If you want to take out a loan, you usually don’t do this between the hinges. Especially when it comes to the first loan, consumers have many questions and are unsettled when talking to their bank advisor.
Are you planning to take out a loan in the near future? Would you like to keep the costs as low as possible? Then read this article and find out which mistakes in lending are particularly widespread and unnecessarily cost money.
Using the disposable is not much more expensive
Are you also one of the bank customers who consider the overdrafting of the current checking account using the overdraft facility to be more advantageous than other credit options? Then you should rethink and consider alternatives. An installment loan, for example, is much more recommendable. For example, banks charge significantly lower interest rates and offer a higher level of security.
In contrast to the overdraft facility, the bank does not have the right to terminate you prematurely or to change the interest rate with this form of credit.
With the fictitious interest of 12.50% for the overdraft facility and 5.00% for the installment loan, there is an interest difference of 375 dollars after 12 months!
The nominal interest rate is decisive
Another misconception of many consumers is the assumption that the nominal interest rate is an appropriate benchmark for the terms of different loans. This is not the case: only the effective interest rate takes into account all factors that influence the cost of a loan. Specifically, these are:
- nominal interest rate
- Account management fees
- Payment and redemption dates
For this reason, you should definitely compare the effective interest rates on loan offers to find a good and cheap loan.
Processing fees for loans are annoying but tolerable
Do you count among the borrowers who have no hesitation in paying fees for checking their creditworthiness and preparing the contract? Then you were not fully informed. At the latest after the relevant judgment of the BGH, it is clear that credit institutions may not charge processing fees for the granting of a loan.
This applies even if the fees are included in the general terms and conditions. As a borrower, take advantage of the opportunity to claim back the wrongly paid processing fees afterward!
With negative Credit Checker, it is impossible to lend
“Consumers about whom negative information is stored at Credit Checker do not get a loan.” – That sounds plausible but is often not always correct. By providing collateral, you replace a lack of creditworthiness with various forms of credit. For example, regardless of the Credit Checker information, it is possible to obtain a security loan. Your shares, bonds and other securitized securities serve as collateral for the loan.
A second borrower, such as your spouse, can also increase the likelihood of a loan approval if you have negative Credit Checker characteristics. In general, a single negative characteristic is not a knock-out criterion when lending!