I tell you a little what this means: when you acquire a line of credit from a company that is regulated by the BCR, the relationship you have with that company and with the other organizations with which you operate , is informed to that entity and this is forming your credit history or also called scoring.

Did you know that from now on with Speedy Loan you can build your credit history?

The scoring imagine that it is your score as a client of financial, non-financial or banking entities. It is what verifies each entity to which you make an order, to see if it is possible to grant you the credit line or not. This is going to form your behavior as a payer, so it will always be convenient for you not to have arrears.
As you will know when granting online I am not as demanding as any bank or financial entity. I always choose to trust and create a loan opportunity for everyone. If you could never get any loan or credit card just because you don’t have a credit history, don’t worry!

Speedy Loan being a non-financial credit provider entity is regulated by the BCR, so I have obligations and rules to comply with. You can verify it by clicking here.

One of the regulations that I have to comply with is to inform this entity of all the clients that use any of my services, either of loans or payment of services, since a line of credit is acquired.

Among the clients that I notify are the negatives, which are those that did not pay in time and form and on the other hand the positives, which are those that fulfilled the payment on time and will be able to continue operating with me without problems.

The latter are the ones that have the most benefits for the following reasons:

– I’m going to trust more and more and the credit limit will increase.

– Your credit history will add positive points.

– Other financial or banking entities will also trust you for your scoring.

When you apply for a personal loan or pay a bill, it will have an expiration date

apply for a personal loan or pay a bill, it will have an expiration date” width=”612″ height=”230″ />

In order for your history to grow positively you should always respect this expiration date, which is the first business day of each month.

Anyway, as I know that not everyone charges the first business day, I extend the deadline until the 10th of each month. As you make more orders and pay them on time and form your socring will rise more and more.

What are you waiting for? You can ask me up to $ 20,000 in 3 installments. 

In common usage, the terms loan and credit are used equally. The difference between the two terms is above all the amount of the lent sum and the duration of the repayment. A loan is a sub-form of credit and involves longer terms and higher sums.

Who grants loans?

Above all, banks lend out loans. These determine the interest rates for the loans and loans and allow the creditworthiness of the applicant to be included in the interest calculation. However, bank lending often takes a long time, so short-term solutions are hardly possible for the consumer. 
Private individuals can also grant loans. Trust in the debtor plays an important role here. If the lenders come from the nearer family environment, it is often difficult and takes a lot of effort to obtain a loan.

The real alternative for quick cash requirements is an online loan through Small Lender . Here, the customer often receives the loan after 60 minutes and does not have to commit himself long. Because after 30 days you can pay off the loan again. Thus, a short-term financial needs can be covered quickly and unbureaucratically.

advantages

Choosing Small Lender for a loan offers many benefits. These can not be offered by banks or individuals to this extent.

1. Free loan calculator

With the free loan calculator, customers at Small Lender can see immediately and in detail what costs are to be expected at the desired level. Since Small Lender does not pay any processing or commission fees, all costs are transparent.

2. Loan requests for loans are Bank neutral

The loan requests at Small Lender are Bank neutral. This means that these requests do not let the Bank score slip into the basement, as is often the case with normal loan requests.

3. immediate payment

Small sums for repairs or medical treatments are usually needed quickly. At Small Lender you will get the loan transferred to your account within 30 minutes. Thanks to the immediate payment for the online loan, long waiting times are a thing of the past.

4. No long bond due to fast repayment

Nobody likes to be in debt. At Small Lender, you are not tied up for long, but thanks to short maturities, you can pay off your debts quickly. This way, financial bottlenecks can be bridged in the short term.

Advantages of a loan through Small Lender

• No effect on your Bank score
• Fast credit decision after a short processing time
• Short maturities and high flexibility
• No processing fees or commissions

Which loan suits me?

Imagine: After buying a car, most of your financial reserves are exhausted. Now the washing machine breaks down and has to be replaced. It is too expensive to use the bank account balance of the account. Here is the Small Lender loan for you the fastest solution. 
The month is coming to an end and your financial resources are as well. If a repair or just a medical bill is added, it will be financially difficult. With Small Lender’s fast and affordable loan, you can act fast and regain your financial freedom. You can easily pay off the loan after the next salary payment.

Definitions around the loan:

Loan amount: The amount that is available to the borrower for a loan.

Loan Account : An account opened with the Loan Agreement that is used to pay out the loan amount and repay the loan.

Loan Performance: Examining and granting the desired loan, disbursing it and overseeing the repayment of the loan.

Interest on loans: Interest which is due for the guarantee of the loan amount. These influence the amount of the loan amount to be repaid.

Loan: conclusion of a loan agreement between the lender and the borrower.

Which loan types are there?

The types of a loan are differentiated by loan amount and loan term.

After runtime

Loans as short-term loans 
If the loan is repaid within twelve months, it is called a short term. These loans are also referred to as short-term loans.

Loan as a long-term loan 
Long maturities are common, especially with higher loan amounts. Long-term loans can be extended over ten years or longer.

