Personal loan a loan granted by a bank to a private individual.
A personal loan is a loan that is given from one bank to one person. This is usually a purpose-based loan. This means that the funds can be used for a variety of purposes, such as a dream trip or a renovation . When awarding such a loan, the bank checks the creditworthiness of each client. This means that not only a query at the Schufa is obtained, but for example, also a safe, regular income must be present.
Likewise, the bank usually inquires about collateral , such as Bauspar , life insurance and real estate. Furthermore, it is usually important that the age of majority has been reached and that the place of residence is within Germany. Private loans are offered in different amounts and terms .
The funds are paid in monthly installments, often with the possibility of special repayments.
The loan from private
In this variant, lenders and borrowers are two already known persons.
A private loan is made between two private individuals. Thus, no bank is involved here. There are, however, two different variants. For example, it is possible to borrow money from a family member, friend, work colleague, or other acquaintance. Here the respective conditions can be freely negotiated with each other. However, it is advisable to record the agreements in writing so that no disputes may arise at a later date. Another variant is the so-called P2P method.
The privately loan is granted through a corresponding platform.
Another form of private loan between two people is the P2P model. P2P stands for the English “peer-to-peer” and means something like “human-to-human”. However, the term itself can be used not only specifically in the banking industry, but in all transactions that take place between two private individuals. For example, it can be about services.
As an alternative to a private loan from a bank, borrowers and lenders meet on corresponding platforms on the Internet. The platforms themselves do not lend and finance themselves through the fees, which are usually only a small percentage of the loan amount. Due to the lack of participation by a bank, borrowers usually benefit from a rather low annual interest rate.
Prerequisite for a P2P loan
Among the basic requirements is the age of majority, a German residence and a German bank account, a secure, regular income and a good credit rating.
Even if no bank is involved, there are several basic requirements for a P2P loan. So it is indispensable that the budding borrower has reached the age of majority and is fully capable of acting. Furthermore, his domicile must be located within Germany. But also a good credit rating and a German bank account are necessary. In addition, a permanent employment relationship and a corresponding, secure, regular income are often required.
Free registration, simple and uncomplicated process.
A P2P loan offers many advantages. For example, signing up for most of the corresponding platforms is free. As a rule, a fee is only payable for a successful mediation. But also the further procedure is simple as well as uncomplicated. For example, as a potential borrower, you simply specify the desired purpose and the sum. Interested investors are then able to view the various publicly held loan applications, to review them and then to vote for or against the awarding of a loan. Once the loan amount has been transferred to the borrower, the repayment is made in monthly installments.
Although a credit check is also made on a P2P loan, it is fully automatic.
Since such a credit request indicates the desired purpose, it may well be possible to obtain credit even in the case of a negative credit check. In addition, the decision on a loan is usually much faster than a bank is the case. The respective amount is usually credited within a few days on your own account.
Good to know: With a P2P loan, it is possible for the two contracting parties to freely negotiate the conditions. In this way, suitable conditions are possible for both persons.
Compare and save
On corresponding platforms, there are different offers, so that under certain circumstances can be saved significantly.
In the meantime, a large number of private-equity lending platforms exist. Because of this, you should not miss the opportunity to compare the various offers well with each other, as these differ significantly, for example, in terms of terms and conditions.
So it is quite possible to save a lot here.
Collateral and special repayments
With a smaller loan usually no collateral is necessary. Special repayments are usually readily possible with a P2P loan.
If the private loan moves on a smaller scale, collateral is usually not required. However, it may be advantageous, especially if the credit rating is not so good, if a second borrower is mentioned. This increases the chance of getting a loan.
In contrast to most banks , private loans are usually welcome payments and repayment before the actual due date . A prepayment penalty is not common.
Attention: Within Germany §32 of the Banking Act applies.
This means that anyone who offers their money for lending on a commercial level needs a permit issued by the Federal Financial Service. As a result, many German intermediaries have begun to change their business model to include a bank in between during the lending process. In this way, the necessary full banking licenses are available.