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What is credit intermediation?

If you want to take out a loan, there are several ways to do it. First of all, there is the classic application process with your own house bank or with another branch bank. The other is the comparatively straightforward way with an online bank. With just a few mouse clicks, the individual providers and their offers can be compared on the Internet. However, there is a third option that is not yet well known to the public, namely the search for and granting of loans with the help of a credit broker.

The loan brokerage

The loan brokerage

Loan brokerage is done here by an intermediary, the approval of which is regulated differently in the different countries. A prerequisite for admission is usually a certificate of competence, sufficient liability insurance, a police certificate of good conduct and membership in one of the relevant associations.

In Germany, on the other hand, you first need permission from the competent authority (trade office) at the location of the company headquarters. This is done in accordance with Section 34c (1) No. 2 of the Industrial Code. However, this permission is only granted if the applicant has the necessary reliability and is able to demonstrate the proper financial situation.

Furthermore, the legal provisions for brokers and some other special provisions apply. Within the European Union, the legal framework for loan brokerage to consumers is legally fixed in the Consumer Credit Directive 2008/48 / EC of April 23, 2008. This provision is intended to ensure the necessary transparency and to limit the remuneration of the credit intermediary to a few, verifiable fee types. The consumer should also be protected against overheating.

In the event of a demonstrable fraudulent deception by the credit intermediary, the consumer can defend himself by contesting his declaration of intent in accordance with § 123 BGB. The legislator understands deception as behavior that is objectively misleading or contains an error that affects the image of the credit applicant accordingly. A contract in these circumstances and the exploitation of the business inexperience of the consumer can be classified as immoral and null and void in accordance with Section 138 (2) BGB.

The main task of a credit broker loan from a German or foreign bank.

The main task of a credit broker loan from a German or foreign bank.

But in individual cases, the activity can go beyond the actual mediation. In this way, a reputable broker can advise the consumer on borrowing and support him in compiling the application documents. Most credit intermediaries have developed a number of contacts with smaller and less well-known banks over the years. Especially here there is the possibility to negotiate far more favorable terms than with the relevant big banks.

Difficult cases can often be dealt with at smaller banks. For example, the intermediaries can better explain the borrower’s unfavorable Credit bureau entries here, so that they are not as important in a credit check as in an automated process as is the case with large banks.

But how do you separate the wheat from the chaff among the credit intermediaries? A serious broker will always act in the interests of his customer. As a rule, no borrowing costs are incurred for the borrower, since the broker receives his commission from the bank. The website of a reputable company always has an imprint with address and other contact options. The company should actually be reachable on a test call.

The information regarding the loan amount, debit interest, effective interest and terms should also be understandable. On the other hand, caution is advised for companies that are already charging for advice, regardless of whether a contract is finally concluded or not. This also includes the sending of documents only by cash on delivery.

The borrower should also reject any proposed form of financial reorganization, as well as the approval of a loan, which is only made dependent on simultaneous taking out of residual debt insurance or a similar insurance. Here only further unnecessary costs are generated to the disadvantage of the borrower.

Likewise, an unsolicited home visit (mostly additional costs are due here) as well as any pushing for a quick signing of the agency contract is to be rejected. Promises that offer an early 100 percent loan approval are also considered to be highly dubious.


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