Personal loan

Getting a personal loan in Germany

As a foreigner living in Germany, an expat working in a large German city or as a student here for a Master’s degree: At some point you might want to obtain a personal loan in Germany. Whether small amounts like 1.000,- Euro for a purchase or a larger loan to finance your car: With a very advanced and regulated financial system and a high language barrier, obtaining a loan or credit in Germany can  seem like a challenge.

GIROMATCH is a loan and credit platform operating out of Germany and we will show you

1. how to obtain a personal loan online,
2. what you should look out for when comparing loans and
3. the requirements you need to fulfill.

We will also show you the typical personal loan in Germany including monthly payments, what fees, costs and interest rates to expect and ways to save money.

While Germany is a huge country with a large and developed financial system, many of the banks are still quite traditional, especially when it comes to English-speaking support and products. For this reason we are not just explaining how big banks and credit comparison platforms operate, but we will also show you alternatives you have when trying to get your loan and platforms that can help you in English – just like we do.

Feel free to apply for a cash loan on our platform:

• No costs or fees to you, the borrower. Our service is always free for you
• We will not call you, send you letters or bother you with SMS
• We operate online only. You won't need to bother with paper or long waiting times

Understand how Personal Finances work in Germany

We also have in-depth guides to find the right bank and credit card for your purpose. Read our guide on the best bank accounts in Germany or our German credit card-guide to find current, rated and reviewed products that fit your needs.

Instant loans, credit lines or fixed installment loans: Types of personal loans and credit in Germany

There are generally four different loan types in Germany to look out for. Those four are:

• Ratenkredit: A fixed installment loan. This is by far the most common type of personal consumer loan in Germany and is generally what you will get when you're looking for a personal loan.
• Autokredit: Auto financing or car credit, generally a fixed installment loan with varying options for follow-up financing or the final rate (ballon payments)
• Sofortkredit: Also a fixed installment loan, can be translated as “instant loan” with lower payout amounts, faster processing and shorter runtime. Sometimes also similar to how payday loans work.
• Rahmenkredit: Personal credit line, usually connected to a bank account overdraft or a credit card with a credit limit.

A fifth type is the “Immobilienkredit” which is a housing loan or financing when you purchase real estate. Housing loans are not in the scope of this article and differ quite largely from consumer loans and personal credit.

Personal loan application in Germany

We are a loan platform operating out of Frankfurt, Germany. As such, it is possible for foreigners to apply for a personal and instant loan in Germany on our platform. We have been operating as a loan and brokerage platform and offer loans that are financed by banks, credit institutions and private individuals. Whether you're looking for 500 Euro cash or larger loans of 10.000 Euro or more: The process on our platform is pretty much the same.

To obtain a loan, you have to fill out our online loan application form. Don't worry: Our services are always free for you. Generally, a personal loan involves the following steps:

1. Apply for a loan: You need to fill out our online loan application. In our form, you have to provide us with information on the loan you want, such as loan amount, duration or purpose of the loan. We will also need some personal information on you, such as your current job and information on your financial standing.
2. Choose your loan: You will be matched to a loan offer that you can choose. This will depend on your application, the amount you have requested, but we will also consider your status as a foreigner and not offer you loans that are not possible for you.
3. Receive your loan: Thirdly, you will need to verify your information and identity. For this you will need to identify yourself and conclude the loan with an online signature. The loan will then be paid out to your preferred bank account.

Our 3 step online loan application

1. Fill out the online application form

2. Pick your preferred loan offer

3. Receive your loan within 24 hours

Understanding personal loans and the German consumer credit market

Most personal loans given out in Germany are fixed installment loans. To give you a feeling for the typical personal loan in Germany, we’ve gathered statistics from public and private sources, including some of largest banks, loan comparison platforms as well as Germany’s largest credit bureau called SCHUFA.

The typical German personal loan amount is a fixed installment loan (“Ratenkredit”) where the monthly rate you pay back stays the same. The loan amount is anywhere between 1.000,- and 50.000,- Euro, whereas most loans paid out fall between between 7.000,- and 12.000,- Euro. The duration can range between 12 and 120 months, but usually is around 48 to 60 months (4 or 5 years).

