Late payment – Credit and leasing in Switzerland

Have you taken out a credit or a lease and pay the monthly fees for delays? What are the consequences and penalties? Is it possible to defer the payment of some monthly payments? From what moment does the situation become serious? Can the relative be called into question by the bank?

When you take out a private credit, you undertake to pay an X sum every month for a certain period. Countless unforeseen events can cause your accounts to go red, which will result in late payments for all or part of your bills.

There are 3 cases for credit or leasing months:

  • payment reminder
  • Monthly reduction
  • Delay that reaches 10% of the debt

 

1. Payment request

loan Payment request

The first case is when you pay the monthly payment of your credit or lease upon reminder. After all, you will think that it is an invoice like any other and that delayed payment is a trivial thing that has never had other consequences than administrative costs. Do not imagine that a future request for credit or leasing could be affected.

And instead it is so! ZEK already considers at this stage that this is a serious breach that damages your reliability index. The will issue you with a ZEK 03 code that will remain registered for 5 years. Therefore all future credit or leasing applications during this period are highly likely to be rejected.

Consequently, to the extent possible, avoid at all costs of delaying payment. Except with Across Lender with which you are entitled to 2 jokers.

Penalty

In what form are these penalties? Are they interest for late payment, fixed costs?

Regarding late payment penalties, the fixed costs range from 15 to 100 USD! The amount differs from bank to bank and is shown in the general conditions.

Exception with Across Lender

Credit-now authorizes 2 late payments without additional interest and without registration in the ZEK.

Some banks do this exceptionally without affecting the customer, but unofficially it is quite rare.

 

Reduction of monthly payments

loan reduction

The second case is one in which your financial situation no longer allows you to pay the monthly amount. So ask your bank for a monthly reduction.

This will result in a ZEK 04 code that is more serious than 03. It will also remain registered for 5 years.

 

Delay reaching 10% of the debt

In the event of a late payment that reaches 10% of the net debt amount, the bank has the right to claim the total amount of the debt plus interest with immediate effec.

Typically this type of procedure ends in court. The customer will be unable to repay the total amount of the debt immediately and, in the event of impossibility, measures will be taken.

If the person lives as a couple and the relative is solvent, the bank can take advantage of the latter.

Financial restructuring loan – how it works?

What needs to be considered when refinancing loans?

First of all, the loan repayment rates should not be too high. It is much easier for you if there is enough money left over from your income for other important things. The key to good financing is good conditions and low interest rates. Many borrowers want a loan that is as adaptable as possible. This includes special repayments without additional costs or the possibility to stop repayment for a month. If all of these things are true, we can rightly speak of viable financing on the subject of financial reorganization credit .

However, keep a few things in mind so that nothing gets in the way of your loan as a pensioner, self-employed, student, unemployed, employee or trainee:

1. Only set the loan amount as high as absolutely necessary

As a rule, the basic principle applies: With a view to the subject of financial restructuring , the costs incurred should be measured realistically from the start. Anyone planning such a project must make a list of all expenses in advance in order to always have control over their finances. Planning a small buffer would certainly not be wrong. However, too large a cushion would disproportionately increase liabilities. You should therefore keep the amount of the loan as low as possible. If the need has indeed been underestimated, follow-up financing in the form of follow-up or top-up financing can easily be used to compensate.

2. Establish a structure of your finances

Anyone who needs a loan for financial reorganization credit must first correctly assess their financial situation and have precise control over their own income and expenses. Writing down your own costs every week is an excellent help, for example: in the evening, you use receipts and receipts to note how much money has been spent on that day. In order not to overlook any hidden costs, small expenses should also be taken into account, such as the hamburger at Mac Donalds or the beer after work. This has the advantage that it can be determined on the one hand where there may still be savings potential and on the other hand the optimal repayment rate can be estimated fairly precisely.

3. Be precise, careful and absolutely honest

It is important to be correct, honest and careful with all information about your creditworthiness and your own financial situation – especially when it comes to financial restructuring credit, with all information about your creditworthiness and your own financial situation carefully, accurately and honestly. You should take enough time to compile all documents and evidence completely. In this way, you convey a serious picture of your financial situation. This will definitely increase your chances of being granted an express or instant loan.

