Small Payday Loan – Definition: What is a small loan?

What is a small payday loan?

What is a small payday loan?

The term bagatell means trifle. A small payday loan is therefore a small payday loan with a maximum payout of 200 euros . Small credits are used in most cases to bridge a small financial bottleneck. Usually, the small payday loan is a consumer loan, which can be used for all purposes. In many cases the small payday loan is used to balance the current account, if this is in the minus or dispo. Smaller purchases are possible with this loan. Businesses and the self-employed can not apply for a small payday loan.

 

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  • What is a small payday loan?
  • Conditions and conditions
  • What are the risks and benefits of a small payday loan?
  • What is the significance of creditworthiness with regard to a de minimis loan?

Conditions and conditions

Conditions and conditions

Basically, a small payday loan can be applied for at almost any bank. Building societies also offer this method. As with a normal or higher loan, the lender will need to do a credit check and make a shuffle call. In the case of a negative credit rating or entries in the Bank, it may happen that no trivial loan is approved. The creditworthiness is defined by an indefinite employment relationship, but at least an employment relationship for three months . For self-employed persons, it is not possible to apply for a de minimis loan. For employees, the last three pay slips are sufficient . A repayment is made in small and fixed installments. A fixed rate is required.

What are the risks and benefits of a small payday loan?

What are the risks and benefits of a small payday loan?

The big advantage is the fast processing and availability of a small payday loan . The legal limit of 200 euros is for private persons to compensate or for smaller purchases interesting. Due to the low loan amount, no collateral is required, as is the rule with high loan amounts. Another advantage is the flexibly configurable repayment and the small fixed installments that are agreed in advance. A short term is also important for individuals. It is not possible to apply for a de minimis loan for companies and traders, as the financial framework of the loan is not meaningful for economic purposes.

What is the significance of creditworthiness with regard to a loan?

What is the significance of creditworthiness with regard to a loan?

A de minimis loan is approved if there is a regular income. In many cases, salary statements are required. This depends on the credit balance of the customer. In some cases a Bank inquiry and Bankeinträge can be the result. The credit rating is assessed differently by each bank . Regular income and other loans can affect your credit rating. A guarantee is possible with a small payday loan. This increases the likelihood of getting the loan. A credit default risk exists for the bank only if the credit rating is not positive. If the credit rating is negative and the bank considers a credit default risk to be possible, it will result in the loan being rejected. The requirements for a small payday loan are very different. In some cases, forms are requested, sometimes a look at the customer’s current account is enough to determine whether a loan can be approved.

 

If you need short-term money to bridge a financial bottleneck or pay a specific bill on time, make the right choice with a micro loan. The provider works reputable, fast and reliable, so you receive the feedback and possibly also the payment on the day of your request. A bank loan is recommended due to the many disadvantages nowadays only for large investments.

 

How do banks consider loan applications?

In order to approve a loan, a number of criteria need to be met by the applicant. Have you thought about how it is possible that a bank will not approve a request that looks good, but will approve a loan to an applicant that you yourself would not borrow at all?

Banks are considering your loan application in different ways from different perspectives

Banks are considering your loan application in different ways from different perspectives

With the experience of assessing more than ten thousand loan applications, we can say that the aspects are really specific. For purpose-free loans, banks take care of who can get a loan.

We will now look at what financial institutions are investigating when a natural person submits a loan application.

The first thing they examine is the type and amount of monthly income

The first thing they examine is the type and amount of monthly income

It is understandable that this figure will clearly show us whether or not the applicant has to repay the loan.

Of course, income is not a guarantee that the applicant will return the loan, but there are a few circumstances that will help the application not be approved:

  • Applicant is on probation
  • the receipt is not on the applicant’s own account
  • the employment contract is for a fixed period.

If the applicant has a low income, this does not mean that he or she has refused the request. In that case, he may offer him a lower amount than he requested. The main goal of the financial institution is to return the borrowed money to the client.

So for consumer credit, they focus on whether the applicant is a good debtor.

In the circumstances mentioned, it is almost clear that the application will be rejected. If the applicant is on probation, it may be released before the end. If money doesn’t come to the applicant’s personal account, he probably has illegal work.

If the applicant can prove that he has already extended his contract of employment for a limited period of time, he may receive the loan. Anyway, the bank will decide.

Can a business owner get a loan?

Can a business owner get a loan?

It is important for the bank that the applicant prove that he / she will have sufficient income each month to pay the monthly installment. Therefore, a novice trader will not have a chance, just like an applicant who is on probation. If he has been a successful entrepreneur for several years, he can get the loan.

The second important aspect is that the applicant is not registered in the debtors register

Nearly every financial institution rejects a loan application from people who are registered in the debtors register. There are several non-bank providers who approve a loan application, but of course, at a higher price. This means that either at a higher interest rate or will ask for the addition of a co-debtor.

The third important factor in the approval process is the age of the applicant

Most financial institutions will also approve young people who are at least 18 years old. But there are also those that do not give a loan to applicants who are under 21 years old.

It is not easy for older people either, because in most cases banks will set an age limit of around 72 years.

The fourth thing banks are examining is the total amount of pre-existing loans of the applicant

If the applicant already has a loan in another financial institution, it is unlikely that the bank will approve the second loan, since the client has not paid the first one either. It is different if we apply for a consolidation loan and ask for an extra amount in addition to the consolidated amount.

The fifth aspect is the social background

For each loan application, financial institutions examine the applicant’s social characteristics:

  • Whether it has a registered address
  • in which company it works
  • if they are applying for a mortgage, they are examining the characteristics of the offered financial guarantee.

It is important to realize that banks do not distribute their own funds but the resources of their clients. And from their realized interest they will pay them their profits.

Therefore, it is very important that banks approve requests carefully, be sure that the applicant will return the borrowed money to them.

If you believe that you meet the criteria above, by comparing our online loan offers on our site, you can find out in a matter of seconds which financial institution offers the best conditions to fund your needs or dreams.

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Responsible Loan

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Trust

We value relationships with our clients that are based on responsibility and trust. Developed a customer approach that is personalized and reliable. What distinguishes us from other lenders? We believe that the basis of a good relationship is trust, so we always trust our customers and consider them our friends. This allows us to establish mutually beneficial cooperation. We are waiting for your call! Each client is offered a customized solution. Call us and use our quality service. We will be happy to help you! After the successful payment of your third loan, you will have the opportunity to join our loyal customer program. After each payment you make on-time you will have access to discounts, bonuses or options to increase your credit limit. You can also request another loan by phone. The website provides you with all the necessary information so you can make an objective decision while filling out your application. Use the “Contact” tab to contact us. We will find a solution to your problem! 

Responsible indebtedness

Responsible indebtedness

Apply for a loan in a responsible manner. As soon as you receive the money you have the responsibility of the contract and you are obliged to comply with it. Doesn’t want your financial situation to deteriorate. Therefore, apply for a loan when you are sure you can pay it on time. We have prepared a payback table and a contract without surprises. 

Problematic situations

Problematic situations

You can trust us in situations where for some reason you cannot pay your loan on time. However, remember that you should not postpone solving the problem! We understand that difficulties may arise, and therefore we offer several solutions: it is possible to extend the expiration date after paying the extension fee. This solution will help you plan your income and expenses, which will allow you to pay the loan within the extension period.

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