Anschlussfinanzierung & Forward-Darlehen: How to Refinance Your German Mortgage in 2026 and 2027

If you took out a German mortgage in 2015, 2016, or 2017 with a 10-year fixed period, you are in the middle of the largest refinancing wave the country has seen in two decades. Roughly 1.2 million property loans signed during that era are reaching the end of their Zinsbindung between 2025 and 2027. Rates back then sat near 1.5%. Rates today sit around 3.7 to 4.2%. The math is unforgiving: a €300,000 loan refinancing at 4.0% instead of 1.5% costs roughly an extra €625 per month, every month, for the next 10 years.

The good news is that the worst outcomes are entirely avoidable. The three refinancing levers (Prolongation, Umschuldung, Forward-Darlehen) plus the under-used § 489 BGB termination right give you more strategic optionality than the typical bank offer suggests. This guide walks through the mechanics, the timing windows, and the math of getting the cheapest possible follow-on financing.

What an Anschlussfinanzierung actually is

When your original mortgage Zinsbindung (the period during which the interest rate is locked) ends, the remaining loan balance (Restschuld) does not disappear. It needs new terms. The new contract that covers the remaining balance is an Anschlussfinanzierung (follow-on financing). You have three legal paths to it:

These three options are not mutually exclusive in time. You can start exploring a Forward-Darlehen 3 years out, decide against it, then run a Umschuldung process 9 months out, and ultimately accept a competitive Prolongation offer when your current bank matches. But you cannot work backwards. Once your Zinsbindung has expired and you are on a default variable rate, your negotiating leverage collapses.

The current rate environment (mid-2026)

These are headline rates for prime credit. Add or subtract roughly 0.20 to 0.40 percentage points for your specific LTV, equity, and credit profile.

The 10-year fix at around 3.9% sits well below the 2024 peak of 4.4% but well above the 2016-2021 floor of 1.0 to 1.5%. The ECB’s signaling for 2026 and 2027 is mixed: cuts are expected, but the curve is flatter than markets priced in late 2025. Forward rate expectations have stabilized around the current level.

The practical takeaway: if you are coming off a sub-2% loan, expect the new rate to be 2.0 to 2.5 percentage points higher. Plan the cash flow accordingly. If you took out at 3% or above in 2014 or earlier, the refinance may be flat or even modestly cheaper.

Option 1: Prolongation

The path of least resistance. Your current bank sends you an offer 3 to 6 months before your Zinsbindung ends. Sign it back, the loan continues with new rate, fixed period, and Tilgung. No new property valuation needed, no new credit check, no land registry costs.

Pros:

• Zero process cost (no notary, no Grundschuldänderung, no new Wertermittlung).
• Fast turnaround (sign and return, done in 1 to 2 weeks).
• Convenient if you have a strong relationship with the bank.

Cons:

• The Prolongation offer is the bank’s anchor offer, not their best offer. The rate is typically 0.20 to 0.40 percentage points above what competing banks offer.
• Limited room to renegotiate the structure (Tilgung rate, Sondertilgungsrecht, etc.).
• No leverage if you don’t have a competing offer to wave at them.

The single most important thing about a Prolongation offer is to not accept it blind. Even if you intend to stay with the bank, get one or two competing Umschuldung offers first. A bank that knows you have a 3.75% offer from a competitor will usually match within a few business days. Failing to do this leaves money on the table at a scale most landlords don’t quantify.

Option 2: Umschuldung (switching lenders)

Moving the loan to a different bank, typically because a competitor offers a meaningfully better rate. The mechanics:

1. Get a written rate offer from the new bank, conditional on standard underwriting.
2. The new bank pays out your old loan (the existing bank cannot prevent this).
3. The Grundschuld (land charge securing your original loan) is either transferred to the new bank or freshly registered. Costs: roughly 0.2% of the loan amount in notary and Grundbuch fees.
4. New Tilgung schedule starts with new bank.

Pros:

• Rate competition genuinely works. A serious Umschuldung process saves 0.20 to 0.40 percentage points vs Prolongation, sometimes more.
• Opportunity to renegotiate structure (fixed period, Sondertilgungsrecht, free Tilgungswechsel).
• Independent property valuation can document an increased property value, improving LTV and rate.

Cons:

• Process cost (0.2% of loan amount, typically €300 to €1,500 depending on size).
• 4 to 8 weeks from offer to closing, longer if the old bank stalls.
• Requires a fresh financial review by the new bank, can flag issues (changed income, additional liabilities).

For a €300,000 Restschuld, a 0.25 percentage point rate improvement saves roughly €750 per year, €7,500 over a 10-year fix. The Umschuldung process cost is recovered in the first year, often the first quarter. The economics almost always favor running the Umschuldung process even if you ultimately accept a matched Prolongation offer.

