It is not possible to take out an instant loan without collateral in German and foreign banking. The granting of a loan by a bank or bank is always tied to various types of security, which the borrower must also meet.
How important is creditworthiness?
The most important thing here is creditworthiness, which is used to determine whether the borrower can even repay the loan at all. As a result, the bank uses it in advance to evaluate whether an applicant should actually be accepted or not. Ultimately, collateral always protects the bank from a default on the part of the borrower, regardless of whether these collateral can be attached later or minimize the likelihood of a default in advance, simply by determining the applicant’s creditworthiness and credit line.
Without collateral, there is no loan, but some optional collateral can significantly increase the chances of successful borrowing. For example, banks like to see the borrower have a possible attachable capital. In the event of a default, this capital can be used by the bank to pay the remaining debt on the loan.
A paid-for car or property that is fully owned by the borrower counts as such attachable assets. The bank remains completely untouched as long as the borrower pays its installments in full and on time.
The quick instant loan with collateral
It is therefore not possible to take out an instant loan without collateral, at least via the banking system. However, a kind of instant loan is the loan of money from the income of a private lender. For example, if person A borrows money from person B, it is effectively a loan, even if it may not be perceived as such.
Collateral does not usually have to be provided here, since the friendly or even family relationship of both people to each other outweighs the creditworthiness and assessment of them. Such a loan is only an option if the borrower actually knows a person in the private environment who is willing to lend money to him on the one hand and who has the necessary financial resources himself.
In banking, an instant loan without collateral from the borrower is only possible if a guarantor instead provides the necessary collateral. In the case of a guarantee, the guarantor’s entire assets and income are also consulted for evaluation, so that much higher-value loans are possible here. Loans are often only possible in the first place if another person vouches for the actual borrower and thus increases his creditworthiness or even creates it.