... The author is a bestseller in Germany, but not here yet. The publisher is large and international, but they haven't made me an offer yet. I just wanted to be prepared in case they ask me for an estimate. The author wants me to translate, but I don't even know how publishers work here in the US.
If the author is bestselling in Germany and wants you to translate into English, the publisher will probably honor the request.
For example, do they usually have their own database of translators or do they allow the author to decide? I just want to make sure that I'm not being taken advantage of and am not going to be rejected because I'm asking for too much. I think literature is paid less than other subjects, which is another reason for asking...
I don't know about pay rates. Let them make the offer - publishers will negotiate, so if it's ludicrously low, make a counteroffer. Make up your mind what the absolute lowest you will accept is and stick to it.
One thing you can ask for is royalties: less money up front, and royalties based on sales. It's a bit of a risk, if the book doesn't sell well here, but might end up paying more over time.