German law does not stop foreign nationals from buying property, or from borrowing to do it (Bundestag research service, 2024). What decides whether you get a mortgage, and on what terms, is the lender's credit assessment. On residence status, job security and foreign income, lenders apply different policies to the same facts, which is why one refusal is not the whole market's answer.
1. What the lender has to check
Before granting an Immobiliar-Verbraucherdarlehen (consumer mortgage), a lender must assess your creditworthiness and may lend only if it is likely that you will meet your obligations (§ 505a BGB). A regulation on these checks, the ImmoKWPLV, sets out how. Three of its rules matter most to internationals:
- the forecast has to cover the period over which the loan's obligations run (§ 3(2));
- likely negative events must be allowed for, and the regulation's own examples include an adverse movement in exchange rates (§ 4(3));
- the value of the home being bought may only play a supporting role; the assessment must rest mainly on income, outgoings and other assets (§ 4(2)).
Within that framework each lender writes its own credit policy, so lenders can reach different answers on the same application.
2. Residence status: EU and non-EU
EU and EEA citizens need no residence permit to live and work in Germany (§ 2a and § 12 FreizügG/EU), so permit type and validity do not come into it. Everything else in this guide still applies.
Non-EU citizens need a residence title that allows work (§ 4a AufenthG), and lenders look at two things: its type and how long it has left to run.
- A Niederlassungserlaubnis (settlement permit) has no expiry date (§ 9 AufenthG), and nor does the Erlaubnis zum Daueraufenthalt-EU (permanent EU residence permit, § 9a AufenthG). The validity question falls away.
- A time-limited Aufenthaltserlaubnis (residence permit) or EU Blue Card raises it, because the loan runs for decades and the income behind it depends on the right to stay. Some lenders lend on time-limited permits, often asking for more equity; others wait for a settlement permit.
Status can change during a search. Blue Card holders can apply for a settlement permit after 27 months of employment on the card, or 21 months with German at B1 level, if the other conditions are met (§ 18c(2) AufenthG).
3. Employment, probation and self-employment
- Permanent or fixed-term. An unbefristeter Arbeitsvertrag (open-ended contract) is the straightforward case. For a befristeter Vertrag (fixed-term contract), the rules allow a lender to count on an extension or conversion to permanent where that is likely, but do not require it to (§ 4(4) ImmoKWPLV).
- Probation. During an agreed Probezeit (probation period) of up to six months, the job can be ended with two weeks' notice (§ 622(3) BGB). Many lenders wait until probation is over; some lend earlier, for example where the employer confirms in writing that the job will continue, or a second borrower has secure income.
- Self-employment. Income has to be shown over time. Lenders commonly ask for the last two to three years' accounts and Einkommensteuerbescheide (income tax assessments) and work from an average.
4. Foreign income, SCHUFA and equity
- Income in another currency. Because a fall in that currency has to be allowed for, lenders differ in how much of such income they will count.
- SCHUFA. This private credit bureau records credit contracts and payment problems. A short history is normal for new arrivals; entries for unpaid debts count against a borrower. Anyone can request a free copy of the data SCHUFA holds (the "Datenkopie nach Art. 15 DS-GVO"). Since March 2026 SCHUFA has been phasing in a new score on a scale of 100 to 999.
- Equity. Lenders generally expect at least the purchase costs (transfer tax, notary, land registry and any agent) to come from Eigenkapital (your own funds), and usually part of the price too; more equity generally means a lower rate. Our guide to buying a home sets out those costs.
5. Why financing experts compare many lenders
Since lenders apply different policies to the same facts, the question is often which lenders will accept an application at all, before which is cheapest. A financing expert (legally an Immobiliardarlehensvermittler, a mortgage intermediary) can put one application to many lenders; larger ones work with several hundred banks, insurers and Bausparkassen (building societies).
