Is car financing possible despite SCHUFA?
Many people who finally want to buy their own car ask themselves whether car financing despite SCHUFA is actually possible. The KREDIT 123 team would like to answer this question and provides a detailed answer below.
Can I finance a car despite SCHUFA?
Basically, it is no easy undertaking to buy a car despite SCHUFA or. To finance despite a negative SCHUFA entry. This is simply due to the fact that the credit assessment procedure of German banks and credit institutions provides for the query of the data deposited with the SCHUFA about an applicant. It doesn’t matter whether it’s a savings bank, volksbank, raiffeisenbank or a manufacturer-affiliated car bank: they are all contractual partners of the German credit agency SCHUFA and carry out a SCHUFA query when a credit application is submitted!
Anyone who wants to apply for a car loan from a bank or for car financing despite a negative SCHUFA entry will usually receive a credit rejection quite quickly. A rejection will be issued even if a regular income can be proven. This is how strict the vast majority of banks and commercial credit institutions are in germany!
What are the ways out of this situation??
Despite the fact that a negative SCHUFA entry has an extremely negative effect on the creditworthiness of the applicant, the applicant still has the possibility of obtaining a car loan or car financing despite SCHUFA: with the help of loan collateral.
Provision of collateral for car financing in spite of SCHUFA
If you don’t have a good credit rating and therefore can’t get a car loan in the first place, you can turn the tables by using personal collateralization options. These include, on the one hand, the addition of a second borrower, and on the other hand, the entry of a guarantee.
Application for a car loan as a joint loan
If a car loan is applied for as a joint loan and the second borrower has a sufficiently high credit rating, the main applicant can still obtain car financing despite SCHUFA.
Tip: even if the main applicant has a high credit rating, in some cases it is advisable to add a co-applicant in order to further improve the interest rates and conditions of the car financing!
Registration of a guarantee
The entry of a guarantee can also ensure that a car can be financed despite a negative SCHUFA score. However, it must be clarified whether a conditional guarantee is sufficient or whether a directly enforceable guarantee is necessary.
Assets and objects as collateral
In order to finance a car despite a negative SCHUFA score, assets and property can also be pledged, provided that the lender agrees to this. In technical jargon, this is referred to as real or tangible loan collateral; the best-known of these are the mortgage and the land charge.
If the credit seeker has a negative SCHUFA entry due to payment defaults, but can prove a high regular income and provide an already paid property as real credit security, car financing despite SCHUFA is also possible here, especially since the car to be purchased can also serve as additional security. In general, however, approval still depends on the good judgment of the contact person at the bank.
Car loan despite SCHUFA from foreign banks?
Another way to obtain a car loan despite SCHUFA is to apply in another european country. In this context, the "swiss loan" has become particularly well known.
Foreign banks located in Switzerland or Liechtenstein, for example, are of course not contractual partners of the German credit agency SCHUFA and do not query the SCHUFA data of the German applicant in the course of their credit assessment. So if you have a high regular income and can basically pay back the monthly installments of a car loan without any problems, despite a negative SCHUFA entry, you have a good chance of obtaining a fair and favorable car loan from a swiss or liechtenstein bank despite SCHUFA.
By the way, such a "swiss loan" can be considered not only as a car loan despite SCHUFA, but also as a car loan without SCHUFA. When taking out this loan, no SCHUFA entry is made!
Tip: taking out a "swiss loan" without SCHUFA may be worth considering in certain cases for all those who would like to keep a "clean slate" with the SCHUFA!
Our conclusion on the subject of financing a car despite SCHUFA
Car financing despite SCHUFA is not an impossibility, especially if personal or real loan collateral can be provided. Furthermore, the approval of a car loan despite SCHUFA can also be achieved by applying to a Swiss or Liechtenstein bank. However, it is important here that a sufficiently high income can be proven and the foreign bank that is to grant the loan can be convinced of one’s own creditworthiness!