How experienced credit intermediaries work

How experienced credit intermediaries work

Above all, the intermediary will assist you in your search for a “loan without Credit Bureau”. In particular, the assistance can also go far beyond the scope of pure mediation and can be expanded to include debt advice. A professional loan despite Credit Bureau intermediary will advise you on the financing offer by drawing your attention to all the advantages and disadvantages and supporting you in compiling the application documents.

Advantages and disadvantages in mediation

Advantages:

  • Detailed advice before submitting the application
  • Help with compiling the documents for the loan application
  • Connections to lesser known banks and credit institutions
  • Aid for argumentation in the event of unfortunate personal circumstances or high financing amounts
  • Good chances of cheap lending rates
  • Mediation of loans even with insufficient creditworthiness

Disadvantage:

  • Any fees for brokering credit
  • Risk of obtaining overpriced loans
  • Dubious offers are not always immediately recognizable

Also worth reading is the contribution loan also with bad Credit Bureau

Since a number of intermediaries maintain good contacts with small financial institutions, there is a high likelihood of negotiating favorable terms for loan refinancing . It is quite possible to negotiate even with complicated circumstances. In contrast to large banks, where the credit approval procedure is largely computer-controlled, every loan application is checked on a case-by-case basis. In this way, the intermediary has the opportunity to declare a negative Credit Bureau entry so that he is not so important in the credit check. On the other hand, applying for a loan to refinance loan from an established bank would be pretty much hopeless.

What distinguishes serious from dubious credit intermediaries

A broker who is reputable is genuinely interested in helping you get a loan for a financial restructuring loan. In principle, he does not charge you any expenses or advance payments for his work, because he receives his commission from the bank.

You can recognize a reputable broker by the following criteria:

  • The office can be reached by phone without having to wait a long time
  • You will receive specific information on the loan amount, terms, debit and effective interest
  • You do not pay any commission to obtain financing
  • The company has a website including address, contact details and imprint

A dubious mediator can be recognized by these characteristics

  • Cost collection for advice and regardless of the conclusion of the loan contract
  • Promises like “100 percent loan approval”
  • Application documents will be sent cash on delivery
  • Offers in the form of a financial restructuring
  • Unsolicited home visit
  • A residual debt insurance must be taken out in connection with the financing
  • Calculation of expenses or additional costs
  • The broker only takes action if you sign a brokerage contract

What are the advantages of foreign institutions for financial restructuring credit

Whether for the new car, a longer trip, a new cell phone or the start-up capital for starting a business – loans from foreign credit institutions have long ceased to be a financing option that you have to keep your hands off. The Internet is becoming more and more popular among consumers in order to take out a loan from a foreign institution, making the domestic financial institution less and less important in this regard. Choosing a financial institution abroad has the advantage that the guidelines for lending are clearly easier there than in Germany.

A negative entry in the Credit Bureau or poor creditworthiness therefore only play a subordinate role in financial restructuring loans. Loans are provided online, which are generally granted by Infra banks. This fact is particularly interesting for those consumers who need an injection of money particularly quickly and have already been rejected by Cream banks. These would be, for example, probationary workers, pensioners, the self-employed, students, unemployed or trainees. When it comes to loan refinancing, this group in particular has a hard time getting a loan.

Swiss credit – the advantages

Swiss credit - the advantages

It is often difficult for a private individual who is in a tight financial situation to obtain a loan. Financing is made considerably more difficult due to debts or poor creditworthiness. In such a case, a so-called “Swiss loan” would be a real option. This is a loan granted by a Infra bank. In principle, such banks do not conduct Credit Bureau queries, which logically simplifies the search for loans immensely. This is ideal, especially when it comes to financial reorganization loans.

Of course, you also need certain collateral and proof of income at a Swiss institution for a loan, whereby a credit check is also carried out before the loan is granted. If your only problem is a negative Credit Bureau entry, but your creditworthiness is okay so far, the Swiss loan for financial restructuring loan would be a realistic chance.

Financial restructuring loan: how it works

Financial restructuring loan: how it works

If you are looking for a financial restructuring loan or “despite moderate creditworthiness” on the Internet, you are generally thinking of a “loan without Credit Bureau”. All well-known credit banks today check the applicant’s creditworthiness. Even if this is not done at Credit Bureau, it will be through another credit agency.

