Month: December 2019

Special loans to finance a solar system

by admin

When the temperatures rise, the purchase of a solar system becomes particularly attractive. Today's credit market offers numerous options for financing a private photovoltaic system. But before you put a solar system on the roof, you should carefully check whether the investment will pay off in the future.

When does the solar system pay off?

When does the solar system pay off?

A photovoltaic system generates the electricity in an environmentally friendly way, which can ultimately reduce emissions. There is also a potential return from the solar system, thanks to a feed-in tariff for solar power, which in the long term brings the operator more money than the purchase costs. However, this only works if a solar system is financed through a discounted special solar loan.

According to a sample calculation created by pressedienst, a photovoltaic system with an output of 5 kilowatts costs around 6,500 USD. Approximately a third of the electricity that the system produces can supply a household with 4 people. The rest of the electricity is fed back into the grid.

The amount that can be saved after 20 years of operation will then significantly exceed the expenses. The approximate calculation is about 8,000 USD in profit.

Financing a solar system with credit

Financing a solar system with credit

Solar loans are a relatively new form of loan to build a new photovoltaic system. Since the solar systems are designed to reduce emissions, the purchase of them is primarily supported by the state. With a funding program 275 that:

  • can guarantee a cheap loan and a repayment subsidy for the operator;
  • The financing is provided by the state-owned bank and can cover up to 100 percent of the costs.

The operator must then submit an application for credit through his house bank and also provide an equity component (around a quarter). The bank assesses your creditworthiness and the risks that can arise from lending. To secure itself, the bank will also promote certain collateral.

But a certain level of security is exactly guaranteed by the state subsidy for solar power, namely as the feed-in tariff, which is regulated in the EEG (Renewable Energy Sources Act) and which you can assign to the bank as security.

The loan offer from a state bank does not always mean the best conditions and the lowest interest rates. In addition, the state funding for the promotion of solar systems is unfortunately not sufficient for all applicants, so that they then have to look for another financing option. As a rule, free special repayment is not possible with such government loans.

Loan for two makes the loan cheaper

by admin

Borrowing together can make sense for borrowers who have concerns that they will not get a loan approval on their own. For example, if you have a low income or cannot meet other bank requirements, it is worthwhile to involve your partner in order to take out a loan for two. For a bank, borrowing together is more secure - the more people are responsible for the repayment, the lower the risk of default.

Requirements for the second borrower

Requirements for the second borrower

The statistics indicate that around 20% of all loans are applied for as a couple, which is also normal for couples who are planning something bigger and want to pay for it together. In the case of a joint loan request, at least one of the two borrowers should meet the following requirements of a bank:

  • majority
  • Permanent residence in Germany
  • permanent employment
  • Positive credit bureau information
  • Sufficient income

The second person does not necessarily have to be a relative or spouse. In principle, everyone can be the second borrower who fulfills the acceptance criteria of the bank and is ready for borrowing "in pairs". However, the first borrower is always the one who proves the higher income.

Benefits with a second borrower

Benefits with a second borrower

First, another borrower with a secure income brings a bank to better prospects by increasing the repayment ability of the first applicant. For example, students or consumers with fixed-term contracts can significantly increase their chances of getting a loan. With joint borrowing, the partners can even expect higher loan amounts.

Second, if both partners have their own income, they are increasing their creditworthiness, which is determined by a bank when the loan request is made. The higher the credit rating of the two applicants, the cheaper the interest rates that can ultimately be obtained when borrowing.

What are the risks?

What are the risks?

If a joint loan is taken out, the two borrowers are fully liable and are two responsible debtors. If a borrower then becomes insolvent, the bank can claim the entire remaining debt from the other borrower. Furthermore, the credit bureau data of the two people are checked and the approved loan is saved in files by both consumers.

Even if a couple divorces, the former spouses are still jointly and severally liable to the bank.

Conclusion: In general, joint borrowing is cheaper than a single application. However, before borrowing, the advantages and disadvantages of a “two-person” loan should be examined and the private life situation should be carefully considered.