Private loans are in demand: while a total of just under 926.7 billion euros was lent to private individuals in Germany at the end of 2001, this figure had already reached 1 by the end of 2021.429.2 billion euros . So when comparing loans and looking for one that suits you, you are in good company!
Here you can find out everything there is to know about different types of loans, requirements and costs. With the personal loan comparison of FinanceScout24 and these tips, your chances of getting favorable conditions are excellent.
The most important facts in brief
1. Not only possible at the bank
You can apply for favorable personal loans at banks as well as at platforms for peer-to-peer loans (P2P loans). Peer-to-peer? That is, that your lenders are private individuals .
2. More favorable conditions or easier access?
With a good credit rating and sufficient income, a personal loan from the bank is often more favorable for borrowers than a P2P loan. The latter, however, often makes borrowing possible even for those who are turned down by banks.
3. Save money with earmarking
An earmarked (online) loan for modernization, the car or the house is often cheaper in the personal loan comparison. Therefore, in case of need, always use a suitable type of loan such as car or modernization loan.
What is a personal loan?
A personal loan is a loan granted to a private person. Thus, the amount granted is not intended for business purposes. Rather, it can serve to cover a wide variety of private costs.
Loans of this type can be issued in several ways:
- From a bank : the classic way of granting a personal loan is to take the loan from a bank. The amount of the loan is paid out by the credit institutions. However, this does not necessarily have to be one's own house bank.
- From a private individual : It is also possible to take out a loan from a private individual – such as your mother or a friend. With this credit from private individuals, however, the partners move in an area not covered by consumer protection, which is why the conclusion of a contract is strongly recommended. You are welcome to use our free sample loan agreement for this purpose .
- Through a P2P platform : P2P platforms are virtual places through which peer-to-peer lending can be facilitated. Either one or more private individuals act as lenders.
How a personal loan exactly, depends on many individual factors. For example, the total amount, the term and also the credit rating determine the exact conditions. This type of loan is also referred to as a consumer loan by banks . The repayment of the amount is – as usual with an installment loan – in the form of monthly payments. The monthly installment is composed of repayment and interest for the personal loan. You as a customer have a number of rights and obligations here, such as how and when the loan can be terminated.
Take out a personal loan with a bank
If the personal loan is granted by a bank, it is also called a consumer loan agreement. All agreements, such as options for unscheduled repayment or payment breaks, must be recorded in writing when the contract is concluded. Uniform form loan agreements are available for this purpose. As a borrower, you consequently receive a complete overview of your rights and obligations prior to taking out the loan.
Compared to the overdraft facility, this has the advantage that clear agreements on repayment are made. The bank is bound to the credit line and you are safe from interest rate adjustments. The interest rate that a bank offers you must also be justified in some way by the institution. For this it is necessary to specify the debit interest p.a. as a representative example. This example shows what interest rate at least ⅔ of all customers actually receive.
Private loans for freelancers and professionals often difficult?
Some banks grant loans only to employees without a fixed term or civil servants. In such cases, freelancers or tradesmen are faced with a closed door. But there are also credit institutions that are open to self-employed persons. However, when it comes to a loan for the self-employed, interest rates can differ. Often, the required minimum income is also higher.
Obtaining loans from private individuals via P2P platforms
For some years now, it has been possible for lenders to join forces and finance projects via online platforms. You as a borrower, this can give you access to a personal loan even if the credit rating is actually too low. Sometimes longer terms are also accepted and loans are granted to companies or freelancers.
You advertise your loan project to a P2P platform yourself. Here you openly give information about the purpose for which the money is needed. Whether a debt restructuring, the purchase of a new car or purchases for the garden are pending – as long as you present yourself well and the financial circumstances are right, the loan from private is a good alternative to bank loans or car loans .
Gladly seen are exact listings of the individual costs. So the lenders get a better impression of your plans. Long not all projects find sufficient lenders with P2P platforms. Success rates range from 20 to 70 percent, depending on the platform and the purpose of the loan.
Often P2P platforms incur costs for the borrower before the actual loan is concluded. For example, for "credit certificates" or other additional services such as inquiries to credit agencies that calculate the Schufa score. Such costs you add to the total loan amount, which increases the effective interest rate and the annual interest rate.
Borrow from private individuals in a direct way
Unlike a loan via a P2P platform, it is different with a loan from private individuals in the personal environment. Here, both parties act as private individuals and negotiate the conditions. Consumer protection does not apply at this point. And since it is not called for nothing " with the money the friendship stops! " , a solid contract should also be concluded for loans from private individuals without a bank. In case of doubt, you can then refer to the negotiated details if there is ever a dispute about the money.
Written form in the case of a relative's loan for capital investments
If you need the money to finance an investment (such as real estate), you should always do so in writing. Otherwise, the interest you pay would no longer be tax deductible. The tax office requires supporting documents, checks the interest rate and sometimes accepts only market conditions.
Bank loan or loan from private individuals: What suits me??
Whether a bank loan or a loan from private individuals is more favorable for you can only be answered individually. However, the following aspects will help you find favorable loans that really suit you and your circumstances.
Bank loans are often more favorable
If you earn well, have no or only low debts and no bad Schufa score, your good credit rating should lead to favorable interest rates for a loan from the bank. What are the requirements and conditions for favorable interest rates at a credit institution can differ significantly. Even a permanent employment contract or a second person as a borrower can elicit favorable offers from banks.
Worse are the chances, however, with negative entries n in the Schufa. These can be, for example, enforcement notices or cancelled loans. They are only cleared after three full calendar years, provided the debt has been paid in full. Banks check here exactly and reject often already in advance.