Increasing a loan is usually possible without any problems. The financial institutions usually check their new request according to the same criteria as for the existing credit.
Renewed creditworthiness check if the loan amount is increased
Since a new loan is concluded with a new agreement on the loan amount, you must expect a renewed credit check. An increase should therefore be considered carefully in advance if your financial circumstances have changed negatively since you last took out a loan. For example, if you have fallen into arrears with an instalment payment, this may have been noted in the ZEK.
In this case, the conditions for the new loan are worse or the bank even refuses to increase it.
Two loans with two banks in parallel also possible
If it turns out after checking the conditions that the redemption of the loan would be more expensive, but another bank offers more favorable conditions for the new loan amount, it makes sense to simply conclude a second loan. Of course, this also depends on the volume. Banks do not like to see a second loan, so they offer to take it over on their own. However, this is not mandatory, but all results from the cost calculation.
In terms of procedure, it is easier to increase an existing loan with the old bank than to take out a second loan. We can quickly calculate which option is the cheaper one. Of course, it can also be useful to present the current bank with the cheaper offer of a competitor in order to negotiate a more favourable interest rate for the increase in this way.
Before increasing, check whether your current financial situation allows you to increase your rates at all.
Conclusion
Banks are generally open to an increase in the loan if the income is sufficient for the higher rate. If interest rates are significantly lower, paying off the loan can bring noticeable financial relief. If a debt restructuring is out of the question, a second loan is conceivable.
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