After loan amount

Mini and small loans 
Mini / micro credits usually include sums of up to € 1,000 and must be reimbursable quickly. The credit risk with these loans is extremely low.

large exposures 
Large loans, for example, are real estate financing and may include six-figure amounts. Here collateral is necessary.

Free calculator for your loan

If you want to know the possibilities of a loan and calculate the potential interest, you do not have to go to the next bank. With the Small Lender Loan Calculator you can easily define the amount of the loan and the term and see immediately what interest you have to pay for your loan.

What are the interest rates for a loan?

Let’s say you need a loan of 500 euros for a new washing machine. If you repay this loan for 30 days, you only pay a loan of 505.80 euros. With an effective annual interest rate of 13.90%, you therefore pay 5.80 euros interest for 30 days. If you repay the loan after 15 days, the debit interest for your loan is only 2.90 euros.

Apply for Loan: How Does a Loan Application Work?

To get an Small Lender loan without Bank, you just have to do three simple steps.

Step 1: Select loan amount In the Loan Calculator, choose the loan amount you need and the duration. You can immediately see what interest you have to pay. Step 2: Make a loan application Now fill out the following loan application and upload the required documents. Within a few minutes, your loan application is ready. Step 3: Verify With Small Lender you avoid effectively annoying paperwork. You can have yourself verified by videoident method on your computer or mobile phone. Already your loan application can be processed.

requirements

Similar to a bank loan, Small Lender also has some requirements for a loan application, although it is not as stringent as other credit institutions.

You must be of legal age and have your residence in Germany . Also required are a German account and a regular income of at least 500 euros per month . A good credit rating is also important, even if our loan is also available for people with a medium Bank score.

In the course of the application, you have to upload various documents in order to receive your desired loan. These include the signed customer master agreement, the signed service contract with Small Lender AG, a scan of identity card or passport with confirmation of registration and a current proof of income.

You need this for the loan application:

• Identity card or passport with confirmation of registration
• proof of income
• bank account
• service contract
• Customer base contract

What do I have to consider when making a loan?

If you decide to buy a cheap loan, you should first of all be thoroughly informed and compare different conditions with banks and other providers. The easiest way to make such a comparison directly online. Both the credit conditions and your credit rating play an important role.

An important point is the cost of the loan. Many banks and semi-mature credit intermediaries charge high fees and initial costs, which are hardly obvious to the layman at first glance. At Small Lender there are no such additional costs. Here you only pay the interest on your desired loan amount. All paid services at Small Lender are clearly identifiable and must be actively requested by you. There are no hidden fees for your individual loan.

Many loans are tied to fixed uses, which are requested prior to lending. At Small Lender, you do not need to specify a purpose but can freely use the loan amount. The online loan should be used exclusively for short-term bridging of financial problems . Before concluding the loan agreement, make sure that you can repay your loan within the set period.

Overview of Loan Tips:

• Inform yourself thoroughly about the loan conditions
• Compare different providers and lenders
• Watch out for hidden costs and fees
• Be wary of fixed-use loans
• Make sure you can easily repay the loan

Loan without Bank

At Small Lender, you get a loan without Bank, which does not mean that Small Lender does not do a credit check, but it means that the loan requests at Small Lender are Bank-neutral. They do not affect your Bank score and do not change it. Thus, the credit inquiries at Small Lender differ significantly from those of other banks. However, in order to safeguard both parties and to underpin the integrity of the offer, Small Lender always carries out a comprehensive credit check.

Pay off loan immediately

There are always situations in which fast money is needed. Whether to settle a bill or to fill the fridge in hard months with high additional costs and to ensure the normal life. Sometimes the costs are downright on someone and seem to crush them.

An instant loan from Small Lender the simple and quick stopgap solution in such cases. Thanks to a short repayment term and a manageable loan amount, financial emergencies can be bridged without complications. Thanks to the fast processing and the fast payment of your loan, you can overcome financial bottlenecks without much trouble.

If you need money to buy something, personal consumer loans are a good option. Its good conditions allow to enjoy a whim without having to wait. For example, buy a television, a computer, a tablet, a smartphone, or take a vacation trip.

Personal loans for consumption

Why give up a little whim when we can finance it ?. Nowadays there are many offers, both in consumer products and in tourist services. In the latter there are many options, from organized trips, to low cost flights and hotels, passing luxury cruises.

The offers reach all sectors and every time there are cheaper prices, and the commercial centers and specialized stores like Media Markt or Ikea are more and more numerous. Before the only option was the department stores like Corner Kickes, which provided credit cards so that their customers could finance their purchases and pay in installments. But today there are many more options, although not all provide credit cards for their customers. So if we want to take advantage of the offers and discounts on products and services, the best option is personal loans for consumption. That is to say those whose objective is to buy televisions, tablets, smartphones, or cars. The tastes of consumers have been changing over the years, and now the consumer spends more money.

In fact, families have gone from spending on basic needs such as food and housing, to spending on less basic products and services. What has resulted in an increase personal loans to consumption. Technological advances have also led to the demand for products such as computers, which are becoming smaller and, thanks to the development of the Internet, have caused more and more devices in families.

