Hi Aaron and welcome to the forum.
It is a cloth Deutsche Kreuz in Gold and from the photo provided it looks original. We will need to see better and clearer photos of the front and back to be absolutely sure as well as one of the date at the bottom of the gold wreath. There are plenty here on the forum should you try a search.
$500 seems to be a little high to me for an original.
Looking for LDO marked EK2s and items relating to U-406.....
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