If a new car has to be bought, if the old kitchen has had its day or if you finally want to go on a trip around the world, then this is often paid for with a loan. Banks advertise everywhere with very favorable conditions and very low interest rates. However, consumers should not be blinded by a cheap loan offer alone. These five things should be considered before submitting an application.
What about your own credit rating?
If you want to take out a loan, you have to be creditworthy. Banks check this with a request from a credit agency such as SCHUFA Holding AG, Creditreform Boniversum, Crif Bürgel or Arvato Infoscore. If you want to be sure, you can apply for a self-disclosure before a loan comparison. At SCHUFA this is possible once a year free of charge. Each credit agency calculates the creditworthiness differently.
For example, the termination of unused current accounts and credit cards contributes to improving the creditworthiness. Anyone who pays on time and does not pay cell phone, rental or other contracts on time improves their creditworthiness. Completed entries can almost always be deleted. However, the deletion must be requested from the respective credit agency.
Is the required credit realistic and can it be serviced?
The required loan amount must of course be calculated before applying to a bank. For example who one Loan online with LoanScouter chooses must calculate exactly whether the monthly installments are affordable. Depending on the amount of the loan, it is important that the borrower can still pay the loan installment on time in 2, 3 or 4 years. The borrower must therefore be honest with himself. Calculated according to a rule of thumb, after deducting the monthly fixed costs, a maximum of 40 percent should be spent on a loan installment. Depending on the amount of money available, the term of the loan can then be chosen.
A dedicated loan is usually cheaper
Are you planning to buy a house or a car? Maybe you need a house or apartment renovation? Banks offer loans with a prescribed purpose for these projects. These special loans are usually always cheaper than installment loans, where the purpose can be freely chosen. Anyone who works in the public sector or has the status of a civil servant can apply for a special loan from many banks. Since the income of these professional groups is particularly secure, more favorable credit conditions, higher loan amounts and longer terms are possible.
The credit comparison of branch and online banks is particularly important
Credit comparisons on the Internet are particularly easy these days. Even if the offer on the Internet is huge, the loans from branch banks should also be included in the loan comparison. However, it is important that only condition requests are made. Multiple credit requests can have a negative impact on creditworthiness. In addition, other banks can see for up to 10 days where a request has already been made. A comparison of different offers is only possible if the same conditions such as loan amount and term are always selected.
With a second applicant, the loan becomes cheaper
If a borrower is married or lives with someone else in the same household, it can definitely pay off to take out the loan together. With a second applicant, the credit rating improves. This usually affects the interest rate and the loan is ultimately cheaper.
Conclusion
The deletion of entries in the Schufa report can improve the credit rating. A credit comparison is particularly important. A loan application should only be made once the right loan offer has been found.