In fact, consumption has increased in computer and technology products, while they have been reduced in leisure due to the economic crisis. That is, consumers go out and travel less, but nevertheless buy more electronic devices to use at home and at work. These computer products usually have a price of around 300 euros for smaller devices, up to more than 1000 euros for products such as televisions, and passing computers and tablets with prices around 500 euros. Amounts of money that sometimes have to be financed with mini credits or personal loans for consumption, since some stores do not offer a card to finance the purchase. So if you find an offer you do not have to wait to save the money you need.

The best online consumer loans

Take advantage of the discount by requesting personal loans or mini credits to finance the purchase and thus start enjoying the product or service. In any case, having financing for consumption depends a lot on the life cycle of each person. That is to say, from the age of 30 – 35, consumption is reduced because the budget is used more for the family or the purchase of a home. While for those under 30 it is more important to spend money on leisure: trips, restaurants, bars, clothes, etc. However, in adulthood and spending 50 years is usually more money to have children at ages where they are more economically independent. So you have two options if you want to spend your money on whims: wait until you have enough money even if it’s 50 years old, or finance purchases. And for the smaller expenses we have several financing options.

• The bank card : it will depend on the type of client we are, because nowadays it is complicated to have a credit card from a bank. In fact, banks usually give debit cards, that is, those that depend on the available balance in the bank’s account. For the best clients, banks usually grant credit cards, whose limit does not usually exceed 1000 euros. A quantity of money more than enough to buy many of the most demanded products. However, it may be insufficient for certain expenses such as cruise trips. In any case, the problem with credit cards is that they usually have a very short payment period, usually less than 30 days. So credit cards are not usually an adequate consumer financing solution.
• Store credit cards : such as department stores like Corner Kickes or specialty stores like Ikea. That allow you to buy your products in installments, but that involve meeting certain requirements for the granting of the credit card.
• Save : it will depend on the moment of our life in which we are, because as life goes by we will have more savings. Which means having to postpone our dreams and desires until we have enough money. Why work if then we can not give ourselves a whim, taking advantage of discounts and consumer offers ?. So you can not let the opportunities slip by the fact that you need time to save more. Saving only makes sense for high expenses that will occur in the future, such as buying a house or saving money for retirement.

Fulfilling your dreams is at your fingertips with the online SMS Credit Comparator, the best way to find personal loans for consumption in the best conditions. The SMS Credit team searches and analyzes the information of hundreds of loan websites, so that you, through our online comparator, can choose the consumer credit that best suits your needs. And thus be able to buy all kinds of products and services paid in comfortable monthly installments, according to the term in months in which you want to return the consumer loan.

Small personal loans

Those who have already experienced the experience of requesting a personal loan through a conventional bank will know that sometimes a guarantor or an endorsement is required on some property that can cover the possible non-payment of the debt. Normally, small personal loans that are requested to cover specific and specific needs, for example, for the financing of the acquisition of a vehicle, do not require any guarantee, or at least your bank should not require it, unless your Credit history is extensive and / or conflicting.

As you will also know, banks always investigate the credit applicant before accepting the request. This ensures that the person is not included in any of the current default lists, such as the RAI, and that he has regularly paid the installments of other current or past personal loans. However, when the amount of the requested credit is somewhat high, say more than € 40,000, for example, for the purchase of a prefabricated holiday home or house, if the applicant also keeps other lines of financing open with the bank., very possibly a guarantee is required on any of your properties (already paid) or a guarantor that responds in case of non-payment.

What happens then when the personal credit return payments are violated?

Simply the bank, after the beginning of the corresponding judicial litigation, will execute the endorsement. This means that the bank will take the guaranteed property to sell it and obtain the money owed to it, or it will demand the payment of the debt to the guarantor by taking the property placed as collateral or by seizing the appropriate bank accounts that cover the amount of the non-payment. For this reason, it is essential that the fine print be read carefully with the conditions and terms of each personal credit before it is signed in order to avoid really rough situations.

What other alternatives do we have then to get our personal loan? Currently, the online credit sector is undergoing a surprising development in our country, precisely because it is presented as an agile and convenient alternative to the financing offered by traditional banks. The online credit agencies are also financial entities or branches / subsidiaries of financial institutions that have the same guarantees and controls. However, its modus operandi eliminates much of the conventional bureaucratic procedures and greatly facilitates the granting of financing to families, households, individuals and professionals. Without renouncing the previous investigation of the file of the applicant, the approval of the credit in many cases is almost granted in a few days (or even hours). In this way, online credits are becoming an increasingly popular option among consumers to obtain the financing they need in a timely manner without too many demands, including bank guarantees that can become a double-edged sword.

Ask for a microcredit!

The thing about finding cheap loans is – understanding the concept of cheaper loans. Low-cost loans are available at any of the banks, credit unions and lenders. Online lending is a huge market if the size of the options shows cheaper loans is achievable.

Debt Consolidation Loan

Uniform banking home loans generally extend over a period of twenty years. It is possible to have it extended to 30 years or reduced to fifteen or something like that. This affects how much you pay in installments every month. The shorter the period you decide to repay the bond issue above, the more you will pay each month. However, it will also pay less interest so the possible amount you will pay back is less than the easiest payment for the longest period.

