Loan with Guarantors
More and more frequently, the loan with guarantors from the loan officer is desired. Many who have borrowed and repaid loans before are astonished. A little insight into the background of the changed practice, which provides the contribution.
Loan with guarantor – changed credit landscape
To avoid misunderstandings, the loan with guarantors, which has always existed. However, the frequency with which the guarantee for credit security has been demanded has changed. Until a few years ago, guarantees were only demanded with very high credit balances or a lack of solvency. A good example was the company foundation without ERP funds.
The financing of the house building, that was another typical guarantee loan. For the financing of the used vehicle or a renovation measure no one, who pursued a regular occupation, had to present a guarantor. In recent years there has been tremendous upheaval in the lending rules of financial institutions, both before and behind the scenes.
Reasons for the guarantee
First, it was the Agenda 2010 reforms that made many workers “day laborers”. Temporary work has brought many people into bread and work. But much more than a piece of dry bread can not be bought by most employees of a temporary employment agency. The incomes are significantly lower than the regular workforce. While many are working full-time, they still need to top up. Job security can hardly be deduced from a contract with a temporary employment agency.
Temporary workers are even rated as having too much credit risk with guarantors from various credit providers. You are excluded from lending. Like the temporary workers, it is the same for retirees. You have worked for a lifetime. The average net pension, according to the ministry, nevertheless lies well below the seizure limit. The loan with guarantors is the only way for many retirees to get a much needed loan at all. The annually increasing seizure limits further exacerbate the situation.
The euro crisis is changing the commercial credit system
While many people literally break their income, the political leverage was also applied to the banks. They have to meet ever stricter requirements. Risk loans should be excluded. The whole thing is controlled by the Dufol.
The best example of this is freelancers. They get a loan despite the good income only under the greatest difficulties. Freelancers often not only earn well, they also pay back their loans. The problem is only that were defined in the Basel 2 contract grant requirements. The requirements can be fulfilled by a normal freelancer, not without high investment costs.
The loan with guarantee over the usual credit supply system is becoming increasingly rare. The cheapest option is the loan without guarantor and without bank. Private lending is not subject to legal restrictions. In parallel with developments in commercial lending, the private capital market has grown almost explosively. A loan with guarantors, which is almost never demanded by the private sector.