Germany is still a car country. But not everyone can easily afford their own car. But even for people with poor credit ratings, the prospect of a car loan is not that bad.
The car is of enormous importance in a country like Germany. This applies to private life and even more so to professional existence. And so almost every adult in Germany is dependent on a car. The credit behavior of most Germans is exemplary. Especially if you have a bad credit rating , you justifiably ask yourself whether you can get a car loan at all or have to use other means. Fortunately, there is good news in this regard.
Unfortunately, it is often a mystery how banks assess the creditworthiness of potential customers. Sometimes it is not even your own financial situation or payment behavior that thwarts the loan application , but simply the fact that the bank follows a scoring model. That means nothing car dealerships that accept bad credit more than that it includes the living environment in the creditworthiness calculation. So if you are unlucky with your neighbors, you often look into the tube. The circle of those who have problems applying for a loan does not only include people with negative Schufa entries . Many banks also rate the creditworthiness of freelancers, the self-employed, temporary workers and even entire employee groups as bad per se.
Since a car loan is not an ordinary consumer loan, the chances of a loan approval are relatively good despite the poor credit rating. Why? Very easily. In contrast to a simple consumer loan, which can be used either for the purchase of furniture, consumer electronics or a vacation in the south, the car loan is earmarked. In this way, the bank’s financed vehicle serves as collateral.
If the borrower is unable to service its installments, the bank pulls in the vehicle and can at least largely or even completely pay off the outstanding debt through the sale. Since the risk for the banks is significantly reduced by the deposited real value, citizens with poor credit ratings are more likely to get a car loan than a normal consumer loan. . An overview of car loans despite Schufa shows the different conditions. However, banks often require appropriate partial or fully comprehensive insurance so that the value of the vehicle is retained.