The interest rates are currently at an all-time low. German consumers applying for a loan pay between 4% to 6% annual percentage rate, or “Effektiver Jahreszins” in German. Some platforms are even advertising for zero-interest rate loans or even negative-rate loans, only a few of which are paid out due to the high requirements for creditworthiness. The general interest rates in Germany range between 1,99% and 19,99% APR.

Loans with negative interest rate? GIROMATCH tells you the truth

It is already known that interest rates for a loan in Germany are quite low compared to other European countries, but what about a loan with a negative interest rate?

In the last years people looking for a credit bumped into loan offers such as:

A loan of 1.000,- € with a interest rate of -5%, where in the end you only have to pay 950,-€ back

Seems unrealistic? Actually, those offers exist and are usually obtained through loan platforms or brokers. In those cases:

• the bank offers the loan with a positive (low) interest rate
• the broker offers the same loan with a negative interest rate
• the broker will pay the difference between the bank's rate and the offered one

And why would a loan broker spend his money in this way? Well, that's how he will get more and more customers, that is why usually these offers are only temporary and for a limited number of customers.

What is my chance? Personal loans that foreign nationals have received on our loan platform

The following are two examples of loans that foreign nationals residing in Germany have obtained on our loan platform and given out by Fidor Bank. Both loans represent the general national average for consumer loans in Germany. Both individuals had a clean credit history (SCHUFA), a net income higher than 2.000,- Euro per month and existing monthly loan rates of 200,- Euro and 140,- Euro respectively.

Attribute	Anastasia	Massimo
Nationality	Greece	Italian
Income	Over € 3.000,-	€ 2.500
Existing loan payments	€ 200,-	€ 140,-
Credit rating	Very good	Good
Loan amount	€ 10.000,-	€ 7.500,-
Duration	48 months	60 months
Interest rate (APR)	3,48%	5,11%
Monthly payment	€ 223,47	€ 141,91
Total cost	€ 10.726,61	€ 8.514,75

Please also note our representative example in accordance with § 6a PAngV repr. calc.: APR 4,62%, borrowing rate 3,90% p.a., net loan amount 10.000 €, loan term 4 years, one-time commission 1,25% of net loan amount, creditworthiness assumed. Loan broker: GIROMATCH GmbH.

Your favorite loan broker in Germany: Take a look at our customers' reviews

At GIROMATCH we strive to offer you the best we can. How do we do that? After having analyzed the market deeply, we consider your initial economic situation and match you with one of our partners with the highest chance of approval. Do you need a loan without payslip? We will find an offer for you. Are you looking for a loan with bad credit? We will do our best to satisfy you, and if we can't, we will find alternative products to help you with your finances in Germany.

Take a look at our customers' reviews:

Since our main business is based in Germany and our bank partners offer loans to customers based in Germany, the present reviews have been translated from their German original.

How much money can I borrow in Germany?

Another perspective we want to give you is an answer to the question of how much money you can borrow. While all banks are different and there are many factors at play when deciding whether to give out a loan or not, this should be counted as a soft indicator for possible loan amounts you can obtain.

Requirements to get a loan in Germany

As a foreigner living in Germany, getting a loan is generally not a problem. You do however need to fulfill a few legal and credit requirements. Before you start applying for a loan, make sure that you fulfill the following minimum requirements to obtain credit:

• You have to be 18 years or older
• You need a German address and need to be a resident here
• Your income should be sufficient for the loan, generally at least 600,- Euros per month
• You should have a clean credit history (“a clean SCHUFA”. SCHUFA is the largest credit agency in Germany)

For the actual loan application, you also need to verify some of the information. Independent of the loan amount, you will always need:

• Identification document, either a passport or, if you’re a EU citizen, your national identity card
• A mobile phone number and/or email

For larger loans over 5.000,- Euro, you will also need a proof of income, which could be a pay slip or a (digital) bank account statement.

Loan applications are usually done online or digitally and you do not have to walk into any bank branch or physical location. If you explicitly want personal support, then you will have to check with each bank individually whether they are able to even help you in English. If you’re in the larger cities such as Berlin, Hamburg, Frankfurt or Munich, larger banks such as Deutsche Bank and Commerzbank should be able to help you - but it might take some time and effort.