There is actually no one who lives in Germany and has no score or entry at Credit Bureau. If you are the owner of a credit card or if you have opened an account with the bank, such a value has already been created for you. You cannot get a “loan without Credit Bureau” from a reputable financial institution. So to speak, only a “loan despite Credit Bureau entry” is possible. Oddly enough, many consumers mistakenly suspect that they have a “negative Credit Bureau entry”, although the statistics say something completely different: the predominant part of the entries is positive

It is best to determine in advance whether the Score Index is in fact so poor that approving your loan application with a bank could become problematic. Incidentally, you can conduct a fee-free query of the “Credit Bureau Score” once a year at Credit Bureau. In order to be able to see for yourself what information is stored, you can obtain a so-called self-disclosure from the credit agency since 2010. Once a year, you are generally entitled to this information free of charge in accordance with paragraph 34 of the Federal Data Protection Act (BDSG). To do this, you can primarily access your own scoring (Credit Bureau score), but you will also receive information about whether someone has made a request about you in the past few months. You can request your data from “MeineCredit Bureau” at any time. Your score is based on various “ratings”, which are somewhere between 1 and 100. The higher the value, the better the credit rating. If someone has a score of 100, this means that there is an extremely small probability of failure. A score index of 50, on the other hand, means that Credit Bureau assumes that payment problems are much more likely.

Tip: This is how you can have a negative Credit Bureau entry deleted

An invoice is due and one overlooks paying it on time. There can be various reasons for this: you have a new address due to a move, were on vacation at the time or were currently in a financial bottleneck. Even a mobile phone bill that has been forgotten to be paid on time may sooner or later cause problems. It happens faster than you think. The result is that you get a bad Credit Bureau entry and it is difficult to get a loan afterwards. If there are warnings and thus a decrease in scoring, this can have an effect on the application for a loan, as I said.

But as a consumer you can have a bad entry at Credit Bureau removed. In view of the considerable volume of data and the amount of information, there is also the possibility that the information stored at Credit Bureau may be outdated or incorrect. After you have the right to self-disclosure as a consumer, you should definitely exercise it and ensure that old entries are deleted. In any case, the deletion is requested directly from the credit agency. As a condition, however, the open invoice must be paid within 6 weeks and must not exceed USD 2,000.

Your data at Credit Bureau – deletion of Credit Bureau data

After a certain time, the Credit Bureau entries will be deleted automatically, even without your request. For example, this happens with:

  • after 12 months for information about inquiries; This information is only sent to contractual partners of Credit Bureau for ten days
  • for loans 3 years after the year of the full repayment of the loan (to the day)
  • for information about outstanding claims, each after a period of three full calendar years (ie with the end of December 31 of the third calendar year that follows the storage)
  • for online or mail order purchases, provided that the claims have now been settled

The benefits of a Swiss loan

Individuals in a precarious financial situation often cannot get a loan. With poor creditworthiness or debt, the chance of financing is considerably reduced. In these cases, a Swiss loan can be a real alternative. This is a loan that is granted by a Infra bank. A negative Credit Bureau entry is irrelevant for these institutes because such an inquiry is generally not required, which makes the search for a loan considerably easier. This fact is an invaluable advantage, especially when it comes to financial restructuring loans.

Of course, even with Swiss financial service providers without a credit check and various proof of income and security, you cannot get a loan. If it is only an entry in Credit Bureau that worries you about financing, Swiss credit could be a real alternative for you, provided that your credit rating is so far in the green.

What is the “APR”

The “effective annual interest rate” or “effective annual interest rate” is decisive for credit restructuring. The “effective annual interest rate” is used to determine the cost of a loan and always refers to the nominal loan amount. It is stated with an agreed percentage of the payment amount. There are loans whose interest rate is variable or flexible and can therefore change during the term of the loan. This is then called the “effective annual percentage rate”

It is not uncommon for a borrowing rate to be fixed for a loan for the entire duration of the term. That means: The nominal interest underlying the “loan” remains unaffected, regardless of the current development on the capital markets. The benefit for you: As a loan customer, a fixed borrowing rate offers you planning security. So you can be sure that the interest rate on the “loan amount” will not change during the entire term.

