A forward loan is a form of follow-up financing, in which a new, low interest rate is secured 13 to 66 months before the fixed interest rate expires. Depending on the length of the forward period until the original fixed interest rate expires, the interest rate is slightly higher than the current conditions. This is then the so-called forward premium.
A forward loan is particularly advisable if the interest rate is particularly good at the time of the request and the probability is therefore high that it will rise in the future. A forward loan is only stupid if the opposite happens and an interest rate falls after the follow-up financing has been concluded. Then you are still bound to the higher interest rate. That's why it's worth talking to a financial expert before you ask for a forward loan. We will be happy to give you a professional assessment. Just write us an email at firstname.lastname@example.org.
By the way: There is a real and a fake forward loan. With a real forward loan, the new fixed-interest period starts after the fixed-interest period of the original loan has expired. In contrast, the fixed-interest period for a non-genuine forward loan begins immediately after the contract is signed.
Want to hear more? Then we recommend this episode of our real estate podcast "Immobilien einfach machen".
Note: German audio only