A Swiss loan is basically an alternative to a conventional loan from a German bank – but it does not necessarily have to be a cheap alternative, and this option of borrowing is not necessarily possible for all applicants, firstly and secondly, it is actually a good idea.
There are basically two different types of Swiss loans: the Credit Bureau-free loan that is offered on the German market and the Swiss loan that is taken out in Switzerland.
Credit Bureau-free Swiss loan
The Swiss loan is now one of the options for external financing that is very popular, and of course, this is mainly due to the fact that no Credit Bureau information is obtained in the course of the application and the creditworthiness check, which sometimes makes the Swiss loan accessible to people that are usually left out of credit.
However, despite or precisely because the Credit Bureau information is no longer available to check the creditworthiness, there are very precise requirements that the applicant must meet so that a loan approval can be given: this includes a maximum age of 55 or 57 years (West and East Germany), a permanent job as an employee or civil servant and a place of residence in Germany, and no debts may exist in Switzerland. This means that a person can only take out a maximum of one Swiss loan, but married couples, for example, two loans (one per spouse).
The loan amounts of Swiss loans are not particularly high and generally hardly exceed the limit of 3,500 dollars – Swiss loans are therefore rarely suitable for financing a car and, due to their limited nature, not for real estate financing, but can only be used as a top-up for ongoing real estate financing or car financing or simply viewed as a small personal loan.
Take out loans in Switzerland
The differences between a Swiss loan and a loan that you actually take out in Switzerland, i.e. directly from a Swiss bank and not through a German credit agency, could not be greater. While Swiss loans, which are known to be offered without Credit Bureau information, have very specific requirements, this does not generally apply to loans from Switzerland – for example, it is also possible for self-employed people to obtain Swiss funding.
The fundamental question is why a loan from Switzerland could make sense – the slightly lower interest rate level compared to German loans, of course, seems tempting at first. However, this advantage could be completely reversed by the existing currency risk and the constant fluctuations in exchange rates, so that borrowing in Switzerland is ultimately a loss-making transaction.
As a rule, loans in Swiss francs are not taken out for financing reasons, but rather to speculate on the exchange rate fluctuations of the currencies euro, Swiss francs, and US dollars – a form of investment that should be left to very experienced and solvent investors for reasons of reason.