Banks ask the schufa of the applicant for every loan application. Accordingly, its score is an important criterion for granting or denying the loan. But does a Schufa entry always automatically mean that the bank does not lend? Up to which limit are the score values okay and what influences the Schufa score at all?
The Schufa score as a sign of creditworthiness and creditworthiness
The Schufa Score represents the end result of different values, which together add up to the risk a borrower presents to the lender. This means that scores about different circumstances are analyzed. How exactly they are calculated, about the Schufa gives no information. However, the results of the analyzes provide lenders with information on whether and if so, with what probability, a borrower is repaying his debts.
One of the factors that influence the Schufa score is the economic situation of a borrower. It is therefore checked how regular and how high the monthly income and expenditure are. For this purpose, data such as income and assets are queried – the work situation is also included. Issues such as fixed-term contracts, agency work or whether the borrower is in training or in the probationary period have a negative impact on the Schufa score.
The income is compared with the account outflows. That is, fixed costs, repayments and similar, regular expenses such as mobile phone contracts, installment purchases and others, are offset against the amount of income. If there is still sufficient credit remaining after this calculation, chances are good that an applicant will receive a loan.
What influences the Schufa score
Consumers who are clients of several banks or financial institutions must have a particularly high income so that this does not have a negative impact on their Schufa score. Frequent account changes, unused checking accounts and credit cards should be avoided by consumers. The part payment function for credit cards can also adversely affect the score. By contrast, long-term customer relationships with as few financial institutions as possible have a positive influence on the Schufa score.
If the checking account is regularly or even overdrawn for the long term, this can also lead to a negative valuation. This also applies to a small credit line. When granting loans, banks assume that a higher credit line means that the applicant is liquid and trustworthy. However, of course, only if the disposition credit is either not or only occasionally used. And above all, if he is served regularly and thus paid off.
Overall, the consumer’s payment and willingness to pay is a key criterion to be considered when applying for a loan. If installment purchases are settled reliably, invoices and open receivables paid on time, then this has an effect on the customer’s trustworthiness. And that means the Schufa score goes up.
Every quarter a new opportunity
The Schufa score is updated every 3 months. So if you have a negative entry, you can actively increase your score by improving your payment history and, in the event of payment difficulties, transparently communicating financial bottlenecks to the creditor. For a loan approval, the Schufa score should be between 95 and 100 points .
Does every Schufa entry mean a rejection of the loan application?
No, not every Schufa entry is an exclusion criterion. Because the Schufa score includes both positive and negative factors. If the positive aspects outweigh, this means a higher probability that a loan will be granted. A negative entry can be compensated accordingly by a positive.
For example, an installment purchase or a borrowed financing model initially means a negative entry. But if the installment payments are settled regularly, reliably and on time, without being maneuvered into a financial shortage, then there are positive reviews. In this case, the payment morality and reliability of the applicant outweighs the actual negative entry on the use of installment options in general.
At the Schufa review in the context of an application for a loan consumers should therefore first of all keep calm. Often the Schufa score is not as negative as your own assessment might suggest. And if it does, you can actively counteract and increase your own value again.