These days there are more than a few programs available for borrowers who cannot make their mortgage payments. If you are facing financial problems, then you should ask your lender about these programs. Some people start by ignoring their lender as soon as a payment is missing, which is not a good idea. Loan modification options, such as HAMP and JUMBO have been designed for the sole purpose of helping home owners. If you do not qualify for the change then short sale could be the ideal course of action. Dealing with the creditor can be very difficult and frustrating, but it is still the best idea.

Cheap loans

Cheap loans are also available for bad credit holders. You can take advantage of the cheap loans even after owning, CCJs, IVAs, defaults, arrears, etc. However, you will be charged a slightly higher rate of interest for this.

Making your home feel like a home with the addition of a doormat. A lot of people tend to overlook the addition of a doormat in front of a door. Not only does it serve a purpose of making a home feel complete, but it also serves to keep your floors clean. Putting out a doormat where people can clean their feet will reduce the amount of time you spend cleaning floors.
For cheap personal loans in the UK, you need to offer any of your assets as collateral to secure the loan amount. It can be your home, real estate, car or other valuable assets. Any deferral in repayment of the loan amount will give your lender all the right to take over your assets. So, you need to be very careful with the repayment plan of cheap UK personal loans.
You must be absolutely sure that you get the right secured debt consolidation loan. When you are on the verge of bankruptcy, a secured loan can immediately save you. Avoid foreclosure of your home or property by applying for debt loan. You must have mortgaged your home against a personal or guaranteed loan.

Some common commissions include management fees, such as enforcement fees, and start paying penalties. Management fees are often included and justified as paying for the time of the person processing the loan. It’s just another way to get more money from borrowers and it’s not really a necessity.

Crowdfunding is still little known in Germany and the entire German-speaking area? In its infancy? Not visible? From a temporal point of view, these statements apply. Attention to the concept is still low in Germany. As we have already mentioned in our first article on crowdfunding, this state is changing, it is increasingly reported by well-known editorial staff on the subject.

Crowdfunding companies start through

But while journalists and other external observers are still discussing whether crowdfunding has a future in Germany, many entrepreneurs have already taken action and are actively shaping a German crowdfunding market. We have looked at this market and indeed: at least eleven. Different crowdfunding companies have been founded and are actively working to establish crowdfunding in this country as well.

Crowdfunding portals already paint a colorful image of the German-speaking scene

Even if the basic principle of crowdfunding is the same for all platforms (the mass “crowd” funds projects “funding”), the different target groups and approaches of the portals already paint a colorful picture of the German-speaking crowdfunding scene. As our infographic shows, existing companies can be divided into four areas, depending on the type of projects financed.

Crowdfunding for startups

Company founders are given the opportunity to have their startup financed by crowdfunding at the German platform seedmatch.de and the platforms investiere.ch and cofundit.com from Switzerland as an alternative to classic venture capital.

Crowdfunding for creative and culture

However, the largest number of German-speaking crowdfunding companies are active in the area of ​​”creative and culture”. Artists, musicians, inventors and visionaries with creative ideas will find capital here for projects. Startnext.de, visionbakery.de and inkubato.de are all within this group of crowdfunding companies and want to offer all creative platforms with access to private financiers. Sellaband.de goes one step further in specialization and focuses on the financing of musical projects – here fans invest in their favorite music. Also mediafunders.net specializes in a certain type of projects and positions itself as a financing platform independent journalism.

Crowdfunding for all types of projects

All types of projects can be funded through mysherpas.com, pling.de and c-crowd.com. These three platforms follow the approach of “being there for everyone” and are correspondingly broad. Whether charitable organization or private person – here everyone has the opportunity to present his project.

Objective: Comprehensive picture of the German crowdfunding scene

As you can see, despite crowdfunding’s young developmental stage in German-speaking countries, there is already a broad base of companies that want to establish crowdfunding as a serious factor in the German financial landscape. With our overview, we try to bring a little more light into the darkness of the current scene and to help young, ambitious companies to gain more attention.

In the next week we will therefore give the opportunity to briefly outline the concept and objectives of your company. So you have the opportunity to see and understand all the different companies and concepts of German-speaking crowdfunding in an unprecedented overview.

The overview provided here will certainly change over the next few months as additional companies start up. Supports us to create the most complete and up-to-date picture of crowdfunding in Germany – If we have not yet considered a platform, just tell us the missing company and we will complete our infographic.

You find this overview interesting and wish the presented company more attention? Then help us get more attention to the goal of the scene and also show your friends and acquaintances what companies are on the market. 

Many borrowers want to consolidate their loans, but they are prevented from doing so by negative registry entries. Banks will most likely not consolidate these people. But some non-bank companies are willing to narrow their eyes and in exchange for a pledge of property or a third party’s liability to offer consolidation of loans without a register.

The advantage of merging debts with register tolerance is the ability to solve large financial problems and the inability to repay various loans. The companies providing this financial service will secure the debt with the property, set the debtor very low repayments for a very long time, and the debtor can gradually recover from his financial difficulties.

