Fixed-rate periods and refinancing in Germany
Plan for the end of your mortgage’s fixed-rate period: compare lender renewal, switching and forward loans, and understand the limits of cancellation rights.
Last updated: 18 September 2026
Contents
Separate rate security from debt repayment
Your fixed-rate period states how long the agreed interest rate applies. The repayment schedule determines how much debt remains. Start with the projected balance at the end of the fixed period, then test whether your budget could support it at a higher rate.
For illustration, a €200,000 remaining balance at an assumed 5% nominal rate and 2% initial repayment implies about €1,167 per month initially. At an assumed 3% rate with the same repayment assumption, it is about €833. Neither figure predicts future market rates or includes fees.
Renew, switch lender or agree a forward loan
A renewal keeps the loan with the current lender under new terms. It may reduce administrative work, but the renewal offer should still be compared. Switching can offer different pricing or flexibility; include any valuation, security transfer and other relevant costs.
A forward loan agrees funding for a later date. It can make future payments more predictable, but pricing includes that timing and the commitment remains even if market rates fall. Confirm the exact start date, amount, drawdown conditions and consequences if plans change.
Check the dates before relying on a cancellation right
Under § 489(1)(2) BGB, a borrower with a fixed borrowing rate may generally terminate after ten years from full receipt of the loan, with six months’ notice. A later agreement concerning repayment timing or the borrowing rate can replace the original starting date. This is not simply “ten years after signing”.
Keep the full-disbursement record and all later amendments. Ask the lender or a qualified adviser to establish the notice and repayment dates before committing to replacement funding. Other early exits may involve compensation; the applicable contract and legal circumstances matter.
Prepare a comparable set of offers
- Record the existing fixed-rate end, outstanding balance and any notice obligations.
- Update income, expenses, savings and property documentation.
- Decide how much cash to repay without exhausting your reserve.
- Compare equivalent borrowing amounts, repayment rates and fixed periods.
- Coordinate old-loan redemption and new-loan availability; avoid a funding gap.
Start gathering information well before your contractual deadline so there is time for competing offers and documentation. There is no universally optimal month to lock a rate.
Prepare your refinancing enquiry or consider renovation funding separately if you also plan building work.
Frequently asked questions
Should everyone choose the longest fixed-rate period?
No. Compare the cost of certainty with your repayment plan, likely remaining debt and possible life changes. A longer fixed period is not a guarantee that the whole loan will be repaid.
Can I cancel ten years after signing?
For the statutory right under § 489(1)(2) BGB, the ten-year period generally starts with full receipt of the loan, not signing. Six months’ notice is required. A later agreement on repayment timing or the interest rate can change the starting point. Have the dates checked for your contract.
Can I simply ignore a forward loan if rates fall?
No. A forward loan is a contractual commitment, not a free option. Failure to draw it can create costs. Review its terms and your expected funding need before signing.
Sources and editorial scope
Source check and editorial revision: 18 September 2026. The linked German-language primary sources take precedence. Examples are illustrative, not offers. This guide provides general information, not individual financial, tax or legal advice. A lender must assess your specific circumstances.