Consumers often wonder if they can take credit despite being negative. In fact, the negative balance on the checking account does not even enter the budget statement at a fictitious monthly rate because there is no repayment obligation. Thus, the partially or even completely exhausted disposition credit does not preclude a positive decision of the loan application submitted.
The difference between the utilization of the disposition credit and an overdraft
Although most private bank clients use both terms synonymously, there is a significant difference between using an agreed disposition credit and overdrawing a checking account. An overdraft is the overdraft of the agreed limit or a negative balance for an account for which the bank has not provided a disposition. This distinction is important when applying for a loan, despite the fact that it has a negative balance.
While a partially or fully utilized discretionary credit does not affect the credit opportunities, the overdraft on a regular basis leads to a rejection of the credit application, as it is considered an indication of improper account management. The overdraft of a current account can be recognized by means of the account statements, which most credit banks require in connection with a credit application. When consumers apply for a credit overdraft, they choose one of the few banks that will continue to refrain from submitting bank account statements. The account overdraft – but not the use of the agreed disposition framework – is also mentioned in a bank information. Obtaining such is unusual in installment lending due to strict formality,
Completely unproblematic can be a installment payment in the trade as a credit despite the minus in the account, since the presentation of bank statements in this case is unusual. For most installment purchases, the retailers do not even ask for proof of income, but are content with proof of the existing bank details via the bank card. Precisely because of this simple borrowing, buyers are particularly responsible not to enter into installment payment arrangements than they can reliably pay with their income.
What do bank customers look for when borrowing despite being in the bank account?
If bank customers take a loan despite a negative amount in the account, the loan application offers a greater than the amount needed for a current purchase, so that they can at the same time balance their bank account in the context of borrowing. After all, almost all banks charge significantly higher interest rates for the repayment credit than for an installment loan. An exception applies to the giro clients of the few financial institutions that do not charge interest on a low negative balance on the salary account.
The monthly installments to be paid on the account for the loan should be low, to which credit customers contribute by choosing a sufficiently long repayment term. In this way they avoid the repeated use of the disposition credit just for the payment of a credit installment.
In a price comparison for the credit despite the negative on the account consumers pay attention to the effective annual interest rates of the individual loan offers as well as the most flexible repayment possible. Such a policy ideally allows them to be suspended occasionally, as well as free special repayments.
Borrowing on negative account balance and low credit rating
A minus on the account is not necessarily a sign of a weak credit rating, but can at least temporarily occur even with bank customers with a high regular income and with a private credit information without negative feature. However, regardless of banks’ usual credit rating, a constant negative balance indicates an unbalanced relationship between revenue and expenditure.
In the case of a loan despite a negative balance on the account and a private credit negative feature at the same time, most customers think of the debt-free loan of a Swiss or Liechtenstein bank. This can be applied for over 3500 or 5000 euros, with the use of a granted dispolimit for the award decision is irrelevant. Few consumers are aware that a few domestic banks do not generally reject lending on a soft or closed private credit entry. Moreover, even with a weak credit rating, it is often possible to borrow money from a German financial institution through a credit intermediary. It is also conceivable for weak credit standing, the joint loan application with another person who makes a regular income and whose private credit information contains no negative entry.
A private loan can be taken on a corresponding loan exchange even with a minus in the account and limited creditworthiness. The submission of account statements in this case either not at all or only at the registration, but not required when submitting a specific loan request. A peculiarity of lending via a personal loan exchange is that the registered there as a lender, a majority of their decisions based on the intended use rather than the classic credit rating. The most accurate description possible of the project to be financed thus facilitates borrowing.