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The reasons for a loan can be many in essence you need money and soon. A personal loan can be a great help for someone in a difficult financial situation. But what if you are living abroad, in Austria? Is it even possible to get a loan? Foreign nationals including EU and non-EU foreign employees, expats can get a loan in Austria. The requirements are to have a main residence in Austria and a source of income. Banks will prove the creditworthiness of the applicant. Are you living in Austria and thinking about taking out a loan. You might have different reasons for doing so, whether it's an unexpected event, the big purchase of financing of the studies - a loan can be a solution. Read in this article all about loans for foreigners in Austria and how to get one. But, firstly, we recommend checking a comparison website for a loan in Austria, to see what options are available. Can a Foreigner Get a Loan in Austria? Foreign nationals, including non-EU and EU expats can get a loan in Austria. As a foreigner, you are able to apply for a loan for personal use, for business use, to buy a home, and to pay for college. Moreover, mortgages are available for foreigners too. Banks don’t have a right to choose applicants based on nationality or to discriminate, yet they might offer different conditions to different people based on their residency and citizenship. Nevertheless, banks in Austria are free to accept or not your loan application. Before offering you a loan, the lender will assess your creditworthiness. Based on the results they would either give you a loan or not. In any case, when applying for a loan, you will be requested to disclose the income. That way bank will know if you are capable to repay the loan at all. Furthermore, banks might be now willing to give a loan to someone who has only been in Austria for a short period of time, for example, a year or less. Your country of origin, residence status in Austria, job, and income will influence how banks assess your application. Therefore, understanding your creditworthiness is crucial when applying for a loan. The longer your credit history, the more information the lender has to determine whether you’re a responsible borrower. It's always a good idea to work on establishing a good credit history in the country you leave. Most likely you will want to apply for the mortgage one day too and there your credit score plays an even more important role. EU citizens At most credit institutions in Austria, EU citizens only need to have a residence in Austria to get a loan. Hence, residency is a condition of approving a loan or mortgage. Nonetheless, credit history is country-specific, a credit score gained in one European country can't be applied in another. Therefore, EU citizens also need good creditworthiness in Austria to get a loan. To build up your credit score in Austria, you can open a local bank account, get debit and credit cards, and make sure you pay your bills on time. Non-EU citizens The situation is different for non-EU nationals. Here, you must be able to present a residence permit and a work permit when applying for a loan in Austria. The period of validity of the residence permit or work permit also plays a role. Having a stable income is by far the most crucial factor for non-EU citizens when getting a loan in Germany. Likewise to Austrian nationals, foreigners must prove their income with wage slips or tax notices. In general, the higher your salary and the longer the employment agreement, the higher your chances of getting a loan and getting a better interest rate. Foreign citizens can also use the help of a guarantor. It can be their relatives or acquaintances for example. The guarantor should have a decent salary and no debts. He or she will pay your loan installments in case you no longer can cover it on your own. EU citizens and PR holders have higher success rates in getting a loan or mortgage in Austria. How to improve creditworthiness and credit score? You can work towards a good credit score so in the future banks will give you a loan or a mortgage. Firstly open a bank account in Austria, get debit and credit cards, and pay all your bills on time. Small loans and purchases with installments that are paid on time will strengthen your creditworthiness. Read more about credit cards in Austria in the dedicated article. The process of getting a loan in Austria To get a loan in Austria you firstly need to find it. Use online loan calculator like Durchblicker to find the best option. Generally, for a loan, you will need to have a valid ID and address in Austria. Secondly, a loan applicant must already have a bank account in the country. Generally, foreign nationals can get a loan in Austria if they fall under the following criteria: Have a residency in AustriaHave a current account with an Austrian bank Have a regular income Your residence status has a large impact on how much you can borrow and for how long. The loan approval and conditions will also depend on your employment and income. Overall, getting a loan as a foreigner is more difficult as it will be for an Austrian citizen. EU citizens have better chances than non-EU nationals. Banks simply don't want to take a high risk. Requirements for the loan Standard requirements of traditional banks when applying for a loan in Austria are: You are older than 18 yearsYou are taking a loan for yourselfYou have a residence in AustriaYou have a bank account based in AustriaYou have a positive credit scoreYou have a regular income Application for the loan Most of the banks in Austria will allow you to apply for a loan online, but you can also do it traditionally, in the office. Here is an example of the loan application with Raiffensenbank. Steps to follow: Select the desired loan amount and monthly installmentEnter your personal dataYour loan offer will be created based on the provided informationSign the loan contractThe loan will be transferred to your bank account Documents for the loan To obtain a loan in Austria, you will need to submit the following documents to the bank: passport or IDproof of salary (for employees) or proof of company income (for business owners)savings account statements Reasons for the loan refusal It's not a rare case when an application for a loan gets declined by the bank in Austria. The refusal criteria are usually kept confidential, but the typical reasons are: low incomefixed-term job positionpermanent job for shorter than 1 year (usually)other debts, especially in not well established financial institutions previous loan refusals Increase your chances of getting a loan To increase your chances of getting a loan in Austria as a foreigner, be sure to only inquire for loans with a repayment