Financial · Glossary

BeleihungsauslaufLoan-to-value ratio

How banks tier your interest rate by loan-to-value

3 min read·Updated December 2024

Beleihungsauslauf is your loan amount as a percentage of the bank-determined property value (the Beleihungswert). It is the single biggest driver of which interest-rate tier you are offered.

How Banks Tier It

German banks set interest rates in tiers based on how much of the property’s value the loan covers, with typical break points near 60%, 80%, and 90%. The rate difference between tiers can be material, which is why some borrowers contribute more equity than the minimum to drop into a cheaper tier.

Key Points

  • Lower Beleihungsauslauf (more equity) usually means a lower interest rate
  • The Beleihungswert is the bank’s conservative valuation, often below the purchase price
  • The tier you land in compounds over the whole Zinsbindung, so it is worth optimising up front

See how much to allocate and finance

Continue in the masterclass

Lesson 2.3 · How property investment works in Germany

Financing

How German mortgages (Annuitätendarlehen) work, and financing as a non-resident.

Lesson 4.2 · Portfolio construction

How much to allocate

Sizing property against everything else you own.

Related Terms

Mortgage(Hypothek / Immobiliendarlehen)

A mortgage (Hypothek or Immobiliendarlehen) is a loan secured by property. In Germany, typical terms include 10-30 year fixed interest rates and 1-3% annual repayment rates.

Down Payment(Eigenkapital)

Eigenkapital (equity/down payment) is the cash you put down when purchasing property. German banks typically require 10-30% of purchase price plus closing costs (another 10-15%).

Interest Rate(Zinssatz)

The interest rate (Zinssatz) is the annual percentage charged on your mortgage. In Germany, rates are typically fixed for 10-20 years. As of 2024, rates range from 3.5-5%.

Planning a purchase?

Buying in Germany adds roughly 7% to 12% on top of the purchase price.

Transfer tax

3.5% to 6.5% of the price, set by the state.

Notary & registry

About 1.5% to 2%, fixed by law (GNotKG).

Agent commission

Usually around 3.57% as the buyer's share.

Run your full numbers How buying works here

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Beleihungsauslauf (Loan-to-value ratio) | Financemate Glossary