

The main characteristics are that you pay back the same amount of money each month. In the beginning that amount is comprised of a sizable chunk of interest and a bit of the amount you owe. In time, this reverses where you mostly pay back the amount you owe and a tiny bit of interest. This type of mortgage is a great way to ensure your cashflow and guarantee liquidity.

You usually translate “Fixed term of interest rate” as “Sollzinsbindung”.

The fixed term of interest rate defines how long the interest rate is guaranteed in the contract.

Now, interest rates are on a historical low. This is why many people decide to apply for a long fixed term of interest rate of 20 years and more.

Of course, the longer the term, the higher the interest rate.  

Let’s delve into the differences between the Sollzins (also known as the Nominalzins) and the effektiver Jahreszins (effective annual interest rate) in the context of German mortgages. The Sollzins is always the first number, the Effective Interest Rate the second (e.g. 3.43% / 3,53%).

When comparing mortgage options, you should always compare the effective interest rate and not the Sollzins because it does not reflect all costs of the mortgage for you.

In detail: 

1. Sollzins (Borrowing Rate):

   • The Sollzins represents the basic interest rate that a lender charges for providing a loan. It is expressed as a percentage and typically calculated annually.
   • For example, if you borrow €1,000 at a Sollzins of 10%, you’ll need to repay not only the borrowed amount but also an additional €100 (10% of €1,000) to the bank after one year.
   • Historically, the term “Nominalzins” was used interchangeably with Sollzins.

2. Effektivzins (Effective Annual Interest Rate):

   • The effektiver Jahreszins takes into account not only the Sollzins but also other associated costs, such as administrative fees, brokerage fees, or other charges.
   • By considering these additional costs, the effektiver Jahreszins provides a more accurate assessment of the total financial burden.
   • It allows borrowers to compare different loan offers effectively.
   • Remember that the loan amount and the loan term should be consistent when comparing different offers.

In summary, while the Sollzins reflects the interest rate solely on the borrowed amount, the effektiver Jahreszins provides a more comprehensive view by factoring in all associated costs. When evaluating mortgage options in Germany, paying attention to both rates ensures a better understanding of the overall financial impact. 🏠📊¹