The supply of loans in the market is very large, this is partly due to the very attractive interest rates, but also to the great competition. Lending enables providers to retain their customers over the long term. But not every loan is serious, so it is important to check everything in advance and above all to read the fine print.
Many banks belong to a banking association and are subject to responsible lending. These include certain certificates, such as the TÜV seal. In addition, customer surveys on lending are frequently carried out in specialist journals. This information is a useful guide and may help you with orientation.
A loan should never be completed prematurely, it is important to inform yourself in advance about the respective conditions. For example, this can be done quickly and easily over the Internet, where different offerings of credit institutions can be compared. So you can quickly find a selection of reputable loans. When a vendor has been shortlisted, not only should interest be focused on interest rates, but repayment modalities are also an important consideration. For example, special payments make a lot of sense in order to repay the loan ahead of time.
Once a suitable financier has been found, the next steps can be taken. For this purpose, a corresponding loan application must be completed. This can either be placed in a branch office or conveniently downloaded from the website. In addition to the actual application, the institutes still require a copy of the identity card, as well as a certificate of merit. In Germany, only persons over the age of 18 may take out a loan. If the creditor is younger, it requires the consent of the parents. Before a bank seeks to lend at all, this checks whether the respective person is on creditworthy. This requires a regular monthly income. With the help of a merit certificate or a bank statement, this can be proven easily.
Lending in a branch bank usually takes a little longer, such as the award of an online loan. Frequently, an application can be reviewed and then either approved or rejected. Some providers also offer more favorable condition, since the administrative burden is significantly lower here. Nevertheless, it is also necessary to examine and read everything in peace, because after all, a loan is often tied to a bank over several years.
Additional products make the loan more expensive
Banks often do not earn so much on an ordinary loan, which is why they often offer so-called additional products, which at first glance seem sensible, but make lending much more expensive. An example of this is a residual debt insurance, which intervenes when the borrower comes in financial difficulties, in case of prolonged illness or unemployment. This is a risk insurance that is put on top of the actual loan. Depending on the amount of the loan, this can be one or the other thousands. And if the insurance really pays when it comes down to it, that’s a completely different matter. For a larger loan amount with a very long term, this additional protection may be useful, but for small manageable sums with a short term, this is not recommended.