Credit without Schufa: serious opportunities despite Schufa entry
Whether it’s a car accident or a high electricity back-payment – sometimes extraordinary expenses can only be met with a short-term loan. But what if the house bank refuses the loan because of negative Schufa entries?
Ways to credit despite Schufa entry
German banks must check the creditworthiness of the customer before the commitment. They do not lend money without consulting a credit bureau – most of the Schufa people are those who have been rejected by the bank, but can do the following:
- ask at other banks, as they can assess the credit rating differently. Point out to the bank that it will only ask for a quote and not a loan request from Schufa at first. Otherwise, the solvency value could deteriorate due to inquiries at several banks.
- Check your own Schufa information and the loan application for errors.
- find a co-applicant or guarantor.
- lending a life insurance or pension insurance.
- Offer securities as collateral for the loan.
- take out a personal loan – whether on online loan platforms or with friends and family.
- as a student to take out a KfW loan.
- if unemployed apply for a loan from the responsible job center.
- looking for a loan from abroad.
Anyone who has financial problems all the time should go to a debt counseling service first – the sooner the better. Already over-indebted individuals should assume that further borrowing will accelerate the downward spiral. Organizations such as the Social Welfare Office, Caritas, Diakonie, the German Red Cross or some consumer centers offer free advice. Free advice centers in your area can be found on forum-schuldnerberatung.de.
Make an appointment as early as possible, as the waiting times often take several months. In urgent situations, many counseling centers offer emergency appointments or help via telephone and e-mail. Some regularly hold an open consultation. During the waiting period, you can also compile all documents and use various savings options: from termination or suspension of some insurance to Stromspartipps.
Debt counseling helps to create a debt settlement plan that the client and creditors agree to (out-of-court settlement attempt). With over-indebtedness, lenders often talk to themselves: for example, they can lower the monthly installment so that it becomes affordable and even waive some of the debt. If the creditors reject the plan, personal bankruptcy can be the cleanest solution, even if this step is bitter. Credit spirals sooner or later lead to insolvency. Here it is necessary to defend already the beginnings.
Submit a loan request to other banks
In the credit check, each bank rates different factors differently. For some providers, weak negative Schufa features make the interest rate more expensive, but do not necessarily lead to disapproval. Anyone who has been rejected by one or two banks due to insufficient creditworthiness can quickly send a credit request to a number of banks online. This request is sent to the Schufa, but is a neutral feature and does not burden the Schufa score. Some of these banks also lend to the self-employed and freelancers.
Note, however: Online you will initially receive only a preliminary immediate decision based on your self-assessment. The final decision will only be made if you send the signed loan application with all documents to the bank. This verifies your information, among other things, by ordering a Schufa information. This query with the feature “credit request” is stored in the Schufa and debits the score. After that, the bank can change the original loan offer and increase the interest rate, or even refuse to lend, despite the immediate promise granted. The rejection of a signed loan application evaluates the Schufa as a negative feature.
After the loan request, customers are contacted by a Verivox consultant. To make sure that your application is not rejected, you can discuss it with the adviser before submitting.
Check the loan application
Loans can also be rejected despite good Schufa scores. Thus, the desired monthly rate may be too high compared to income. Do not over-estimate and choose a longer runtime to lower the rate. Who wants to use the loan for debt restructuring, should specify this as the purpose. If the bank does not know that old loans are being replaced, it assumes that the monthly burden is too high.
Have the Schufa information corrected
Schufa’s tests repeatedly find that it stores outdated or incorrect information. Once a year, you can order your Schufa information at meineschufa.de for free. Take advantage of the opportunity to check the information and correct possible errors. Each statement also indicates which company submitted the information to Schufa. You can send an informal letter to this company and the Schufa to ask for a correction. If you have evidence that the information is inaccurate – for example, receipts or a cancellation notice – you should attach copies to the letter.
Co-applicants and guarantors
Those who take out a loan together with a second applicant increase the likelihood of lending and often get a better interest rate. A co-applicant can have a say in the use of the loan. The two borrowers can decide among themselves who actually pays the loan. A guarantor has a similarly positive effect on lending and interest rates. But he can not influence what the money is used for, and only has to pay if the borrower fails. Both the second applicant and the guarantor should have regular income and a good credit rating.
Capital Life and Pension Insurance
If you have a life insurance policy or a private pension insurance, you can take a loan without a Schufa test at the current surrender value. You can either
- Apply for the loan directly from your insurer.
- or offer insurance at a third bank as collateral for an installment loan.
For more information, see Policy Loan.
