Many online finance offers promise a loan even if other banks have already rejected the loan application. The reasons for a rejection mostly lie in the creditworthiness. But why do other banks advertise with a loan despite bad Credit Bureau and thus bad creditworthiness despite all of this? How good and how safe are such loans? And where can you find them?
The Internet is a gathering point for many providers
As is so often the case with such offers, the answer to these questions can be found above all on the Internet. Because here mainly loans without Credit Bureau and upfront costs are offered and advertised in this context. Often it is credit intermediaries who draw attention to themselves through targeted advertising and thus appeal to the clientele that other banks have no chance of a loan.
The mediation then usually takes place to private donors who provide the financial means when there is sufficient security. Since the credit rating is not given as security, it must be obtained from other sources. Here, a guarantor or a second liquid borrower who has a high income and can secure the loans without Credit Bureau and preliminary costs is usually required.
In addition, the first borrower must be able to offer collateral in the form of valuables or real estate. However, these guarantees are always based on the amount of the loan and the length of the loan. With a small loan amount, these components are correspondingly smaller than with a large loan amount.
Another security offers the providers an increased interest rate.
This is usually well over 10% and thus ensures that loans without Credit Bureau and upfront costs ultimately result in good money for the donor. A prepayment or processing fee is not uncommon in this context and is often requested by the borrower.
If you want to avoid this, you have to look very closely at whom you sign a loan agreement with. It is good if you can see exactly what additional costs will arise in advance. The more transparent the loan agreement is, the better it is for the borrower, since he doesn’t have to be afraid of hidden costs.