Here you can get your loan cheaply
A cheap loan is offered by various banks, but there are a few things you should consider before taking out it, and don’t be afraid to read the fine print carefully. If you read on the Internet or on a bank notice that a cheap loan is being offered, it usually has a low interest rate.
However, this does not mean that the interest rate also applies to you. Many providers work with a so-called creditworthiness-dependent interest rate. A cheap loan is only given to customers who can prove a high score in the Schufa or other information files or who have an exceptionally high income.
If neither applies to you, you must expect that you will only get the loan at a higher interest rate, which means that you will have to pay a higher monthly rate.
Cheap Loan – The Facts
It is not very difficult to get a cheap loan. You should obtain various offers in advance. Always make sure that the interest rate is fixed or depends on your creditworthiness. A fixed rate should apply over the life of the loan.
In addition to the fixed and credit-dependent interest rates, there are providers who offer a variable interest rate. This is redefined at certain intervals and adapted to the market situation. Currently, the interest rates are very low, for this reason it cannot be assumed that a cheap loan with a variable interest rate will be cheaper.
Rather, the interest rate can be raised, for example in the event of a key interest rate hike. You will always make the right decision with a cheap loan that has a fixed interest rate over the entire term and is not granted based on creditworthiness. With this you can enjoy the low interest rates even if you do not earn an above-average amount. Since the interest rate is fixed over the entire term, you do not have to worry about unjustified interest rate increases.
Online banks often have better deals
When looking for a cheap loan, also take into account the offers of the online banks. Many of them do not have a branch network and therefore have lower costs. You do not need to pay a shop rent for a shop in an attractive and central location and you also save personnel costs.
Online banking can be done from any computer connected to the internet. Older people, who have been familiar with going to their house bank for decades, also take advantage of the new possibilities because it is more convenient to do banking on their home computer instead of having to go outside in all weathers. These are the reasons why online banks have established themselves in the banking landscape and present strong competition to branch banks in terms of their offers and possibilities.
The savings that they have thanks to the lower administrative effort are often passed on to their customers in the form of free current accounts and lower interest rates for loans. You should therefore check various offers from online banks and compare them with the conditions of your house bank. You do not have to be a customer or have a checking account to get a cheap loan from an online bank. You can also apply for a loan as a new customer. You can prove your identity using the Post-Ident procedure.
You go to a Deutsche Post branch with the corresponding document, which you print out after applying for the credit. There your data and your signature will be compared using your identity card. You can then be listed as a customer of the bank.
Securing a cheap loan
A cheap loan should also be protected against the risk of unemployment, illness and death. You can take out credit insurance for this. This is used to settle the remaining debt if you:
- become unemployed through no fault of their own
- are no longer able to work due to a serious illness or accident
- die during the repayment phase of the loan
In the latter case, you will not bequeath any debts to your surviving dependents, they will not be charged with the costs of your loan. Please keep in mind, however, that you cannot take advantage of the coverage if you culpably lose your job or if the illness leading to incapacity for work existed before the loan agreement was signed.
Even if a cheap loan doesn’t cost much, you should consider whether you really want to go into debt for the thing you are trying to get. Sometimes it makes sense to postpone the purchase and save a certain amount for a lower loan amount.
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