Usage of the three past tenses

Präteritum and Perfekt

The correct usage of the German past tenses is not difficult. Präteritum (simple past) and Perfekt (compound past) do not really differ from each other in the usage. In most cases both tenses are correct, though Präteritum is more and more rare. There is no real difference in the meaning between the following sentences:

Ich habe gestern viel gelernt.
Ich lernte gestern viel.
(Yesterday I learnt / I was learning a lot.)

We can say that ich lernte is a bit closer in meaning to the English “I was learning”, while ich habe gelernt is somewhat closer to “I learnt” or “I have learnt”. So the Präteritum may express some continuous meaning while the Perfekt expresses that the action is already in the past and finished and can have some result in the present moment. But the two meanings are quite mixed in today’s German spoken language.

Using Präteritum seems to be easier as you do not have to take care which auxiliary to use but try to avoid Präteritum and use Perfekt instead.
However some common verbs sound a bit complicated in the Perfekt, and so they are rather used in Präteritum, e.g. sein, haben, and the modals:

Ich war schon zweimal dort (I have already been there twice). Ich bin dort schon zweimal gewesen would be also correct but quite rare.
Ich hatte ein Haus (I had a house). (rarely: Ich habe ein Haus gehabt.)
Ich wollte gehen (I wanted to go.) (sometimes: Ich habe gehen wollen.)

Note that these two past tenses can express everything that happened in the past. It is not important how long or since when the action had been in progress or whether the actions were in progress in a certain time of the past or just simply happened instantly, or if the action has a result in the present. Everything that happened somehow in the past is expressed using the two past tenses:

I had been working for five hours: Ich arbeitete seit fünf Stunden / Ich habe seit fünf Stunden gearbeitet.
I was working: Ich arbeitete (sometimes also: Ich habe gearbeitet.)
I worked: Ich arbeitete / Ich habe gearbeitet.
I have worked: Ich habe gearbeitet (sometimes: Ich arbeitete).
Somebody has been smoking here as everything smells of smoke: Jemand hat hier geraucht / Jemand rauchte hier, denn alles stinkt.

However, if the action is in progress or actual at the present moment, the present tense (Präsens) is used:

Somebody has been smoking here for half an hour: Jemand raucht hier seit einer Halben Stunde.
I have lived here for twenty years: Ich lebe hier seit zwanzig Jahren.

The German present tense expresses even a past action in a subordinate clause if the main sentence is in past tense. So the present tense expresses simultaneity this way:

I don’t know what the time is: Ich weiß nicht, wieviel Uhr es ist. (All present tense.)
I didn’t know what the time was: Ich wusste nicht, wieviel Uhr es ist. (Ist refers to a past action here!)

Perfekt and Präteritum in temporal clauses

One exception when you really have to take care which past tense to use is the temporal clause. In a complex sentence two actions (verb forms) appear at least, one in the main clause and one in the subordinate clause. The two clauses are connected to each other with a connective, such as nachdem (after), bevor (before), sobald (as soon as), wann (when), bis (until), während (while).
If the two actions were happening simultaneously at the same time we use Präteritum (and not Perfekt):

Während wir in Berlin waren, besuchten wir oft die Museen.
Während ich las, schlief er.

We use Perfekt to express an action that happened before a present action:

Nachdem er die Arbeit beendet hat, schläft er.
(After finishing his work/As he has finished his work, he is sleeping.)

Perfekt can even express the meaning of the English future perfect, thus showing anteriority relative to another future action. This “other future action” can be expressed using the present tense as in German sentences the present tense can also express future actions:

Ich antworte sofort / Ich werde sofort antworten, wenn ich deinen Brief bekommen habe – I will answer as soon as I have received your letter.

Together with the Plusquamperfekt, Präteritum (and not Perfekt!) is used in temporal clauses, see below.

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Plusquamperfekt

The usage of  Plusquamperfekt is very similar to the English Past Perfect. It expresses that an action in the past happened before another action in the past. It is mostly used in temporal clauses and the other action is described using the Präteritum (and not the Perfekt!):

Nachdem ich gearbeitet hatte, ging ich schlafen.
After I had worked, I went to sleep.

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