We gives information around the topic of online loans. Numerous providers, numerous loans: One has the known agony of choice. The problem: Counseling by the house bank is not always independent. We inform about the online installment loan – the best guidebook for an individual credit profile. Find the best terms and the cheapest installment loan for your needs.
Take some time, because you should know exactly what it is, before you make an online installment loan. We inform comprehensively: Which requirements must be met by cheap installment loans? What are quality characteristics? Online installment loans in comparison: Which online installment loan makes sense for whom? Which providers are recommended? We have tested and give you an overview of the offer – only then can you make the best decision.
How does our online loan comparison work?
You do not have to be inhibited if you want to use our website. It is quite simple: You just have to specify what loan amount you are looking for, the term and purpose are also important. In this case, it is about a installment loan.
A installment loan is a loan that is repaid in installments at a predetermined interest rate. The interest rates are usually set individually. Their amount depends on the size of the loan and the creditworthiness of the borrower. Generally speaking, the lower the amount and the more installments are agreed, the higher the interest rate will be.
Cheap Online Installment Loans: The search is not difficult!
First, it is easy to understand: a installment loan is a standardized product of banks for private customers. As a rule, the two parties agree on a monthly installment, the term of a loan varies. The borrowed amount and the interest and fees of the credit institution must be repaid within the specified time. A installment loan is usually awarded for sums between 1,000, – to 75,000, – €. For smaller or larger sums, banks usually offer other types of loans.
There are numerous offers that you will come across as soon as you search the internet. To find a cheap installment loan online whose quality you can count on, you should take some advice. With our installment credit comparison, however, the selection will not be difficult for you.
Seriousness in the test: The quality of installment loans
The biggest concern of most borrowers is that you could fall for dubious providers and blindly fall into a debt trap that makes them hard to get rid of. The fear is not entirely unjustified, especially as in this area many fraud attempts are made to exploit the situation of a borrower.
That’s why it’s even more important for you to be well informed in order to actually assess the seriousness of a cheap online installment loan. We have put together the five decisive quality features for you:
- The bank does not charge any hidden fees, which are hidden in the fine print. Get help if you are not sure and present the loan contract to a specialist or a specialist. Even the consumer centers offer a good and free service, should you have any doubts.
- No usury! The average interest rate is about 6 percent, from 10 percent APR, the rate is well above the average. Cheap online installment loans you get from 3 percent.
- Special repayments are possible. Of course, a good lender will allow free reimbursement in addition to the agreed rates, even if it reduces the term.
- No processing fees. In addition to the above fees for additional insurance, banks are not allowed to charge processing fees on the credit opening.
- Transparency through interest rate-independent interest rates. Non-credit-linked interest rates, which enable even low-income clients to take out loans, are still not very common. We rate credit-independent interest rates not just for social reasons, but also because of the associated transparency as a quality feature. The APRs can be compared in this way since interest rates are not individualized.
The comparison: is a installment loan useful for you?
There are numerous loan options: home savings loans, lightning loans, auto loans and many more. Whether an online installment loan makes sense for you, is our short test. Just answer the following questions:
- Are you looking for financing up to a maximum of 75,000 euros?
- You want to make a short-term purchase? Or have a financial emergency, because a device, the car or other broken?
- Do you have regular income?
- The agreed rate is to be paid by you? You have set up a good financing plan?
- The burden of the loan can be estimated for you over the entire term? You have included the costs in your private plans?
- Have you been blinded by a cheap installment loan offer and have not objectively compared all the terms?
Can you answer most questions with “yes”: An installment loan sounds like the best solution. Did you answer most questions with “No”: A installment loan should not be envisaged. If your answers are balanced, look for independent advice that will help you.
5 questions: You should know that!
1. What collateral must be deposited?
As a rule, no special securities are needed. However, you must have a Private credit information available and possibly also payroll. In any case, after completing the online installment loan, a message will be sent to the Private credit.
If your credit rating does not satisfy the lender, then additional collateral will be required: A guarantee would be a possible option here. However, the requirements differ from bank to bank in the end.
2. How is the repayment done?
The term of an online installment loan is up to a maximum of 84 months (7 years), in exceptional cases up to 120 months (10 years). The amount of the monthly installment depends on the amount borrowed, the interest accrued and the fees that may be added – depending on the institution.
Attention to the fees! Since 2004, processing fees are no longer allowed! Until then, many banks have demanded a processing fee of 2 to 3.5 percent of the loan amount, which has been banned by the BGH, however.
Additional fees may apply for a so-called residual debt insurance. Some banks insist on taking out such insurance, which intervenes in the event of death, illness or unemployment, to pay off the remainder of the debt. The costs incurred by the insurance must be paid by the borrower.
Beware of the hidden costs that may come your way!
