A loan is always required when certain sums of money are missing that cannot be raised through own funds. The purpose for the loan is irrelevant. The purpose of the loan is of no interest to banks and credit institutions, particularly in the area of small and consumer loans. On the other hand, it becomes more important if a loan is to be taken out to finance or build a property, since there are significantly different conditions there than with the other forms of credit.
A loan can be realized through various lenders. The most frequently used and, accordingly, the safest is the bank or credit institution. However, private lenders are also an option, especially for smaller loan amounts. Taking out a loan is not difficult and only requires less preparation
Taking out loans – Preparing for the loan interview
Before the prospective borrower starts applying for a loan, some preparation should be completed. On the one hand, your own credit needs should be precisely defined. What is important here is the fact that when issuing loans, fees are usually charged by the credit institutions, which must be counted towards the loan amount. It is therefore recommended to choose a high loan amount so that you have enough financial leeway even after deducting the fees. But the borrower’s own budget should also be revised in advance. Since these factors also play a role during the credit discussion, the lender should carry out all statements in a well-structured and written manner so that they can be presented during the credit discussion. The various budget calculators offered on the Internet are helpful here.
Monthly income and expenses can be compared to calculate the remaining available budget. For the sake of simplicity, annual and semi-annual payments should be counted down to the respective months so that a comprehensive and correct overview is created. It should be noted in these calculations, however, that banks generally want to leave a sum of between 10% and 15% of their monthly income in reserve so that short-term expenditure can also be made. These sums still have to be deducted from the total of the available budget. Now the borrower gets an overview of what the maximum loan rate may be. With this amount in mind, the borrower should now start comparing the different lenders. Again, the Internet offers the necessary tools.
Thanks to various loan comparison calculators, the loan terms of the different banks and credit institutions can be compared with each other. Here the borrower can now see directly which loan amount he would have to pay with which loan installment. Depending on the loan amount required and the possible rate, the term of the loan can be determined. Once the right and suitable bank has been found, the potential borrower can make an appointment with the bank. He should take the statements already made with him to this interview, as this can significantly speed up the process of lending. The appearance of the borrower is particularly important in such a conversation. Even if many criteria decide on the granting of a loan, the opinion of the bank advisor is also a criterion.
Well-groomed clothing and a calm, thoughtful demeanor are therefore extremely important in such a conversation. Carrying the calculation that has already been carried out further convinces the bank advisor of the serious intentions of the customer and of their comprehensive preparation. Further points can now be raised during the conversation. If the borrower can provide various types of collateral, this can not only have a positive effect on the valuation of his loan application, but also have a lasting impact on the interest rate. The more secured a loan is, the lower the bank can set interest rates.
Land, real estate, life insurance, savings contracts and retirement provisions can serve as collateral for loans. These are accepted as security by the banks and can be used to secure the loan. During the interview, a credit application is completed after a credit check and if the bank advisor is positive. The customer must sign this. In addition, other documents often have to be provided because the bank wants to secure them. The last payslip and a copy of the current employment contract are usually requested. This is how the banks hedge against a borrower’s default. If all the data are to the satisfaction of the bank, the loan can be approved quickly and without much effort. So the sum is available to the borrower within a very short time.
Take out loans from private
Taking out a personal loan is much less difficult than getting through the banks. However, one also has to take into account that a personal loan does not offer the security that a credit institution can provide. The sums that can be realized through a personal loan are often lower than in a banking business. The big advantage here is the flexibility of the loans and the lack of control by the lender. Even if a certain creditworthiness and a regular employment relationship should be proven, entries in the Credit Bureau for a personal loan are no obstacle. This means that even in difficult situations, a loan can be taken out if this would not be possible through conventional banks and credit institutions. You can either take out a personal loan from friends, acquaintances or relatives, or organize it via a mediation platform on the Internet. Thanks to the right preparation, smaller sums in particular can be quickly organized.
Taking out a loan is not difficult. With a little preparation time, every borrower can ideally prepare for an upcoming loan discussion. This preparation not only provides a better overview of the possibilities, but also ensures that banks and credit institutions have a much better reputation due to the planned approach.