Take Loan Abroad: Advantages and Disadvantages

Anyone who tries in vain to borrow or be dissatisfied with the house bank or other local credit providers can resort to borrowing abroad. The interest rates are significantly lower in some countries than at home, but to check the terms of the loan agreement in advance as well as here.

Even with foreign credit, there are pros and cons to weigh.

First of all, we will briefly summarize the most important points concerning the topic of “taking credit abroad” – these factors will be discussed in more detail below.

advantages disadvantage
 Bypassing a Private credit query possible
Due to currency differences may be very good conditions
When mediating through a local bank, you can also be hedged against risks such as currency fluctuations
 Less predictable due to interest rate and currency fluctuations
Many dubious mediators
Often takes longer than inland

If you decide for a loan at home, you should take a look around here:

How do customers get a loan abroad?

Lending abroad is usually provided through specialized institutions that are often based in Switzerland. Unlike in Germany, no guarantors, securities or information from Private credit are required for the granting of the loan. By transfer from abroad or postable, that is against signature directly from the postman, the borrower receives the money.

Most frequently, loans abroad are used to bypass a Private credit query. This is mainly due to the fact that credit institutions are now extremely strict regarding Private credit entries in Germany. Even a non-paid mobile bill in this country can destroy the creditworthiness. However, taking credit abroad is not without risk! Interest rate and currency fluctuations make this type of loan much more unpredictable than traditional bank loans in Germany. At the same time, however, there is also the biggest advantage of a foreign credit – due to the different interest rates in one country, the lending rates can be much cheaper.

When choosing a suitable credit institution, loan seekers should therefore show a healthy skepticism, because in particular behind very full-bodied promises are often concealed dubious intermediaries who lure people in financial distress quickly into the debt trap.

It is also important to note that a loan abroad is almost always final. This means they are not paid in installments, but at the end of the term in one fell swoop. So you should be really sure that you can afford this final payment.

Is it risky to take out a loan from abroad as a German?

Is it risky to take out a loan from abroad as a German?

Of course, the biggest risk with a loan from abroad is to get the wrong provider and one should consider whether one first tries to find someone in Germany who manages to successfully arrange a loan. Really necessary to take a loan from abroad only if the personal Private credit really looks so bad that no German bank is willing to give a loan. In this situation, of course, only one bank can help abroad, which completely waives the Private credit information.

It is also important to find out which foreign institutes maintain contact with the Private credit and which do not, otherwise the circumstances will end up being wasted. In the same way, one should first clarify which banks – for example in Switzerland – lend credits to German customers, that is by no means all facilities.

Experience on loans abroad

Whether credits from abroad are really particularly risky or whether a loan is reputable abroad can not be answered in the end. There are different statements from customers and people who have experience with the whole:

“Foreign loans without Private credit are a good thing, but it took me more than a week to get the money! So if you really need it now, you better borrow it from your friends or from your parents. ”
– F.Günther

“A foreign loan without Private credit is already OK, but if you need money now urgently, it is definitely faster in Germany.”
– D.Hofer

“My sister has used foreign loans twice without Private credit twice, and that was quick and easy, even online.”
– C.Winter

Warning sign at unserious providers

There are some points that you should pay particular attention to, if you do not want to rip off the glue:

– On pre-cost, incurred before the payment of the credit, you should generally never get involved. Because with such methods no serious institution works.

– Side shops are also a red cloth. If it is a prerequisite for the credit to take any insurance with you, keep away!

– The same applies if something is generally to be purchased for the loan, such as shares in the credit institution or the like.

Is a credit from abroad reputable?

This question can not be answered in general, it is just on the way to the credit. As already mentioned, there are quite a few dubious providers in the area who, while helping to get credit abroad, charge considerable fees. In the worst case, you make an advance payment and then it does not happen anymore.

But getting a credit from abroad reputable or serious way is impossible in any case and can also have its advantages through lower interest rates etc. You should be very well informed first – as with all credit transactions – and work best with a local bank.

Serious loans via local banks

In order to obtain good conditions, the loan agreement can also be concluded by arranging domestic banks abroad. Due to the various legal situations, customers can not make this directly and are dependent on the help of the domestic bank. The loans are then usually settled in the foreign currency and offset with the (if available) cheaper interest rate. In most cases, loans abroad are then also hedged for some risks, such as the fluctuation of the currency.

Advantages and conditions for a foreign loan

Advantages and conditions for a foreign loan

In addition to possibly lower interest rates, the greatest advantage of having a loan abroad is the refusal to provide information from Private credit, even after successful lending, no Private credit entry is made, as is always the case with loans taken in Germany.

This is simply because, for example, Switzerland does not even know a facility like the Private credit. Instead of a positive Private credit information, however, a regular source of income should be proven. In addition to ideally an indefinite professional activity, this can also be pension benefits.

Alternatives to foreign credit

Alternatives to foreign credit

Before you really consider taking out a loan abroad, you should look for all possible alternatives.

If, for example, you want to avoid the Private credit query, there are certainly providers in Germany who are already willing to accept other collateral. For example, a provider who clearly states that a negative Private credit need not be an immediate exclusionary is creditist. A provider that is generally considered trustworthy.