1. Determine creditworthiness yourself
First of all, it is advisable to find out about a possible loan amount. On the one hand, a budget is drawn up for this, in which all income and expenditure are included. A buffer for unforeseen expenses should also be included. The amount that remains at the end can be used for a loan or for repayment.
In the process, you should also find out about your own creditworthiness. Have you already submitted a loan application that has been rejected? Then this rejection will be saved for around two years at the central office for credit information, where all lenders can view it. The credit rating determines the amount of the loan, if it is granted at all, and the interest rate. The worse the credit rating, the higher the interest rate will be.
2. Pay attention to serious offers
Unfortunately, the financial market is full of dubious offers that appear lucrative at first glance. The instant loan that is paid out in a few minutes? Sounds good, but it's not. It is a fraud, and by the way, even advertising for such an instant loan is prohibited by law.
Dubious providers often advertise with low interest rates and high amounts of credit, with a settlement without a credit check and with the fact that they can accelerate lending if an advance payment is made. Serious providers do not make such promises!
3. Don't finance short-lived products with credit
Important rule of thumb: The term of the loan should in any case be shorter than the life of the product financed with it. It is therefore not recommended to finance a vacation with a personal loan, for example, because here you are already caught up in everyday life if you still have to pay off the loan installments. Cars, renovations or new furnishings are more suitable for personal loan financing.
4. Keep an eye on costs
Of course, the personal loan is not in vain and costs fees that the borrower demands in the form of interest. The lower the borrower's credit rating, the higher the interest rate. A maximum of 10 percent is possible as an interest rate, here the legislator has capped the interest rate.
5. Better bet on personal loans
The personal loan has several advantages over other forms of credit. On the one hand, the aforementioned maximum interest applies. On the other hand, financed goods and products belong directly to the buyer, while, for example, in the case of a purchase in installments, the goods remain the property of the seller until full payment. The personal loan protects the borrower against over-indebtedness because it is only granted after a thorough credit check. If the creditworthiness is negatively assessed, a reputable lender decides against lending.
Would you like to compare the conditions for a personal loan? Then you are with our credit comparison precisely!
