Express credit – It can go so fast
The quick loan
- Explanation of the term express credit:
- An express loan is a loan that is decided on immediately and that is paid out immediately if the decision is positive; in cash or by transfer to a current account.
- An express loan is offered by various banks in their branches and on the Internet.
- An express credit is useful if the money is needed quickly and the immediate payment is desirable or necessary.
Before concluding an express credit contract, it is important to compare the terms. The terms offered as well as interest and other costs vary. The criterion that correctly indicates the information about the costs involved is the APR.
Some banks advertise with a significantly lower nominal annual interest rate, which does not include fees. This is permitted as advertising, provided that the statutory effective annual interest rate is also specified.
It is also popular to advertise with a low nominal interest rate, but not to calculate it from the loan amount that has not actually been repaid, but to use the initial amount as the basis for calculating the interest rate.
This representation of the costs can also be seen when comparing the annual percentage rate.
Credit Bureau inquiry
An express loan with an immediate credit decision and a Credit Bureau request are by no means mutually exclusive. If a Credit Bureau request is made online, the bank will have the information within a few minutes.
An express credit without a Credit Bureau request is possible with some providers, but on less favorable terms than with Credit Bureau information.
Beware of dubious providers
It is important that the fee for the loan application is only raised when the loan is paid out. Some providers charge a fee even if the loan application is rejected. Such a business practice is generally considered to be untrustworthy, especially since quite a few companies acting as credit intermediaries do not really intend to grant loans, but only have an interest in collecting the loan application fee. Reputable credit institutions only charge a fee if the requested loan is granted.
Overdraft facility as an alternative to express credit?
If the current account overdraft facility has not yet been used, it may be easier for some credit interested parties not to apply for an express credit but to use the current account overdraft facility. Such behavior only makes sense if the loan serves to bridge a short-term financial bottleneck and the account will soon be balanced again. If this is not the case, the use of the approved overdraft facility is the simplest type of loan use, but at the same time the most expensive. This applies all the more if the overdraft facility granted has already been exceeded and the customer overdraws his account to an extent that is not approved but tolerated by the bank. An Expresss loan is much cheaper.