When Does a Consumer Credit Make Sense? 

 

Consumer credits are unsecured loans that banks give people for private use. In German, this type of loan is referred to as Privatkredit, Konsumkredit or Ratenkredit. Of course, it’s not advisable to take out a consumer credit for going on holidays or buying lifestyle products, but there are sensible uses for a consumer credit.  

 

Buying Furniture 

 

If you want to furnish your private apartment but can’t afford to do this just with your savings, a consumer credit can be of help.  

 

 

Deposit for Rent to Own Apartments (dt. Mietkaufwohnung)  

 

If you don’t have the necessary resources at hand to buy an apartment yet, but your already thinking of how you can own property in the future, Rent to Own could be a great option for you. By making a down payment, you secure yourself the right to buy the apartment after five to ten years. In many cases, a personal loan is suitable for this down payment. 

 

The eventual price for buying the apartment is usually based on the original construction costs, not the future market value. This makes it easier for tenants to get a loan for buying the apartment later.  

 

Often times people think the monthly payment contains rental as well as redemption costs, but this doesn’t necessarily have to be true. Terms for Rent to Own differ from model to model; in most cases, however, little to no amount of the monthly payments are part of the redemption. 

 

  

 

Debt Consolidation 

 

If an account has been overdrawn too excessively in the past or other debts have amassed, high interest rates are usually the consequence. In such a case, it makes sense to take out a personal debt consolidation loan to consolidate separate pending loans and then pay your loan back in regular instalments with a lower interest rate.