Option 3: Forward-Darlehen

A forward contract on a fixed-rate loan. You sign today with a bank that will disburse the loan when your current Zinsbindung ends, at a rate fixed now. Available up to 60 months in advance.

How it works:

• You choose the new fixed period (typically 10 or 15 years) and Tilgung.
• The bank charges a Forward-Aufschlag (forward premium) on top of the current spot rate.
• The premium is approximately 0.20 to 0.25 percentage points per year of lead time.
• For 24 months ahead: roughly 0.40 to 0.60 percentage points above the current 10-year spot rate.
• For 36 months ahead: 0.60 to 0.90 percentage points.
• For 60 months ahead: 1.20 to 1.50 percentage points.

You cannot back out without penalty. Once signed, the bank has committed funds at a future date; if rates fall and you walk away, you owe a Nichtabnahmeentschädigung (typically 1 to 5% of the loan amount).

When a Forward-Darlehen is worth it:

• You expect rates to rise meaningfully more than the Forward-Aufschlag.
• You value certainty of cash flow over potential savings.
• The current spot rate plus the premium is still well below your stress-test scenario.

When it usually isn’t:

• The premium for 36+ months out often exceeds the realistic rate increase.
• You can usually achieve the same risk reduction more cheaply by shortening the planned holding period and refinancing in stages.
• Your existing bank may offer a better all-in rate via Prolongation closer to the date.

The Forward-Darlehen makes sense in a clearly rising-rate environment with short lead times (12 to 24 months). For lead times beyond 30 months, the math rarely works unless you have a very specific reason to lock now.

The hidden lever: § 489 BGB

Most landlords don’t know this. § 489 BGB grants you the right to terminate any loan with a fixed interest rate after 10 years from the full disbursement, with 6 months’ notice, regardless of what your original Zinsbindung says.

In practice:

• Your 15-year fix signed in 2017 can be terminated in 2027 with 6 months’ notice. The bank cannot charge a Vorfälligkeitsentschädigung (early termination penalty) because the termination right is statutory.
• The 10-year clock runs from the date the loan was fully drawn, not the contract signing.

This is the single most under-utilized refinancing tool in Germany. If you signed a 15-year fix at a peak rate and rates have since fallen, you can refinance at the 10-year mark without any penalty. You just need to send a written notice 6 months in advance.

The exception: if your loan is a Bauspardarlehen or a specific subsidized loan (KfW), different termination rules apply. Check your contract.

The Sondertilgung play before refinance

A Sondertilgung is an extra loan repayment above your regular Tilgung. Most German mortgages allow 5% of the original loan amount per year as Sondertilgung without penalty.

Strategy: in the year before your Anschlussfinanzierung, max out your Sondertilgung rights to reduce the Restschuld. The smaller the Restschuld, the better the LTV at the moment of refinancing, and the better the rate the new bank offers.

For a property bought for €400,000 with an original loan of €320,000:

• Without extra Sondertilgung, Restschuld at end of 10-year fix might be €260,000. LTV: 65%.
• With €20,000 final-year Sondertilgung, Restschuld is €240,000. LTV: 60%.

The LTV improvement from 65% to 60% is often worth 0.10 to 0.20 percentage points on the new rate. Over a 10-year follow-on fix on €240,000, that’s €2,400 to €4,800 in interest saved.

This only works if you have meaningful liquid savings parked at low yields (current accounts, Tagesgeld). The Sondertilgung is essentially a guaranteed yield equal to your current loan rate, which after-tax usually beats holding cash.

The Tilgung rate decision

Your new Anschlussfinanzierung needs an Anfangstilgung (initial repayment rate). Higher Tilgung means faster debt repayment but higher monthly payment.

For a 4.0% rate environment:

Rule of thumb in a 4% rate environment: a 2% Tilgung leaves significant Restschuld at the end of a 10-year fix, requiring another follow-on financing. A 3% or 4% Tilgung gets the loan paid down meaningfully or even fully within two fixed periods.

For rental property, the optimal Tilgung also interacts with the Anlage V tax position. Interest is deductible, principal is not. Higher Tilgung means less interest deduction over time. But interest deduction is a tax shield on rental income, not a reason to hold debt forever. The cleanest analysis: use our mortgage calculator to model the total interest cost across a full holding period at different Tilgung rates, and pick the rate that aligns with your exit plan.

Step-by-step refinancing playbook (12 months before Zinsbindung ends)

12 months out:

• Pull your current loan contract. Note the exact end date of the Zinsbindung, the Restschuld estimate at that date, and the original disbursement date for § 489 BGB purposes.
• Decide your target Tilgung rate for the new loan.
• If you have liquidity parked at low yields, plan the final Sondertilgung for the last 6 to 9 months before refinancing.

9 months out:

• Get an independent rate quote from at least one online broker (Interhyp, Dr. Klein, Baufi24). This gives you a market benchmark.
• If forward rates look attractive, evaluate a Forward-Darlehen for the remaining lead time.

