Guide

Early Loan Repayment

Guide for Newcomers / Ratgeber für Neuankömmlinge

Everything you need to know if you want to repay your loan early. Rights, costs and benefits in Germany.

Key German Terms / Wichtige deutsche Begriffe

Kredit

Loan

Zinsen

Interest

Schufa

German credit bureau

Tilgung

Repayment

Laufzeit

Loan term

Sparkasse

Savings bank

Vorzeitig ablösen

Early repayment

Sondertilgung

Extra repayment

Newcomer Tip / Tipp für Neuankömmlinge

As a newcomer, you can get loans even without a long Schufa history. Compare different providers! / Als Neuankömmling können Sie Kredite auch ohne lange Schufa-Historie erhalten. Vergleichen Sie verschiedene Anbieter!

Your Right to Early Repayment

For consumer loans in Germany, you have the right under §500 BGB to repay the loan early at any time, in whole or in part. The bank cannot refuse this but may charge compensation for lost interest.

Legal Regulations in Germany

Right to early repayment for consumer loans
Max. fee: 1% (over 12 months) / 0.5% (under 12 months)
Mortgages: Special termination right after 10 years

When Is Early Repayment Worthwhile?

Inheritance or bonus: When you unexpectedly receive money
Property sale: When selling your property
Better conditions: When refinancing is cheaper
Short remaining term: When the fee is low

Conclusion

Early loan repayment can save you money - but must be calculated carefully. For consumer loans, the risk is manageable due to the legal cap on fees.

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