What does the loan term mean

A loan can have different terms. This primarily affects the repayment terms that borrowers agree with the bank. A long “loan term” means that the borrower has to repay lower monthly installments than is the case with a short-term loan. Going through the various options related to the loan term can therefore be very worthwhile. Please note that not all maturities are offered for all loans.

The time interval from the payment to the complete repayment or payment of the loan amount is called either the loan term or loan term. The amount of the nominal interest rate and the repayment are the main factors on which the duration depends. The duration is clearly influenced by the amount and the number of installments. If the monthly installments are low, the full repayment of the loan or loan amount including interest and processing fees will of course take a comparatively long time. Loans that are connected over 5 years or longer are considered long-term loans.

What are loan fees

What are loan fees

Loan fees are often referred to as processing commission, loan processing fee, closing fee or processing fee. Why these fees? Until 2014, the credit institutions required a certain amount for the effort incurred for a loan request or the processing of the application for a loan. The calculation of the “loan fee” for activities in connection with a loan application, including the check of the borrower’s creditworthiness, has been declared inadmissible since May 2014. Banks and other financial service providers are therefore no longer allowed to charge costs that are dependent on the respective loan amount. Until 2014, such processing fees were generally around 1 – 3 percent of the loan amount, for example, for a loan of USD 10,000, this was already USD 150 to 450. Processing fees that have already been paid by borrowers for the loan application or the credit request can therefore be reclaimed in many cases.

What is a lender

What is a lender

The lender is a natural or legal person who lends money to the borrower or borrower for a certain period of time at an agreed interest rate. As far as the term “lender” is concerned, this is generally used in legislation, although the terms “creditor” or “lender” are sometimes used in loan agreements.

Lending a loan presents a significant risk to the lender as the loan could default. As a result, higher interest rates are predominantly required. Typically the lender is a bank, a savings bank, a building society or an insurance company. Of course, borrowers also have rights and obligations that are set out in the Civil Code.

What is the monthly rate

What is the monthly rate

The repayment of financing, such as “loans with poor creditworthiness” is also done in the form of individual monthly installments. The interest rate is an important component in the monthly installment. This interest rate is based on the current market prices for which the bank procures money on the international capital market. It then passes this interest on to the borrowers with a corresponding premium.

Another component of the “monthly installment” of loans is repayment. How high the borrower sets the monthly repayment rate mainly depends on his economic circumstances. The repayment is usually 1 percent annually for longer-term loan contracts. If the borrower intends to repay the loan amount and thus the loan amount with a shorter term, he must agree a higher repayment with the bank. Of course, depending on the repayment, an increased monthly charge must be expected.

Above all, it is the repayment and the interest rate that essentially result in the monthly installment for loans. Nonetheless, the monthly commission also includes the brokerage commission from the credit intermediaries and the processing fees from the banks. Normally, these costs are already taken into account in the interest rate, but count towards the monthly installment for the total loan amount.

What is a debt rescheduling loan

What is a debt rescheduling loan? This is a loan that a person takes out in order to be able to pay a loan with a very high interest rate a little cheaper by means of debt restructuring. Debt restructuring also has the positive aspect that it can be used to combine different loans into one. You can therefore disclose more than one loan for the debt rescheduling. The “debt rescheduling loan” is then logically not taken out at the previous bank but at another. There is certainly no reason why the loan for a debt rescheduling should be taken out again from the same bank – logically only if the conditions are right this time.

You see, debt restructuring has several advantages. The real meaning and purpose, however, is that with the debt rescheduling loan you have a lower financial burden than before after taking up your new loan. It can help you save money if the interest is even marginally cheaper.

What is the total loan amount

What is the total loan amount? In principle, it contains all additional costs that a customer must repay together with the loan taken out. The total amount that the borrower has to repay to the credit institution within the term of the repayment includes the ancillary costs and is therefore higher than the loan amount owed. The requested loan amount increases by any processing fees or commissions as well as the interest to be paid. Due to the additional costs, the “total loan amount” is significantly larger than the nominal amount of the loan.

The cost of residual debt insurance that may need to be taken out to cover the loan amount is also part of the total loan amount.