6 months out:

• Get a written Umschuldung offer from at least one competitor. This is your negotiation anchor.
• Send a copy to your current bank with a request for their best Prolongation offer.

3 months out:

• Compare the best Umschuldung offer with the best Prolongation offer. Decide.
• If switching: sign with the new bank, they handle the payout of your old loan.
• If staying: sign the Prolongation back to your existing bank.

0 months (Zinsbindung ends):

• The new contract activates. New monthly payment begins.

Missing any of these steps doesn’t make you uninsurable, but it tends to add 0.15 to 0.40 percentage points to your new rate.

Worked example: €280,000 Restschuld, 2027 refinance

Landlord financed a Berlin apartment in 2017 with a €320,000 loan at 1.6% for 10 years, 2% Tilgung. Restschuld estimated at €265,000 at the 2027 maturity.

Option A: Default Prolongation accepted blind in 2027.

• Bank offers 4.10% for 10 years, 2% Tilgung.
• Monthly payment: €1,348.
• Total interest over the next 10 years: ~€95,400.

Option B: Umschuldung after benchmarking.

• Competing offer: 3.80%.
• Bank matches at 3.80% to retain you.
• Monthly payment: €1,281.
• Total interest over the next 10 years: ~€87,800.
• Savings vs Option A: €7,600 over 10 years.

Option C: Forward-Darlehen signed mid-2025 (24 months ahead).

• Spot rate at signing: 3.75%.
• Forward premium: 0.50 percentage points.
• Locked rate: 4.25%.
• Monthly payment: €1,381.
• Total interest over the next 10 years: ~€99,100.
• This is worse than Option A and B. The forward premium ate the saving.

Option D: Forward-Darlehen signed late 2026 (12 months ahead) in a rising-rate scenario.

• Spot rate at signing (hypothetical late-2026 reversal): 4.30%.
• Forward premium: 0.20 percentage points.
• Locked rate: 4.50%.
• Realized 2027 market rate scenarios: 5.00% or 3.80%.
• If 5.00%: Forward saves ~€18,000 over 10 years.
• If 3.80%: Forward costs ~€18,000 over 10 years.

The Forward-Darlehen is essentially an interest rate hedge with a known premium and an unknown outcome. Worth taking when the conviction on rising rates is strong; not worth taking by default.

Common landlord mistakes at Anschlussfinanzierung

1. Accepting the Prolongation offer without benchmarking. Average lost saving: 0.20 to 0.30 percentage points, or €5,000 to €8,000 over 10 years on a €280,000 loan.
2. Locking a Forward-Darlehen too far in advance. The forward premium eats most or all of the potential saving for lead times above 30 months.
3. Not exercising § 489 BGB on long fixes. A 15-year fix at a high rate can be terminated after 10 years without penalty.
4. Keeping Tilgung at 1% because “that’s what’s been working”. In a 4% rate environment, 1% Tilgung makes the loan a near-perpetuity. Most landlords should now be at 2% to 3% minimum.
5. Forgetting the Sondertilgung in the last year before refinancing. Cash sitting at Tagesgeld earning 2.5% is worse than reducing a 4% loan.
6. Not negotiating the new contract structure. Sondertilgungsrecht, free Tilgungswechsel (changing the Tilgung rate during the fixed period), and break clauses are negotiable.
7. Ignoring the LTV impact of property appreciation. If your apartment appreciated 30% since 2017, your effective LTV is much lower. Get a current Wertermittlung and use it in the rate negotiation.
8. Combining Anschlussfinanzierung with a major renovation loan unnecessarily. The new structure may carry higher rates on both portions. Sometimes a separate KfW-funded renovation loan plus a clean Anschlussfinanzierung works out cheaper.

How this connects to your wider financial picture

The Anschlussfinanzierung is one of three big financial events in a landlord’s decade-cycle. The other two are the original purchase and the eventual sale.

• The mortgage calculator lets you model the new Restschuld and the new monthly payment at different rates and Tilgungen.
• The AfA calculator shows the tax position: a refinanced loan with a higher interest rate generates more deductible interest in early years of the new fixed period, partially offsetting the cash flow hit.
• The rental yield calculator tells you whether the property still meets your yield target at the new financing cost.
• The hidden costs article covers everything outside the mortgage that may also shift in 2026 and 2027.

For most landlords with 2015 to 2017 financing rolling off into a higher-rate market, the cash-flow swing is meaningful. A €300 to €600 increase in monthly mortgage payment turns a previously cash-flow-positive rental into a marginally negative one for a few years. The right response is rarely panic. It is to run the playbook above, capture the 0.20 to 0.40 percentage point saving that the rate-shopping process reliably delivers, and adjust the Tilgung to a level that matches your holding plan. Done properly, the refinancing is a 6-week project that pays the landlord €5,000 to €15,000 over the next decade. Done poorly, that money goes straight to the bank’s margin.