Pfandbrief banks agree on moratorium on commercial property mortgage loan

The Association of German Pfandbrief Banks (vdp) has developed jointly with its member banks an Amortization Moratorium in respect of commercial property mortgage loans, which member banks can join should they wish. The moratorium represents a contribution to overcoming the COVID-19 crisis in the real estate sector. Banks that join are required to inform their customers accordingly. The main conditions of the moratorium are listed below.

Loans and borrowers affected:

  • Member banks of the vdp which have joined the vdp Amortization Moratorium
  • Beneficiaries: borrowers of loans secured with security rights on immovable properties where at least 50% of the income is not generated through residential use
  • Properties in Germany and in other countries; in other countries, however,
    • additionally with separate agreement in keeping with the legal position in the respective country
    • only if a transaction avoidance in insolvency (retroactive action) or comparable measure is precluded, and
    • not another moratorium is applicable in the respective country (after the bank has joined the moratorium in that country)
  • Borrowers must not be consumers.


  • Loan contract before March 14, 2020, disbursement as per contract up until then
  • Payment as per loan contract of interest and amortization up until March 31, 2020
  • Income on the property affected by the pandemic
  • With regard to the financial situation at the time of filing the application and to continuing the property from an economic perspective, it is not economically reasonable to service the loan under the terms and conditions in effect up until then
  • No profits, dividends etc. distributed since the crisis
  • Borrower makes appropriate use of available liquidity to continue servicing debt and seeks to obtain economic support through public programmes
  • In the case of syndicate financing, possible only if all the banks involved have joined this moratorium or give consent
  • If the bank needs the consent of third parties, then possible only with their consent
  • Decision on the application by 30 September 2020


  • Application by the borrower in written or text (electronic) form


  • Extension (Deferral) of all principal payments falling due as from application up until end of December 2020
  • No extension of interest payments
  • Interest in the agreed amount on the higher principal amount due compared to the payment schedule in effect up until then
  • No prolongation of the life of the loan (or of the interest rate fixation period); as a result, higher residual principal at the end of the life
  • Borrower may pay the deferred amounts on any scheduled payment date (one week’s prior notice)
  • Borrower may pay the deferred amounts later at any time (one week’s prior notice)
  • Borrower’s interest rate hedges are not changed by the moratorium
  • Bank does not charge any fees (third-party costs are possible, however)