Mortgage in Germany With No Down Payment

You worked out that buying beats renting for your situation, and you understand how a German mortgage is structured. Then you checked your savings account: nowhere near the 20% Eigenkapital every guide assumes. Before you write off buying for another five years, it's worth knowing exactly what a no-deposit mortgage costs and who actually qualifies.

100% vs 110%: two different products, not one

"Financing without Eigenkapital" gets used loosely, but the two structures differ in what they actually cover:

• 100% Finanzierung (100% financing) — the bank lends the full purchase price. You still pay Kaufnebenkosten (notary, land transfer tax, agent fee — typically around 10% of the price) out of pocket, so you need some cash, just not equity toward the property itself.
• 110% Finanzierung / Vollfinanzierung (full financing) — the bank lends the purchase price plus the closing costs. This is the genuine zero-cash-down route, and it carries the largest surcharge because the bank is now exposed beyond the property's own value.

Our mortgage mechanics guide covers Sollzins, Tilgung and Sollzinsbindung in detail if those terms are new — this article assumes you already know the shape of a German mortgage and focuses on the one variable that changes when Eigenkapital drops to zero: risk pricing.

The real cost: the rate surcharge

Lenders price loan-to-value in tiers, and the tiers above 100% get materially more expensive. fmh.de's lender comparison puts the average surcharge at +0.70 percentage points for 90–100% financing, rising to roughly +1.2pp — or a separately negotiated rate — above 100%. Dr. Klein's own worked example shows a similar pattern: a 100%-financed loan priced noticeably above the same loan with equity behind it, because the bank carries more risk without a deposit cushion.

Here's what that surcharge does to a real purchase. Using a €350,000 property, a 10-year fixed rate, and a 2% initial Tilgung — with a baseline 10-year rate of 3.99%, the low end of Interhyp's published range for the week of 7–13 September 2026:

Financing	Loan amount	Rate	Monthly payment	Interest paid over 10 years
80% LTV (20% Eigenkapital)	€280,000	3.99%	€1,398	€99,040
100% financing	€350,000	4.69%	€1,951	€145,055
110% Vollfinanzierung	€385,000	5.19%	€2,307	€176,156

Own calculation: constant monthly payment, interest charged monthly on the remaining balance, illustrative rates from the sources above — not a quoted offer for any specific borrower.

The jump from 80% to 100% financing is a larger loan and a higher rate stacked together — that's €46,000 more interest paid over just the first ten years, before either loan is anywhere near paid off.

What lenders actually require

None of this is available on request — full financing is underwritten more strictly, not less. Recurring conditions across lender guidance:

• A flawless Schufa file. Dr. Klein's guidance is direct: "a high, secured income and a flawless Schufa score are essential" for full financing — not merely good, flawless. Any negative entry tends to end the conversation before pricing even starts.
• Income headroom. The commonly cited ceiling is spending no more than 35% of net household income on the mortgage payment (Zins + Tilgung) at this risk tier, tighter than the 35–40% range typically quoted for standard financing.
• Secure employment. An unbefristete (permanent) contract, ideally with several years' tenure, weighs heavily — Beamte on lifetime tenure get preferential pricing precisely because a bank's income-loss risk on them is close to zero.
• A property worth the risk. Lenders are reluctant to finance 100%+ of a property with deferred maintenance or in a weak local market — without an equity cushion, a forced sale needs to cover the full loan.

The bar nobody's German-language guide mentions: being new to the country

Every source above assumes a borrower with an established German financial footprint. If you arrived in the last few years, three things compound against you specifically:

1. A thin Schufa file reads as risk, not neutrality. A short credit history with no track record looks similar to a weak one to an underwriting model, even with a perfect payment record so far.
2. Fixed-term contracts are common in a first German job — and they hurt here more than elsewhere. Full financing leans hard on income security; a befristeter Vertrag, even a well-paid one, works against you exactly where an equity cushion would otherwise have compensated.
3. Residence permit type and remaining validity get checked. A permit tied closely to a specific job or with limited remaining validity reads as instability, separate from your actual income.

None of this makes full financing impossible for foreigners — it raises the bar to "everything else about your file has to be excellent," because you don't have the Eigenkapital cushion to offset one weak point. The most direct fix is sequencing: build 6–24 months of visible German credit history and get an unbefristete contract in hand before applying, rather than applying at the earliest possible moment.

Full financing now, or wait and save?

There's no single right answer, and this is where the surcharge table above earns its keep — it's the number to weigh against how long saving 20% (€70,000 on the €350,000 example) would realistically take on your income while paying rent in parallel. If your Schufa file and contract are already strong and property prices in your target area are rising faster than you can save, the €46,000 extra 10-year interest cost may be the cheaper option once you account for years of rent paid while waiting. If your file is thin, your contract is fixed-term, or the property itself is a marginal one, the surcharge tier is also the one most likely to get declined rather than merely priced higher — waiting and strengthening the file first is usually the more realistic path. Our renting-vs-buying breakdown works through the wait-and-save side of that comparison in more depth, and our foreigner-specific buying guide covers the eligibility questions upstream of financing itself.

How to compare offers

Rate surcharges for full financing vary more between lenders than standard-financing rates do, because fewer lenders compete seriously in this tier. Comparing several is more valuable here than for an 80%-LTV loan, not less.

FAQ

Can you buy a house in Germany with no down payment?

Yes, via 100% financing (purchase price only) or 110% Vollfinanzierung (price plus closing costs), but both carry a rate surcharge and stricter underwriting than standard 80% LTV financing.

What's the difference between 100% and 110% financing in Germany?

100% financing covers only the purchase price — you still pay closing costs (around 10%) yourself. 110% Vollfinanzierung covers the purchase price plus closing costs, so no cash is needed at all.

How much more does full financing cost in interest?

Per fmh.de, roughly +0.70 percentage points for 100% financing and about +1.2pp for financing above 100%, compared with standard 20%-equity financing. On a €350,000 purchase over a 10-year fixed period, that's tens of thousands of euros more interest.

Do foreigners qualify for full financing in Germany?

Yes, but a thin or short Schufa file, a fixed-term employment contract, or an uncertain residence permit all work against an applicant here more than they would with a standard, equity-backed loan.

Is it better to wait and save a deposit, or finance 100% now?

It depends on how strong your credit file and contract already are and how fast prices are moving in your target area. A strong applicant may find the surcharge cheaper than years of rent paid while saving; a thin file is more likely to be declined at this tier than merely charged more.

This article is for informational purposes only and does not constitute financial or insurance advice. Compare options via licensed intermediaries such as Check24 or Verivox.