If you want to borrow money privately, often only the circle of friends or your own relatives remains. The partner's relatives can also be asked about a private loan, but that's about it. But even if you can easily repay the borrowed money, there is always the fear of not being able to repay the payday loan of people in your own environment because something comes up.
Internet platforms bring private investors and private borrowers together.
But there are other loans from private individuals who are actually investors. Fast credit is one such platform that brings together retail investors and borrowers. The primary concern here is to finance a small loan with the help of several investors. The donors then only make relatively small amounts, which significantly minimizes the risk for every investor. So the financing of the loan is spread over many shoulders, and yet everyone still gets a return for investing the money. Financing is often very quick if the requirements are right. The borrower can have the money within a few days and, depending on his options, can also repay the loan amount in previously agreed installments.
Free credit request
Over 40,000 investors at fast credit are already ready to invest money in a loan request. The one who needs fresh capital describes his loan request and the necessary loan amount. To do this, the borrower needs some information and data for security
The principle of personal credit
deposit that shows the financial community and above all the investors that the income situation of the borrower allows the loan to be repaid. If the important information is missing or there are still questions, no lending will take place. Financing can only begin once all conditions have been met and all questions have been clarified.
Have you ever borrowed money? Whether in the restaurant, cinema or in the stadium - we all borrow money from friends or acquaintances. With larger amounts - for example for a car purchase or start-up capital for self-employment - friends can often no longer help.
When starting your own business, irregular income or an unusual business idea often have a negative impact on banks' willingness to finance - fast credit is a brilliant alternative to the bank.
Never pay fees before a contract is signed!
Only when your set loan volume has been fully financed and you have the money in your account, an agency fee is due, which is then paid to the agency platform via the loan installments. Rather than contacting a financial institution that charges fees before they even start paying out, you'd better try asking for a payday loan.
Another important information about fast credit:
The platform also offers investors the option of lending to borrowers with small amounts. As with a bank loan, collateral, such as your own car, can be behind the online payday loan. The creditworthiness of a borrower also plays an important role, as with a conventional bank loan. At the same time, with this form of lending, it is possible to include the social aspect in the considerations.
Potential lenders can choose the risk they want to take.
In this way, loans can be granted to borrowers who address the investor personally. Friends often use the credit platforms to lend to each other. This trend will only intensify in the coming years, because such a form of lending is often easier and faster than normal bank loans, which are more difficult to obtain in the current credit crunch. So if it is possible anywhere, it is easiest with this loan platform, because here you can still borrow money privately without major hurdles.
Beware of payday loans without protection
As mentioned in the previous section, such platforms as fast credit are increasingly used by friends and relatives to securely grant private loans. Because, as is well known, money and friendship make it a difficult topic. Therefore, it always makes sense to secure everything legally.
A payday loan is suitable for anyone who needs cash because they urgently need a new car or have to pay off debts to the bank. With private financing, borrowers do not have to provide collateral or prove their income. Even if lending money privately seems straightforward, there are plenty of pitfalls.
Make sure you legally secure a payday loan. Otherwise, the relationship between the lender and the borrower can be severely affected.
Consumer protection and notice periods
When lending through a bank, the bank protects itself with a special clause in the contract if the loan repayment is suspended by the borrower. This contractual clause gives banks the right to have garnishment seized should there be a default. On the other hand, if money is lent from one private individual to another private individual, it seems a simple matter, since normally no complex loan agreements are drawn up for this. Nevertheless, or perhaps because of this, caution is advised with private loans.
If there is a dispute between the lender and the borrower, there is no consumer protection. This means that the recipient of the money cannot consult an ombudsman or seek advice from a consumer protection organization.
A payday loan is also a delicate matter when it comes to the notice period. If no loan term has been agreed, relatives, friends or neighbors can cancel the loan with a three-month period. The borrower must repay the full amount in full if the lender so requests. It is therefore extremely important to agree on fixed terms in writing.
Duty to provide information and personal relationships
With a private loan, there is no information requirement as with the banks. A financial institution must comply with legal requirements, which is why every borrower is given the regulations with the loan agreement. There are no information requirements for payday loans. A contract should therefore be drawn up for every payday loan business. Model contracts are available on the Internet for this purpose. The personal relationship can also get cracked through a private loan business. Disputes over USD and cents have burdened or destroyed many friendships. With bank loans, the focus is on neutrality, human relationships do not matter.
Income from payday loans is taxable
If a private lender calculates interest on the loan, he must state the interest income according to Section 20 Paragraph 1 Nos. 5 and 7 EStG in the tax return as "income from capital assets". The situation is different if the borrower deducts the interest amounts paid as operating expenses or advertising costs. Then the donor is taxed by setting a private tax rate. In this way, the legislator prevents the parties from enriching themselves and gaining advantages through the "scope for maneuver". However, these regulations only apply to credit transactions between family members and other related parties.
Internet platforms for private loans as an alternative
If you want to borrow money privately, you can also use internet platforms for payday loans as an alternative. An online payday loan is granted in a similar way to classic bank loans. The loan application is also submitted and checked. If a private loan application is approved, the borrower must repay the amount as agreed and may also pay interest. The borrowed money comes from private lenders. The conditions are often more favorable and the requirements less stringent than at banks. Nevertheless, interested parties should first thoroughly inform themselves about the credit conditions, because borrowers often pay in the end. You can get money relatively easily even with limited creditworthiness, but the interest is often higher than that of the financial institutions.
Template for a private loan contract:
If you are looking for a template for a private loan contract, we have found the right page for you. Here you can download the best template for a private loan contract without signing up or registering: private loan contract