An installment loan is particularly suitable as a consumer loan to finance certain purchases such as car, furniture or washing machine. Even a vacation can be made possible with a favorable installment loan. Anyone who has such a loan request should compare the terms of the different providers.
Credit to individuals for private purposes
Typical of the installment loan is that it is given to private individuals for private purposes. He is not repayable at once, but in regular monthly installments, the amount of which is fixed in advance. Depending on how high the loan amount, the monthly installment and thus the term, there is another effective interest rate. This in turn is determined differently from one bank to another. The fees of the bank are also different. The interest rates for a installment loan are generally lower than for a discretionary loan and therefore particularly well suited for larger purchases. The installment loan is not suitable for building a house : On the one hand, the interest rates would be too high, on the other hand, the consumer credit tends to include smaller sums of up to an average of 75,000 euros.
At the house bank or another bank
A private loan in the form of an installment loan can be applied for by anyone. As a rule, collateral does not have to be deposited, a simple proof of income and a positive Schufa report are sufficient. If the creditworthiness is missing, a installment loan can nevertheless be granted. In this case, the signature of a guarantor under the credit agreement is necessary. An application for a installment loan can be submitted to the principal bank or to any other bank other than building societies. There are also so-called consumer banks that specialize in the provision of small loans to private individuals. Here also lower income earners have the opportunity to receive a installment loan. However, this generosity is usually associated with significantly higher interest rates. More recently, direct banks and online banks have been added, which also provide installment loans for consumption purposes.
Important when buying a car and by mail order
An important area for an installment loan is the car purchase. There are tailor-made auto banks that exclusively offer financing for private cars. Mail order companies also work closely with their house banks or operate their own installment loan bank. In principle, it is possible today to finance all consumer wishes with the help of an installment loan.