Loan Rejected? Here Are Your Options
A rejection is not the end. Discover alternatives and steps to improve your chances.
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Common Rejection Reasons & Solutions
Negative Schufa
Solution: Request your free Schufa report. Dispute errors. Consider Schufa-free Swiss loans or P2P platforms.
Income Too Low
Solution: Apply for smaller amounts. Add secondary income sources. Wait for salary increase or bonus.
Still in Probation
Solution: Wait until probation ends (usually 6 months). Some lenders accept applicants after 3 months.
Short Residence Permit
Solution: Apply for shorter loan terms. Provide extension evidence. Consider a German co-signer.
Alternative Lending Options
P2P Lending (Auxmoney)
Peer-to-peer platforms connect borrowers with individual investors who may take more risk than traditional banks. Auxmoney is Germany's largest P2P platform. Approval rates are higher because investors can choose to fund applicants banks would reject.
Schufa-Free Loans (Schweizer Kredit)
Swiss banks offer loans without German Schufa checks. These require stable employment and minimum income but ignore German credit history. Higher interest rates apply (8-15% APR). Reputable intermediaries include Bon-Kredit and Maxda.
Co-Signer (Bürge)
A German resident with good credit can co-sign your loan. This dramatically improves approval chances. The co-signer is legally liable if you default. This option works well for expats with German family connections or trusted friends.
FAQ
Why was my loan rejected in Germany?
Common reasons include: negative Schufa entries, insufficient income, employment in probationary period, temporary residence permit too short, too many recent loan applications, high existing debt-to-income ratio, or incomplete documentation.
Can I apply again after rejection?
Yes, but wait at least 3-6 months if possible. Multiple applications in short periods create more Schufa inquiries, which can lower your score. Use this time to address the rejection reason—improve income documentation, clear negative Schufa entries, or complete probation.
What alternatives exist after rejection?
Options include: P2P lending platforms (Auxmoney), Schufa-free loans from Swiss banks, applying with a co-signer (Bürge), asking for smaller loan amounts, or trying different banks with varying criteria.
How can I check why I was rejected?
Request a free annual Schufa report (Datenkopie nach Art. 15 DS-GVO) to check for negative entries. Banks must provide rejection reasons upon request. Common issues include old debts, late payments, or errors in your credit file.
Can negative Schufa entries be removed?
Yes, if entries are incorrect or debts are paid. Disputed entries can be challenged. Paid debts are marked as settled. After 3 years, most negative entries are automatically deleted. Contact Schufa directly for disputes.
Will a co-signer improve my chances?
Yes, a German co-signer (Bürge) with good credit significantly improves approval chances. The co-signer is legally responsible if you default, so this arrangement requires trust. Family members often serve as co-signers for expats.
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