Anyone who has a securities deposit can use it as collateral for a Lombard loan (securities loan). Normally, the money so borrowed is used to buy more securities. However, some providers allow the credit to be transferred to their own checking account.
If you can easily repay the loan despite a weak Schufa score, you can also look for private lenders. The obvious starting points are probably the family or the circle of friends. In addition, you can apply for a loan from private individuals on various online platforms. Again, there is a credit check, but the admission criteria are often less strict than in banks. The interest rates are higher. Those who pass the exam can describe their individual case in detail and convince private investors.
KfW loans for students
The Kreditanstalt für Wiederaufbau (KfW) grants development loans for students, business start-ups and builders. The “soft” Schufa characteristics do not have a negative effect on the awarding of the student loan and the education credit. The loan application will only be rejected if:
- the student has taken an affidavit;
- an arrest warrant for the delivery of the affidavit was issued against him;
- the student is in an out-of-court debt settlement or consumer insolvency procedure.
Loan from Jobcenter
If you need a loan without a Schufa exam because your unemployment benefit I is too low, you can apply for a housing allowance and possibly an increase in unemployment benefit II. Anyone who receives unemployment benefit II is entitled to a loan from the job center in emergency situations.
Unemployment Benefit II (Hartz IV) should theoretically be sufficient for all expenses with the exception of rental and heating costs. The money for larger purchases such as new home appliances to save jobseekers from the standard benefits. But if, for example, the refrigerator suddenly breaks down, the money is needed immediately and can not be saved first. There is an “unavoidable need”. In such cases, the job center grants an interest-free, but strictly earmarked loan – without a Schufa exam, of course. However, the loan can be provided not only as a monetary but also as a contribution in kind – that is, instead of money, the borrower receives a functioning refrigerator.
In the following months, the Jobcenter will withhold rates of no more than 10 percent of the regular benefit until the entire loan amount has been repaid. The recipients of unemployment benefit II receive only 90 percent of the regular benefits. In addition, jobseekers are entitled to unpaid loans for:
- the security deposit (see §22 paragraph 6 of the Second Book of the Social Code (SGB II));
- Rental, heating, water or electricity debts, if otherwise a termination or lock threatens – but only if the supplier has rejected a installment of the debt (§22 paragraph 8 SGB II);
- The procurement of goods which self-employed persons need to start their self-employment – a maximum of 5,000 euros as a subsidy is possible (§ 16c SGB II).
- Necessary home ownership repairs will be fully covered if they cost less than a reasonable annual rent. For the rest, however, a loan can be brought (§22 paragraph 2 SGB II).
Loans without Schufa from abroad
Since the Schufa is a German institution, a loan from abroad – a so-called Swiss credit – is usually awarded without Schufa information. But beware: solvency is tested differently and the higher risk means higher interest rates. In addition, there are many opportunities for credit fraud especially with such offers.
Dubious offers are often difficult for customers to recognize. As a general rule, loans without Schufa, which entail costs or tie-in transactions for the customer, must be classified as dubious. These are just some of the strategies that a loan fraudster could use:
- A loan from abroad is normally only given through credit intermediaries. A reputable broker is paid by the bank, not the client. He should not charge any commission for successful loan brokerage, no reimbursement of expenses incurred by his activities, and certainly no pre-payments. Paid telephone numbers are a warning sign. Also, check if any documents are sent by cash on delivery – for which credit scammers can collect expensive fees.
- If the provider insists on a home visit, this is another warning sign. When you visit a home, it is easier to persuade the customers. In addition, dubious intermediaries require retrospectively high travel costs – ask in advance who pays the travel costs.
- Do not take out insurance, home savings or real estate purchase agreements – even if the broker says that would improve the credit rating. He receives a commission, but the customer has no guarantee that he will get a loan. Only the residual debt insurance can be useful depending on the case. Note, however, that their costs come at an interest rate. Calculate how high the APR will be if you add the cost of the insurance to the cost of the loan.
- In a financial recovery or debt settlement, the company promises to “get a grip” on your finances so you only pay for one job. You will not receive a loan, in contrast to a rescheduling. Credit fraudsters often just keep track of your creditors and / or pass your money on to them. For this “benefit” they collect a disproportionate fee.
- Other companies offer a fee-based debt advice. You also do not get a loan, but the services can be useful. Pay attention to whether the company has permission to provide legal services or whether to use an outside lawyer. In the latter case you have to pay for both.
- In general: Do not sign anything without completely reading and understanding the fine print. If in doubt, have the documents read by third parties.