The question "How high should a loan be?"
Cannot be answered clearly. Because there are some criteria that will help you to estimate and apply for the right loan amount.
What is most important for the correct decision about the loan amount is the purpose. This means that if you want to finance a new car with the loan, you then intend to enter the approximate price of the car as the desired loan amount. If a renovation of the apartment is planned, determine the loan amount based on your experience or ideas.
The problem is that you are often annoyed about the wrongly selected loan amount because you have equated the current loan requirement with the loan amount. Thank God if the loan amount received was sufficient to buy the car, but what to do if the new spare parts for the car are used two weeks later or other household technology breaks down? Then the 15,000 USD in loan money will not cover the newly incurred costs, because the amount requested was that they leave no room for maneuver.
Banks are negative about another short-term loan
Did you pay off a loan and apply for a new one immediately afterwards? The banks can assess the renewed request as negative - it signals that you are probably not in control of your financial situation and are unable to plan for the long term. Among other things, this can have a negative impact on the creditworthiness of the borrower, which can worsen credit opportunities in the future.
Theoretically, your current loan can be increased, but there are in fact several problems and difficulties. Applying for a new loan shortly after borrowing is not exactly the best idea and a negative sign for the banks, which mostly only want to work with reliable and trustworthy customers. That is why the increase is most likely rejected.
Tip from us: estimate your financial needs cleverly - ask for a slightly higher loan amount, create a "buffer" for unexpected additional costs.
- If the requirements for a loan are met, it does not matter to a bank whether you apply for 15,000 or 17,000 USD.
- With the reserve you save yourself from incorrectly calculated costs, which in some cases, such as renovation or house building, will almost certainly be incurred. It is better to be financially flexible than to save a smaller sum with slightly cheaper interest.
If part of the money is not to be used after all, there is usually nothing standing in the way of a free repayment.
Conclusion: the decision on the amount of the loan must be well balanced, because there are often unplanned additional costs. Do not calculate the loan amount too tightly and always apply for a slightly higher amount. This means you leave a reserve and do not have to apply for a loan again shortly after borrowing.