Credit despite running credit
In particular, real estate owners or builders often have to resort to a loan despite running credit. This is usually the case when the savings are used up and short-term liquid funds are needed to buy material or to pay for ongoing craft invoices. But even unforeseen events such as a broken vehicle can lead to further borrowing.
With sufficient creditworthiness another loan can be taken up
At first glance, there is nothing standing in the way of taking out several loans. However, if you want to take out a loan despite having a current loan, you should take a close look at your financial situation in advance. Often, several loans become an extraordinary burden and deferred or overdue installments can have a negative impact on the credit information. When taking out an additional loan with a direct bank or a house bank, a credit check and a query of the credit data will always take place.
If the loan requests are rejected because the credit rating is too low, no further inquiries should be made to other banks. Every time a loan is requested despite the loan in progress, a credit query takes place. Each query is noted in the credit information and has a negative effect on the scoring.
The alternative to bank credit is the trade credit
Anyone who does not receive another loan from the bank or does not wish to raise another loan can apply for a trade credit for the purchase of home furnishings, household appliances and electrical appliances. Many electricians, furniture and department stores ask only the information of credit. If the credit information has no hard negative characteristics, the credit business is concluded in many cases, since an exact credit check is waived. The disadvantage for the borrower, however, is that many smaller purchases can become a huge monthly burden.
Often, the credit line is used as an additional source of income
With a discretionary loan, the bank grants borrowers a credit line that is usually two to three months’ net salaries. This loan is also approved in spite of ongoing credit, if the credit rating is sufficient and a permanent employment exists. The disadvantages of this type of loan, however, are the immense interest rates and the usually monthly or quarterly settlement of the overdraft interest.
Even if the discretionary loan is terminated indefinitely, the bank always has the option of unilateral termination. This may be the case if the income of the borrower changes or if the repayment credit is permanently exhausted beyond the limit. In most cases, an overdraft on the credit line will no longer be charged and any returned funds will be charged with processing fees. Anyone who applies for a service loan or a loan despite the loan being due must be of age and full legal capacity.