Taking out credit: how is it done?

Determine your credit needs

What do you want to buy and how much money do you need for it? The amount and your project decide which loan is suitable for you and which form of financing is best suited.

Do a household bill

How much money do you have monthly to pay the loan installments? Calculate your income and expenses. You can set your credit limit in just a few steps.

Compare different loans

Which provider has the best conditions for your individual needs? Compare as many loans as possible by calculating how much each loan will cost you based on the amount you need and the monthly payments you can afford. Many online portals offer such comparisons, where you can have your individual loan calculated.

Submit a loan application

Once you have decided on a provider, submit an application with the relevant data, the desired conditions and your personal documents.

The application is checked by the lender, for example the bank. He uses a Schufa query to determine your creditworthiness. If the application is approved, you will receive the relevant documents and the money.

How much credit can I take out?

The amount of the loan depends on how much money you have for the monthly installments. You can determine the amount of your monthly financial resilience using what is known as a household calculation: You compare your income with your expenses. Earnings include net income, rental income and other benefits you receive.

When calculating expenses, include rent, ancillary costs, savings contracts, groceries, travel expenses, clothing, leisure activities and other expenses. However, the amount by which the income exceeds the expenses should not be used entirely for the installment payment, after all there should always be a buffer for unplanned expenses. The rule of thumb is that 15 percent of the amount that would be possible should be retained as a safety reserve.

Budget calculator

Who can take out a loan?

Of course, whether you get a loan depends on your financial resources on the one hand, but other factors also play a role. For example, there are loans that are only granted to certain groups of people, such as civil servants, the self-employed, students or pensioners. Basic conditions:

Age: If you want to take out a loan, you must be of legal age. Some lenders also refuse to lend to seniors because they believe there is an increased risk of death.

Residence: The borrower must have a permanent residence in Germany.

Employment relationship: A permanent employment relationship is often a prerequisite for obtaining a loan. A loan for a fixed-term employment relationship is usually possible if the term of the loan does not exceed the term of the employment contract. Anyone who is still in the probationary period usually does not get a loan or has to expect higher interest rates. Lending is usually more difficult for the self-employed because their income often fluctuates and is difficult to calculate.

Income: The amount and regularity of income determines whether and how much credit will be granted. Income must be documented with wage slips.

Creditworthiness

Collateral: In the case of long-term loans or loans for large sums, the lender often requires additional collateral such as property or life insurance. In the case of earmarked loans such as a real estate loan, the property is used as security.