Cons: property pledge and longer maturity

What disadvantages can we find in this area? In addition to the need to stop the property, it is the fact that debt consolidation without looking into the register is a long-haul journey and the debtor may even be in debt for twenty years. As a result, the client can pay a lot more than the sum of all previous liabilities, as debt consolidation after consolidation usually takes much longer.

Therefore, it is always necessary to calculate all the options and choose the one that is most feasible. In many cases, the cheapest is not the best. But the guiding principle should be that the cost of borrowing and possible repayment difficulties must be taken into account when the first loans are requested.

Examples of consolidating loans without a registry

• Acema loan consolidation

Acema’s non-bank company is one of those offering consolidated loans without a register. They are therefore intended for so-called problem clients or clients with a record in the debtors register. The company says it allows these people to get a “new chance of getting rid of debt and living a comfortable life without fear and commitment”. Loans with a total value of between 100,000 and 5 million crowns can be consolidated, and the maturity period can be set to 20 years. Acema notes that clients can earn lower overall interest rates and significantly lower installments.

• Personal Loan Asisteam

This personal loan is a type of property pledge. The provider also offers it as a loan suitable for merging previous debts. You can borrow up to 3 million crowns, with a maturity of up to 25 years. Everything can be done without looking into the debtors register because the loan will be stopped by the property. The maximum loan amount can reach 70% of the value of the property.

What is auto loan?

The car loan, also called car loan, is a payment solution to finance the purchase of a vehicle, whether new or used. It belongs to the category of consumption credits. But since the auto loan is exclusively reserved for the financing of a vehicle, it is a particular consumption credit: an assigned loan. However, another category of auto loan can be offered by the financial institutions, the personal auto loan.

• The auto loan assigned

The assigned loan is for the financial institution called the lender to give the borrower a sum of money specifically intended to finance the purchase of a particular property. This means that to be legally valid, the credit must be used only to finance specifically and exclusively the good for which it was concluded. It will not be possible for the borrower to buy a property other than the property mentioned in the contract that gives him the credit. Thus, for the auto loan, the borrower can therefore buy only one vehicle, to the exclusion of any other type of property. If the borrower buys something other than a vehicle, the credit he has just made will not be valid. As a result, the borrower will no longer be able to benefit from the payment facilities offered by the car loan.

Although the auto loan is used in particular to finance the purchase of a car, the concept of vehicle is not restricted to that of automobile, car. Indeed, with a car loan it is possible to finance the purchase of a motorcycle, a scooter, a boat, a caravan, a camper etc. It is called auto loan by convenience because in most cases people use it to buy a car. In addition, the condition of the vehicle does not matter for the car loan. Thus, the borrower can just as easily use the car loan to finance the purchase of a new vehicle than a used vehicle.

• The personal auto loan

The personal loan is for the financial institution to give the borrower a sum of money without the borrower having to justify the good he will buy afterwards. The borrower will be able to buy his vehicle as well as additional equipment or his gray card for example. The borrower is free to use his personal auto loan as he sees fit.

Whatever its form, the auto loan falls under the category of consumption credits. The auto loan is then subject to the same limits as those of the consumer credit. This means that the maximum amount that can be granted to finance the purchase of a vehicle is 75,000 euros. Similarly, the car loan must also provide for a repayment period of at least 3 months.

Once the auto loan is concluded, the borrower will have to repay monthly, in the form of monthly payments, a portion of the borrowed amount, called “capital”, and interest. To obtain the total cost of the loan, simply add the price of the insurance to interest and ancillary costs.
Whether it’s an affected auto loan or a personal auto loan, upon the conclusion of the loan agreement, the borrower knows the schedule of repayments. That is to say, the borrower knows both the amount of monthly payments to repay, the repayment term (the number of monthly payments) and the cost of credit (interest + ancillary costs).

It is also possible to give up the borrowed capital and therefore not to buy the desired vehicle after concluding a car loan. The law protects the borrower in this case. There exists for this purpose a period of 14 calendar days during which, after the signature of the loan offer, the borrower may not follow up the loan offer by not buying the vehicle previously desired. This period is called the withdrawal period. To benefit from this, it is sufficient for the borrower to send the lender a registered letter stating that he wishes to withdraw from the loan offer made a few days earlier. Most often, a withdrawal form is attached to the loan agreement. All that is required is for the borrower to complete it and return it to the lender.

The components of the auto loan

The auto loan is made up of the same elements as the consumer credit since it is a particular consumption credit.
The capital corresponds to the amount requested by the borrower when he wants to subscribe to a loan. The capital, as well as the interest and the repayment period, make it possible to know the amount of the monthly payments to be refunded.

Interest is expressed as the lending rate in%. This is the share of the interest payable on the capital that is owed to the lending financial institution. The interest he receives is a part of his remuneration.

More generally, interest is grouped within an annual percentage rate of charge (APR) expressed in%. This APR also contains other ancillary costs, such as handling fees, excluding insurance costs. One should be wary of the APRC because this rate can be fixed, variable or revisable. The APR amount represents what is known as the cost of credit.

