If you want to finance the car purchase without Credit Bureau and dealers, you should exercise caution: loans that do not check Credit Bureau are sometimes very expensive or have special contractual clauses. The car loan without Credit Bureau also has some disadvantages that must be known before taking out the loan. We show what to look for and which are the cheaper alternatives when it comes to car financing.
What is a car loan?
Around a third of the cars registered in Germany are financed by a loan. The car loan is therefore widespread and actually a typical consumer or installment loan_ except for one essential point: the money paid out is tied to a specific purpose and may only be used to buy the car. However, other vehicles such as motorcycles, campers or caravans can often also be financed by car loans.
Because the car loan is earmarked, the interest is usually better than with an unbound installment loan. There are also several ways to obtain a car loan: the two most common are dealer financing and car loan through a manufacturer-independent bank.
Why is Credit Bureau relevant for lending at all?
Banks have to check the creditworthiness of their customers before granting a loan simply because of legal regulations. In order to reliably determine creditworthiness, banks in Germany mostly use the information stored at the best-known credit protection scheme Credit Bureau Holding AG. Data relevant to the lending business of over 67.5 million private individuals are stored there.
With this information, the respective probability of default of the person concerned is determined using mathematical-statistical calculation methods. It is the likelihood that a customer’s credit default could fail. The bank wants to protect itself from possible payment defaults by querying the data.
The credit check and the Credit Bureau query are also in the interests of the other customers who have entrusted their funds to the bank in trust. Credit defaults would jeopardize the bank’s assets entrusted to savers and investors. In addition: Last but not least, the Credit Bureau query protects consumers themselves. Additional loans would drive financially vulnerable customers into overindebtedness. For this there are criteria and key figures that experienced bank employees recognize and apply immediately. A loan would then not be granted.
No reputable bank grants loans without Credit Bureau information & credit checks
In general, every customer or consumer should ask the question: How serious can a bank or provider be that enables car financing without Credit Bureau? Ultimately, it is about getting a loan without consenting to the “Credit Bureau clause”. The bank is then not given permission to transmit data on the contractual relationship or, in return, to receive information about the person from other member companies. As a result, the bank cannot make a sound check of the creditworthiness and the risk of default.
Note: Financing a car despite a Credit Bureau entry is also not recommended from the perspective of the borrower. Especially if the entry indicates a tense financial situation. In this case, you should first consolidate your own finances before taking out another loan.
At Across Lender, the credit comparison has no influence on the Credit Bureau score
If you want to compare a car loan without Credit Bureau, you will probably shy away from loan requests and comparisons with banks. However, this worry is unfounded: the credit comparisons offered online are mostly neutral on the job. This means that only credit condition requests are sent to a large number of banks. However, this type of request is a neutral feature and in no way affects your own Credit Bureau score.
Tip: Even at Across Lender, the credit comparison has no influence on the Credit Bureau score. With the free loan comparison calculator from Across Lender, a comparison can be carried out quickly and easily at any time in order to find an inexpensive car loan.
Disadvantages of a loan without Credit Bureau
Loans without Credit Bureau are often very expensive for customers: Not only high, sometimes double-digit debit interest, additional fees and expensive residual debt insurance are driving up the cost of these auto loans. Or maximum rates for mostly modest loan amounts and strangely low installments for very long loan terms are stipulated. Foreign banks are not uncommon among providers of car finance without Credit Bureau.
This is usually how consumers recognize the questionable credit intermediaries who offer auto loans without Credit Bureau:
- Credit is brokered by a private individual
- Provider is not entered in the commercial register (see imprint website)
- the credit institution has only been operating for a short time
- Processing fees apply for the examination of the loan application
- Service hotline charges high fees, otherwise little or no contact options
- euphoric customer reviews or fake security seals on the website
- comparing loan terms costs money
- allegedly low interest rates for car loans are offered despite Credit Bureau
- Lending also happens without a regular income
- Dispatch of contractual documents subject to charge (cash on delivery)
- Memberships and supplementary insurance are required before lending
Anyone who recognizes even a few or a few of these disadvantageous features when offering car financing without Credit Bureau should best keep their distance from the offer. After all, the following applies: serious providers are only paid for by the donor.
Car loans are particularly cheap because there is countervalue
The earmarked car loans are usually the cheapest financing options for new or used car purchases. The reason for the better interest rates is that the bank holds security in its hands with the financed car. It represents a real asset and, if the worst comes to the worst, it can be sold again. If necessary, the bank’s outstanding credit claims can be paid in this way.
Advantages of car loan vs. Dealer financing
With a car loan from a dealer-independent bank, buying a car can be worthwhile if a double-digit cash discount can be used. A clear advantage compared to financing the car purchase through a dealer, where the cash discount is then no longer applicable. On the other hand, dealer financing by car comes conveniently from a single source and saves a lot of time and operations. All in all, there are advantages and disadvantages for both financing methods for car financing, as this diagram shows:
|Car loan||Dealer financing|
|Benefits:||– Discounts for cash payers and strong negotiating position||– Convenient: no offers have to be obtained and compared|
|– cheaper car financing in the annual percentage rate||– Advice and decision on site|
|– Faster redemption||– so-called zero percent financing|
|– Vehicle registration remains in your possession|
|Disadvantage:||– Time expenditure: obtaining offers and comparing conditions||– higher vehicle price|
|– usually a comprehensive insurance is required||– mostly so-called balloon financing: very low repayment, high residual debt|
|– Residual debt not in the right proportion to the residual value of the car|
|– Vehicle registration remains in the dealer’s possession|
Tip: With a car loan as a typical consumer or installment loan from the house bank, the new vehicle can usually be financed more cheaply than with some dealer credit. In any case, it is worth comparing conditions using the free loan comparison calculator from Across Lender