The starting point for a loan without Credit Bureau information and proof of income is extremely poor. For a Credit Bureau-free loan, people are interested who have abnormalities in their Credit Bureau file and who no longer receive credit from normal German banks. The criteria for awarding banks are a clean Credit Bureau and a sufficiently high income.
Before each loan approval, banks conduct a Credit Bureau query. This shows the customer’s creditworthiness. If negative characteristics are entered, this suggests that there could be difficulties with the repayment of the loan. Even if a proof of income cannot be presented, the loan seeker does not necessarily have to have no income. This is often the case with self-employed or freelancers who do not have a regular income.
The financial situation may be stable, but cannot be proven using conventional means. For a self-employed person, it is advisable to include the BWA or the income tax assessment. For all others, a loan without Credit Bureau information and proof of income applies with other credit protection.
The credit without Credit Bureau information and proof of income
If the loan seeker has been rejected when requesting a loan because there is a bad credit and no proof of income can be presented, he must switch to other credit protection systems. This can be a property or a piece of land, a capital-building life insurance policy, high-quality property such as antiques or gold. The naming of a guarantor also increases the credit opportunities for a loan without Credit Bureau information and proof of income.
To substantiate the loan, rental income or income from leases can also be specified. But for a good loan, a guarantor is the best starting point for a loan without Credit Bureau information and proof of income. A guarantor significantly reduces the risk of default. In this case, the guarantor is liable for a credit or payment default.
But to guarantee someone else is more than risky. The borrower can still have an excellent credit rating, a guarantee remains a risk. A surety can ruin a guarantor by putting his signature under the loan agreement without much thought. According to the Federal Court of Justice, a guarantee is only effective if the guarantor can easily pay it in the event of a loan default. If he gets into financial difficulties himself and can no longer pay his own obligations, the guarantee is not valid.
Anyone who signs a guarantee should also make claims themselves. For example, the loan should help improve living conditions and get the borrower out of a financial problem. In addition, the guarantor should insist that he be given insight into the borrower’s finances. This is the only way to ensure that, for example, a rate that has not been paid is not mentioned due to false shame. If the loan is canceled because of this, it becomes really expensive for the guarantor. The easiest way to keep control of your guarantee is to have the loan debited from your current account. In this case, the borrower pays the guarantor.
If no guarantor can be named, the possibility of a pledge remains. In the case of a loan without Credit Bureau information and proof of income, the value of the pledge will be the security for the loan. The pawnbroker, however, does not ask about the income situation and will not obtain any Credit Bureau information. He gives the sale value of the pledge, about half of the price mentioned corresponds to the mortgage lending value. Up to this value of the pledge, a loan will be possible without asking.
In addition to naming a guarantor, a co-applicant could also enter the loan agreement. In view of the tense situation, it should be considered whether the co-applicant is not alone applying for the loan from a normal bank. In this case, he could lend the loan to the loan seeker with a private contract and equal conditions. There is no additional risk, he would be in debt if the borrower could no longer pay his installments. However, the annual percentage rate would be significantly cheaper. A small loan of over 3,000 USD would then be available with 2.89% APR.
If you want to apply for a loan without Credit Bureau information and proof of income on your own responsibility, you can secure the loan with real assets or savings. In order for the approval to be obtained, the collateral should be considered relevant to the loan amount. A lender will recognize the collateral if it can serve as real protection and if the amount is sufficient.