Do Banks Offer Installment Loans in Germany


It is the traditional way to obtain an installment loan from a bank in Germany.
In Germany installment loan is called consumer credit. A personal loan obtained from the bank can be used to finance various kinds of purchases including holiday expenses room rental and medical fees. You don’t have to provide any proof on how you plan on using the funds from the loan. When the loan is approved it will be transferred to your bank account. Usually the monthly amount will be automatically deducted from the balance in your bank account.

Many banks in Germany offer installment loans with a loan amount that ranges from $2500 – $50000 Euros. Borrowers usually can choose the loan term which can range from 1 – 7 years. These banks usually have websites where they publish complete information on the loan including loan amount interest rate loan terms and eligibility requirements for getting approved for the loans. Some banks in Germany assign an interest rate based on the creditworthiness of the borrowers while others don’t. If the interest rate is determined based on creditworthiness borrowers with a lower credit score will pay a higher interest rate. On the other hand borrowers with a high credit score will pay a lower interest rate.

There are a few basic requirements that you need to fulfill in order to obtain a loan in Germany. One of the requirements is that you must be at least 18 years old. Installment bank loans in Germany are only available to residents who have a physical address in Germany. They will verify your home address when they check your creditworthiness. In addition you must have a steady income from a job that you have been involved for at least 3 – 6 months. In Germany the credit record is called SCHUFA Auskunft. The SCHUFA score reflects whether you have promptly pay your bills. Keeping your credit record clean allows you to qualify for the lowest interest rate at the bank.

When shopping for a loan in Germany you can use the loan comparison site to compare the loans interest rates. With the help of a loan comparison website you don’t have to stick to your current bank. It allows you to do research on the loans offered by other banks in Germany without having to waste a lot of time. Banks are not the only ones that offer loans in Germany. There are crowd funded loans like p2p loans where the loans get funded by private persons. Crowd funded installment loan in Germany offers a loan amount of up to $25000 Euros. Crowd funded loans usually have lower interest rates and require lower SCHUFA score to qualify. If you are a freelancer and couldn’t get a loan from the bank you can get a crowd funded loan instead.