There is also another financing option – the short-term loan .
In this case, the main question to be defined is exactly what exactly is a short term and which loan amounts are realistic in this context. Of course, the amounts can well be in the five-digit range, if the budget available is sufficiently high. Normally, however, a short-term loan will tend to be in the range of microloans or small loans available on the market. Let’s take a look at the key details about this particular type of financing.
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Many names for “short-term loans”
When you first look at this term, you will quickly realize that there are different names for the same product. In the credit comparison , the term short-term loan is actually often mentioned in the same breath as the mentioned small loans, short-term financing or even short-term loans.
Of course, for short-term expenses beyond your budget, you can use the credit line of your checking account or your credit card. However, in your own interest, this should only happen if the credit line is really quickly balanced. Otherwise, customers will pay significantly more than ten percent interest each year if they use it permanently. Normal installment loans are available in part but from as little as two or three percent APR. Even with a short-term loan, consumers should therefore take the time to make an accurate comparison. By the way: Particularly flexible are consumers who have access to an on- call loan .
In this case, borrowers can have a credit line agreed with the bank at any time, similar to a discretionary loan. Interest only accrues for amounts actually claimed. Ideally, you should also compensate these limits as quickly as possible in order to keep interest charges low.
How complicated is the application for a short-term loan?
One feature that distinguishes short-term loans is the often straightforward application and application review process. After all, banks generally see lower hurdles for the award than for a large loan .
Nevertheless, you will encounter a few short-term credit requirements. These are usually these:
- a minimum age of 18 years
- a first residence in Germany
- a German bank account (for withdrawals and debits of the agreed loan installments)
- a regular income
- sufficient creditworthiness
For such financing, the credit check with Schufa or another credit bureau is certainly also standard – if only because the German legislature provides for the examination of the creditworthiness as obligatory. Accordingly, ” loans without Schufa ” come from abroad. Many borrowers look around there for supposedly better opportunities for offers. However, foreign banks and agency portals based outside of Germany may incur fees which may not be charged in this country. One example is the processing fees that have been banned in the German market for consumer credit for several years.
Offers from German financiers for a short-term loan are more than enough due to the Internet boom. Concerning the Schufa- information, it becomes clear that with smaller amounts of funding, there does not necessarily have to be a good or very good Schufa score. Even with average results, you have a good chance of success with short-term loans.
More and more loan offers with a very short term
The question asked at the beginning of the definition of the ” short term ” is decisive. New service providers, such as and others, are attracting short-term loans, targeting a maximum of 30 days. The background is, for example, the bridging of short-term bottlenecks until the next salary is transferred or open invoices have been paid by the clients. Even as a loan for self-employed, the offers of many banks and online service providers are now available without any problems. Many other short-term loans tend to use the suffix “short” to mean offers in which the lent sums are repaid within six to a maximum of 12 months. Compared to mortgage lending with terms of 20 years or more, a loan with a 36-month term is, of course, rather short-term.
Larger credit amounts can also be applied for in the short term
In fact, experts in short term loans tend to understand contracts that call for a maximum of 12 months for repayment – exceptions, of course, as always, rule out the rule. It’s not just the young online providers that can apply for a short-term loan. Established direct banks such as netbank and others are also increasingly using maturity terms for their installment loans, whose lower limit is six months. In general, short maturities are beneficial to borrowers of all types. Because as short as the term, the time period for interest payment also falls. Of course, the deciding factor is always the sum that customers want or need to apply to banks, savings banks or agency portals.
Clear details of maximum amounts for financing
If you have a high income, you can also take on higher short-term loans
The term as such is not necessarily a restriction on the loan amount. For example, there may be instances when companies or the self-employed need loans to cover temporary costs until sufficient capital is available. The sums of money may in such cases be five digits. The credit debt then only has to be redeemed with relatively high monthly payments. Can I afford this as a bank customer, nothing speaks against the project. Low income will inevitably lead to limited opportunities in terms of loan size. The limits for loans with a short maturity of up to six months usually range from a maximum of 2,000 or 3,000 euros. Those who need more money will normally find a less abundant selection in the credit comparison.
If things need to be done quickly, because the need is acute, instant loans with extra-fast checks and payouts make sense. Some providers guarantee immediate on-line checks with a deployment within 24 hours. In general, online loans are characterized by a quick evaluation of the application and an associated quick statement of the approved funds to the specified reference account.
Customers influence the lead times
The promise of a quick and straightforward award requires applicants to prepare well in return. This means that you have all relevant documents for the examination of your loan request at hand and do not have to look for them first. The typically required documents include at the latest for larger loan amounts
- approval of the required Schufa query
- the submission of current proof of income
- Proof of permanent employment or self-employment / self-employment
- the conclusion of the legitimization procedure
As mentioned, borrowing in Germany does not succeed without the inclusion of creditworthiness. Portals such as auxmoney, where visitors can receive loans from private to private, require this step. Through a transparent presentation of the purpose (such as a clever new business idea) you increase the chances of a timely approval. In this case, the funds come from various private investors who use the platforms as a kind of investment. However, money only flows when the full amount of the short-term credit is collected in the community. If this is not the case, the financing will not materialize. In the case of traditional bank loans, on the other hand, “only” has to agree with the individual bank.
Instant loan loans are quick fixes
In order for the immediate addition to succeed in the application, future borrowers should as I said important documents such as the income tax returns of the past one to three years (for self-employed are statements for several years common practice) promptly to the provider. This works increasingly online. The same applies to the authentication. If the proof of identity was only possible by presenting a valid photo ID by means of the PostIdent procedure, the digital financial service providers and the direct bank are increasingly allowing legitimacy via VideoIdent. To do this, you need a webcam or camera on the mobile device and Internet access for the short-term credit.
The main advantage of many loans with this extra service: → The contact to the support of the funders can be independent of location and sometimes even around the clock – so an audit can take place in real time. If you have sent all the documents to the bank and provided the proof of identity, the credit decision can indeed be made within a few minutes – and thus also the loan payment.
Credits with short maturity can be realized even with low income?
Especially apprentices, students, but also retirees with lower incomes sometimes have a hard time. Even with a short-term loan, the search effort can be quite high. But if it really only needs a loan for one to two months and moves the capital request below 1,000 euros, many service providers turn a blind eye. Occasionally, microcredit and microcredits are even available for unemployment benefits if they are appropriately creditworthy.
But even when small loans usually separates the wheat from the chaff. The majority of offers are for a non-purposive purpose, unless you are applying for a loan like a car loan. Recipients of state benefits are usually excluded from applying for a loan. What sums of money you can repay on time, ideally determine with a household calculator. This should be used by any interested party before non-binding offers are obtained. So you can find out quickly which running costs have to be financed and what rates you can afford! Important: never overstrain yourself.