E.Applying for a loan online has several advantages. If you apply for the loan directly online, you are independent of opening times, appointments and consultants and there is no waiting time after documents have been sent by post. At the same time banks save costs when processing your application? Not only do direct banks save themselves the expenses for branches, branch banks also often give purely digital customers better interest rates because this is the cheaper option for them. Online loans are also not only faster and cheaper, but also easier to compare: Loan calculators online allow you to calculate conditions in advance and compare different offers.
The contents of this article:
How does an online loan work?
Basically, a loan applied for online works just like a loan that you take out in the classic offline way: You borrow a certain amount from the bank and pay it back in fixed monthly installments plus interest? So it is a classic installment loan. The amount you can borrow is initially not limited and is not tied to any specific purpose. You can finance both a car and a property with the loan or use the money for a free purpose.
The key difference is the distribution channel: instead of making an appointment at the bank, the complete application, submission of the documents and verification of the application is done digitally by the bank. Thanks to the Videoident process and the option of digital signature, your identity is checked and the loan agreement is signed fully digitally. This procedure not only saves paper, but also speeds up the loan disbursement: If the check is positive, you will usually receive the money within one to two banking days.
Requirements for the application
To be able to apply for a loan online, the same requirements apply as for applying for a classic installment loan. This includes:
- Of legal age
- Main residence in Germany
- ideally a permanent employment contract? in the case of a time limit, the loan should be paid off within this period
- regular income in sufficient amount
- good creditworthiness, or a positive Schufa score
Important documents for the loan application
If you are employed, the bank will usually ask for the last proof of your salary in order to check your creditworthiness. Documents on additional income or other financial security, such as owning real estate, also serve as a basis for valuation. Self-employed and freelancers often find it more difficult to obtain a loan (on favorable terms) because they do not have a regular and secure income. As an alternative to the pay slips, banks often request business balance sheets and income tax assessments from the last few years.
Credit check for online credit
Good to know: If you want to compare several loans in advance, make sure that the respective bank only sends a condition request to Schufa, not an actual loan request. The latter should only be done when you actually take out a loan, as the request will be noted in your score.
Conclude credit securely online ?? Tips
In order to find the best loan quickly and safely, here are five tips for finding a suitable online loan:
- Read the fine print. Serious providers transparently break down any fees and interest and try not to hide anything in the small print or to formulate it in unnecessarily complicated form. Providers who call processing fees in advance or who link the loan to other financial products, for example to building society insurance, are usually just as dubious as lenders who do not carry out a credit check.
- Calculate the loan amount and installments correctly. Think about beforehand how much money you actually need and in what period of time you can repay the sum. The term of a loan should not exceed the benefit: For example, if you agree on a loan to finance a car, which you then have to pay off for 15 years, the loan term and benefit are not in proportion. When setting the rates, do you keep in mind that you can pay them at any time? even if your financial situation changes (in the short term).
- Arrange free special payments. With long-term loans in particular, there is a high probability that you will “make money” in between. and want to pay off a larger portion of the loan out of turn. Many providers allow these special repayments to be paid extra because there are interest losses. However, you can exclude these extra payments by making sure in the loan agreement that such special payments are possible free of charge and that no early repayment penalty is charged.
- Enter a purpose. Even if you can basically use an online loan for any purpose, you can often secure better conditions at the bank with a fixed purpose. The reason for this is that, for example, a financed car or property is deposited with the bank as security, thus minimizing the risk of a loan default.
- Compare different offers. One advantage of taking out online is that it is quick and easy to compare different offers. The key value is the APR, which takes into account all the actual costs related to the loan. Since many providers of online credit are direct banks, you don’t have a personal contact person for any questions about the loan? It is all the more important that you inform yourself thoroughly and calmly before making a decision.