Financing is not only indispensable for the economy, even private individuals cannot make major investments or bridge financial bottlenecks without loans. More and more providers are responding to this demand, but they can differ considerably in terms of cost structure, conditions and, of course, seriousness. A detailed research on the Internet should therefore bring a market overview.
Examine cost structures precisely
The lurid low interest rates, some of which even advertise with zero percent, should be examined more closely, because financing always costs money. So these costs have to be hidden somewhere, because no bank lends money for free. Especially when financing cars or everyday objects, the returns for the dealers are reflected in the price, which would simply be lower if paid in cash. Fees for examining a credit request can also be raised in order to earn at least. It is very clear that serious loans can do without upfront costs. When choosing a proper provider, such cost items must not appear.
Check interest rates
If an interest rate offer contains an “ab” or an “*”, it must be carefully examined under which special conditions this offer applies. Mostly, constellations are used that have little to do with reality, since the fixed interest rate is often dependent on creditworthiness. It is only after the credit check that there can be a binding offer that an interested party can also rely on.
Normally, no costs may be charged for this check, since reputable loans are offered without any upfront costs. But even with conditions that are independent of creditworthiness and are particularly suitable for a somewhat worse financial situation, a binding offer should first be obtained. Because all the cost items are listed here, which is what the Price Disclosure Ordinance (PAngV) prescribes. In this way, the costs can be compared precisely, since not all items are included in the annual percentage rate, which should always be a yardstick for comparison.
Compile and compare total costs
The clearest procedure for comparing loans is to compare the total financing costs, i.e. all fees, the interest charge and the payment amount. Of course, residual debt insurance also plays a major role, as some financing providers make it mandatory and these costs must then be included in the annual percentage rate.
If it is taken out voluntarily, which can make sense in some cases, the insurance premium must also be added to the total costs. Since serious loans do not involve any upfront costs, the resulting positions can be co-financed. This either increases the loan amount or reduces the payment amount, which must also be carefully considered in advance and taken into account in the comparison.
Compare exactly and save costs
Financing offers are diverse and have different cost structures. It should be clear from the outset that only serious loans are processed without any upfront costs. The list of total financing costs is the best way to compare the conditions and the partially hidden costs exactly.