Obtaining credit without down payment is not very complicated for a consumer loan. Getting a home loan without down payment can be more complicated. Whatever the project and the situation, our credit comparison adapts to all situations to offer a classification of the best rates and an evaluation of the chances of being accepted.
However, be aware that borrowing without contribution affects the amount borrowed and potentially over time. Credit without contribution can therefore be more expensive in the end.
Consumer credit without contribution
Unallocated credits such as personal loan or revolving credit do not oblige to justify the use of the loaned money, therefore the contribution is not taken into consideration for obtaining the credit. This is the principle for this type of consumer credit. A credit without contribution in this case therefore has no influence on the acceptance rate.
The contribution that one can invest is really important to save on the cost of credit because the more the contribution is important and the less one needs to borrow. Thus, it is possible to reduce the duration AND to benefit from a lower rate. In fact, to lower the cost of a loan, you can lower the rate, but also lower the duration can save even more.
To choose to make a loan without contribution or not, it also depends on the interest rate of his savings. But since pay rates are low right now and credit rates are low too, now may be a good time to unlock some. A credit without contribution is therefore dependent on his need for money but also on the rate that can be offered depending on the amount and duration chosen.
With our exclusive questionnaire, we offer a ranking of the best loan rates without any contribution whatever the project, for all amounts and all durations. We note all the rates charged by the largest financial organizations and provide a custom ranking.
But that’s not all. Our system offers an assessment of the credit file without contribution. Indeed, some organizations charge very low rates but only select the best files. So that everyone can know at what rate their file could be accepted, we give a response in principle in real time. So if the request for credit without contribution is not accepted at the cheapest rate, it is possible to query the organizations classified 2nd and 3rd with a simple click.
Example of credit without contribution
Here is the example we have chosen to explain more simply the interest of a loan without contribution:
- Amount of the car to finance: 10,000 $
- Possible contribution $ 3,000
Organization X offers a fixed taeg rate of 5.9% for an amount less than $ 8,000 and 3.9% for an amount greater than or equal to $ 8,000.
In this example, it would be in your best interest to borrow a loan of 8,000 USD to take advantage of the best rate and to bring in only 2,000 USD of contribution.
For a consumer loan, the contribution is not decisive. It is simply a possible way to get cheaper rates or shorten the term. In this way, you can get a loan that costs a little less than a down payment.
Different forms of credit without contribution
Personal loan without contribution
It is the most generalized form of unpaid credit. To finance any type of project without having to justify the use of the money made available, it is easy to obtain credit. Whether in the form of revolving or redeemable credit, it is mainly offered by large credit organizations.
Auto loan without contribution
As we will detail below for the purchase of a car without contribution, car credit is a very good option. But to obtain a rental with option to buy, LOA without contribution, it can be much more complicated.
Works loan without contribution
It really depends on who offers this credit. Indeed, to obtain a credit without contribution for work with organizations like Bankate or Xaloan or even a bank, there is no problem. To get a work loan without contribution when it is the craftsman or the company who does the work, it is something else. In fact, he often uses the contribution as the first payment when signing the quote.
Mortgage without contribution
It is undoubtedly in this loan category that the contribution is most important. Indeed, obtaining a loan without contribution to finance the purchase of real estate can be a real challenge, especially for young people. We will detail it later. Also for young people, the zero rate loan known as PTZ, does not constitute a contribution.
Compare a loan without contribution
In consumer credit, as in mortgage, it is essential to compare. In the credit without contribution, we have just seen the interest of trying to determine the amount to borrow. For the same credit, the rates can change completely.
Take the example of a loan without contribution to finance a car over 60 months through a 10,000 USD loan :
Least expensive rate: 3.90% monthly payment: 183.41 USD cost of credit: 1,004.60 USD
Most expensive rate: 7.89% monthly payment: 200.94 USD cost of credit: 2,056.40 USD
It is not complicated, for the same credit without contribution, you can pay more than double for exactly the same thing !!! Everyone would be shocked to pay the same car twice as much from one garage to another. So why not for the credit ??? And do not believe that the most expensive credit without contribution is offered by a small unknown organization. It’s quite the opposite !
Not all contributions are created equal
There are credits that don’t say their name. This is the case with rental, whether it takes the form of a rental with option to purchase, known as LOA, or long-term rental, known as LLD. You should know that this type of financing costs more than the traditional car loan.
What is even more annoying is that the rental is not subject to the law on consumer credit. This is also why we never see rates on rental ads. It is unfortunate but the builders are very happy like that… Hopefully it will change one day because a rental without contribution or with contribution, it can cost on average between 1000 USD and 2000 USD more expensive than a credit without contribution or with contribution, as we demonstrated in our exclusive auto credit comparison against LOA and LLD.
What is even more annoying is that there is practically no rental without contribution. But things are not expressed as clearly. Indeed, the goal of a rental is to be able to show the lowest possible monthly payment to claim access to a car for very little money per month. Even if we have shown that a car at 100 USD per month is possible, it is certainly not with a rental without contribution that it is possible if we do not want it to cost too much.
So to be able to advertise very low monthly payments as part of a rental, dealers have the right to provide a first increased rent on the one hand and to offer an offer subject to takeover condition on the other hand. And there, we no longer even speak of rental without contribution. The contribution will be huge, you will accumulate a first rent of 5000 USD for example plus the recovery of your old vehicle, let’s also admit for 5000 USD. The whole makes a contribution of 10,000 USD !! Under these conditions, it is easy to announce small monthly payments, but in the end, the equivalent rate is undoubtedly much more expensive than a loan without contribution.
A mortgage without contribution
For a mortgage, the contribution is of great importance both for obtaining and for the credit conditions.
Banks or credit organizations prefer contributed credits because they have a higher risk when there is none. However, there are other methods to guard against risk. For example, banks regularly ask guarantors if the borrower is too young or does not provide enough collateral.
Still on the risk, a contribution will help lower the amount borrowed and therefore the monthly payment. It is therefore a good method to lower the debt ratio. However, banks have fairly sharp limits on the debt ratio. Loan without contribution can generate an unacceptable debt ratio for the bank.
The last point concerns any promotions. Indeed, in some cases, to obtain a promo rate, you must be able to give at least X% of the good contributed.