Anyone who has ever specifically searched for private individuals who lend credits, certainly knows the entries in classifieds. Certainly there is also an offer, which is serious. But who wants to play it safe, should use one of the new operator portals. Here, donors and applicants are audited and the processes are standardized. Applicants with a lower private credit, the self-employed, and employees with a fixed-term employment contract will generally receive money. We have researched for you, and the conditions of 4 known providers under the magnifying glass. How it works, and what it costs.
How does it work?
If you want to finance your project with a loan from private individuals, you can set this on one of the portals mentioned above. Who wants to invest money (investors), selects one of the projects presented, and supports the loan seeker with a cash injection. As a result, the portals bring together supply and demand. A bank takes over the administrative processing, since a lending in Germany is officially reserved for banks. However, the money comes from private individuals, who also bear the risk of default on the loan. The portals receive a commission, which is already included in the monthly installment of the borrower. The lending private individual also pays 1% of the investment support, for example, at trucredit. However, costs only apply if a payment actually occurs.
Who receives a loan from private individuals?
Unlike many banks, the portals do not exclude self-employed and temporary workers from lending. In order to obtain the relevant information, the platforms use either an in-house rating or the information from the private credit. In addition to the private credit score, the internal ratings also include other criteria in the credit decisions. On this basis, eg trucredit subdivides the applicants into one of seven classes (AA to X), using a similar system Giromatch and Crosslend. The rating decides on a commitment as well as the conditions. The following basic requirements must be met, see list below. If it comes to a rejection of your application, short-term loans, such as Viloan or Neofunding offer alternatives .
- Age: 18 to 69 years
- Residence and bank account in Germany
- sufficient income to repay
- Grounds for refusal: affidavit, account surrender , past loan defaults, open claims with title, personal bankruptcy, arrest warrant
What are the costs for loan seekers?
The good news right away: As long as no loan is paid, there are no costs. This also applies if your request is rejected. Only when a contract is concluded, interest and depending on the provider, an agency fee, see table above.
- Registration on the portal: free
- Publication of your loan project: free of charge
- Credit check: free
- for lending: interest, and depending on the provider agency fees, see table
- additional costs for unpaid installments and dunning
Advantages and disadvantages of a personal loan
- fast transfer and payment
- Also awarded to the self-employed, freelancers, students and employees on fixed-term contracts.
- no risk to reach dubious loan sharks
- Private individuals also lend small loans under 1,000 euros
- Lending even without / for worse private credit
- possibly additional fees
- high interest rates with weaker credit ratings
- Lenders bear the risk of loss in the event of a loan default
Without a bank it does not work
Although, of course, a loan is provided by private individuals without a bank, nevertheless, a credit institution is turned on. For officially allowed in Germany only banks loans. However, the institute only handles the settlement, and thus a kind of trust function. This includes, for example, the processing of applications, the payment and the subsequent support. However, the money comes from the private person himself. This also decides whether it comes to a lending, and on what terms. The risk of a loan default is borne by the lenders.
How serious is the settlement?
At the beginning, the portals met with criticism. In particular, the fee structure and rating procedures were criticized. For example, at the beginning applicants had to pay fees even if no degree was concluded. In the meantime, the providers have optimized the processes according to the financial test . Costs are only incurred if it actually comes to a successful mediation. Another point certainly contributes to the seriousness. According to our research, mediation is completely anonymous. Borrowers and lenders do not face each other personally, and the loan is taken out of the total pool. If the applicant’s rating is not sufficient for placement, he has the opportunity to introduce himself and his project in more detail. In this case, the data to the outside is revealed, which reveals the loan seeker. Nevertheless, we have a point of criticism. When researching the costs, we never found all fees clearly listed, but always in different places on the respective web portal. At Giromatch and Crosslend we even found no concrete information on interest rates and any other costs. For the financial layman, this can lead to the cost later occurring surprisingly. Dear portal operator, please improve there!
Who is it worth?
Borrowing money from private individuals is not worth it for everyone, but in some cases it can be useful. For one thing, consumers whose credit rating is not top notch have a real chance of getting a loan. On the other hand, the portals also organize small loans with sums below 1,000 euros. Self-employed persons, students and employees with fixed-term employment contracts can also obtain liquidity through the credit marketplaces, which is often not possible through normal banks.