Admittedly, this headline is a little overstated. But it is true in its core!
Consumer organisations recommend yes, compare financial products. However, who does this at loans and applies for a loan at different banks in order to choose the most favourable, will have to pay higher interest in the end or won’t get any loan!
Caution: a comparison could become expensive!
Why is that?
In Germany, all loan – but also all loan requests (!) – are stored at the Schufa.
The normal way from the perspective of the credit agency is:
- Entry: loan request
- Entry: loan agreement with amount and term
- Entry: loan fully repaid
(Herein, it is also stated, if loans were not repaid on time!)
There can be several entries “loan request”, however, no entry “loan paid” follows. So the credit agency assumes that there are problems and the bank has not paid the loan because of them. As a consequence, the personal creditworthiness rating decreases.
Creditworthiness (score value) often determines the interest rate
Banks use this personal score value (Schufa-score) not only to decide on the loan payment, but in many cases they calculate the interest rate depending on the score value!
From the perspective of the bank, this is logical.
Bad creditworthiness rating = higher risk = higher interest!
That means: If you start to compare loans yourself, it will become expensive or you even ruin your chances to get a loan.
How to do it right
Use a closed system to find the most favourable loan provider. Smava is the leader of this area in Germany.
At Smava, you enter your personal data, as well as the desired loan amount. Smava only makes one single entry at the Schufa – of course, as it needs your score value too – and calculates, how much your loan would cost at different banks.
For this, Smava works with many (not all) German banks. Smava knows which banks finance which borrowers with which creditworthiness rating and at which interest rate.
In the best of cases, you get several loan proposals. You can choose the one you like best. This is generally the most favourable interest rate.
The bank does not choose you – You choose the bank from several proposals!
Up to this point, the loan-providing bank does not know your name yet. Only when you choose a bank, your personal data is transmitted to this bank for the payment of the loan.
Through this clever way, you receive several loan proposals that are adjusted to your current creditworthiness by making only one Schufa-request.
Here you can start right away with the loan calculation:
Please note that “interest offerings” are shown in this tool. Your specific interest rate can only be calculated after entering your personal data. Simply follow the entry procedure by clicking on “Weiter” (continue).