New KfW conditions from 04/2016

You don’t have to repay the loan during the term, then the fixed interest period simply ends and you have to refinance or pay off [ablösen], depending on how much is still outstanding.

But what is then the advantage of a longer term than 20 years with KFW 153?

Nominal interest rate (effective interest rate)
per year term (years) repayment-free start period fixed interest period


1.30 % (1.31 %) 11 to 20 1 to 3 years 20 years*

1.50 % (1.51 %) 21 to 30 1 to 5 years 20 years*

The interest rate (1.51%) is still fixed for only 20 years and after that you have to refinance because there is still a residual debt.
And you have paid 0.2% more interest for 20 years.

I would rather not miss out on this 0.2%, so I would like to finance with 1.31% at KfW but also still have enough installments left for the main loan in order to achieve over 3% repayment there.

But the installment burden is then lower because the total duration is longer. Of course, the bank charges for that.

I would have the same effect if I choose a 20-year fixed interest period and a 20-year term and then balance the rate so that I still have a residual debt.

It doesn't matter if I still have €25,000 residual debt after 20 years and the term is over and I then have to look for refinancing on the open market, or if after 20 years of fixed interest I automatically receive an offer from KfW for refinancing within the 30-year term which also includes an interest rate that is not subsidized by federal funds (so it will be at market level).

The only difference would be that over the first 20 years I have already paid 0.2% more interest each year.

You can't "balance" the rate for the KfW.

20 years term with 20 years fixed interest rate is then a full repayment mortgage, which is cheaper...