How do I get a cheaper loan?

If all loans are too expensive, there are several ways to reduce the cost of credit:

1. Check Private credit information

1. Check Private credit information

It often happens that in the Private credit outdated or even wrong entries are found, which can have a negative effect on the score and thus on the loan terms and conditions. That is why everyone should first use Private credit’s own information before applying for a loan. Once a year it is free. If there are any discrepancies, future borrowers can apply to the Private credit for a cancellation of the entry.

2. Save equity

2. Save equity

Equity can significantly reduce the cost of borrowing. The risk of the bank drops so considerably and moreover In this way, the borrower indicates that he is financially able to raise part of the required capital himself. This shows a responsible handling of finances and is welcomed by credit institutes.

3. Offer securities

3. Offer securities

Collateral is not possible with every type of loan. However, you can significantly reduce the cost of borrowing. Especially cars, real estate or securities accounts are ideal for security. However, the borrower in this case should pay particular attention to the fact that he can actually repay the desired loan. Otherwise, he faces significant financial difficulties.

4. Guarantees

Guarantees also reduce the risk of the credit institution and thus reduce interest rates sometimes considerably. This is because a guarantor will have to settle the remaining debt if the original borrower fails to pay. A guarantee therefore needs to be well considered by both sides and can severely burden an interpersonal relationship in an emergency.

5. Loans only for reasonable purchases

Consumer credits for consumer goods are only conditionally recommendable and should only be taken in an emergency. On the one hand, such loans are often associated with unnecessarily high interest rates, on the other hand, every loan is stored in the Private credit and thus contributes to higher borrowing costs at.

6. Compare loan offers

6. Compare loan offers

Anyone planning to take out a loan should check with as many providers as possible. In the rarest cases, the house bank or the car dealer are the cheapest options. A credit comparison helps to identify overpriced offers and find cheaper alternatives. However, interested parties should also be careful to compare only the total costs. Only then can they estimate which loan is actually the cheapest.

7. Apply for funding

 

Especially when it comes to mortgaging or investing in renewable energies, many borrowers do not inform themselves sufficient about the state funding. The loans granted are state subsidized and therefore much cheaper than on the market.