There are many companies in Germany that grant loans. These facilities support customers applying for small loans that they cannot get from traditional banks. With the help of such providers, you can solve your financial problems in the short term.
Small loan briefly explained
- The amounts that can be borrowed are small and start at 100 euros but do not exceed 1,500 euros
- These loans can be granted with different terms depending on the customer’s wishes and can be repaid within 15 days, 30 days or even 60 days
- The interest rate on these loans is usually 7.95%
- Even if you have a negative Schufa, you can take advantage of such a loan
- This loan can be granted to you with no up-front costs.
The advantage of this loan is that it can be applied for online. The processing of the applicant’s data also takes place online as part of the Verify-U procedure. The verification of the prospect is not done via video application. With Verify-U it is also possible to determine the age of the applicant.
What do we mean by a small loan?
The banks offer loans with a long term, which in some cases can be up to 360 months or even more. However, small loans are only granted for a short period of time. These loans can be taken out with a repayment period of 15 to a maximum of 60 days.
This type of loan is given not only to natural persons but also to business people with legal status who have problems with their company that need to be resolved as soon as possible.
You need to think of this loan as a line of credit.
Loans are only granted in small amounts
You can apply for a loan with amounts between 100 and 1,500 euros. Of course there are exceptions, but these depend on various aspects, but above all on the applicant’s economic situation and, in particular, on his creditworthiness. If these conditions are met, you can receive higher amounts for a short period of time. You don’t have to specify what you are applying for.
In many cases, it is better to state the purpose for which you applied for the loan, as it can have a positive effect on interest rates. For example, the interest on the purchase of an object is lower than the interest on a trip.
Who can take advantage of such a loan?
This type of loan can be accessed by anyone who meets the conditions required by this type of institution and you can usually get it after passing a SCHUFA exam. Typically, you can still get this loan even if your payment or credit history is negative. Ultimately, however, only the decision of the provider is decisive for receiving the loan.
There are also small loan providers who do not require submission of pay slips and bank statements or collateral.
With other providers, the small loan is confirmed online or by smartphone without the need for a SCHUFA query. There are several types of institutions that provide this type of loan and some do not require collateral such as pay slips or bank statements. No guarantors are required either. There are other institutes that do not require a SCHUFA preliminary examination and grant this type of loan quickly via online confirmation or even via smartphone.
Do these loans require insurance?
You don’t need to provide any collateral or purchase life insurance to qualify for this type of loan.
Under current law, such inquiries are not a requirement and financial institutions requesting such documents or insurance are suspect.
What is the difference between small loans and mini loans?
In general, these terms are similar and refer to the same thing. A small loan is characterized by a short credit period and an upper limit for the amount requested. The same goes for applying for a mini loan. The main feature of a small loan is that the amount borrowed is repaid as soon as possible and the repayment period generally does not exceed 60 days. However, there are financial institutions that can extend the repayment period up to 180 days.
The amount you borrow is always important, as are the terms on which you take out the loan.
In general, you should be able to request an extension of the repayment period without the institution concerned having to introduce additional financial clauses. Therefore, pay attention to the contract that you sign when granting the loan, because it should also contain the possibility that the applicant can benefit from an adjustment of the repayment period.
It is therefore very important to read all contract clauses carefully to ensure that there is no mention of any clause involving additional costs. There are several situations in which the borrower may default, such as: B. if he loses his job during the period in which you applied for the loan or if various suppliers and business partners fail to meet their financial obligations.
In such a situation, the borrower will certainly not be able to repay the amount within the deadline set by the credit institution.
This situation can often have a negative impact on the borrower, because with many financial institutions the contractual terms are designed in such a way that the borrower has to pay dearly if he does not repay the loan on time. Sometimes these additional costs can be well over half the amount borrowed.
Featured image: stock.adobe – © zest_marina # 99671484
–
