Getting a Loan in Berlin as a Foreigner - Step by Step Guide

Updated on
January 25, 2023

Berlin is one of the most renowned international cities for expats and attracts thousands of foreigners they’re visiting for a short while or planning to live in Berlin for the long term. If you are one of those looking to stay for longer, perhaps finding an apartment in the city or considering buying a vehicle, you might well be considering the steps required for getting a loan in Berlin as a foreigner. There are many reasons for needing a loan and the longer you plan on living in Berlin the more your expenses in the city will grow. So whether it is a car you are looking for, an apartment, a house, or even a small cash injection to get your business up and running, a loan will help you make the most of your investments in Berlin.

Of course, getting a loan in Berlin as a foreigner might seem like a rather daunting task, especially once the German banking terms are mixed into the process. But whatever your aim is with a loan, this article will give you a detailed overview on loans in Germany, so that you can secure the right type of loan, while being fully aware of all the requirements and procedures of getting a loan in Berlin as a foreigner.


Getting a Loan in Berlin

As with everywhere else in the world, getting a loan in Berlin, whether as a foreigner or citizen, falls under the same procedures and rules. A lender agrees to borrow you a sum of money, with a predefined plan for the interest rate at which you repay back the amount. Whilst the borrower benefits from up-front money, the lender makes a profit from the loan by an additional fee on top of the original loan that is divided between each installment you repay.The rate of interest is usually defined on the risk incurred by the lender. A lower rate generally reflects a lower risk. Many factors can help the lender of the loan to assess the risk in each borrower’s situation. Factors that affect the rate can include a borrower’s: present income, secondary income sources, bank savings, bonds, stocks, estate and property ownership, age, health, and marital status.

Types of Loans You Can Get in Berlin as a Foreigner

In Berlin, there are several types of loan available for foreigners:

Consumer Credit

called either consumer credit or installment credit, under the terms of these loans the borrower does not have to state their intent to the bank or lender. Often these loans can be used to buy home or apartment furnishings or appliances, or for a holiday.

Car Loan

a car loan has its aim clearly stated to the bank, and with the car itself acting as security for the bank, interest rates for this type of loan are often more favorable than those for consumer credit.


overdrafts involve additional credit built into an existing current account, allowing the account holder with ‘overdraw’ loaned cash up to a limit.


credit cards allow ATM withdrawals and spending on all purchases, but interest rates can be particularly high if monthly repayments are missed.

Securities Loan

if you have securities account at a bank with stocks and funds these assets can be deposited as security for the bank for a loan, with upfront security usually bringing favorable rates for the borrower. A loan secured in this way can be spent on anything.


the favorite and cheapest loan option for buying a home, the property itself is security for the bank until the loan is paid off.

Self-employed and Company Loans

loans for business endeavors pose the highest risk for lenders, so lenders in Germany will generally be more cautious and propose higher interest rates.

Short-term Loan

the easiest loan to secure is a short-term 30-day loan, often capped a 500 Euros for new customers. Returning customers can also secure more attractive loan sums and repayment times.

Requirements for Getting a Loan in Berlin as a Foreigner

Once you determine what type of loan you need, your attention must now turn to the process and requirements of securing the loan, which depends on the loan’s type and where it is that you apply for the loan. German banks are generally more conservative than other countries in their use of credit, with a credit loan remaining difficult to secure unless you meet or exceed certain requirements. These requirements should not deter you from getting a loan in Berlin as a foreigner, as they can be met easily, with some guidance. The requirements are as follows:

Good Schufa Score

The German equivalent of a credit rating reflective of your positive financial history.

What is a Schufa Score And Record?

Acting as credit history, the Schufa score is an easy way for banks to reliably measure and judge your ability to meet previous financial obligations and how this might reflect on your ability to do so in the present. These scores will look at old obligations like utility bills, credit cards, and previous loans. These scores are consulted all the time, for example when you make a new bank account, take out a new phone contract or rent a new property. Companies and lenders can consult your Schufa score and record to assure themselves you have no unresolved debts or issues with financial trust.

A Residence Permit in Germany

Ideally this would be a permanent residence, but it must be a residence permit that at least covers the period of the loan.

A Stable Source Of Income

This can generally be proved to lenders with a number of salary or payslips. This also applies if you are a freelancer, where even a note from a routine client can assure lenders of your ability to keep earning a regular income.

Applicants Must Have a Minimum AgeOf 18

As in most other countries, the minimum age in order to apply and qualify for a loan is 18 years of age.

Additional Requirements:

Securing a mortgage in Germany, in particular, will however require a bit more from the loaner and the property handler:

  • A surveyor must provide a property assessment report.
  • You must provide at least 20% of the property value as a deposit (preferably 30%).
  • You must provide the last statement of your tax returns.
  • An up to date extract from the property’s land register must be supplied.
  • Where can you get a loan in Berlin as a foreigner?

Where To Get a Loan From, as a Foreigner in Berlin?

Getting a bank loan in Berlin

A bank is the most common place to seek a loan in most countries, and the same holds in Berlin. The aforementioned consumer credit (or installment credit) loan is the most common loan found here. The loan sum can be spent however the borrower intends, and this intention does not need to be stated to the bank. Getting a loan from a bank means that the loan amount will be linked to an existing bank account for repayment. The same situation applies in mortgage repayments, with the repayments deducted from the bank account.

Bank interest rates

With regard to the bank’s interest rates in Berlin, they are generally defined by one main determining factor. The bank evaluates the interest rate of a loan via the credit-worthiness (and score) or the lender. This will benefit those with good credit scores as they will have to pay less interest on the loan, but those with lower scores may be subject to higher interest rates. On the other hand, some banks such as DKB, do not take into account credit scores and instead, all people borrowing from this group will have roughly the same interest rate. Asking for the help of an advisor, or leveraging your existing assets, can be other helpful ways of getting the best conditions for your loan.

Getting a loan from Credit institutions in Berlin

The easiest way of getting a loan in Berlin as a foreigner is usually credit institutions, which offer quick and easy ways to secure small short-term personal loans, offering flexible repayment options. A pre-existing good credit score is required, and some of the repayment fees can quickly escalate if you fail to repay, but a well-planned short-term loan can be a very efficient and versatile way to borrow.

Getting a loan from Crowd Funding (Peer-to-Peer loan)

Often found online, these platforms link lenders and borrowers quickly and easily, with the website itself, often managing most of the relationship. This is ideal for those who need a credit loan but who have only lived in Berlin for a short period of time. On these platforms a solid credit score can secure better rates, to offset the initially high-interest rates.

Getting a Mini Loan in Berlin

Not everyone might be able to keep up with the conditions for getting a loan from a bank or is seeking such a complex and long-term way to borrow. As an alternative, a mini loan (also often called a payday loan) is a short-term loan often over one or two months that deal in small amounts. The interest rates can be quite high if you fall behind with repayment, but they can be effectively used to overcome shorter-term needs as they are one of the easiest ways of getting a loan in Berlin as a foreigner.

If you are exploring the options of buying a house in Germany, need any financial advice for buying a property, or would like assistance in obtaining a mortgage in Germany, Hypofriend is an online and independent mortgage advisor that is experienced in responding to the special needs of expats. All their services and information are available in English. Get in touch with them directly via or navigate to their website

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