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Relationship with Maximilian I

The expansion of high-risk, albeit very lucrative, business connections to Maximilian I was undoubtedly promoted by Fugger. In his view, the House of Habsburg was bound to be the dominant power and dynasty within the German region, and as such should receive his financial and political support. Jakob Fugger met the young Roman-German king for the first time in 1489 at a Frankfurt fair.At that time, his plans for the independent Duchy of Tyrol had been agreed upon with the king's chancellor, Johann Waldner. On 16 March 1490 Sigismund and the Tyrol Estates came together with King Maximilian also present. The archduke had to resign under the pressure from the estates, who accused him of mismanagement, and his possessions fell to the king. Maximilian then promised to repay all loans of its predecessor to Jakob Fugger.

Thus the Fugger business became one of the most important financial backers of Maximilian, who since 1486 was co-regent of the Holy Roman Empire. After his father Frederick III died in 1493 he became the reigning emperor. Despite having constant financial difficulties due to an extravagant lifestyle and many failed political projects his reign saw the kingdoms of Spain, Bohemia and Hungary gained for the House of Habsburg, not by waging war but through advantageous marriage arrangements which were funded with the help of Jakob Fugger.

On 15 July 1507 Maximilian I sold the County of Kirchberg, located at Ulm, the adjacent lordship Weißenhorn with the associated city, as well as the lordships Wullenstetten and Pfaffenhofen (Roth) from the Habsburg possessions in Further Austria to Jakob Fugger. Maximilian I who crowned himself Holy Roman Emperor in 1508 received a payment of 50,000 guilders for these sales. More sales followed in 1508 where he sold manor Schmiechen and in 1514 where he sold the lordship Biberbach to Fugger. Maximilian I elevated Jakob Fugger into nobility in 1511 and granted him the title of Imperial Count in 1514 so the former burgher could operate his business without interference from local nobility. In the course of his life Jakob Fugger also became lord of more than 50 smaller villages.

Criticism from reformer Martin Luther on the Fugger business methods and novelistic portrayal from early research have led to the notion that Jakob Fugger exercised considerable power over Maximilian I the king and emperor of the Holy Roman Empire, while more recent research shows that this was only partially true. However, close to the end of his life Maximilian was so heavily indebted to Jakob Fugger that he had no choice but to continue his support for the Emperor to still be able reclaim his outstanding debits. When Maximilian's grandson Charles V stood for election to become the next Emperor, Jakob Fugger raised a sum of more than 500,000 guilders, a significant portion of his wealth and of the total amount raised in his support, to ensure the seven prince-electors would choose him. Thereby he helped prevent the election of Francis I of France which would have endangered his claims and investments gravely, although it also made him highly dependent on the House of Habsburg.

Much later the Fugger family lost a large portion of their wealth following three Spanish state bankruptcies (1557, 1560 and 1575) under the reign of Philip II of Spain.