Get a car loan despite a poor credit rating: This is how it could work

Would you like to take out a car loan despite a poor credit rating? This is definitely possible. credXperts helps you to improve your credit rating and thus your chance of getting a car loan. Car loan to increase.

A poor or negative credit rating is considered an increased risk by banks: banks assume that if you have a poor or negative credit rating, you will not be able to repay your loan easily or at all.

A poor credit rating can lead to your loan application being rejected

If your credit rating is poor, banks or lenders may even refuse to finance your car and reject your car loan application. This in turn worsens your credit rating, as another negative entry is now noted in your score (= creditworthiness value). The likelihood of getting a loan despite a poor credit rating decreases even further.

The score records all the payment information collected about you, such as age, home address, positive and negative payment experience, etc. Information about your data is collected by credit agencies such as CRIF or Intrum Justitia. This is common practice in Switzerland: various private companies and agencies collect data on a person's payment behaviour and creditworthiness.

If your credit rating is poor, this will result in disadvantages in terms and conditions: higher interest rates, restrictions on the term or instalments or even rejection of your loan application.

Does the SCHUFA entry or SCHUFA score also exist in Switzerland?

In Germany, it is SCHUFA (= Schutzgesellschaft für allgemeine Kreditsicherung) that provides information about a person's creditworthiness or SCHUFA score. In Switzerland, it is credit agencies such as CRIF or Intrum Justitia that provide information about your creditworthiness. This data is collected in the ZEK, the Central Office for Credit Information.

Banks and lenders access this information before they review and grant a loan application. The banks are obliged to obtain a query from the ZEK when checking a loan application.

ZEK and its codes

A bank communicates anonymously with other banks using ZEK codes. Each code has a direct impact on creditworthiness. Below you can see the most common codes:

• ZEK Code 01: Open credit application
• ZEK Code 02: Regular instalments
• ZEK Code 03: Delayed payment with reminders, retention period 3 years, negative entry
• ZEK Code 04: Collection measures/enforcement, retention period 5 years, negative entry
• ZEK Code 05: Partial or total loss, retention period 5 years, no more credit possible
• ZEK Code 21: Blocked credit card, retention period 5 years, negative entry
• ZEK Code 22: Ongoing collection measures, retention period 5 years, negative entry
• ZEK Code 23: Partial or total loss, retention period 5 years, no more credit possible

ZEK and debt collection extracts correspond approximately to a SCHUFA information or SCHUFA enquiry

So when it comes to financing your car, Swiss banks look at ZEK information and debt collection statements, which is roughly equivalent to a SCHUFA information or SCHUFA query. Terms such as "car loan despite negative SCHUFA or despite bad SCHUFA", "car loan despite SCHUFA entry or despite SCHUFA entries" or "car loan without SCHUFA" do not exist with Swiss loans. Instead, terms such as "car loan despite poor credit rating" or "loans despite poor credit rating" are common in this country.

So if you have moved to Switzerland from Germany and would like to apply for a Swiss loan despite negative SCHUFA or despite negative SCHUFA, do not hesitate to contact us - we will advise you free of charge: +41 44 244 34 00.

Would you like to get a car loan despite a poor credit rating?

Before you apply for a Swiss loan for your new car, it is advisable to check your creditworthiness as a borrower beforehand. This is because your credit rating determines whether you get a loan for your car and on what terms. Banks usually reject loans because of a negative credit rating.

The credit rating is nothing more than information about how likely you are as a borrower to repay your car loan. If your credit rating is low, the banks rate the probability of repayment for your car loan as low: The risk of default is correspondingly high. A high credit rating, on the other hand, tells banks that you as a borrower are very likely to repay your car loan. This gives banks and lenders more opportunities to grant you good conditions for your car loan. Be it in terms of interest rates, the term or the structure of the instalments.

Did you know that a person's credit rating is often incorrect? The reasons for this are often incorrect, incomplete or outdated information about your creditworthiness. A bank only sees negative entries and uses these to decide whether or not to grant you a loan for your car.

Get a loan for your new car with a credit check and credit rating adjustment

You should therefore rely on a credit check with a reputable provider such as credXperts before you apply for your loan: we can check and clean up your creditworthiness from as little as CHF 69 to minimise the risk of your loan being rejected.

And it's quick and easy. We support you from A to Z during the credit check: We check your creditworthiness and enquire about it with the credit agencies. At the same time, we provide you with templates for letters and emails so that you can have your credit rating corrected by creditors and bureaus. This is because you have the right to have incorrect entries deleted or corrected.

Credit rating adjustment made easy

If you do not wish to clean up your credit rating yourself, we will take over as an independent and Reputable credit brokers will of course do this for you. You can get this personalised service for CHF 399:

• We check your creditworthiness, actively clean up the creditworthiness databases and thus improve your score.
• We take care to keep you continuously informed about the status of the credit rating adjustment.
• We are in direct contact with creditors and public authorities.
• We even cover the costs for the first three debt collection extracts.
• We will refund the costs if your credit rating or creditworthiness does not improve despite the adjustment.

Do you have questions about poor creditworthiness? Or would you like advice on how to finance your car loan? Or do you have general questions about taking out a loan?

No matter what questions you have, we at credXperts will be happy to help you: +41 44 244 34 00.

Financing a car loan - what you need to look out for

Car loans are not only available from banks, but also from car dealers: car dealers usually use the brand dealership's own bank to finance loans and leases for cars. The car dealers' advertising often sounds like favourable offers and interest rates, but you should check them out.

Firstly, you should check whether a car loan or leasing is more worthwhile for you. Because you can save money here. Read our blog article "Car loan or leasing when buying a car in Switzerland: Which financing is worthwhile?". Here you can find out all the advantages and disadvantages of leasing compared to a loan for your car. The first advantage of a car loan is that you can deduct the interest on a car loan from your taxes, whereas you cannot with leasing. You can find out more about this in our blog article "Deducting car loans from tax: This applies".

If you have any questions about financing your car, please do not hesitate to call us: +41 44 244 34 00.

Requirements for successful car financing

In order for your bank to grant your car loan, you must fulfil the following requirements when applying for a loan:

• Minimum age 18 years, maximum age 70 years
• Resident in Switzerland, the Principality of Liechtenstein or cross-border commuter
• Swiss citizenship or residence permit C, residence permit B, residence permit G, residence permit L
• Regulated income

In addition to a regular income and a good credit rating, the bank also looks at these points when financing your vehicle:

• Existing loans: If you have current loans, this may reduce your chances of obtaining another loan. This is because it is forbidden to grant credit if you become overindebted as a result (Art. 3 UWG).
• Loan amount too high: Loans often cannot be financed if the desired amount is too high. In addition to income, monthly expenses also count before loans are approved. If these expenses exceed the monthly instalments of the car loan, there is no car financing.
• False information: Even that! Yes, an incorrectly completed loan application can often lead to a rejection of the loan. You should not leave a bad impression here and fill in everything truthfully.

Apply for a car loan now

Do you now feel well informed about car loans? Then we would be delighted if you applied for your car loan with us: as an independent credit broker, we compare the loans and interest rates of all providers so that you get the best conditions.

You can see what such an interest rate comparison looks like here.

With us, you can get a car loan from as little as 4.4 per cent interest. Calculate and apply for your car loan today. If you have any questions about the loan, we will be happy to help and advise you: +41 44 244 34 00.