A consortium of 20 German financial groups, including Deutsche Bank and Allianz, is challenging Dutch banks by offering a repayment mortgage with an interest rate of around 2.8%.

The average rate offered by Dutch banks for a standard repayment mortgage is between 3.9% and 4.5%

Two mortgage advisory firms, who are involved in the German move, have now confirmed the details to the Volkskrant. The news first emerged in the local media on Thursday.

Overwhelmed

The German mortgage will be available through 20 independent mortgage advisors nationwide. Rob Jansen, director of Adfinis, which is one of the companies involved, said he has been overwhelmed with phone calls since the news broke.

‘We wanted to keep the news local but have been phoned by house buyers from all over the country, he told the paper.

A German source told the Volkskrant the German banks are ‘swimming with money’ and looking for new markets. ‘Unlike Dutch banks, the Germans are not in financial difficulties,’ he said. ‘Here everyone repays their mortgage – there is no such thing as an interest-only loan.

The German banks will finance between 70% and 100% of the purchase price, depending on income, family situation and the condition of the property, the Volkskrant said.