Regarding the duration of the car loan, it is usually expressed in months or years. There is no legal maximum repayment period. In practice, repayment terms are generally between 12 months and 84 months (from 1 year to 7 years). The duration makes it possible to calculate the amount of the monthly payments and has an impact on the amount of these and the cost of the credit. The longer the repayment period, the lower the monthly payments. In return, the interest will be higher, which increases the cost of credit. Conversely, the shorter the repayment period, the higher the monthly payments. On the other hand, interest will be lower and the cost of credit will be reduced.

The monthly payments of a car loan correspond to the amount that the borrower will have to repay every month to the financial institution that has granted him credit. These monthly payments are calculated on the basis of the borrowed capital, the repayment term and the value of the APRC, including interest. To these elements can be added the amount of insurance if the borrower decides to subscribe. Thus, a monthly payment is generally broken down into 3 elements: the share relating to the amount of the capital repaid, that corresponding to the part of the interest paid to the lender and that relating to the share of the insurance.

Finally, a car loan can also include insurance. This one is not obligatory. It allows the lender to guarantee the repayment of the car loan by covering the risks related to the death of the borrower, disability, incapacity for work, or loss of employment. It all depends on the insurance the borrower will take out. In case of serious health problems, it is possible to benefit from the AERAS (Insuring and Borrowing with an Enhanced Health Risk) convention. The amount of insurance will be higher but it will be possible to enjoy the benefits of insurance. Insurance is generally offered by the institution offering the credit. The insurer is free to choose the institution of its choice to insure itself. However, the credit granting institution strongly encourages the borrower to purchase insurance from their institution. The cost of insurance plus the APR (credit cost) is the total cost of credit.

Caution: If you decide not to opt for insurance, banks or credit institutions may refuse to lend you the money you request. It then seems wiser to take insurance. You never know what life has in store for you!

What are the conditions to obtain a loan?

In order to be able to subscribe to a car loan, several conditions must be respected. First of all, you have to be of age. Indeed, a minor child under 18 years can not validly conclude a credit and therefore by extension, a car loan.

Then the future borrower should not be registered on the National Register of Personal Credit Reimbursement Incidents (FICP). As soon as a person who has subscribed to a credit no longer reimburses his monthly payments, it will be declared as a payment incident and will be recorded on this file. This file was set up to prevent an indebted person, who can no longer repay his credit, can again subscribe to a credit. Thus, the absence of registration on this file will reassure the financial institution to lend the sum requested.

Before subscribing to a car loan, you must also check its ability to repay future monthly payments. This condition has the same objective as the previous one: to reassure the lender. Indeed, the absence of registration in the FICP does not guarantee the lender financial institution that the future borrower will be able to repay future monthly payments. A person can effectively not be registered with the FICP and not be able to reimburse his future monthly payments if he has asked to borrow a sum of money too high compared to his repayment capacity. To know its repayment capacity, it is enough to make a table, or a list, of all the receipts and expenses during a month. While providing for a certain amount of money to be allocated in the event of unforeseen circumstances, the difference between revenue and expenditure constitutes the repayment capacity. The positive amount of the resulting balance indicates how much can be reimbursed per month. This is the amount that corresponds to the repayment capacity.

In addition to repayment capacity, care must be taken not to exceed a certain threshold of indebtedness. This debt threshold is called the “debt ratio”. It is set at 30% of the income of the future borrower. It corresponds to the ratio between the total financial charges relating to the loans and the monthly income collected.
For example: a single person with an income of 2,000 euros per month will be able to contract one or more credits until the total monthly payments she repays reaches 600 euros per month. 600/2000 x 100 = 30%. Thus, a single person receiving 2,000 euros per month of income and having no other credit in the process of repayment can make a car loan with a monthly payment of up to 600 euros per month maximum.

Be careful: do not forget to check both the repayment capacity and the debt ratio! A loan commits the borrower and must be repaid. It appears essential that the borrower can repay his monthly payments, given his ability to repay and his debt ratio.

Thus, if the repayment capacity is good and with the car loan, the debt ratio does not exceed 30%, there should be no reason for the financial institution refuses to grant you the car loan.

Finally, when you go to see a financial institution for the granting of a credit, it must give you a pre-contractual fact sheet containing all the information concerning the credit envisaged. Thus, with regard to the auto loan, the borrowed capital will be mentioned as well as the duration of the loan and the number of monthly payments, the amount of the interest and the APR. All information in this form is valuable. Since it contains all the characteristics of the credit envisaged, this sheet appears as a very practical tool to compare the various credit offers of different financial institutions. It is therefore essential to play the competition to find the credit that will be the most advantageous for you. Indeed, not all offer the same interest rates and APRs and some impose ceilings lower than the maximum of 75,000 euros.

What is the difference between a car loan for new and used cars?

There are not really any fundamental differences between the new car auto loan and the used car loan. The only differences are mainly the amount borrowed and the repayment term, and therefore the amount of monthly payments.

For two cars of identical model and brand, the new car will cost more to buy than the same car but in second-hand version. As a result, you will have to pay more for a new car than for a used car. As a result, the amount of the loan that will be granted will be higher for a new car than for an opportunity.
In addition, with the same repayment term, car loans are more advantageous. Since a used car costs less to buy than a new car, the amount of monthly payments to be repaid will be lower than for a car loan.

