Private Borrowing Money with Negative BCR Registration

Small loan

Small loan

When you borrow an amount up to and including 1500 USD, we call this a small loan. You can take out a so-called mini loan or flash credit for this. There are two providers there in the Netherlands: Bankate (the global market leader in this market) and Eicredit. Both fall under AFM supervision and therefore adhere to the law. They also have identical conditions. All other providers were banned a few years ago by new regulations.

The reason that the AFM has looked strictly at this product and the providers is because these loans are given outside the BCR. This is due to the limited amount of money that you borrow, which means that the risk for the parties is automatically lower than, for example, a loan of tens of thousands of USD. Therefore they do not perform a BCR check.

You hardly even have to fill in any paperwork: only your ID proof is sufficient, furthermore no documents such as payslip or proof of income are required. So you can already apply within a few minutes. And after approval, it will often be in your bank account within 24 hours. In the event of an emergency, a good solution is therefore also possible.

The only thing you need is a guarantor. One that you find yourself is the simplest, but if that fails then they can also arrange one for you. Note that this costs money. It is therefore preferable to ask someone in your immediate area to guarantee you, such as your parent, brother, sister or close friend / acquaintance.

The term of these loans is short: one to two months. This means that you have to pay back relatively quickly. That is why you should see this form of loans primarily as a bridge. For example, until your next vacation allowance comes, but you already need a new laptop… something like that. If you only know that you can pay you back by the time the term expires.

The advantage of a short term is that you actually pay less interest than with a longer term. You pay interest per time unit (month / year). So in absolute terms you pay less interest, despite the fact that the interest rate / annual cost percentage (APR) is higher than a “regular loan” with a duration of several years.

Calculation example Bankate: You take out a loan of 400 USD. The duration is then 30 days, after which you have to pay back including interest. The interest due then amounts to 4.32 USD. Together you pay this off in one go.

P2P borrowing

P2P borrowing

You can also borrow money without having to do so through an official financial institution. So outside banks and lenders. This is possible with a private loan from a known person, or you can borrow from other (unknown) individuals via so – called peer-to-peer platforms (P2P).

Examples are Fast Invest and Mintos. Note that these are foreign internet companies, but that they will still send you a collection if you do not pay. These platforms bring supply and demand together: some people do want to invest in consumer credit because this provides a good return. On the other hand, you can apply for a loan here without a bank. The platforms facilitate and check the creditworthiness of applicants.

Personal loan or revolving credit

Personal loan or revolving credit

If you don’t come out with a mini loan / flash credit, so you need more than € 1,500, then there are basically two types of loans in the Netherlands that you can take out: a personal loan or a revolving credit. Click on the links to read more about the properties of these products, the advantages and disadvantages.

However, you cannot just request this if you are registered with the BCR. You will see that the providers always do a check on this because it often concerns fairly large amounts. However, it doesn’t hurt to request multiple quotes, because providers all look differently at the precise BCR statement. Further on you read why. Below you see the lowest interest rates for these loans in real time to request a quote.

These two credits each match a different situation. We are not going to advise you on this, you must go to a recognized financial advisor. They can also check deeper whether you can apply for it with your BCR registration.

Free professional advice

Free professional advice

Not all registrations at the BCR are the same or count the same. With some negative registrations you can even borrow. Such as a recovered report or a mortgage repayment by the NHG. Kredietspotter is a Dutch specialist in loans. They can not only spot the best loans (and interest rates) for you, but they can also assess how your BCR is doing. And requesting a quote is free !

Types of BCR registrations

Types of BCR registrations

Every form of borrowing from 250 USD is recorded in the file of the Credit Registration Office (BCR). This also includes payment arrears at your bank (marked in red) or credit card company. Not all of these recordings count equally heavily and registration is not necessarily negative. As long as you do properly meet the repayments of a current loan, it will remain with a positive registration.

However, as soon as you incur a payment delay, it will be converted into a negative statement. Actually a kind of big red flag for lenders, because that indicates that you have not paid in advance and therefore are less creditworthy.

By the way, this only applies to loans that were ever introduced as a positive registration. So if you pay too late for your rent or subscriptions, they will not be visible. Payment arrears to the Tax Authorities or to your study debt are also not included.

When you have resolved the payment arrears and are again on track with your repayments and the loan is being repaid, the negative registration will be converted into a “recovery report”. This will remain visible for 5 years and that is how long companies can continue to see that you have been late in paying.

BCR check versus BCR review

BCR check versus BCR review

Companies check the BCR to see if you are worthy to apply for a loan from them. The simplest thing they can do is see if your name is in it. They can also see what loans you have and at what amount.

This may be enough reason for some to refuse you. They can also look at the type of report, so as previously indicated whether it is a positive, negative or recovered report.

However, the BCR can also provide a ‘score’ for the companies. This is based on your borrowing and payment behavior. This is compared within your age group against (compare with) the other people with a registration. This indicates a risk factor (forecast) on future payment arrears.

Companies were allowed to decide for themselves how they handle the various registrations and scores. That is not regulated by law. One provider will therefore be slightly more flexible than the other. That is why it is smart to always request multiple quotes from multiple parties.

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