Second credit – How does it work?


Sometimes, as a private individual, you may have already taken out a loan, but this is not enough to cover all the costs. If there are unforeseen expenses that lead to liquidity problems, it quickly becomes a serious financial threat. For example, this can be an unexpected bill, a car repair or water damage in the house – risks are always lurking everywhere.

In such cases it makes sense to start a second loan. This can be used for a variety of purposes, such as the settlement of open invoices, to increase the initial loan or even to invest in a car or in furniture. Many people also use the second loan to reschedule a too expensive first loan or even to compensate for a costly minus in the account.

The second loan – how does the additional loan work?

The second loan - how does the additional loan work?

Secondary credit is also referred to as supplementary or secondary credit and is a good solution if a current loan is not enough.

An example: If you have already taken out a home loan for the construction of a home and needs more financial resources, it can be problematic to convince the house bank of the increase. With an additional loan, you enjoy the advantage of not having to ask any unpleasant questions, because you simply pick this up at another bank.

On the one hand there is the possibility to take the second loan through a normal branch bank, on the other hand, the Internet also offers numerous attractive offers: direct banks handle their entire business online and offer their customers therefore usually the more favorable conditions. It is therefore worthwhile to compare the various loan offers before taking out a loan.

What else can the second loan be used for?

What else can the second loan be used for?

More and more people use a second loan to reschedule. This means that several individual loans from different banks are combined into a single loan. With the new loan all outstanding amounts are paid off at the banks, so that only for the new loan interest must be paid. This can save a lot of money especially for a long term.A second loan with very low interest rates is also suitable to compensate for an expensive disposition, so that the bank account is back in plus and incur no costs.

How to apply for a second loan correctly?

How to apply for a second loan correctly?

The first step for most people is the way to the house bank or to the bank where you have already taken out a loan. However, other offers should definitely be obtained, because the house bank must not be the cheapest partner. Especially with installment loans, the interest rates are very different from each other, which can make a considerable difference, especially for large amounts.

Make sure that both the interest rate and the additional costs are cheaper than the initial loan if you want to repost the loan.

A good tip:
First calculate all costs incurred to keep track. Only then is a comparison made on this basis.

The easiest way to compare loans is via the internet: Special comparison portals offer a free comparison of different loan offers. This process takes only a few minutes and only requires the entry of some data, such as the term and the desired loan amount. Based on this information, the reference calculator evaluates the available offers and creates a tabular overview. Now you can choose the most suitable loan offer and submit the application directly online.

Secondary credit without credit bureau – is that possible?

Secondary credit without Schufa - is that possible?

Quite a few people are wondering if an additional loan can also be taken without a credit bureau exam being carried out in advance. Some, though few, banks now offer such a loan. The big advantage is that the credit bureau receives no information about the borrowing and thus could not pass this on to third parties. Neither the employer nor the house bank are informed about this, and their own credit rating is not affected.

What should be considered before receiving a second loan?

What should be considered before receiving a second loan?

Because, despite all the advantages of having a second loan, it is of course also a financial burden, as a borrower you have to be aware of the risks and disadvantages. It is therefore important to consider carefully before taking a second loan whether the loan is worthwhile.

If you have already taken out a loan but it entails very high interest costs, rescheduling a second loan would certainly make sense. A new loan with a lower interest rate will quickly save you hundreds or even thousands of euros if you run for several years. Before replacing the old loan, however, it is important to clarify whether the bank charges for the termination.

As a rule, it requires a so-called prepayment penalty from the customer. This represents a kind of default sum – of course, the bank expects the money it receives from the customer and would like for the waiver of compensation.

Before accepting a second loan from the bank where the first loan was taken out, ask about the possibilities and potential costs of loan remittance or transfer. Based on this basis, it is then possible to calculate well whether the new loan is worthwhile or whether it still brings with it savings.

Rescheduling is generally worthwhile but almost always when it comes to loans with higher sums or long maturities. Because the longer the term of a loan, the more interest it will pay.

Important: Pay attention to seriousness when choosing the bank

Important: Pay attention to seriousness when choosing the bank

Also, you should check whether the new bank is reputable before applying for the second loan. Especially on the Internet, it is not difficult to find reviews from other customers or consumer portals that you can orient yourself to. Take the time to read all the documents carefully and find out exactly what the conditions are. In particular, the effective interest rate plays a major role, since unlike the nominal interest rate, it includes all costs incurred by the borrower.

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