Finally, regardless of the condition of the car (new or used), the amount of APR and interest are generally the same.
The only real difference can be the type of credit you subscribe to. Indeed, although the auto loan is originally an assigned loan, credit institutions now offer more and more a personal loan as a car loan. Differences can then include the APR (cost of credit) and therefore the amount of interest to be repaid. It may be that for a car loan used car, some financial institutions offer an amount of TAEG much higher than they offer for a car loan for new car. This is particularly the case when the auto loan in question is a personal loan and not an assigned loan.

What are the advantages and disadvantages?

The advantages and disadvantages of the auto loan depend on the type of loan that will be granted.

• Assigned loan

Regarding the affected car loan, it is only contracted for the purpose of acquiring a vehicle, a car most often. The borrower is therefore bound by the nature of the property he must buy: a vehicle. He will not be able to buy another type of property. The granting of credit is linked to the purchase of a vehicle and vice versa. We are talking about interdependent contracts. This means that this category of auto loan is accompanied by a significant constraint: the purchase of the vehicle and the granting of credit are closely linked. This link between the granting of the car loan and the purchase of a car has the effect of nullifying one of the two acts if the other does not occur or can not occur. In other words, the non-realization of one automatically cancels the other.

For example, once the auto loan is concluded and the car purchased, if it is not delivered to the borrower, then the auto loan is canceled as a result. It is the same if the sale is not realized. In addition, if the borrower has just bought a car and fails to obtain the auto loan necessary for its financing, then the contract of sale of the car is canceled, considered then null and void.

However, despite this rather significant disadvantage, the affected auto loan has a significant advantage over the personal loan. Indeed, with an assigned loan, repayment of credit begins only when the car has been delivered. The refund can not be made until the borrower has received the car he has purchased. Thus the payment of the first monthly payments may be deferred for a few weeks or even months. This presents a considerable advantage if the delivery of the vehicle occurs late.

Moreover, with this type of auto loan, no definitive payment can be required before the signature of the advance credit offer and before the expiry of the withdrawal period following the conclusion of the credit agreement. This means that if you intend to subscribe to an auto loan assigned to purchase a car, payment of the price of the car can only be made once the loan agreement has been definitively concluded, ie after retraction of 14 days has elapsed. This protection offered to the consumer in article L312-52 of the Consumer Code differs somewhat if the buyer has asked for the immediate delivery of the car. In this case, the retraction period is increased to 3 days. It is then necessary that the buyer waives his auto loan assigned within 3 days after its conclusion so that the contract of sale of the car is also canceled by right.

Finally, it is important to mention, on the order form of the vehicle, that the purchase is conditioned to obtain the credit you are seeking.
To conclude on its advantages and disadvantages, it can be said that this type of auto loan is not very flexible due to the mandatory purchase of a vehicle. However, it offers more security to the borrower. Indeed, there is no need to repay this loan if the car has not been purchased or the borrower has decided to waive the loan.

• Personal loan

Credit institutions and banks also offer another type of auto loan: the personal loan, also called by these institutions the personal auto loan.
Unlike the credit allocated, the personal loan is free to use. It is granted without justification of its use. It can then be used to finance the purchase of a new car, as well as other miscellaneous equipment.

However, this freedom of use is offset by loan conditions that are generally less favorable to the borrower than those of an affected loan. In this case, the interest rates are generally higher than those of the affected loans. The same is true of the APR. Thus, the personal auto loan is often more expensive than a conventional car loan (assigned).

In addition, this type of loan does not offer protection to the borrower unlike the one that would benefit with an auto loan affected. If a problem actually arises during the sale of the car, the car is not delivered, or the contract of sale of the car is canceled, the borrower will still have to repay his monthly payments, and this, from the conclusion of the personal loan. Which is not the case with an auto loan affected.

To conclude on its advantages and disadvantages, it can be said that this type of loan offers flexibility in its use. However, it is not necessarily the most suitable for the purchase of a single vehicle but will be perfect in case of purchase of a vehicle and other types of property. It is still possible to use this kind of loan to buy only a car. It will then be necessary to be careful when buying the vehicle.

New car vs used car

Whenever you have to change your car, the same question keeps coming back: which car to choose? New or used? It is necessary to ask this question since according to the answer, the solution will not be the same since the characteristics of the car loan differ depending on whether it is a new or used car. New and used cars stand out in different ways, not just the cost of the car when it’s bought. Other criteria are counted as the cost of maintenance, comfort or the presence of a multitude of options on the car …

In order to choose between these two types of car, you first need to determine the essential characteristics that will make you buy one car rather than another. To help you, you only need to know the differences between new and used cars.

• New car

The new car can seem the solution: car in excellent working condition, at the forefront of technology … It is possible to customize it from A to Z, that is to say that you can choose the brand, the model, the color, the motorization, as well as any kind of optional options.

A new car also has the advantage of not incurring any immediate maintenance costs. Indeed, new cars are now generally guaranteed for a few years for any mechanical problem that occurs during this period. Thus, you will not have any expenses related to the replacement of a part during this period since the guarantee assumes the cost. According to some manufacturers, this guarantee can even reach up to 7 years, which is not insignificant.

