Mortgage Calculator 2026

A common rule of thumb is that your monthly mortgage payment should not exceed 35% of your household net income. For a net income of 4,000 EUR, that would be a maximum of 1,400 EUR per month. Many financial advisors recommend staying at 30% to maintain a buffer for unexpected expenses, repairs, or temporary income loss. Additionally, keep at least 3 monthly payments as an emergency reserve.

Ideally, you should bring 20-30% of the purchase price as equity. At a minimum, purchase costs (8-15% depending on the federal state) must be covered with your own funds, as banks typically do not finance these. A 100% mortgage without equity is possible with some banks but comes with significantly higher interest rates and greater risk. The more equity you contribute, the better your interest rate conditions will be.

Purchase costs are additional costs on top of the property price that apply to every real estate transaction. They consist of: property transfer tax (3.5-6.5% depending on the federal state), notary and land registry fees (approx. 1.5-2%), and potentially broker fees (3.57-7.14% incl. VAT). In total, expect 8-15% of the purchase price in additional costs. These should be paid entirely from equity, as they do not increase the property value.

The nominal interest rate (Sollzins) is the pure interest rate the bank charges for the loan. The effective interest rate (Effektivzins) additionally includes all other costs such as processing fees, account management fees, and the effect of repayment scheduling. The effective rate is therefore always slightly higher than the nominal rate and reflects the true annual cost of the loan. Always compare offers based on the effective interest rate, as only this allows a fair comparison.

A longer fixed-rate period (e.g., 15 or 20 years instead of 10) typically costs a rate premium of 0.2-0.5 percentage points. In return, it protects against rising interest rates and provides planning certainty over a longer period. In a low-interest-rate environment, a long fixed-rate period is particularly advisable as you lock in favorable conditions long-term. When rates are high, a shorter period may make more sense if you expect rates to fall.

When the fixed-rate period expires, the remaining debt must be refinanced - this is called Anschlussfinanzierung. You can request a new offer from your current bank (prolongation) or switch to a different bank (refinancing). The follow-up financing is then at the current market rate, which may be higher or lower. With a forward loan (Forward-Darlehen), you can lock in favorable rates for your refinancing up to 5 years in advance.

Extra repayments can significantly reduce interest costs. Example: On a loan of 300,000 EUR at 3.5% interest and 2% repayment, an annual extra repayment of 5,000 EUR saves tens of thousands of euros in interest over the full loan term. At the same time, the loan term is shortened by several years. Most contracts allow 5-10% extra repayment per year. Use this option whenever you have the financial flexibility.

Yes, some banks offer 100% financing or even 110% financing (including purchase costs). However, interest rates for full financing are significantly higher - often 0.5-1.0 percentage points above the rate with 20% equity. The risk is also greater: if property values decline, you could quickly owe more than the property is worth. Full financing should only be considered if you have a high, stable income.

Germany offers various subsidy programs: KfW provides low-interest loans for energy-efficient construction and renovation (e.g., KfW program 261). For families with children, there are successor programs to the Baukindergeld that vary by federal state. Additionally, some federal states support the purchase of owner-occupied housing with their own programs. Check with your municipality and KfW for current funding opportunities.

The repayment rate has an enormous impact on the total loan term. At an interest rate of 3.5%, it takes about 46 years to fully repay the loan with an initial repayment rate of 1%. With 2% repayment, it takes about 30 years, and with 3% repayment only about 24 years. Each additional percentage point of repayment saves tens of thousands of euros in interest over the loan term. A minimum initial repayment rate of 2%, ideally 3%, is recommended.