Loans and financing to buy a car

49 posts in this topic

Hi,

 

Been here a year so thought it was time to buy a car.

To my shock my bank refused to consider a loan because I have only been banking with them for 1 year and I just moved house , blah, blah blah.

 

Anybody found a good deal on car finance without having been here forever?

 

Cheers,

Jono

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If your "house bank" won't give you a loan you may have problems elsewhere. Any other loansharkarranger will almost certainly need references from SCHUFA (maybe you are not here long enough to have a record there) and your bank. It depends of course on how much you want to borrow...

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Since the car companies have built up their own banks as a tool for sales and marketing, why don't you ask the car dealer if their own bank would be willing to finance purchase or leasing of the car? That might help because these banks are a bit less strict than the "normal" German banks who seem to have forgotten that it is their major role in an economy to lend out money anyway...

 

if you go to other banks, please make sure that when they check your SCHUFA (credit record) that they do not make a "Kreditanfrage" (credit check) because this becomes registered at SCHUFA and each registration without getting actually a credit from this bank will lower your credit rating. After havong talked to a couple of banks without knowing that, you can actually forget to get a decent loan from anyone even though your financial situation has not changed. Banks are able to make a simple check of the SCHUFA which is not a "kreditanfrage" but sometimes the bankers are to lazy or to uninformed themselfes to follow that. There was a large article in FINANZTEST some time ago, if someone need more reference material on this problem, PM or email me and I'll send you a copy which you can show your banker if he does not know how to do it... ;-)

 

Cheerio

I am a professional independent insurance broker, financial adviser, and authorised advertiser. Contact me.
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Have any expats successfully obtained a car loan shortly after moving to Germany (i.e., within a month or two)? I expect to be moving there soon and would like to buy a used car while maintaining liquidity. I will be a new employee with a German company.

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I would not expect any bank or other institution to lend you money unless you are not here already for at least 3-6 month and can show proof of income during this time from a GERMAN bank account as an employee. For self-employed persons it would even be worse, you'll need to establish yourself and show proof of income for 2 years or so before anyone will lend you money.

 

Cheerio

I am a professional independent insurance broker, financial adviser, and authorised advertiser. Contact me.
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Hi

I was in Germany for 4 months when I arranged the finance for my car (3 year loan). I had all the same worries as you and so I arranged it through the dealership and the Manufacturers Bank (Audi Bank) because it was the most hassle free and the garage dealt with everything. I had to provide a letter from my employer stating that I was indeed an employee and also proof of my salary (through wageslips). If I remember correctly they were looking for 3 months of wageslips. Then all the standard things, like proof of address and ID. For me it was pretty straight forward, I did however pay more in interest than some of the online offers but then again it was all dealt with by the dealership and I had little hassle.

Good Luck.

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I had all the same worries as you and so I arranged it through the dealership and the Manufacturers Bank (Audi Bank) because it was the most hassle free and the garage dealt with everything.

 

Good taste in automobile. I did the same thing at the VW bank with no hassles.

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Have any expats successfully obtained a car loan shortly after moving to Germany

Yes, I was in Germany for only 4 weeks when I made the deal and it was finalised after a week. Renault Bank financed my car and everything was arranged by the sales guy at the dealership so I did not expirience any problems. I had to wait until I received my proof of address though for the car registration ie. 'Anmeldebestätigung'. You will have to provide the bank with your employment contract etc.

 

Good Luck!

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I also did it through the dealership. It's the easiest way for a car I guess. The rates are a bit high (6 or 7 % I think) compared to what I had in Canada though, but I don't know if rates are better at a bank.

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I have made use of Patrick OTT as recommended on TT...http://www.toytowngermany.com/archive/crcie_insurance_and_finance.html

and found him to be realy great and super helpful.

 

Talked me thorough options and I took the plunge and followed his recommendatiosn to take a SMAVA loan.

as basic entre level German speaker he got me through the whole process .line by line, tranaltion all the gobledegook...I particularly appreciated his personal care in getting me through an axious time and frankly mind boggling system.

 

SMAVA,http://www.smava.de/ itsself I knew nothing about previously, and again on Pat's advise , could now not recommend it highly enough... simple process, easy online application to complete (especially with google translator ON) , once all docuuments were received and in place Loan was settled in less than an hour!

 

Quicker , easier and more ethical than many banks.

 

I dont usually write unsolicitated effusive recommendation with no good reason...but I am genuinely delighted with Pat's service , cannot recommend him highly enough and further would suggest that if you are needing financing/loan/credit...give smava a look

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While doing research into car loans, one of the most common req's I found (for non-Germans seeking a loan) was unlimited employment & an unlimited work/residence permit.

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Very helpful info everyone.

 

One further question...@Clapoti mentioned their rates are "6 or 7%". Can anyone else provide info on their interest rate or what the current rates are for car loans / autohaus financing etc.?

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There are plenty of websites out there providing credit comparisons - example

 

The final rate of interest will be related to the amount of the loan the repayment period and the perceived credit risk. People in established, permanent employment are a better risk then freelancers on limited work permits.

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I got a loan at 5.71% at ING Diba. I did the whole request online on Wednesday night, printed it out and mailed it on Thursday. I had the money in my account on the following Tuesday (read: less than 4 business days). Of course, I already have a big house loan with them so maybe it made it faster but still, they are cheap, cheap, cheap and you can pay it off at any time WITHOUT penalties or pay lump sums at any time at any amount. This is a big difference to normal German banks. So, if you win the lottery and want to pay it off or are leaving the country and want to sell it, you won't pay any additional penalties for paying it off early.

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@kitkat64- Just curious, do you have unlimited work/residence permits for Germany? I've found that having a limited Aufenthaltserlaubnis makes banking slightly more difficult/inconvenient.

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Yes, I do have a Niederlassungserlaubnis now, but at the time of the first loan (which was obtained in 2005) I did not (but I was together with my husband who is German).

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I can only share my experience with the BMW-Bank: Always insist on a Restschuldversicherung, i.e. an insurance that covers the remaining loan should you become incapacitated or otherwise unable to pay the installments. I insisted on this when Scogs signed the contract in 2005 and could hand over the car and keys when he died. The insurance paid the BMW-Bank for the remaining purchase price, the car then became part of the estate and heaven knows what happened to it next - at least I wasn't stuck with a white elephant.

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Watch out for the BMW bank. They are one that will make you pay penalties if you end the loan early. We asked for a quote and it was way too much plus penalties if you pay it off early and no chance to pay extra either.

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