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General information about loans – loans and their importance for private individuals, entrepreneurs, banks and the economy

Loans and their significance for private individuals

Loans and their significance for private individuals

The word “credit” is derived from the Latin creditum – the trust entrusted to good faith. Of the various meanings that the word carries, the most socially relevant is classic money and commodity credit . The lender leaves the borrower a certain amount or goods with confidence that the borrower will repay the value according to a contractual agreement. The lender’s profit usually consists of a certain interest rate, which is due in addition to the installments to be paid.

National and private sector loans

National and private sector loans

Loans are a driving force in our economy. The granting of loans by banks is understood as a process of creating money in the existing banking system. There are various reasons to take out a loan. Private individuals usually endeavor to obtain a loan if they want to fulfill certain wishes and the financial means are not available. In the classic case, it is a purchase and installment loan that is paid off in monthly installments. This is usually not earmarked, unlike a car loan or a building society contract. The type of property to be financed is specified here.

For lower sums, such as to finance some occassion or a vacation, there are small loans. If you want to have a certain amount quickly and easily, you now often choose an instant loan that can be applied for online from a direct bank.

Credit check

The process of lending almost always includes a credit check, in which the lender is convinced that the applicant is able to repay the loan. Too little income or a negative entry at Credit Bureau can put obstacles in the way of the borrower.

In the meantime, some loans without Credit Bureau are also possible, but when they are granted, the credit rating is also checked to protect both sides. In the case of existing debts with very high interest rates, rescheduling can make sense.

Financing for companies

Financing for companies

Banks also offer certain options for lending for start-ups and business customers with existing companies. These often apply even stricter requirements because the risk of financial bottlenecks and even bankruptcy can be relatively high. For larger companies, the transition to other forms of financing is fluid if they have access to the capital market.

For business customers, a distinction is made between investment loans, which correspond to a classic installment loan, working capital loans and goods financing loans, which each function similarly to overdraft facilities, as well as discount loans for the purchase of bills of exchange.

As an alternative to business loans, there are other financing strategies such as the leasing of equipment, machinery or vehicles or strategies such as factoring, mezzanine capital and private equity.

Calculate and compare credit

Calculate and compare credit

In cooperation with our partner finance check, we offer you the opportunity to first calculate your monthly rate based on your desired loan amount and term. You can then submit a serious loan request and also apply for the loan directly.