Do you need a student loan?

If you have just moved to Germany to start your studies, you may not have the necessary net income to apply for a personal loan. Do not worry! There are some options of student loans in Germany that you can find explained in our ultimate guide!

Read our guide ≫

Did you know? The rights you have when applying for a loan

Germany is a heavily regulated country with a focus on consumer protection. For this reason there are quite a few legal requirements that banks, lending platforms and peer-to-peer lenders have to fulfill to give out loans. This will help you understand the rights that you have, but also the requirements that you need to fulfill to get a personal loan in Germany.

Generally, every bank has the obligation to:

• Gather key information on the borrower, such as personal information, address, contact information (in this case, you)
• Identify the borrower with a proper identification document (passport or identity card for EU residents)
• Assess the creditworthiness of each borrower, including questions on income, job, existing loan obligations and the ability to pay back the loan
• Present all necessary information in regards to costs of the loan, interest rate, duration, monthly rate and secondary fees (e.g. overdue payments, costs for direct debit, direct debit recalls etc.)

The bank is forbidden to:

• Give out the loan without assessing creditworthiness or identifying you
• Without giving you all required information in writing beforehand, including costs and fees, right of withdrawal, SECCI (“Standard European Consumer Credit Information”) and more. This is usually sent to you via email, some banks (Sparkassen, Volksbanken) might still use traditional email
• Charge fees for handing out the loan (“Bearbeitungsgebühren”, which is a handling fee / processing fee)
• Charge you interest rates way above market. There is no hard limit, but generally is said to be more than 5% higher in comparison to competitors. As of 2021, we are not aware of any bank or platform giving out large installment loans with an APR higher than 19,99%

Lastly, you, the consumer, always has the right to:

• Withdraw from a loan within 14 days of concluding it (“gesetzliches Widerrufsrecht”, right of withdrawal)
• Pay back the loan at any time you wish (although there is an additional fee of up to 1% of the outstanding loan amount the bank can charge you for this)
• Request information on why you were rejected for a loan application
• Ask for all the information and data the bank, credit institute or credit agency has on you (this is in accordance with § 15 of the GDPR, the General Data Protection Regulation)

Loan application and credit score: What you need to know

In the past, when applying for a loan in Germany, your credit score could be influenced negatively.

This was given by the fact that applying for a loan was considered as a warning signal from banks: Customer A needs money. Let's now imagine that customer A applied for 10 loans in a row: he does not only need money but has also difficulties in finding it.

With the emergence of online platforms and credit comparison tools, customer can apply for a loan at dozens of banks with one single application. That is why banks have progressively refused to register your loan applications to credit bureaus and these have lost they predictive character.

Nowadays, you can apply for a loan online without fear: your credit score in Germany will not change and other banks will not know anything about your application.

Key terms regarding loan, credit and financing in Germany explained

German	English with explanation
Kredit, Darlehen	Personal loan, credit
Finanzierung	Financing
Kreditbetrag, Nettokreditbetrag	Loan amount, net loan amount
Laufzeit	Duration (typically in months)
Verwendungszweck	Loan purpose
Effektivzins, effektiver Jahreszins	Annual percentage rate (APR)
PAngV, Preisangabenverordnung	Regulatory requirement for pricing transparency
2/3-Beispiel, Zweidrittel-Beispiel, §6a PAngV	A representative example of the interest rate that 2/3 of all customers receive at the bank offering the personal loan, see PAngV (regulatory requirement)
SCHUFA	Germany's largest credit bureau, a private company with financial data over around 65 million consumers in Germany
Kreditvergleich	Loan comparison
Ratenkredit	Installment loan
Sofortkredit	Instant credit or instant loan
Minikredit	Payday loan, small loan
Autokredit, KFZ-Kredit	Auto loan, car financing
Geld leihen	Borrow money
Immobilienkredit, Immokredit	Housing loan, real estate financing
Identifikation, Legitimation	Identification (legal requirement for identification with passport or ID card)

Frequently asked questions regarding loans and credit in Germany