In return for these considerable benefits, buying a new car requires a larger budget than that required for a used car. Thus, the amount of your car loan will be greater, as well as the cost of credit, compared to a car loan for a used car. In addition, it must be taken into account that ensuring a new car is more expensive than securing a used car. This is explained by the fact that in case of an accident with a new car, it will cost more insurance to be replaced than if it is a used car. The higher price of the new car is thus “reflected” on the monthly contribution of the car insurance.

It should also be noted that the biggest discount of the car will be made during the first 3 years (about 30% of the purchase price).
Ultimately, a new car costs more to buy and insure a used car but in return, it has the advantage of reducing the maintenance costs of the vehicle.
Tips for buying a new vehicle:

• Try to negotiate the model you want to buy. For this, play the competition and negotiate with the commercial to get a discount on the original price of the car.
• Even if you can customize the car to your taste, stay sober and avoid buying an unusual car. These elements will allow you to resell your car more easily. It is indeed complicated to sell a car with a color that is out of the ordinary. Similarly, it is better to buy a car from a recognized brand, which you find in all the streets, rather than an unknown brand in your country. People will not take the risk of buying a car of a brand they do not know.
• Enjoy the end of series, it is possible to do good business in this case.
• Ask the dealer how much he will take back your car. It is a common practice that allows you to pay for your new, cheaper car in exchange for taking back your old vehicle.
• Also ask to try the car of your choice. This will allow you to make sure it is the car you want. So you will not regret your purchase and you will not have any surprises while driving it.
• Used car

Buying a used car will save money since such a car costs less than a new car. This even reduces the cost of the car loan. The least cost of a used car, compared to a new car, is its main advantage.

However a used car will require more maintenance than a new car. You will have to check that the vehicle has been regularly maintained by asking the invoices of the various repairs. If you do not, despite the technical control still valid (made less than 6 months before the sale), you may expose yourself to possible near-immediate repairs may be very expensive.

One solution that may seem interesting is that of buying a new but used car. In this case, you should not expose yourself to expensive maintenance costs as the vehicle is still relatively new. If you opt for this solution, try to buy a vehicle that is more than 3 or 5 years old. In addition, by combining it with the classic (assigned) auto loan, you will reduce the cost of your car loan when it would be otherwise with a personal auto loan.
Tips for Buying a Used Vehicle:

• Find out about the side of the vehicle. A price that is too attractive can hide potential defects or lack of maintenance. It would be a shame for you to buy a car much cheaper but having to make all the repairs.
• Some dealers offer used cars. In this case, go to a dealership of a different brand than the car you want. This will make you realize small savings. Indeed, a used car of an X mark will generally be cheaper at a Z dealership than at an X brand dealership.
• If you do not pay attention to the aesthetics of your vehicle, you can opt for a car of an unusual color. Since this type of car is more complicated to sell, the price will be slightly lower than for a car of a classic color (black, white, gray …) Having a license allows you to gain autonomy by not depending on others when we need to move. But when you have just received your license, you are considered a young license for 2 years if you have done the driving accompanied, or 3 years otherwise.

Acquisition of a car for young people

The status of “young license” has consequences that must be taken into account when buying a car. Indeed, due to the lack of experience in driving, car insurance offers higher rates for young drivers. Similarly, if you buy a big car if you are young, the insurance may refuse to insure your car, or will accept in exchange for an additional cost on your insurance contribution.

To counterbalance this higher car insurance rate, it is then necessary for the young driver to buy a used city car. Since this type of car is designed to run primarily in the city, this is a small to medium size car model suitable for a young license. In addition, for a young person who has just passed his license and who does not have a significant financial contribution, or no contribution, this type of vehicle is ideal. It will not pay too much auto loan payments.
Therefore you will benefit from a vehicle that will not have cost you too much, compared to a big car, while paying monthly payments rather suitable to your financial situation. So your car loan will not cost an ‘arm’.

Buy the car of your dreams

Have the latest model released? Or a car equipped with a radar and a reversing camera? or an electric car? Determining the model of the car of your dreams is rather an easy thing to do despite the multitude of criteria to take into account. The more parameters to take into account, the more the amount of the ideal car will be important. Unless you are a bargaining chip, it will be very hard, if not impossible, to lower the price of the vehicle at a reasonable price. Therefore, the amount of auto loan will be larger, and the cost of auto loan too.

However, it is more complicated to ask which type of car is best suited to its needs. One must then ask what is most important to eliminate superfluous criteria and focus only on what really matters.

For example, for a family with several children, the most suitable vehicle will be a minivan. This type of vehicle has the advantage of being spacious, to have a larger number of seats (7 in general) and has a large chest.

Another example, if you have good weather all year round and you are single or a couple without children, then a convertible may seem to you the car best suited to your desires. You can enjoy the sun while driving.

Choosing the vehicle that suits you best is essential. Indeed, it would be a pity to take out a car loan to finance the purchase of a vehicle that you will only use occasionally as it would not be adapted to your needs.
Therefore, the car of your dreams may be completely unsuited to your real needs. It would be a shame to waste your money repaying a car loan that will seem like a burden.