Those based in Germany need a licence under § 34i Gewerbeordnung (Trade Regulation Act), which can be checked in the public Vermittlerregister (intermediary register). Before acting, they must tell you which register they are in, whether they work only with certain lenders, how their pay is calculated, and whether lenders or others pay them commission, and how much (Art. 247 § 13b EGBGB). If you agree to pay them a fee, it is owed only once the loan has been paid out and you can no longer withdraw (§ 655c BGB). A Honorar-Immobiliardarlehensberater (fee-based mortgage adviser) must consider a sufficient range of loans on the market and may not accept payments from lenders (§ 34i(5) GewO).
6. How a German mortgage is built
Most home loans are an Annuitätendarlehen (annuity loan): a fixed monthly payment that covers interest and repayment. As the balance falls, the interest share shrinks and the repayment share grows.
- Zinsbindung (fixed-rate period). The rate is fixed for a set period, commonly 10 or 15 years, with 5 to 20 years or longer available. Longer periods usually cost a higher rate. Unless the loan is repaid by then, a follow-up loan is needed when the period ends; see our guide to a fixed rate ending.
- Tilgung (repayment rate). The initial repayment is a percentage of the loan per year, and it decides what is still owed when the fixed rate ends. On €300,000 at 3.5 per cent, an initial 1.3 per cent leaves about €253,000 after ten years; 2.9 per cent leaves about €196,000. Our mortgage calculator runs the same arithmetic on your own figures.
- Sondertilgung (special repayment). Many contracts allow extra repayments of 5 or 10 per cent of the loan a year without charge, if agreed at the outset.
A fixed rate longer than ten years has a statutory exit: ten years after full payout, the borrower can end the loan with six months' notice and no early repayment charge (§ 489 BGB).
7. KfW loans
KfW, the state-owned promotional bank, offers low-interest loans for owner-occupied homes. Programmes and conditions change regularly: some, such as Wohneigentum für Familien, are for families with children and have income limits, some are tied to energy standards. The published conditions are addressed to private individuals and set no citizenship requirement.
- Applications go through a bank, insurer, building society or financing expert, not to KfW directly.
- For a purchase, the application has to be made before the notarial purchase contract is signed, because signing counts as the start of the project. For the family programmes it must have reached KfW by then, unless the contract is made conditional on KfW's commitment (KfW conditions for programme 300).
- The family programmes prove their income limits with income tax assessments for the second and third calendar years before the application; foreign tax certificates count with a certified translation (KfW programme 308).
Our guide to KfW loans for home buyers goes through each programme, the family income limits and the timing.
8. The 14-day right of withdrawal
A consumer mortgage can be withdrawn within 14 days without giving reasons (§ 495 and § 355 BGB). The period starts with the contract, but not before you have received the contract document (§ 356b(1) BGB). If the information on the withdrawal right was missing, the period starts only once it is supplied, and is then one month; for home loans the right ends at the latest 12 months and 14 days after the contract, or after you received the contract document if that was later (§ 356b(2) BGB).
- Before you sign, the lender must give you the European Standardised Information Sheet (ESIS) with the key terms (Art. 247 § 1 EGBGB).
- If the loan contract itself is notarised and the notary confirms your rights were respected, there is no withdrawal right; instead you must have at least seven days to consider the offer before signing (§ 495(2) and (3) BGB).
- In the normal case, withdrawing from the loan does not undo a property purchase already signed at the notary (§ 358(3) BGB).
This is why timing matters: a loan signed shortly before the notary appointment can still be withdrawn if the purchase falls through, while a signed purchase is not undone because the loan failed, unless the contract provides for that.
The short version
Lenders must be satisfied that repayment is likely over the life of the loan, and for internationals that turns on residence status and how long it lasts, the type of employment and whether probation is over, the track record behind self-employed income, the currency of income and the equity available. Policies on each point differ between lenders, which is why financing experts compare many of them. The loan itself is usually an annuity loan, commonly fixed for 10 or 15 years; KfW loans must be applied for before the purchase contract is signed; and the loan can be withdrawn within 14 days, while the notarised purchase cannot.
Primary sources checked on 1 November 2026: the statutes and official pages linked above.