The general conditions that banks initially name are always adjusted individually. An additional residual debt insurance can be very expensive. However, if you do get involved, be sure to take out fair insurance. It is highly recommended to read the fine print carefully. For many policies, the insurance only comes into effect after a waiting period of up to six months. You can also expect unpleasant surprises when it comes to the benefit period: it is often limited to just 12 months.
3. What interest do you need to expect?
In general, it can be said that even a cheap online installment loan demands higher interest rates than mortgage lending. Our installment loan comparison with discretionary loans again shows that the interest rates are much lower with a favorable installment loan.
Exact numbers are difficult to name, as most interest rates are set individually. The amount of interest depends on the amount of the loan and the creditworthiness of the borrower. We tested the best online installment loans in comparison.
As a rule of thumb, you can remember: the lower the amount and the more installments are agreed, the higher the interest rate will be. The financing of an installment loan is so very expensive in such a case. It is advisable to arrange as few installments and a short term as possible in order to reduce the costs.
4. Can I terminate an online installment loan?
There are two ways to resolve an installment loan:
- Customers have a right of objection of 14 days. The consequence of this is: The loan amount must be repaid immediately.
- A installment loan can also be terminated. Borrowers can always withdraw from the loan agreement since 2010 without any notice period. However, in such cases, banks may require a prepayment penalty. However, the amount of the compensation is not arbitrary, but has been specified by the legislator. For loans with a maturity of more than 12 months, the maximum is 1.0 percent. For loans with a maturity of less than 12 months, no more than 0.5 percent of the remaining debt is permitted as compensation.
The exact legal requirements can be found in the BGB: Termination of installment loans in paragraph 489 and the contradiction in paragraph 495.
5. Can the bank cancel the customer?
Do not worry, as long as you comply with all the obligations you have entered into with the loan agreement, a termination by the credit bank is not possible. The requirements are:
- At least two consecutive installments must not have been paid in whole or in part.
- There must be three reminders that meet a two-week deadline. In the third reminder, a loan termination must have been threatened.
The current situation: the top 3 in the market
Now you should have an overview of what you should know about an online installment loan and what you have to consider before signing a contract. But one question still exists: Which good providers are currently on the market?
We have put together the best installment loan offers at a glance:
The Alibank: top mark!
The Alibank offers an excellent online installment credit, which can fulfill all our quality features: The online installment loan is offered without residual debt insurance, the interest rate is cheap and fair and does not depend on the creditworthiness of the borrower. The award was given to Focus Money as “Best Installment Loan” and the Alibank as “Fairest Direct Bank” in 2014.
- 4.45% eff. Interest pa
- 4.36% debit interest pa
Survey the situation with the Alibank Loan Calculator
SKG Bank: very good offer!
Closely followed is the Alibank offer for favorable installment loans in comparison with SKG Bank : also highly recommended and of the highest quality. SKG does not charge processing fees, special repayments and early repayment are free of charge. In addition, a good rate protection insurance can be completed, which not only costs, but offers an actual protection for the insured. An interest-rate-independent rate also convinces here.
- 4.50% eff. Interest pa
- 4.41% debit interest pa
Everything in the overview: The loan application at the SKG
Alibank: Excellent for middle earners!
The only drawback of the installment loan offer at Alibank: Interest rates are calculated individually and are not independent of credit rating. The benefits are all the greater: there are no processing fees, special repayments or early repayments are free of charge, as well as a rescheduling or replacement of existing liabilities. Very good offer for anyone who can present a salary certificate with a good income.
- 2/3 of all customers receive: 4,79% eff. Interest pa
- 4.69% debit interest pa
Calculate the desired loan at Alibank
The top providers for cheap online installment credits in comparison: Alibank takes first place with interest-rate-independent interest rates and best terms, closely followed by SKG with a slightly higher APR. For income-secure customers, Alibank is a very good recommendation with favorable interest rates and the possibility of free special repayment.
How do installment loans develop in the future?
Of course, the future of the installment loan is difficult to estimate. Above all, our installment credit comparison has shown that it is important to recognize hidden costs. Good providers are characterized by transparency of fees and fair conditions. This market model will presumably become more and more prevalent through selection by consumer demand. Interest rates are difficult to predict as they depend on many factors. It remains exciting!
5 tips and tricks for dealing with the installment loan
When you take out a loan, you are in debt and make certain commitments. You have to learn a good way to handle it. Here are tips and tricks to help you manage your debts in the best possible way.
1. Pay attention to free special repayment!
If the provider does not allow this possibility, it is worth looking for alternatives!
2. Check the residual debt insurance!
Convince yourself that the insurance makes sense for you and does not turn out financially to your disadvantage!
3. Pay attention to credit-independent interest!
This is especially true if you are not among the better earners.
4. Create a realistic installment plan!
Be sure that you can bear the financial burden and oversee in the longer term.
5. Use credit comparison!
To make a wise decision for the right online installment loan, you should not rush – but to inform!