Many consumers need a car to get to work. However, very few can pay the sometimes considerable loan amount from the current budget. Often, consumers have nothing on the high edge that they can access. Basically, a loan for a car purchase is the most popular in Germany.
For many, the car is no longer a luxury object, but often ensures its existence. In addition to a normal installment loan, there is also a special car loan, which is often even cheaper because the car can be brought in as security. But what about a car loan despite a negative Credit Bureau?
The car loan despite negative Credit Bureau – the situation
Sufficient creditworthiness is the be-all and end-all of a loan even with a car loan. The customer can choose between an installment loan or a special car loan, but can also choose financing from the dealer. A perfect credit rating is required for all credit variations. It consists of a sufficient income and a clean Credit Bureau. If the conditions of the banks are met, nothing stands in the way of a loan.
But many consumers have noted negative entries in their Credit Bureau. They can have arisen for a variety of reasons. Since an invoice was not paid, payment in installments was simply forgotten. But serious reasons such as a loan termination or garnishment of wages lead to a burdened Credit Bureau with its unpleasant consequences, namely, among other things, a loan refusal.
Customers with a burdened Credit Bureau often do not receive the apartment they want because a landlord also takes a look at the Credit Bureau. Just think of a cell phone contract, this is also only possible with a perfect credit rating. Anyone who is burdened with a negative Credit Bureau is classified by banks with a dark credit history. The risk of default is then increased, according to the banks. However, the loan seeker should know that a car loan has an increased interest rate despite negative Credit Bureau. Interest is often charged at 15.99%. So if you want a 10,000 USD loan, you would have to pay a whopping 829 USD annually in interest.
Before applying for a car loan despite a negative Credit Bureau, the budget should be at the beginning. This only shows whether the customer can pay a loan at all. Because the negative Credit Bureau has already shown payment irregularities. If the bottom line shows financial scope for a rate, a car loan could be applied for despite a negative Credit Bureau. However, a financial buffer should always remain.
If a used car is bought, a larger or smaller repair must always be expected. Devices in the household can also fail and need to be replaced. With the financial buffer, these costs could be paid without thinking about a loan again.
In order to get a suitable car loan despite a negative Credit Bureau, some large credit agencies offer a loan. Credit agencies themselves do not grant loans, but rather mediate them between the customer and the bank. There are not only loan seekers who do not have a negative Credit Bureau and opt for a loan despite a negative Credit Bureau. Often there will be a financial project in the near future where a good credit rating is required. Since the loan does not appear in the Credit Bureau, the house bank is not informed of the loan either.
As a major credit broker reveals, there is no cost to a loan request and the subsequent loan offer. There are also no processing fees. The commission, ie the payment of the mediation, is taken over by the lending bank. The costs are then reduced in accruing agency fees as part of ancillary credit costs.
Of course, not everyone gets a Credit Bureau-free loan. Conditions must also be met here. The customer must be of legal age and should not be older than 58 years. The sufficiently high and regular incoming income is very important. It must be above the garnishment exemption limit, which can be found at around 1,100 USD. The Credit Bureau is not queried and the credit is not entered.
Anyone who is unemployed, self-employed or a reform recipient should be able to name a solvent guarantor directly for a loan, who must also prove his creditworthiness with proof of income. Without a guarantee, this group of people cannot receive a Credit Bureau-free loan. If you think you can buy a high-priced car, you will be disappointed, the loan amounts range from 1,000 to a maximum of 7,500 USD, whereby the latter amount must have a very good credit rating and the employment relationship must exist for four years.
The car loan despite negative Credit Bureau get borrowers who have a permanent employment that is not limited and does not include a trial period. In addition, the employment relationship must have existed for at least one year. The income must not be pledged. The customer has to sign a transfer of salary when applying for a loan. If there is a default on the loan, the bank pledges it immediately.
The car loan despite negative Credit Bureau – the loan application
Many customers place great value on a personal discussion about a loan, which is also available at the major credit agencies, but via telephone hotline or live chat. The cash payment of the loan amount by post has not been possible for some time, so that the loan amount is credited to the customer’s checking account.
Before the loan application is signed, the customer has to fill out a form that requires some data, such as the loan amount, the address, the term, a possible installment amount and the income. Based on this data, the credit agency will make a preliminary loan approval and send the loan agreement to the customer. This is then signed and sent to the agency with the necessary credit documents such as proof of salary from the past three months, account statements from the same period and a copy of the employment contract.
Before the documents are sent by post, the customer must carry out the Postident procedure, an identity recognition based on a valid ID card. This certificate goes with the documents to the intermediary. This checks whether the documents are complete and sends them on to the bank. Only when the bank has viewed the documents and found them to be good will the final loan approval be given with the cash payment.
The whole procedure takes about 5-6 working days when the documents are complete and when the bank has no more questions. Even with so-called urgent loans, which are advertised without Credit Bureau, the customer must also expect a processing time of a few days. It is always the postal route in between and it is always the same credit process.