Credit bureau-free loans from bank.


Credit bureau free loans

Credit bureau free loans

Providers who offer the loan without querying the Credit bureau data are not dubious, but they mediate loans from abroad. Since many of the Credit bureau-free loans are granted by banks from Switzerland, this is often referred to as Swiss credit.

Credit bureau-free loans have the advantage that Credit bureau is not activated for the application or for the subsequent notification. These loans are a good choice especially for people with a negative credit rating.
Just like classic installment loans from Germany, Credit bureau-free loans can be used freely, there are no conditions here. The loans can be used to pay bills as well as to pay for a new car or for the next vacation.

Credit bureau-free loans from Cream Bank

Credit bureau-free loans from Bonkredit

Cream Bank is a credit broker who does not grant loans itself. Rather, he receives customer credit inquiries and forwards them to the respective banks. With a large volume of credit inquiries and brokered loans, it is possible to obtain significantly more favorable terms than with a separate request from the customer.

Cream Bank has been active on the German market for more than 35 years and, in addition to brokering real estate and installment loans, has also specialized in Credit bureau-free loans. A great advantage here is that the loans can be granted for amounts up to USD 100,000, even pensioners up to the age of 75 can still use this loan. With terms of up to 120 months, the loan rate can be individually tailored to the borrower’s income and financial opportunities.

Best Bank credit provider

Creditolo credit provider

The credit broker Best Bank also offers Credit bureau-free loans. Like Cream Bank, Best Bank is only a credit intermediary that forwards the customer’s request to the respective credit banks.

Best Bank’s loan amounts range from 1,500 – 100,000 USD, so that here too, all requests can be financed without any problems. Like the loan amounts, the terms are flexible, each customer can choose between 12-120 months.

With both loan providers, customers have the advantage that the loan application is completely free of charge and the loan request is therefore possible without any upfront costs.


Investment alternatives: senior loans funds

For an investor in fixed income there is an obvious fact: the profitability of the German ten-year bond (Bund) is in negative territory, while the ten-year US bond is below 2%. They are not tempting returns for such a long term.

Therefore, and after the cuts in interest rates in the United States, Europe, Brazil and Hong Kong and the announcement that Japan and Switzerland would also be willing to reduce them if necessary, investors seek profitability on other assets within the debt, mainly among those of private fixed income.

In this environment, the attractiveness of private debt increases because the fundamentals of companies with the highest financial rating (investment grade) are strong and the risk of a recession has been reduced. In a market context where sovereign debt pays very little, in order to achieve a more profitable debt market, other options must be sought within corporate fixed income; One of them is that of senior loans.


Senior loans

Senior loans

Senior loans consist of the extension of an existing loan to a company that does not have a credit rating, but that needs to refinance its debt, finance some purchase or support non-organic growth (purchases of other companies).

This kind of loans is secured by the borrower’s assets (the company that is requesting the loan) but with the provision that they are the first line of payment to receive, so they are the safest of the issuer. They are granted by large financial companies, which chop senior loans and distribute them throughout a private market among other entities and investment funds, which would be to convert that senior loan into a syndicated loan.

‘Senior loans’ or ‘senior debt’ differ from subordinated or junior debt in terms of repayment: senior debt is guaranteed and offers less risk than junior debt.

The market for this class of assets has grown considerably in recent years due to the greater supply available and a significant increase in the number of demanding institutions.

On the interest side, it is worth knowing that senior loans do not offer a fixed rate, but a variable or floating rate, since the company that requests them pays a fixed differential plus the evolution of a given index (Euribor or Libor).


Advantages and disadvantages of senior loans

money loan

Like any investment product, senior loans have their pros and cons:

Since we are in an environment of low profitability, precisely the main advantage is its greater profitability compared to public debt, very similar to that of high yield debt, to which security is linked in the term, because they depend on the evolution of a benchmark and are not of a fixed type.

They are also interesting because they are the first on the collection list (first-class guarantees) and suffer less volatility, because they adapt to the market through the benchmark index at all times.

However, its disadvantages include the fact of possible defaults (default), the possibility of renegotiating conditions in case of need by the issuing company, lower liquidity to buy and sell in the market and profitability which also adjusts to the market thanks to that benchmark index , so they do not offer unexpected joys either.


How to invest in senior loans

money loans

This corporate fixed income instrument is not available to retail investors. As we said, it is listed on a private market that only institutional investors have access to. On the other hand, as we have also pointed out, the shares that are placed in this market are not small enough for a retail investor to achieve sufficient diversification in its debt portfolio.

As a better example of what we say, when the first alternative debt investment fund arrived in the Spanish market in 2016, it had about 30 million dollars under management and announced 21 investments in European liquid quoted loans. Among the broadcasters that it had in its portfolio in its first stages were emissions from Savesafe Security, IPC Salud or ByteNet. And its annual profitability objective was Euribor plus 4-5%, with fortnightly liquidity.

What are peer-to-peer loans? – Invest in a smart way

In recent years, we have seen many industries fundamentally change as new technology drives new business models. One of the strongest growing trends is the sharing economy where new technology connects people who have something with people who want something.

The increased digitalization of recent years has allowed the sharing economy to flourish. According to an analysis from the investment Best Bank, close to 70 percent of the world’s population is willing to share their assets with others and around 65 percent want to participate in something someone else owns. According to an estimate by the audit and consulting firm PwC, the five largest sectors in the sharing economy will be worth $ 335 billion by 2025, which represents an increase of over 2,200 percent in just ten years.


What are peer to peer loans?

credit loan

There are many different names on peer to peer loans where some of the most common are P2P loans, marketplace lending, crowdlending and person to person loans. The essential thing for the form of financing is that all parties meet on equal terms.

Peer to peer loans are currently the fastest growing method of financing. Peer to peer loans, where individuals finance each other’s loans, have emerged as an attractive alternative to the banking sector and its high and hidden fees. For investors, it is a good alternative to buy shares or invest money in savings accounts without interest. For borrowers, it is a smarter way to borrow money than traditional private loans.

In the US, where peer-to-peer loans have been around for over ten years, major banks and payment institutions have also joined the game. For example, Richman Zachs has created solutions with greater transparency towards customers in order to meet the new competition.

For the financial sector, it is good that digitalization has reached the industry as it can make it more efficient and create added value for the consumer. It’s about making this industry more efficient and transparent, which is better for customers.


How do peer-to-peer loans work at Lendofy?

Lendofy is today Sweden’s largest marketplace for loans. We connect borrowers and investors via a digital platform and create a transparency that has not previously existed in the private mortgage market.

By cutting intermediaries, efficiency gains are achieved for both borrowers and investors. Borrowers receive a competitive interest rate while giving investors a good return.

Lendofy handles everything beyond the credit risk borne by the investors. Investors are given the opportunity to invest in an asset class that was previously only available to the banks. Instead of the bank making big profits from lending the savers’ capital, our investors can now get the return while taking the credit risk.

We can see that the return in relation to risk is high on loans to creditworthy private individuals by studying the banks’ profits. Through Lendofy’s digital platform, ordinary investors can take advantage of the banks’ profits by lending money directly to creditworthy borrowers.


Why invest in peer-to-peer loans?

peer-to-peer loans?

The conditions for peer to peer loans in Sweden are very good and from an international perspective quite unique. Some of the unique conditions for P2P loans in Sweden:

Good insights into the borrowers’ finances and ability to repay thanks to the credit reporting system Swedes have a high payment ethic Social security number which facilitates identification Widespread use of BankID which reduces the risk of fraud A good infrastructure of debt collection companies and the Crown Prosecution Authority, which creates good conditions for getting back delayed and missed payments.