Fixed-Interest Period (Zinsbindung)
Fixed-interest period (Zinsbindung) in German mortgage financing: durations, special termination right after 10 years, and strategic considerations.
Financial
§ 489 BGB
Auch bekannt als: interest rate lock-in, fixed rate period, rate lock period
Common fixed-interest periods under German law are 5, 10, 15, 20, or 30 years. Under § 489 BGB, borrowers have a special right of termination after 10 years with 6 months' notice and without any early repayment penalty. The choice of fixed-interest period depends on the interest rate environment and personal risk appetite. (§ 489 BGB)