Secure follow-up financing for your home loan online in a timely manner and save thousands of euros
19 Jun 2025
7
Minutes
Katrin Straub
CEO at nextsure
The end of your fixed interest period is approaching, and you fear rising rates? Act now, because well-planned follow-up financing for your home loan can save you over €10,000. We'll show you how to successfully navigate the process online in good time.
The topic in brief and concise terms
Start planning your follow-up financing at least 12 to 36 months before the end of the fixed interest period to avoid time pressure.
Always compare the offer from your home bank (extension) with refinancing from a new provider, as there is often potential to save thousands of euros.
Exercise your statutory right of special termination under § 489 BGB to exit a costly loan without additional charges after ten years.
Cushioning the interest rate rise: Why early action is crucial
Your bank is legally obliged to present you with a new offer no later than three months before the end of the fixed interest period. However, waiting this long puts you under time pressure and you miss the opportunity to secure the best terms in the market. Experts recommend addressing your refinancing needs 12 to 36 months in advance.
An interest rate difference of just one percentage point can have enormous impacts. With an outstanding balance of 150,000 euros, this means an additional interest burden of 1,500 euros per year. Over a ten-year term, this amounts to 15,000 euros.
The current development of mortgage rates shows that the historically low rates of the years 2015 to 2021 are over for now. Early engagement with this topic protects you from unpleasant surprises and provides you with the necessary room to negotiate. In this way, you lay the foundation for choosing the right financing strategy.
Strategic decision-making: Forward loan or refinancing?
There are primarily three ways to secure your follow-up financing: the extension, refinancing, and the forward loan. The extension, meaning continuing with your current bank, is convenient but rarely the most economical option. Refinancing or a forward loan often offer significant potential savings.
An overview of your strategic options:
Forward Loan: This allows you to lock in today’s interest rates for a payout in up to 66 months. This is sensible if you anticipate rising interest rates, but it comes with an interest surcharge of about 0.01 to 0.03 percentage points per month of lead time.
Refinancing: You switch to a new bank with better conditions at the end of the fixed interest period. Even an interest advantage of 0.2 percentage points can make refinancing worthwhile despite low costs for transferring ownership registry.
A forward loan is a bet on interest rate development and entails a commitment to proceed even if interest rates unexpectedly fall. Carefully consider whether you prefer to commit long-term with a forward loan or opt for the flexibility of later refinancing. Your knowledge of legal rights can significantly impact this decision.
Your Legal Right: Exercising the Special Termination Right under § 489 BGB
A powerful tool for any borrower is the special termination right under section 489 of the German Civil Code (BGB). Regardless of the agreed fixed interest rate period, you can terminate any construction loan after ten years. The notice period for this is six months, and the bank cannot charge any early repayment penalty.
The ten-year period starts the day after the loan has been fully disbursed. Be cautious with refinancing or a forward loan: here, the date of contract signing already counts as the start date for the period. A calendar entry for this date can secure you thousands of euros in flexibility.
This right allows you to react to more favorable interest rates even during a long fixed interest period and to carry out a refinancing. This way, you avoid the often high costs of an early repayment penalty. With this knowledge, you can confidently start the online comparison process.
In five steps to optimal online follow-up financing
Securing follow-up financing for your home loan in good time online is straightforward if you proceed systematically. The digital process provides transparency and saves time. Follow the five-step guide below:
Inventory: Review your current loan agreement. Note the remaining debt, the end of the fixed interest period, and the current interest rate.
Request a renewal offer: Obtain an offer from your bank. It serves as an important reference point, although it is rarely the best deal.
Compare the market: Use an online calculator to get an overview of current terms. A favourable housing finance deal is often found with a new provider.
Prepare documents: Assemble all necessary documents. These usually include the last three payslips, the land register extract, and your current loan agreement.
Finalise and conclude offers: Obtain binding offers from two to three favourites and choose the best option.
By following this structured comparison, you secure a solid negotiation basis and avoid common pitfalls.
Expert Tips: Common Pitfalls and How to Avoid Them
On the way to follow-up financing, there are a few pitfalls you can avoid with the right preparation. Many borrowers lose money out of sheer convenience or ignorance. A common mistake is accepting the first offer from your bank without comparison.
Our expert tip: Plan for future special repayments from the start. With follow-up financing, you can often adjust the repayment rate flexibly and become debt-free more quickly. A higher repayment rate, for example, four instead of two percent, significantly shortens the term.
Another pitfall is hidden costs. For refinancing, notary and land registry fees are incurred, but these usually amount to only a few hundred euros. These small costs are quickly offset by the interest savings of often several thousand euros. Also check whether you want to adjust your annuity loan. Proper planning is the last step before a secure conclusion.
Conclusion: Proactive planning as the key to success
The follow-up financing for your home loan is not an automatic process, but a strategic decision. Early and digital planning, at least twelve months in advance, is crucial. It gives you the necessary advantage to compare offers without pressure.
Use your special termination right after ten years, and do not shy away from the effort of refinancing. Switching to a cheaper provider can lower your monthly payment or shorten the remaining term by several years. Even an interest advantage of 0.5 percentage points can mean savings of over 10,000 euros.
Act now to actively shape your financial future in your home. A professional analysis of your situation can help exploit all potentials. Have your options reviewed by experts to find a tailored solution for your mortgage financing.
Request an individual risk analysis now: have your insurance situation checked for free and receive concrete optimisation suggestions.
More useful links
Wikipedia explains the term 'Anschlussfinanzierung' in the context of mortgage loans.
The Bundesbank provides statistics on interest rates for housing loans to private households in Germany.
The Bundesbank includes data on interest rates and yields for housing loans to private households and mortgage loans on residential properties.
The Bundesbank refers to its MFI interest rate statistics, covering stocks and new business.
The Bundesbank offers an Excel file with data on mortgage interest rates.
The Federal Statistical Office (Destatis) provides a PDF document with experimental data on mortgage contracts.
The Federal Statistical Office (Destatis) leads to a page about construction prices and the property price index.
FAQ
What is the difference between debt rescheduling and extension?
With an extension, you renew your expiring loan with your existing bank under new conditions. A refinancing means that you switch to a new bank that pays off your remaining debt with the old bank. Refinancing is often associated with more favourable interest rates.
Is a forward loan worthwhile?
A forward loan is worthwhile if you are in a period of low interest rates and expect the rates to rise significantly by the end of your fixed interest period. You pay an interest surcharge for this. However, if the interest rates drop contrary to expectations, you end up paying more than necessary as you are bound by the contract.
When can I terminate my construction loan after 10 years?
In accordance with § 489 of the German Civil Code (BGB), you can terminate a loan agreement with fixed interest rates at any time ten years after receiving the full loan amount. The notice period is six months. The bank is then not allowed to demand a prepayment penalty.
What documents do I need for follow-up financing?
For comparison and completion, you typically need your old loan agreement, a current land registry extract, the last three payslips, and a statement of the remaining debt as of the date of repayment.
Can I refinance with a follow-up loan even if the remaining debt is low?
Yes, even with a remaining debt of under 50,000 euros, refinancing can be worthwhile. Alternatively, you can check if repayment through equity or an instalment loan is cheaper than extending the loan with your bank.
What happens to my KfW loan during a refinancing?
A KfW loan can be handled separately. If it expires at the same time as your main loan, it can be refinanced together. Otherwise, you will need to extend it with the KfW or refinance it separately. The special right of termination after ten years also applies to KfW loans.
