Mortgages for foreigners
Can foreigners invest in German real estate?
First, a quick note on the term foreign nationals: this refers to people who do not hold a German passport. But what if someone without German citizenship still wants to finance a property in Germany?
As a foreign national, you might think investing in German real estate is daunting. Granted, dealing with the infamous German bureaucracy and overcoming possible language barriers sounds like a Herculean task — especially if you don't have any reliable contacts to turn to. It's also why many people, even German citizens, dismiss the idea of buying real estate as a capital investment.
But it’s completely normal to feel a bit intimidated by the process. Even many Germans think buying an investment property is out of reach. Yet there are plenty of good reasons to do it — and it’s actually not that complicated if you have the right support. Keep reading to find out how your residence status and residence permit can affect your financing options — and how Urbyo can help you along the way.
- Options For Foreign Nationals
- Overview
- Summary
- Support
- FAQ
Which Financing Options Do Foreign Nationals Have In Germany?
Let’s start with the good news: in principle, any foreign national can take out a loan, buy property, and become an owner in Germany. Many banks offer financing options for both German citizens and non-Germans. So yes — you can buy property in Germany even without holding German citizenship. In many cases, banks even offer financing without requiring any equity. Case closed, right?
Well, not entirely. Since the Residential Real Estate Credit Directive came into effect in 2016, the situation has become a bit more restrictive for tax non-residents and cross-border commuters. Still, it’s definitely possible. The exact requirements for obtaining a mortgage depend on the individual bank. Naturally, your financial situation is one of the key factors — banks will look at your savings, household income, and expenses. That applies to everyone. Beyond that, however, German banks are also interested in your current residence status. Depending on that status, you may have access to different types of financing models.
Financing Options by Residence Status: Loans for EU and Non-EU Citizens
The financing options available to you depend on your residence status. Depending on your specific situation, you can still qualify for full financing, open a building savings contract and get a mortgage — even without German citizenship. To give you a better overview of what’s possible, we’ve put together a handy summary of the different options available to you:
| Residency status | Options |
|---|---|
| EU Citizens & Permanent Residents (Niederlassungserlaubnis) | Thanks to the EU's open-border policy, EU citizens get pretty much equal benefits compared to German citizens. If you qualify as a permanent resident and worker (and are therefore a taxpayer) in Germany, you can apply for a mortgage to cover up to 100% of the property value. In theory, some banks even go the extra mile and offer financing with no down payment. The availability of this option depends heavily on the region, your financial situation, and the property itself. |
| Blue Card Holders | If you've got a high-skilled worker visa, you may qualify for a mortgage that covers up to 100% of the property value. If successful, you'll only have to pay the ancillary purchase costs yourself, which amount to 10-15% of the purchase price). Got an EU Blue Card? Then you can improve your chances by applying for a permanent residence permit (Niederlassungserlaubnis). To qualify, you need to have lived in Germany for 33 months. And if you're well-versed in the German language and have acquired a B1 level, you can already apply after 21 months. |
| Other non-EU Nationalities | Most banks will consider you a high-risk applicant if you're not from an EU country. Therefore, they'll request a larger down payment, usually starting at 30%, and won't cover your ancillary purchase costs. As a result, you'll need more equity to seal the deal. Keep in mind that the German government also offers permanent resident visas to people who aren't EU Blue Card holders. Since the permanent residence visa gives you access to better financing, it might make sense for you to wait before applying for a mortgage — at least if you're close to being eligible. |
In A Nutshell
Regardless of your visa status, banks will always want proof of the following things before giving you a
You can legally reside, receive an income (paid in euros), and pay taxes in Germany
You've got a good credit score (SCHUFA)
You have the necessary equity to cover the down payment and the ancillary costs (when needed)
You can comfortably pay the monthly installments according to your household budget calculation
How Can Urbyo Support Me?
There's no reason why buying real estate in Germany should be difficult — for you or anyone. With Urbyo, you'll get the support you need to get your hands on the property you want, with the best financing you can get.
You can use our platform to find great investment opportunities, along with all the relevant details and calculations you need to make an informed decision and optimize your cash flow in the future. And why stop there? Once you've found the right property, our financial experts will filter out the mortgage deals that match your needs. Our team will even help you find a notary in your area. All you need to do is hire a translator to accompany you to the appointment. Or have us go to the notary appointment for you and confirm it at a later date. Pretty convenient, right?
Tell me more about the Urbyo Process
As you can see, buying real estate in Germany as a foreigner really isn't as complicated as it looks. If you have any further questions, don't hesitate to contact us —or simply let the Urbyo community answer them for you.
