The credit record is intended to protect against payment default of any kind.
Can you take out a loan despite negative record and creditworthiness?
Use the record lending company and individuals can obtain financial information of their potential contractor to assess its creditworthiness based on its previous credit history better. The record states that every day about 380,000 information to 9,000 partner companies or to individuals pass. According to statistics, more than 90 percent of all stored consumers have only positive information.
But what happens if you have a negative entry to the record? Can you take a loan with bad record? How does record scoring work? Under what circumstances can you apply for loans despite negative record? Which bank gives a loan despite negative record?
What role does record play in borrowing?
If a person wants to take out a loan , they usually have to prove that they are repayable and willing to pay because German banks are required by law to check the creditworthiness of their clients before they lend. Banks often resort to credit bureaus such as record. Why is it not usually possible to apply for a loan despite record?
In the credit check, the focus is on minimizing the risk of a credit default. If a customer can not repay the loan, the bank may incur significant economic losses. A record query is also useful for the consumer to determine whether he can actually afford a loan.
Among other things, before granting a loan, the bank checks whether the customer has already repaid past loans. Because if the monthly repayment rate exceeds the financial capabilities of the customer, there is a risk of over-indebtedness.
As German banks always work with record or other credit bureaus, they usually do not issue credit without a credit check . As a result, German consumers usually can not get credit on negative record.
How does record scoring work?
The record indicates the degree of creditworthiness in the form of a score between 1 and 100 . The higher the record score, the more creditworthy the person or company.
The score value does not relate to the personal creditworthiness of the person concerned, but indicates the value of a statistical comparison group. record may not record information about income or job , but the focus is primarily on the payment history of the person concerned. For this reason, a loan request might be rejected even though the person is financially well off. Conversely, it could also be possible for you to get a loan despite a negative record entry if the entry is unjustified and you inform the credit reference agency in good time .
It is not known in detail on which calculation basis the record score is due. In order to prevent criminal influence on the rating, the record keeps all details on the analysis method and the calculation of the probability value secret.
Which bank gives you a loan despite negative record?
In a mathematical-statistical method , the value for comparative assessment of consumers is determined. It uses all the data that record collected about the person. The stored information from the past creates a forecast for the future payment behavior of the person, whereby the calculation relates only to the currently existing record entries.
The data used to determine the score can be found in the record self-report. Since German banks want to hedge with the record exam, it is usually not possible to get a loan despite negative record and credit rating.
Where do you get a loan despite bad record?
With a credit check, banks want to ensure that the borrower is able to repay the loan granted to him. In a credit check, the payment behavior of the borrower in the past under the magnifying glass , especially if the debt has always repaid regularly and on time .
Not infrequently, the creditworthiness of a person is classified as moderate or bad, although the person concerned is able to meet the liabilities. This is the case, for example, with traders who have no regular income .
For this reason, many banks grant a loan despite record entry. In the case of a loan with bad record, the creditworthiness is also checked, but the banks decide on a case-by-case basis whether financing makes sense.
Among other things, you can get an instant loan despite negative record if you provide a guarantee. Recipients can also apply for an instant loan from the Job Center despite the record entry.
Consumers should only borrow in an emergency despite record, because on the one hand there are many risks involved, on the other hand, a negative record should be a warning signal in order not to fall into a debt trap.
Before borrowing, it is always advisable to seek different offers and compare the interest rates . It is important to note which information is passed on to the record. In the best case, only a condition request should be reported that does not affect the record score. That is, instead of submitting a loan request, the bank should only tell record that the information provided by the credit reporting agency is needed to be able to make an offer and that this is not a final credit check.