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Five years after your last funding notice, it lands in your mailbox: the repayment notice from the Federal Office of Administration (Bundesverwaltungsamt). Many people get scared, yet repaying BAföG, Germany's federal student aid, is far less dramatic than most think. You repay at most half, the installments are low and there are several ways to legally reduce the amount. I'll show you how the deadlines work, when forgiveness is possible and how to save on the installment.

Repaying BAföG: when the deadline actually starts

The obligation to repay doesn't begin right after your studies. According to Section 18 of the BAföG law, you have to start repaying at the earliest five years after the end of the maximum funding period. The Federal Office of Administration in Cologne sends you a determination notice for this, usually about half a year before the first installment is due.

Important to know: only the loan portion has to be repaid, not the grant portion. Since 2019 the total amount has been capped at a maximum of €10,010, regardless of how much BAföG you received in total. You'll find details directly at the BAföG repayment portal of the Federal Ministry.

When do I have to start repaying BAföG if I dropped out of my studies?

Even if you drop out, the five-year rule applies from the end of the originally calculated maximum funding period for your field. The Federal Office of Administration goes by the standard period of study, not by your actual end date. Switching programs or dropping out usually doesn't change that, but you should report it actively.

BAföG repayment: how high the installments really are

The standard installment is €130 per quarter, so €390 per year. That sounds manageable at first, but with the full loan amount it stretches over up to 77 months, so a good six years. If you can or want to pay more, you may voluntarily make higher installments and shorten the term.

If you earn little, you don't have to panic. There's an exemption from repayment for low income, set out in Section 18a of the BAföG law. The allowance is €1,605 net per month for single people, plus allowances for children. If you're below that, you can be exempted for up to four years at a stretch, but you have to submit the application yourself and re-document it every two years.

Lowering your BAföG repayment installment: what you can concretely do

An application for exemption does not replace an automatic check; the agency won't take action on its own. For this, submit a current income statement, ideally right away with the form described on the back of your notice. If you're currently between a bachelor's and a master's degree or in an income gap, you shouldn't put this application off. There's more on this in my article on financing your studies during the transition period.

  • Submit an exemption application if your income is below €1,605 net per month
  • Submit up-to-date proof every two years, otherwise the exemption expires automatically
  • With children, the allowance increases by a fixed amount per child; check your notice

BAföG forgiveness: when you really save money

Woman calmly calculating BAföG installments at home with a notebook and smartphone

This is where it gets interesting, because repaying BAföG can be noticeably reduced through several discounts. The best known is the performance-based forgiveness for the top 30 percent of a graduating class at your university, which your examination office has to confirm. How high the forgiveness is gets set anew each year by the Federal Office of Administration; most recently it varied depending on the top-of-class rate.

Even more lucrative is often the discount for early repayment. If you pay off your remaining debt in one lump sum, you get a discount tiered by the size of the remaining debt, up to roughly 9.5 percent for large amounts. So if you have a few thousand euros left over, for example from a working-student job, you can save real money here. How a working-student job and side income go together with BAföG in the first place, I explain in the post Working student and BAföG: how many hours are allowed.

BAföG forgiveness for good grades: how to file the application correctly

You don't have to apply for the performance-based forgiveness yourself; the examination office automatically reports the best graduates to the Federal Office of Administration. Still, it's worth asking the examination office whether the report was actually made, as administrative errors happen more often than you'd think. Ask specifically for confirmation of the "top-of-class rule under Section 18b of the BAföG law".

Paying off BAföG early: is the discount worth it?

Early repayment is especially interesting for anyone who suddenly has capital available through an inheritance, a severance payment or a well-paid side job. On request, the Federal Office of Administration sends you an individual discount offer that depends on the remaining debt and the remaining period. Just call the hotline or use the online form in the customer portal.

Do a quick calculation beforehand to see whether early payment is really worth it, or whether you need the money more urgently elsewhere, for example as a reserve. You'll find more on the topic of a financial cushion in my article on the emergency fund for your studies. If you're considering a student loan anyway, you should also know the counter-calculation; more on that at Student loan: when debt for your studies pays off.

What happens if I can't pay an installment

Woman calmly organizing documents for early BAföG repayment at the kitchen table

Before you simply let an installment slide, contact the Federal Office of Administration proactively. There's the option of an installment adjustment or a temporary deferral if, for example, you become unemployed at short notice. If you simply stay silent, you risk late fees and, in the worst case, the entire remaining debt becoming due immediately.

Especially in financially tight phases during your studies or shortly afterward, it's worth looking at alternative sources of income so you don't fall behind on payments in the first place. Some students combine classic side jobs with platforms like MySugardaddy to bridge short-term shortfalls without taking on new debt. The only important thing is that you're clear about the legal side beforehand; there's background in the article Sugarbabe student: what is legally allowed.

Frequently asked questions about repaying BAföG

How long do I have to repay BAföG?

Regular repayment runs over a maximum of 77 months in installments of €130 per quarter. With exemptions or deferrals, the overall period can be extended considerably.

Do I have to repay the entire funding amount?

No, only the loan portion has to be repaid, and it is capped by law at a maximum of €10,010. The grant portion always stays a gift.

What does early repayment get me?

If you repay the entire remaining debt early, the Federal Office of Administration grants a discount that is tiered by the size of the debt. You can get an individual offer on request directly from the agency.

What do I do if I don't have money for the installment right now?

Apply in good time for an exemption due to low income or for a deferral. Simply not paying leads to late fees and can make the entire remaining debt due.

Do I automatically get forgiveness for good grades?

Partly yes, because examination offices report the top 30 percent of a graduating class directly to the Federal Office of Administration. Checking back with the examination office to be safe still doesn't hurt.

Conclusion: repaying BAföG is plannable, no need to panic

Repaying BAföG sounds more threatening than it actually is once you know the deadlines and take action. Use the performance-based forgiveness if you have good grades, check for an exemption if your income is low and calculate whether early payoff with a discount is worth it. Most importantly: always respond promptly to mail from the Federal Office of Administration instead of waiting. If you inform yourself early, you often end up repaying significantly less than you originally thought.