German consumers borrow more than a few years ago. According to , around 17.4 million installment loans are currently running, a figure that has increased by more than half over the last decade. Not only an increased need for consumer goods is held responsible, but also the currently relatively low interest rates on installment loans allow consumers access.
However, if you want to get a good and cheap installment loan , you should take the following five advices to heart. They increase the applicant’s chances of his application being accepted by the financial service provider concerned and indicate where costs can be saved:
1. Compare, compare, compare
Favorable interest rate offers entice consumers – especially in recent times – to conclude a installment loan without great preconceptions. But that’s not what should happen, but take a look at several offers before submitting a loan application.
In addition, it should be kept in mind that providers only award their lowest interest rates to customers with a very good credit rating . A realistic view of one’s own creditworthiness helps to assess whether the low interest rate of the bank in question can actually be maintained.
In addition to the borrowing rate of the loan offers, the 2/3 interest rate should also be compared. With this interest rate give banks to which of interest , the majority (2/3) of the customers their credit get.
2. Always consider the credit rating
The creditworthiness of a consumer mentioned in the last point is therefore decisive for the interest on a installment loan. Each bank sets some criteria, but in most cases the place of residence, the job situation (permanent / seniority), the income, the monthly expenses and the number of borrowers . Added to this is the so-called value of the applicant, which states the probability with which he repays his loan in full. The better the value of the prospective customer, the higher his credit rating. Incidentally, the score can be checked once a year with in-house information.
3. Do not ask too many specific requests
Specific credit requests for installment loans are automatically forwarded to the . If these requests accumulate, the can correct the so-called ” value” of the person concerned downwards. Therefore, interested parties should only make a condition request, which will be deleted immediately after ten days. The value of the person concerned will then not deteriorate permanently.
4. Match your loan request with your life situation
Before a loan is applied for, one’s own financial and living situation should be considered more closely. For example, if there is a debt rescheduling of old loans, an overdrawn credit line and credit card debt should also be included. It also has to be thought about which monthly loan installment can be made permanently. In order to remain as flexible as possible in exceptional situations, for example, the monthly rate may be set slightly lower and additional special repayments may be required.
5. Credit protection – if necessary
In principle, the conclusion of a residual debt insurance does not increase the likelihood of being granted a loan. The decision as to whether such an insurance is completed is therefore completely free for any applicant . Those who have a term life insurance , for example, are already adequately covered by their installment loan in the event of their own death. But what happens if the job is lost or you can no longer work as a result of an injury? If a family is dependent on a main earner, loans over 10,000 euros and with long terms are applied, should therefore be taken into account when concluding an installment loan, the combination with a residual debt insurance.
The five points presented can make life easier for applicants if they want to take out an installment loan. With a good credit rating and targeted condition inquiries with different providers, a very good result, that is a cheap credit conclusion, can be achieved without much ado.