Even though the distinction between nationality and customers is largely discriminatory and therefore mostly taboo, banks differentiate between German and foreign applicants when lending. However, at least German financial institutions are clearly limited by German and European law.
The fundamental rejection of any lending to a foreigner is in no case allowed. Violations of the principle of equal treatment do not take place in practice. Possible refusals of lending to a foreign loan seeker are usually based on objectively justified reasons such as an unclear or temporary residence status.
Lending to foreigners from other EU countries
Citizens from all other states of the Community and from the member states of the EEA are subject to an absolute prohibition of discrimination. This means that no bank may deny credit to an applicant who is a national of an EU country or an EEA country because he is a foreigner.
Since not all states enter the respective registration address in the identity papers or citizens living abroad often only have a passport without address information, a current registration certificate may be required for the credit application.
Not only foreigners are affected by this special rule, but also German citizens who can only produce a passport and no federal identity card. Thus, it does not constitute discrimination, but is indispensable for a complete proof of identity.
Credit for foreigners without credit bureau
When applying for non-scholarly loans, foreigners are actually disadvantaged even if they are a national of another EU country. As most of these loans come from Switzerland, the refusal is due to a foreign nationality.
The majority of Swiss federal banks require the applicant to live in the country of which he is a national for the purpose of granting credit bureau-free bank loans. Since Liechtenstein is a member of the EEA, unlike Switzerland, the banks there are obliged to treat all EU citizens equally.
However, experience has shown that they reject most of the non-credit bureau loans requested by EU foreigners who are resident in Germany, each stating a reason other than foreign nationality. A EU foreigner dependent on a credit bureau-free loan is best advised to seek a credit intermediary who can raise bank credit through Luxembourg financial institutions.
Credit for foreigners from non-EU countries
It can not be observed that banks based in Germany are restricting lending to foreigners from non-EU countries. Rather, most financial institutions alike ensure that repayment of the loan is guaranteed to both domestic and foreign credit applicants.
This results in the lending to foreigners with a temporary residence permit, the additional requirement that the term of the loan agreement may not go beyond the current residence permit.
Exceptions are possible if the extension of the right of residence can be regarded as a formality and thus secured according to the usual criteria. Turkish citizens tend to prefer loans to a branch of a financial institution originating in Turkey. This decision is based mainly on a bond with the home country and not on bad experiences with German banks.
Private loans for foreigners
Especially for foreigners with a temporary residence status, the loan application is offered on an online platform for private loans. The members registered there often follow social criteria in their decisions to make requests. They deliberately favor lending to foreigners, believing they would find it hard to get credit from traditional banks.
Even foreigners with a temporary residence permit can apply for the required credit in most cases via the personal loan platforms. Significant for a quick credit subscription is a meaningful representation of the planned use of funds for domestic as well as for foreign customers, as this contributes significantly to private lenders decision.
5 Tips on Credit for Foreigners
1. Ways for a loan
For foreigners, there are basically no regular ways to get a loan. Only a citizen with a German passport could jump in here. However, it would then no longer be a guarantor but the person concerned would be the sole borrower. Another possibility is that the loan is again taken abroad.
This can be done via a credit intermediary, whereby here also usually a German passport must be presented. There are very few providers who actually provide loans for foreigners in Germany and are actually serious.
2. Which credit hedges are accepted
Securing a loan is a major problem. Even if such a loan is granted, many of the collateral, such as real estate abroad, can be found. As a rule, a German bank has no access to these because the seizure is subject solely to the regulations of the country of origin.
Thus only goods that the persons have with them remain. Often, however, no credit can be covered with these, so that a rejection will occur. However, it is also possible for a foreign guarantor to intervene if he has the sufficient funds and the exchange rate of the foreign currency is acceptable to the bank. Here, however, enormous resources have to be available in the room.
3. Receive credit from private
If you are lucky, you will receive a loan from private. Here online platforms can be considered, which convey such directly. Although a residence in Germany must be proven here, but the odds are much better than a regular bank.
As a rule, you have to register on the platform and then set up a credit project. It should be noted that the amount of money really comes from private and is not paid through a bank. If this can not check the credit bureau, there is usually a rejection.
4. Open account in Germany from abroad
An effective way to obtain a loan in Germany is to open an account from abroad at a German bank. There are many offers that are also offered by regular banks. As soon as such an account exists, the creditworthiness of the customer can also be checked by credit bureau.
This then makes it possible to take out a loan. However, this usually a minimum receipt must be detected. An empty account is of no use in such a case. This rather damages the credit rating.
The currency is not set. Disadvantage: The account is subject to German law that in the home country of a person is not always applicable.
5. These documents are required for the opening of an account from abroad
As a rule, a current ID card or another comparable document must be presented, from which the place of residence can be derived and the address can be precisely determined. However, as a rule, there is no credit check, since this is very difficult to achieve abroad. Therefore, the account can only be managed in plus.
Unlike German account holders, who are forced by their economic situation to open such an account, this does not mean loss of credit for foreign nationals. Rather, comprehensive evidence of collateral and earned income must be provided if lending is to be successful.
In addition, it can not hurt to be able to prove economic ties to Germany.