Mortgage Repayment Calculator Germany

Your Repayment Results

Your results show the direct impact of your inputs. The fixed monthly payment 1.660 € is the amount leaving your account each month for your fixed term, comprising both interest and principal.

In the first month, this payment breaks down into 1.107 € for interest and 553 € for principal. The most important number for future planning is the remaining debt after the fixed term: 250.522 €. This is the amount you will need to refinance at market rates when your term expires. The total cost of borrowing during this initial period is 117.722 €.

How your loan and costs break down

When buying a property, purchase fees of 32.000 € are added on top of the purchase price. The majority of the purchase fees must be covered by your equity. The remaining of your savings reduces the loan amount to 332.000 €. This corresponds to a loan-to-value ratio of 83 %.

How is your Mortgage Repayment calculated?

The vast majority of German mortgages are annuity loans (Annuitätendarlehen). Their defining feature is a constant monthly payment that provides excellent budget predictability for the entire interest fixation period. The payment is fixed for the duration of the fixed interest period. Every month, the same number.

This fixed payment is composed of two parts: interest (Zinsen) and principal repayment (Tilgung). In the beginning, most of your payment covers the interest. As you pay down the loan, the interest calculated on the smaller balance decreases. Since your total payment is fixed, a larger share automatically goes towards repaying the principal. This is how you build equity faster over time, even with a constant payment.

Formula

Monthly payment = Loan amount x (interest rate + Repayment) / 12

Example

So on a 300. 000 € loan at 3,5 % interest rate with a 2 % repayment rate, you'd pay 300.000 € x 5,5 % / 12 = 1.375 € per month. Inside that payment, the interest portion shrinks every year, and the principal portion grows. But you never notice because the total stays the same. When the fixed period ends, you refinance the remaining balance. The bank sets a new rate; you choose a new Tilgungsrate. Your monthly payment will likely change at that point.

Repayment table

Year-by-year breakdown: opening balance, interest paid, principal repaid, closing balance. The end of your fixed period is marked. That's the moment everything can change.

Your First Big Decision: Choosing the Right Repayment Rate (Tilgung)

Could paying off your loan too quickly be a mistake? For some, yes. Choosing your initial Tilgungsrate is a strategic trade-off between your current cash flow and your long-term goals.

A high repayment rate (3% or more): This is aggressive. Your monthly payments will be higher, but you will pay off the loan years sooner and save tens of thousands in interest. This path is ideal for those with high, stable incomes who want to be debt-free quickly. The downside is reduced liquidity for other investments or unexpected costs.

A low repayment rate (1,5% - 2%): This keeps your monthly payments manageable, freeing up cash. This is a smart choice if your income is currently constrained, but you expect it to grow, or if you want to maximise funds for other high-yield investments. The trade-off is a longer loan term, higher total interest paid, and a larger remaining debt (Restschuld) to refinance later.

Our advice: For most buyers with stable employment, an initial Tilgung of at 1,5 % is a prudent minimum. It strikes a good balance between manageable payments and making meaningful progress on your debt.

Your Second Big Decision: The Interest Fixation Period (Zinsbindung)

Choosing your Zinsbindung (interest fixation period) is a trade-off between cost and security. A shorter period (5-10 years) usually comes with a lower interest rate, but exposes you to the risk of higher rates when you refinance. A longer period (15+ years) offers security but at a higher initial rate.

Let's make this concrete. A 10-year fix might have a rate of 3,5 %, while a 15-year fix is 3,8 %. On a 400.000 € loan, that 0,3% difference costs you an extra 1.200 € per year. Are you willing to pay 12.000 € over the first decade for five extra years of certainty? That is the real question.

A longer fixation with a higher rate also means a slightly larger portion of your fixed payment goes to interest, not principal. This results in a marginally higher remaining debt compared to a shorter-term loan over the same period. The benefit is not faster repayment, but extended peace of mind.

Accelerating your repayment (Sondertilgung)

Most German mortgage contracts include a clause for Sondertilgung, or special unscheduled repayments. Typically, you are allowed to repay an extra 5 % of the original loan amount each year without any penalty.

Should you always make a special repayment when you have extra cash, like from a bonus? Not necessarily. Making a Sondertilgung is a guaranteed, risk-free return equal to your mortgage interest rate. If your rate is 4 %, you get a 4 % return on that money. However, if you are a confident investor and believe you can earn a higher average return 7 % in a diversified ETF portfolio over the long term, it is mathematically better to invest the cash. The choice is between the certainty of being debt-free sooner and the potential for greater wealth creation through investment.

Refinancing at the end of your fixed term

When your Zinsbindung ends, you will almost certainly have a large remaining debt (Restschuld). Arranging new financing for this amount is called Anschlussfinanzierung (follow-on financing), and managing this transition is the most critical long-term risk of homeownership.

The interest rate risk is real. Imagine your Restschuld is 300.000 € after 10 years. Your initial rate was 3,0%. If market rates for refinancing have risen to 5,0%, your annual interest cost jumps from 9.000 € to 15.000 €. Your monthly payment, just to cover interest and a minimum repayment, could increase by 500 € or more. This is why a higher initial Tilgung is so powerful: it shrinks the principal that will be exposed to this future risk.

You have three main options for your Anschlussfinanzierung:

1. Refinance with a new lender: This is often the best choice. Shopping around for competitive offers can save you thousands.

2. Prolongation: Your current bank will offer to extend your loan. This is convenient but rarely the cheapest option. Always compare it to the market.

3. Forward-Darlehen (Forward Loan): This allows you to lock in today's interest rates for a refinancing that is 6 to 66 months in the future. It provides security against rising rates but comes with a small rate premium.

Crucially, the § 489 BGB of the German Civil Code gives you the absolute right to terminate and refinance your loan with six months' notice once 10 years have passed since the full disbursement, regardless of your chosen fixation period. If you're in a 15 or 20-year fixed term and market rates have dropped significantly.

Assumptions

This calculator provides a clear forecast based on a standard set of assumptions. It's important to understand what they are.

Can I change my repayment rate during the fixed term?

Generally, no. The repayment rate is fixed in your contract. However, many modern contracts allow for one or two changes to the Tilgungsrate during the fixation period. This is a valuable feature to look for, as it allows you to increase your repayment speed if your income grows.

What happens if I need to sell the property before the fixed term ends?

If you sell your property and repay the loan before your interest fixation period is over, the bank is entitled to charge a significant prepayment penalty, known as a Vorfälligkeitsentschädigung. This fee compensates the bank for the interest income it will lose. This is a key reason why choosing a very long fixation period reduces your flexibility.

Why is the remaining debt still so high after 10 years?

In the early years of an annuity loan, a large portion of your fixed monthly payment goes towards paying interest, not principal. The pace of actual debt reduction accelerates significantly in the later stages of the loan. This is why it's so important to consider the remaining debt (Restschuld) when planning your follow-on financing.

• In Germany, you control the repayment speed by choosing an initial annual repayment rate (Tilgung), not a fixed 30-year term.

• Your monthly payment is constant, but the portion that pays down your actual debt increases over time.

• The biggest financial risk is the remaining debt (Restschuld) at the end of your fixed-interest period (Zinsbindung). Choose this period carefully.

• After 10 years, you have a legal right (§ 489 BGB) to refinance your mortgage, offering a valuable opportunity to find better rates.