Consumer credit

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Under consumer credit ( consumer credit ) is understood to bank loans , which the financing of consumer goods or services for consumers serve.

General

Bank loans can also be differentiated according to the intended use of the loan, among other things . In the case of natural persons as borrowers, in addition to the consumer loan, there are also overdraft facilities serving to secure liquidity , which usually have short terms (<1 year) and are usually not earmarked. The consumer credit, on the other hand, is mostly of a medium to long-term nature (> 2 years to 5 years) and is often earmarked. Outside of the banking sector, there are also supplier credits , leasing , the installment credit or “writing down” (such as the beer mat ) as a substitute for consumer credit . The Consumer Credit offers the possibility to house economic needs already in anticipation of future income of the household to cover. The resulting debts are sometimes referred to as “consumer debt ”. Consumer loans are non-commercial, private purposes and apply when the banks of the lending business as part of the banking business within the meaning of § 1 para. 1 no. 2 KWG . Because of the considerable importance of consumer credit for private demand and the associated economic policy effect, the credit institutions had to report the amount of consumer credit granted to the Bundesbank from 1963 onwards . The Bundesbank defines consumer credit as “credits that are granted for the purpose of personal use for the consumption of goods and services”. Consumer credit is a common cause of over-indebtedness .

Credit occasion

While the cash flow is decisive for investment loans and the increase in value and the saved usage fee are decisive for real estate financing , there is no clear object for consumer loans from which the repayability of the loan can be determined. Its eradication is usually out of the income of the borrower. The consumer goods financed with it serve private consumption , whereby a distinction must be made between consumer goods ( food , luxury goods , fuels ) and consumer goods ( household items , jewelry , motor vehicles ). In the case of consumer goods, the consumer credit can be used for their initial purchase or replacement purchase. Real estate financing, on the other hand, is not counted among consumer loans; at best, building materials for repairs and renovations can be financed with consumer loans. The term of consumer loans is roughly based on the useful life of the financed assets and generally does not exceed 5 years.

Credit terms

As a rule, credit institutions require the use of equity between 10% and 25% of the purchase price in their credit conditions ; full financing is the exception. The use of equity capital can reduce the credit risk , while the borrower can also prove that he has taken on his own financial risk. Consumer loans can be granted as blank loans or must be secured, especially for longer terms. As loan collateral are usually the acquired consumer goods in question by way of transfer of ownership (household), transfer of ownership of motor vehicles or mortgages are used. In addition, the assignment of wages and salaries is customary in banking. As collateral documents are sales contracts on items purchased and proof of income of the borrower in question. Most of the time, the loan is made available for a specific purpose. It is usually repaid as an installment loan or as a bullet ; the annuity loan is less common .

Switzerland

In Switzerland, consumer loans are subject to the Consumer Credit Act (KKG) of January 1, 2003. There they are often referred to as personal loans . Consumer loans do not include mortgage liens (Section 7a KKG) or otherwise secured loans (Section 7b KKG), so that consumer loans in Switzerland are typical unsecured loans. In addition, only loans of up to 80 thousand Swiss francs (Section 7e KKG) or which are repaid within 3 months or are repaid in a maximum of 4 installments in a year (Section 7f KKG) are considered consumer loans .

Anglo-Saxon language area

Here consumer loans are called literally translated English consumer credits , they are usually associated with the use of credit cards or debit cards , in car finance taken or retail financing to complete.

See also

Individual evidence

  1. ^ Günter Petermann, Market Position and Market Behavior of the Consumer , 1963, p. 22
  2. ↑ Volker Häfner, Gabler Volkswirtschafts-Lexikon , 1983, p. 328
  3. ↑ Udo Reifner / Michael Knobloch / Kai-Oliver Knops, residual debt insurance and liquidity assurance , 2010, p. 149
  4. ↑ Max Lüscher-Marty, Theory and Practice of Bank Loans, Volume 1, 2009, KAp. 10.03