Best Loans in Austria

Loans in Austria, All You Need To Know:

Take a quick read to learn how to get the best credit in Austria in minutes and all you need to know before signing up for an offer. We’re passionate about making the loan selection and application process easy by feeding you with all the information you need.

Quick Summary:

• Mini-credits in Austria are often small amounts
• They are repaid after a short time
• Many entities in Austria give the first loan without any fees
• Mini-credits are taken in the face of an emergency
• Long term credits are taken when in need of big amounts of money
• The repayment period is long
• Lower interest rates than mini-credits
• Slower application process

What are loans and how do they work?

A loan is a specified amount of money or resource that’s given to an applicant for different purposes such as personal, business, family, or purchase of commodities. Loans are either secured – backed by collateral – or unsecured – not backed by collateral. Secured loans attract lower interest rates and better deals including big amounts and longer repayment terms. Unsecured loans are often small in size, have high interest rates, and are short-termed. 

A loan can be a good debt only when it’s used to help you make good financial progress. It’s never meant to make you run into debts.

What you should know before getting a loan from Austrian Banks

• Every type of loan in Austria is regulated by directives.
• The administration of AllCredits will not be held responsible for any bad consequences of getting a loan from entities
• Be sure to know the terms of the contract before signing up for a loan
• Conduct personal research about the credit company, its history, and reputation before getting a loan from there
• Every type of credit entity is required to have a license from the government allowing them to carry out lending services
• While the interest rates in Austria vary with the entity and the type of loan, Austrian banks provide loans at generally lower rates than in other countries, falling between 2.99% and 14.99% p.a.
• The Austrian financial system has been ranked among the best in Europe over the years
• Take a loan only when you should and use it responsibly

When is it advisable to apply for loans in Austria?

Getting a loan in Austria is advisable when faced with an emergency that needs financial intervention. That’s where mini-credits come in. On the other hand, you can apply for long-term loans in Austria, when you need to make a big purchase, consolidate loans, advance your studies, and the like.

These are the three circumstances that should lead you to take out a loan:

1. To consolidate debts. This mostly happens when you get a low-interest loan to consolidate a high-interest loan
2. When you get a good deal that allows you to make good money and can make repayments easily and comfortably
3. When faced with an unexpected financial emergency

When should I not take out a loan?

• If you’re unable to repay within the agreed period
• If the purpose for which you’re taking the loan can wait for your monthly salary or other sources
• If you don’t know the details of the loan contract
• If you’re taking out the loan for something that will not give you good returns

Loans are good financial sources when the purpose is right and when applied after making a good financial plan. 

What types of loans are best offered in Austria?

Austria has hundreds of banks most of which focus on:

• Retail banking
• Real estate financing
• Cooperative retail banking

In that case, there are many types of loans available in banks all across the country including mortgage loans, personal loans, online loans, quick loans, payday loans, student loans, business loans, among others. With Austria’s cutting edge advancement in financial systems and soundness of banks, the rates of interest are lower than in other countries, making it one of the best countries to get a loan from.

Are Austrian loans available to foreigners?

Yes, foreigners from Europe and beyond can get loans from Austrian banks as long as they work under the provided guidelines and processes to get the loans. A foreigner might not qualify for every loan because some banks tighten the rope for foreign banking.

What types of loans are available to foreigners? 

According to the Austrian National Bank (OeNB), the European Central Bank (ECB), and the Financial Market Authority (FMA), foreigners have a right to access banking services, including the types of loans. However, a bank also has the prerogative whether to provide the loans to such clients or not. 

Therefore, the types of loans available vary with the bank but may generally be limited because of the processes needed to follow.

Requirements to access loans in Austria

Requirements to get funded depend on the type of loan you’re looking for. If you’re in need of a fast mini-credit, the process is going to be fast with a few hurdles to jump. On the other hand, a long-term loan will mostly involve large amounts of money, hence, the processing of the loan is going to take a long time. The conditions might also be a little bit stringent.

Below are some of the most common requirements to get funded in Austria:

1. You are of legal age. Some entities will not fund you at 18 years but 21 and above. This is mainly because many 18-year-olds are still considered minors.
2. Your level of creditworthiness: Entities in Austria, just like other countries in the world, will only be confident to fund you if you are not listed on Austrian credit bureaus like SCHUFA or KSV.
3. Residence: You’ll be required to be an Austrian resident to get financed
4. Some lenders will require that you hold a bank account with one of the licensed banks within the country
5. Income: You’ll also need to show proof of regular income before getting a bank loan

Documentation required when taking out a loan in Austria

While documentation also varies with the uniqueness of your situation and the lender, below are some of the documents you’ll need to submit.

• Have a valid form of identity
• Documents showing the last two or three paychecks or income you received
• Bank statements showing the needed information

Many entities are reducing paperwork and opt to have their clients do an online application of loans because the process is fast and hassle-free.

How to take out a loan online step by step

1. Select the loan amount and amount of the monthly installment
2. Fill out the blank fields with your personal information. The loan will be designed according to the information you provide
3. Upload the documentation required before sending them
4. Sign the contract after reading through the contractual terms and agreeing with them
5. Receive the funds in your bank account

Why was my loan application not approved?

Most at times, the bank will not let you know why they refused your loan application. Therefore, the following are some of the reasons why your loan was refused by an Austrian bank:

• Your income was lower than what the entity required to grant the loan
• You are a young long term employee, mostly for less than a year
• Poor creditworthiness history

Wrapping Up

A loan is meant to be good debt and should be used responsibly. Take out a loan only when you truly need it, can comfortably repay it, and can’t find any other source to avoid over-indebtedness.

Always be informed about the loan contract to avoid surprise payments to make in the future. The Austrian National Bank (OeNB), the European Central Bank (ECB), and the Financial Market Authority (FMA) regulate banking in Austria.

About this page, our methodology

About this page: we are passionate about helping you get the best financing that best addresses your needs. We, therefore, marshal the best available information about consumer credits and how to compare the options to end up with the most attractive offer right now.

Source: the information regarding the main characteristics of loans in Austria and their current regulation comes from the World Bank statistics, among other reference portals.

Methodology: The data relating to the conditions of these products (amount, term, interest, etc.) have been obtained through online research and consultation of the official statistics of the aforementioned reference sources.

About Us: FUNDGECKO is an online comparator website specialized in personal finance and home economics products. We help our users to not only compare the available financial products in the market but also provide rich information that will shorten the decision-making process and help them end up with the best offer.

Note: the services we offer are totally free for the user, as FUNDGECKO obtains its income from advertising and its featured products.