Bailey will now head to the Midlands to undergo a medical and discuss personal terms after a deal was agreed between Villa and the German club.
The 23-year-old appeals to Villa boss Dean Smith due to his pace and ability to play on either flank.
Villa, who broke their transfer record earlier in the summer with the capture of Norwich playmaker Emi Buendia, have focused on increasing their attacking options during the current transfer window.
The future of skipper Jack Grealish, meanwhile, is set to be decided in the coming days.
Grealish is the subject of a £100m transfer offer from Premier League champions Manchester City.
Villa are keen to keep the 25-year-old and have offered him a new contract on considerably improved terms. But the lure of playing in the Champions League is likely to prove strong to Grealish.