Compare before you want to take out a loan

The financial world is large and often difficult to understand. Everyone knows the countless loan offers from banks and savings banks that are advertised in many media. 

A good overview of all offers is usually not possible, because it helps to compare loans online. The conditions on which the loan is granted are too different. Below you will get some useful tips for comparing different loans.

Taking out a loan – which points should be considered?

First of all, it should be mentioned that the cheapest loan does not always have to be the best since, in addition to the interest, many other modalities must also be taken into account. For example, many banks offer the option of special repayments. Ultimately, these extra benefits can also be found in the interest rate level. If you want to take out a loan, you basically have a statutory right of withdrawal.

However, some banks also offer an extended right of withdrawal, which is another form of the loan agreement and sets an important benchmark for comparison. Rate breaks can also be of interest to some borrowers. For an optimal comparison, all desired conditions must be specified.

These can often have a major impact on interest rates. This includes the term, the amount of the loan, the purpose and the creditworthiness of the debtor. The effective annual interest rate serves as a benchmark for a comparison – only this gives usable information about how expensive the loan really is.

Take out a loan – don’t just look at interest when comparing

If you want to take out a loan, you should also compare the ratings. Borrowers’ ratings can also be viewed on many portals that offer a comparison of different loan contracts. In many cases, there are even detailed test reports that can influence the decision.

From a borrower’s perspective, good customer service can be a clear competitive advantage. Furthermore, it can also make sense to study all product details carefully. Conditions may be specified here that are particularly desired or not desired. This can be, for example, processing or account management fees.

If you take out a loan, you should also consider taking out installment insurance. Insurance will step in if, for example, there is unemployment through no fault of your own or another insolvency.

Take out a loan – the amount of interest depends on many factors

In addition to the term and the amount of the loan, the interest rate level also depends on the credit rating. The higher the income and the lower the number of dependents, the higher the credit rating. Precise information is based on Section 805c of the Code of Civil Procedure (garnishment exemption).

Existing assets can also influence creditworthiness. If you want to take out a loan and want to save a lot of money in the process, you should consider a surety. Do you have a sufficiently solvent relative or friend? With a guarantee, the latter could significantly lower the bank’s risk interest premiums, because banks protect themselves against potential default with higher interest rates.

However, you can take out a loan without a guarantee. In any case, as many portals show, a comparison can save you a lot of money. Such a comparison works within a few seconds. If you have found the right offer and want to take out a loan, you can usually send an inquiry to the relevant bank immediately and often get an answer quickly.