Berlin residential invesment
2023-03-16 05:29:09 | INSIGHTS
How to obtain financing as a foreign investor in Germany
AUTHOR: Alexandra Harrison

How to obtain financing as a foreign investor in Germany 


In short, obtaining a mortgage is relatively simple as a foreign investor - 

  • Minimum 60% LTV on all German projects
  • Interest rates currently 3.85% for a 5 year fix & 3.91 for a 10 year fixed rate. 


In more detail, here are the ins & outs of obtaining a mortgage;


We have multiple mortgage providers who we work with to help you secure financing. Our go to lender is a pension fund which offers a 60% LTV, 3.91% fixed interest rate for 10 years & 3.85% for 5 year fixed. Our clients have had a 100% success rate with this lender. We also work with banks who may be able to offer higher LTVs but at higher rates. 


We are happy to introduce you to our long standing partners at Berlin Finance or Baufi Nord (mortgage consultants), who are adept at dealing with foreign investors. We can make the introduction prior to purchase so you feel secure in the fact that you will obtain lending. They will ask you to fill in a form to assess your current financial position and will suggest the lender they see as most appropriate. 


If you have a secure job and 40% of the purchase price in the bank, you should have no trouble in securing a mortgage. 


If you use our go to lender, pension fund VZN, then you will need a European bank account to make repayments. This is easy to accomplish using online bank accounts such as Wise or N26. 


We asked our partners at Baufi Nord for their current reading of the market - 

- Financing up to 100% of the purchase price is possible for German, Austrian or Swiss passport holders.

- This also applies to married couples where only one of them is a German citizen

- For non-German customers living in Germany, financing is possible up to 100% of the purchase price


As for the application procedure, the entire financing process is digital (documents are exchanged via email) and can be processed remotely. This means that the customer does not have to travel to Germany to sign the loan agreements. Baufi Nord can send the contracts no matter where you live in the world.


Every customer receives an individual financing offer tailored to their needs for the property they are interested in. The Baufi Nord team are available to customers for personal conversations via telephone or video call at any time & will guide you every step of the way. 


Don’t hesitate to reach out if you are interested in understanding your lending options before investing in Berlin. 




AUTHOR:
Alexandra Harrison
Associate
alex.harrison@volsung.com

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