In addition to borrowing money from a bank or lender, it is of course also possible to do this from a private individual. The big difference between borrowing money from a financial institution or a private individual is the test. This is carried out with a recognized lender and not with a private individual.
If you borrow money from a bank or other institution, you borrow money at a previously agreed interest and repayment amount. Before you can take out the loan, a test is performed. This gives the lender insight into your financial situation. If you still have outstanding debts, then you often have a negative code. This means that it is almost impossible to take out a loan.
This negative coding will remain in place for five years until you repay your last debt. The bank then knows that you can pay a loan or that it is not wise to do this.
Borrowing money without a test
Do you have a negative registration, but still want to borrow money? Then you can look for other options. This way you can borrow money from a private individual. This can be a stranger, but also a friend or family member. As with other loans, a contract is also drawn up for a private loan. The duration and interest are described in this contract.
The Risk Of Borrowing Private Money
In most cases, borrowing money from a private lender goes well. Yet it can sometimes turn out wrong. For example, it can happen that individuals provide a loan to launder black money or to be able to earn money quickly. Money is often lent to several people. If you cannot keep to the monthly repayment period, a difficult situation may arise. Especially if you borrow money from a wrong institution. You can then end up in a difficult situation. So it is recommended to only borrow money from acquaintances or family.
Borrow money from family or friends
Borrowing money from family or friends is common. This often involves small amounts of money. If large amounts are involved, it is advisable to record agreements in a contract. Before you borrow money from family or friends, it’s a matter of calculating whether it fits within your budget. After all, you must adhere to a monthly payment obligation. If you are unable to repay the money, conflicts may arise. This puts your relationships at stake. For this reason, it is often not recommended to borrow large amounts from family or friends.