A loan is the best solution
In some situations, the available money is not enough to realize necessary acquisitions. But when money is really needed, a loan is often the best solution. In Germany, loans are increasingly being taken up even for small purchases.
In 2012 alone, approximately 7.8 million new loan applications were approved, according to the banking association in Germany. According to credit bureau, the number of current loans in 2012 was 17.5 million. The trend in loan applications also showed a clear upward trend in subsequent years. According to credit bureau information 97 percent of the installment loans are paid easily. On average, the borrowed amount is 7,900 USD and will be paid in approximately 43 months.
Received credit from 2008 to 2014
In what follows, we look at the purposes for which Germans lend money to others.
The top 10 reasons for Germans to apply for a loan:
- House and yard: Most loans take Germans for their own land. With the money houses or apartments are bought, renovated or rebuilt.
- Debt rescheduling: The terms for loans change from year to year. Especially in periods of low interest rates it makes sense to replace an old loan with a new loan on better terms. This is called debt restructuring and is the second most common reason for taking out loans.
- Cars and motorbikes: For bikes or a car in Germany many new loans are taken every year. Under this point, both used and new vehicles are summarized.
- Family: Often, loans are not taken for their own use, but the money is provided to their own family.
- Cash: To be liquid for everyday expenses loans are often taken in Germany.
- Further Education & Training: Many further education courses or even training courses have to be invested from own pocket. This investment in your own future is often only possible with a loan.
- Health: If health insurance companies do not take on various services, the customer has to pay by himself. A good example of this is the teeth.
- Travel: Even trips are often financed on the spot.
- Feste: Is there a round birthday, another anniversary or the wedding? Big parties can be quite money and often have to make a loan for it.
- Consumer electronics: For consumer goods such as computers, TVs or consoles many Germans take a loan.
There are many credits that can be considered reasonable and that significantly improve the standard of living over the long term. However, some of the uses listed above should not be used without due consideration. Whether a loan for a trip really has to be taken is doubtful. Nothing is worse than having to pay for years for a unique experience long past.