Loan agreement in Germany: Template, Key Clauses and Local Law (2026)

What a loan agreement is under German law A loan agreement (Darlehensvertrag) is governed by the German Civil Code (BGB), sections 488 and following. Under section 488, the lender must make the agreed amount available, and the borrower must pay interest if agreed and repay the loan when it is due. The rules split sharply depending on whether the borrower is a consumer, because consumer loans attract a set of mandatory protections. ## What German law requires A general loan is formless. A business or private loan does not have to be in writing to be valid, although a written agreement is strongly advised for proof. Interest is payable only if agreed; if agreed, it is due annually and at the latest on repayment. A loan with no fixed term can be terminated with three months' notice under section 488(3). A consumer loan must be in writing and carries strong protections. For a consumer loan (Verbraucherdarlehensvertrag), written form is required under section 492(1) BGB, together with prescribed pre-contract information. The consumer has a 14-day right of withdrawal under section 355. Acceleration after default is limited by section 498: for an instalment loan the lender may call in the loan only where the borrower is behind on at least two consecutive instalments and the arrears reach a set share of the principal. Usury and immorality cap interest (section 138 BGB). German law has no single numeric usury ceiling, but section 138 voids a contract that is usurious or immoral. Section 138(2) covers true usury, needing a striking disparity between performance and counter-performance plus exploitation of the borrower's position when the contract was made. In practice, the more common route is the usury-like transaction under section 138(1). Courts use a rule of thumb: a striking disparity is regularly assumed where the contractual interest exceeds the market rate by about 100 percent (double), or by an absolute margin of around 12 percentage points above the market rate. Crossing that line can make the whole loan void. Default interest follows the base rate. Under section 288 BGB, statutory default interest is the base rate (Basiszinssatz, set twice a year by the Bundesbank) plus 5 percentage points for transactions involving a consumer, and plus 9 percentage points for business-to-business transactions. For a consumer loan, section 497 refers default interest on overdue amounts to the section 288 figure. Check the current base rate before you calculate. Stamp and notary. There is no stamp duty on a loan agreement. A plain loan needs no notary. Notarial form and registration become relevant only when the loan is secured on real estate by a land charge (Grundschuld) or mortgage (Hypothek), which must be created by notarial deed and entered in the land register (Grundbuch). ## The clauses that differ under German law - Interest and the usury line: keep the rate well below the section 138 threshold (roughly double the market rate, or 12 points above it), or the whole loan can be void.

• Written form for consumers: a consumer loan must be written and include the prescribed disclosures, or it is defective.
• Withdrawal right: a consumer loan must carry the 14-day withdrawal right; the clock does not start properly if the information is wrong.
• Acceleration: for a consumer instalment loan, the contract cannot allow earlier acceleration than section 498 permits.
• Security: a Grundschuld or mortgage needs a notarial deed and land-register entry. ## A usable template (adapt with advice) Replace every [bracketed] field. This is a skeleton, not legal advice. ``` LOAN AGREEMENT (DARLEHENSVERTRAG) 1. Parties: Lender [name, address]; Borrower [name, address].

2. Loan amount: The Lender grants a loan of EUR [amount in figures and words].
3. Payment: The amount is paid to account [IBAN] on [date].
4. Interest: [X] percent per year on the outstanding balance, payable [annually]. [For a consumer loan, state the effective annual rate and prescribed disclosures.]
5. Repayment: [one sum on date / instalments of EUR X from date] until fully repaid.
6. Ordinary termination: Either party may terminate a loan of no fixed term on three months' notice.
7. Default: On default, statutory default interest under section 288 BGB applies [base rate plus the applicable margin]. For an instalment loan to a consumer, acceleration follows section 498.
8. Withdrawal (consumer loans only): The Borrower may withdraw within 14 days under section 355 BGB; information per the statutory model is attached.
9. Security: [none / land charge (Grundschuld) over [property] by separate notarial deed].
10. Governing law and forum: German law; the competent German court at [place]. Signed by both parties at [place] on [date].

- **Clause 7 (default and acceleration)**: use the right section 288 margin (5 points for consumer-facing, 9 for business-to-business) and respect section 498 limits on calling in a consumer instalment loan.
- **Clause 8 (withdrawal)**: for a consumer loan this is mandatory, and a defective withdrawal notice can leave the withdrawal period open far longer than 14 days.
- **Clause 9 (security)**: a Grundschuld is the standard German real-estate security, and it must be created before a notary and registered. Writing it into the loan alone does not create it. ## Red flags - An interest rate near or above the section 138 usury threshold, risking the whole loan being void.
- A consumer loan that is not in writing or omits the prescribed disclosures and withdrawal notice.
- Using the wrong section 288 default-interest margin for the type of borrower.
- A consumer instalment loan with an acceleration clause stricter than section 498 allows.
- Assuming a land charge exists without the notarial deed and Grundbuch entry.
- Lending to consumers as a business without checking banking and licensing rules. ## One workspace for the loan and its whole life A loan is a long run of dates and conditions. Instalments fall due, the base rate resets twice a year and moves your default-interest figure with it, a consumer withdrawal period runs, a Grundschuld has to be released on final repayment. The agreement is signed and then the schedule runs quietly until a payment is missed, a rate is disputed, or a defective consumer disclosure surfaces, and everyone starts hunting for the clause and the current base rate. An AI contract workspace is built to hold that whole life in one place: draft the agreement, read the interest, default and withdrawal terms back in plain language, track every due date and rate reset as a live alert, and keep each version tied to the borrower and the right people. [Adira](https://adiralaw.com) is built around Indian corporate law first, and depth for German consumer credit rules is on its roadmap rather than live today, so a German consumer loan still needs German counsel and a licensing check. The idea to keep is simple: the loan document and the schedule it creates belong together, not in a drawer and a spreadsheet. This guide is general information, not legal advice. Confirm the current base rate and the consumer rules with a German lawyer before you lend.