You should consider these points before applying for a loan.

According to the Federal Statistical Office, every tenth household in Switzerland currently has a consumer loan. Many use the money to buy a new car, and getting a loan is also very popular when purchasing furniture or financing an apprenticeship.

This is no coincidence: the borrower receives the money quickly, and its repayment may take longer, thanks to fixed installments. However, there are a few important points to consider before applying. You can find out what these are in our loan FAQ.

In Switzerland, the following minimum requirements apply to be eligible for a loan application:

• Minimum age: 18 years
• Residence: Switzerland or Liechtenstein
• Nationality: Swiss or foreigner with residence permit
• Minimum income: CHF 2,500/month

Creditworthiness and creditworthiness also play an important role – see next points.

Banks do a credit check before giving a loan. Every lender is primarily responsible for checking an applicant’s credit worthiness. According to the Federal Consumer Credit Act (KKG), consumer credit can only be given to consumers with creditworthiness. While assessing the creditworthiness, the consumer’s income and expenses are compared, taking into account the current payment obligations. This is usually checked on the basis of documents submitted by the consumer (see below).

In addition to creditworthiness, credit institutions and banks also check the creditworthiness of the applicant. Each bank does this in its own way. It’s basically about questioning payment behavior for example. Therefore, if you always pay your bills on time, you are more likely to run into trouble when it comes to lending. On the other hand, if you regularly default on payment, your creditworthiness will suffer. Lenders can also check with the Credit Information Central Office whether you have applied for loans before and whether they have been rejected. Banks can also see if you regularly meet your current payment obligations (eg consumer loan, leasing). Finally, various personal data are taken into account, such as how old you are or how long you have worked for the same company. Or are you still in the testing phase? This is to find out how financially stable your life is or if you have risk factors that oppose lending.

To check your creditworthiness, the lender needs your most recent three pay slips to prove you have a regular income. However, the lender will need to calculate what your fixed costs are – i.e. health insurance, rent, etc. – to be able to estimate whether you will actually be able to repay the loan. wants to know – how much you spend monthly on Front and back photocopy of ID, passport or driver’s license is also required.

Calculation example: The total cost for a cash loan of CHF 10,000, with a 12-month maturity and an annual effective interest rate of 7.95 to 9.95 percent, ranges from CHF 420.80 to CHF 523.40.

No, the lender usually doesn’t care exactly what you use the money for. You are also under no obligation to report it. An exception is a loan linked to the financing of an object serving the purchase of an object (for example, a vehicle).

It is important that you choose a reputable and well-established player from Switzerland. Caution is advised in questionable foreign credit institutions. These often advertise at low interest rates, but they are not allowed to offer loans in Switzerland. According to the law, the consumer/borrower has the right to withdraw from the consumer loan agreement within 14 days. Consumer loans are generally not paid to the consumer before the statutory cancellation period expires.

In fact, credit and credit are not the same thing. Most lenders offer a variety of loan options. For example, in Cembra, customers can choose from three options (see box above).

Cash purchase, loan or leasing? There is no right or wrong when buying a car, it all depends on its type. Would you like to own your car? Then the loan is better: it is yours, depending on the product, after the conclusion of the car financing contract or at the latest after the full loan amount, including interest, has been paid. With leasing, you only use the vehicle and return it after the rental period expires. Or you pay the remaining value. Then the car would be yours too.

Quite fast: The bank usually transfers the consumer loan after the 14-day cancellation period has expired. This is required by law. The deadline is used by the borrower to withdraw from the loan agreement in case of doubt. This is especially useful if the loan application was made for a spontaneous purchase or similar reason and you regret the decision after sleeping a few times.

The interest charged on loans varies in Switzerland depending on the creditworthiness and practices of the bank. However, a maximum interest rate for consumer loans is determined by law. This is currently 10 percent. The interest range on Cembra is currently 7.95 to 9.95 percent.

If someone has several loans running at the same time, it’s worth combining them with one and the same provider. The reason: You only have one loan amount instead of several and therefore you only have to pay one monthly installment. This saves you time and money. Because interest only affects the amount of a loan, and it’s not uncommon for you to enjoy better terms when you combine them, provided you have a good credit score. You can get the loan back from the old provider at any time. The new provider takes care of the change. Fees may apply for final settlement.

Here you have the option of insuring the loan. Cembra offers such an option with its installment insurance. This includes incidents of being unable to work due to an accident, illness, or even unemployment through no fault of your own.

You will only get the loan if you meet all legal requirements and the bank’s selection criteria. Otherwise, the application may be rejected without further information. Credit refusals can be viewed by other member credit institutions for credit information at the head office for a period of two years. That’s why it’s worth checking your creditworthiness beforehand to minimize the risk of rejection.

The monthly interest rate is between CHF 868.40 and CHF 876.95 and the total cost is between CHF 420.80 and CHF 523.40 for a 12-month maturity CHF 10,000 cash loan with an annual effective interest rate of 7.95% to 9.95%. The Lender is Zurich-based Cembra Money Bank AG. Lending is prohibited if it leads to excessive consumer borrowing (Article 3 UWG).