Sondertilgung: A popular but overrated option

Who doesn't like the idea of being able to repay extra on their mortgage? That is what “Sondertilgung” is. But is it a good idea?

Dr. Chris Mulder

Dr. Chris is a former Senior Economist and Manager at the IMF and The World Bank. He is a Hypofriend Co-founder.

Published on Jun 25, 2020 Published on Jun 25, 2020 . Updated a month ago

Dr. Chris is a former Senior Economist and Manager at the IMF and The World Bank. He is a Hypofriend Co-founder.

Who doesn't like the idea of being able to repay extra on their German mortgage without penalties? That is what “Sondertilgung” is, and virtually every mortgage borrower wants it. It is a great sales argument for advisors: If you were to use your extra payments/savings/bonuses, you could be done with your mortgage by year "X".

Why is Sondertilgung by and large a dead option?
Is Sondertilgung at the present juncture hence an entirely bad idea?

Dr. Chris Mulder

Dr. Chris is a former Senior Economist and Manager at the IMF and The World Bank. He is a Hypofriend Co-founder.

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Sondertilgung A Popular But Overrated Option For Your German Mortgage

Sondertilgung: A popular but overrated option

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