What is the loan amount

Logically, the actual loan amount paid to the borrower by the credit institution after approval of the loan application is lower than the total loan amount. The payout may be lower because the “loan amount” is not paid out in full as a total. This also applies to a “Swiss loan” or a loan.

It does not matter whether the borrower is a private person or a commercial company, the bank will definitely check the available total income or the current earnings situation before approving the application for the loan amount. A secondary aspect is the size of the loan amount. For example, the applicant’s monthly income for a loan amount of USD 500.00 is checked in the same way as for a loan amount of USD 10,000.00.

The monthly repayment rate within a certain period is generally fixed for the loan amount. These agreements are always laid down in the written loan agreement. For the borrower, however, there is usually the option of repaying the loan amount more quickly by means of special repayments. Fees are often asked for such special repayments. A quick look at {the respective loan agreement} provides information as to whether you have to shell out something extra for this. If the last installment for the loan amount has been repaid, the loan contract also automatically expires. If a new application is made for a loan amount, the borrower must submit a new one to the bank in writing.

What are the credit rating criteria

There is no loan without an assessment of the creditworthiness. The credit rating is based on the result of the credit check and defines the surcharges on the loan. The result is primarily dependent on the “creditworthiness criteria”. If the creditworthiness is excellent, comparatively cheap loan interest is required. A good result in determining the various criteria of the credit check is therefore always advantageous for the borrower. Each bank usually has its own credit rating criteria, which often differ significantly from those of other financial service providers. These credit rating criteria apply to every borrower and are in fact identical for every bank.

  • What is the amount of income?
  • What is the employment relationship like?
  • Is the borrower a contract agent, officer or official?
  • Who’s the employer?
  • Where is the borrower’s place of residence?
  • Are there entries at credit agencies such as Credit Bureau etc.?
  • Does the borrower keep a budget book with an entry-expense account?
  • Are there assets in the form of land or real estate?
  • What is the marital status?
  • Are there any existing loans and guarantees?

These are the prerequisites for loan refinancing

These are the prerequisites for loan refinancing

If you want to apply for a loan from a loan broker, you have to meet a few prerequisites. Amongst other things:

  • Age over 18 years
  • German address
  • Cream bank account
  • regular income
  • sufficient creditworthiness
  • for dedicated loans, collateral such as a car or property

There is a special loan that some credit intermediaries offer in principle with an unfavorable credit rating. This is the so-called credit private or personal loan. “Borrowing money without Credit Bureau” does not work through a normal financial service provider, but through one or more donors.

“Financial restructuring loan” – good tips and advice

Never apply for a loan with an inadequate Credit Bureau or a poor Credit Bureau score if you are not quite sure that you can really repay it. The bank often has valid reasons to refuse a loan application.

Remember, one of the primary business criteria of credit banks is to get all of the loans that {consumers get} out of with interest. Logically, the stated goal of financial institutions is to lend to reliable borrowers. If an application is now rejected anyway, the analysis of the creditworthiness has shown that the payment behavior has been so bad so far that it will not be possible to reimburse the installments on time. Even with a sufficient Credit Bureau, the loan application can be refused. Namely, when the necessary funds are insufficient or the minimum income is so low that a repayment of the financing cannot be guaranteed.

As a result, when it comes to applying for funding, such as a “credit without Credit Bureau”, it would be advantageous to compare your income with the expenses as realistically as possible. You will then already know in advance whether you can easily repay the desired loan or whether the monthly installments might mess up your budget. Unfortunately, very few people initially think that financing with a longer term can lead to financial bottlenecks and that it can then become a problem to repay the loan on time. It is possible that, for example, the car urgently needs to be brought in for repairs, the fridge suddenly breaks or suddenly a high payment request from the electricity provider flutters into the house.

Otherwise, take the opportunity to get personal advice from your credit advisor on a “loan with Credit Bureau entry”. Together with you, he analyzes your financial situation and also helps you to find the right offer. People who did not get sufficient advice before taking a carefree “loan despite Credit Bureau” often got into a debt trap – with unpredictable economic consequences. Borrowing in spite of Credit Bureau is also particularly popular with borrowers. The loan broker is also an expert on this topic and can provide the right information when it comes to summarizing various loans..