Whether buying a car, the rescheduling of the current account or new home furnishings – there are numerous reasons for borrowing from the consumer’s point of view. However, the amount of the loan is completely different and, especially in the case of short-term private or consumer loans, is usually in the area of the so-called “small loan”.
Credit sums in the small credit range
In the banking landscape, the term microcredit refers to loans that are below a specified limit in terms of their amount. For this limit, however, there are no agreed provisions across banks, so that it differs from bank to bank, with which loan amount is a small loan. On average, German banks consider loan sums in the range of 500 to 10,000 euros as small loans.
According to a Wikipedia statement, 70% of private and consumer loans in Germany are below the defined minimum credit limit of 10,000 euros. This value reflects the high demand for short-term loans up to 10,000 euros. Small loans are usually granted as installment loans without fixed collateral, ie “blank”. The borrower receives a fixed interest rate and usually has an unlimited special repayment right. However, the Private credit information required by most banks can quickly become a “stumbling block” for many borrowers when it comes to taking a small loan.
Who and what is behind the term “Private credit”?
The term ” Private credit ” stands for the company Private credit Folding AP, which is the largest private-sector, German credit reference agency. With the help of the Private credit information, a wide variety of contractual partners can obtain information on the creditworthiness of third parties. As of January 2014 Private credit has data sets of approximately 75% of the German population. Many banks require a positive Private credit information from their borrowers as a prerequisite for lending.
Borrowing without Private credit information
If a borrower knows that the Private credit has negative entries, for example information about existing arrears, stored for his person, borrowing is usually difficult. Loans without Private credit information are generally not possible with traditional branch banks, such as Folks banks or savings banks. However, to achieve successful lending, borrowers can turn to reputable online credit intermediaries. On the Internet, there are numerous providers who promise a loan without Private credit information or despite negative Private credit entries. The decision whether to be a serious credit intermediary or not can be made on the basis of few criteria:
– Reputable credit intermediaries work without any pre-charge or additional costs. According to the recent DFT judgments on processing fees, a small loan may incur no additional costs in addition to interest costs. Of course, this also applies to credit intermediaries. Dubious credit intermediaries require the borrower, even before the mediation, virtually independent of success, the payment of abstract Vorkosten. It is important for borrowers to distance themselves from such providers, as experience has shown that often, after paying the required pre-financing costs, not much has happened.
– Anyone looking for small loans without Private credit on the Internet, lands quickly with credit providers, which offer a so-called “financial rehabilitation”. Even with such providers fall in advance and regardless of the actual grant of a loan costs. As a consumer, you should therefore urgently stop your eyes and read exactly whether the provider of a loan or financial restructuring is offered.
Small loans without Private credit – how can it work?
The granting of a small loan without Private credit information is possible at various banks, if the borrower can provide sufficient alternative collateral or there is another co-applicant or guarantor with good credit rating. Some credit providers, such as MaxCredit, look beyond the borrower’s negative Private credit and agree to lending. In principle, small loans without Private credit are not the rule and therefore in a sense always a matter of courtesy and negotiation. In some cases, it can also help if existing savings are assigned as collateral. Here, for example, it is also possible to assign the claims of life insurance not yet due to the lender. Since the amount of credit in the field of small loans is manageable, additional collateral and co-applicants can have an extremely beneficial effect on lending and can even out a negative Private credit information.