period that lies fully within the duration of your residence permit. If you are looking at getting a mortgage, your best chance is to wait until you hold a settlement permit (PR). Apply for a loan that has the maximum duration of your residence permit in Austria.Establish a good creditworthiness history.Provide income and financial proof - you can support yourself and are able to pay back the money.Try to apply for a smaller amount at online banks - they have fewer requirements and easier processes of granting a loan. Moreover, getting a loan can be more difficult for young graduates with limited-time employment contracts and for self-employed consultants or business owners. Personal Loans in Austria Personal loans can be used for different reasons. Banks will usually ask about the purpose of the loan. Some common ones are: Purchase of vehicles, e.g., cars, boats, etc.Travel and vacationWeddingFurnishingsConsumer electronics and home appliancesHealth and beautyEducation and trainingDebt coverage Keep in mind that a personal loan or consumer credit has a higher interest rate and shorter payback time, than a mortgage. The monthly installment for the loan should be a maximum of 40% of the family's income. As an alternative to taking a loan, you can apply for a credit card in Austria. The process is easier than getting a loan. Student Loans in Austria Every year, thousands of students come to study to Austria. Many of them struggle to finance their studies and living expenses. Hence, the question about student loans arises. In Austria, different banks offer different loans. Student loans are paid monthly and have a lower interest rate than conventional loans. Unfortunately, traditional student loans in Austria aren't available for non-EU st citizens. EU students should contact loan associations. Education loans are generally more favorable than normal consumer loans, also have certain conditions. You usually only have to pay small monthly installments during the studies. The monthly rate will increase after you complete the university. Educational loans are granted regardless of the income and assets of the student. Interest rates are also very low. In these banks you can apply for a student loan in Austria: Wüstenrot BausparkassesBausparkasseRaiffeisen Bausparkasse Nonetheless, as a non-EU citizen, you can try your chances by applying for a student loan on the loan comparison and calculator tool such as Durchblicker. It's the biggest one in Austria. Compare mortgages and loans in Austria It's advisable to compare offers from different lenders before making a decision on a loan. Pay attention to these details when applying for a loan: The loan amountThe duration of the loanInterest rateTotal amount to be reimbursedAny costs to be paid, regularly or on a one-off basisThe number, frequency, and size of the installmentsConditions for early repayment and charges You can compare all existing loans and mortgages in Austria on the comparison platform and calculator at the same time - Durchblicker. It's the biggest website as such and help people to find loans, insurances, and even internet deals for more than 10 years. On Durchblicker you can: findselectapply and receive a loan in Austria Durchblicker gives you an overview of loans from over 60 banks, many of them well-known in Austria. more than 20 leading credit banks, online lenders, and peer-to-peer lenders. For any help, you can reach out to one of 200 loan advisors. On their website, you can find a favorable loan with the best conditions and ultimately save money. Every month around 350,000 comparisons are made on the Durchblicker. There you can compare different types of loans including: The housing loan calculator - for buying, building, or renovating the houseThe car loan calculator - to buy a new or used carThe consumer loan calculator - find an affordable way to finance furniture, a computer, a fancy vacation, or something else You can read over 1,400 positive reviews on Trustpilot, where Durchblicker receives a 4,8 rate. Benefits of personal loan with Durchblicker: Zero additional or hidden costsFast processing timeThe amount of the loan ranges depending on the purpose. You can apply for 1,000 EUR and up to 1,000,000 EUR.Interest rates for mortgages start with 0,25% and personal loans with 2,99%. Banks you can choose loans from Erste, BAWAG, Bank Austria, Volksbank, Sparkasse, Hypo, and others. How does it work? Firstly compare loans - select the loan amount, adjust the term and start the comparison. Get loan offers - enter the key personal data about yourself and your financing requirements. After that, the individual loan offers will be calculated. Apply for the loan - simply select the best offer to apply for the loan right on the platform. Durchblicker is Austria's largest loan comparison website, which is offering quick, easy, and affordable loans since 2011. Interest Rate in Austria The rates for a loan can vary between 2,99% to 14,99% for personal loan and from 0,25% to 6% for mortgages. Interest rates for loans and mortgages in Austria are one of the lowest in Europe. Moreover, interest rates keep decreasing over the years as the Austrian economy gets stronger and stronger. Loan interest rates are based on the contractually fixed which are agreed between banks. These rates have a major impact on the amount you pay every month in your installments. This, therefore, affects how much you have to pay back to the bank each month for borrowed money. The amount of the loan interest depends on various factors. Factors that influence an interest rate: Type of interest (variable or fixed)Amount of the loanTermOther interest rates The amount depends on whether it's a mortgage or a consumer loan. In the case of a consumer loan, the reason for taking a loan also plays a role. The exact interest rate for the loan can be only estimated in the particular case, you can make a calculation here. Best Banks for Loans in Austria Raiffeisen Bank Austria Raiffeisen Bank is headquartered in Vienna and is the biggest and well-known bank in Austria. It has 1,948 offices in Austria. hence, there is for sure at least one department in your town. Raiffeisen bank provides different types of loans, where a bonus loan is one of the easiest to get. Advantages of a Raiffeisen Bonus Loan: Loan up to 30,000 EURPayout within 48 hoursCalculate online and receive an immediate decisionFixed interest rate over the entire term - up to 10 yearsYou don't need to provide any security deposits Requirements for a Bonus Loan: Minimum age of 18 yearsMain residence in Austria for at least 6 monthsProof of income for the last 3 monthsMinimum income 1,100 EURPassport, ID, or driver's license UniCredit Bank Austria Bank Austria is part of UniCredit. It’s the second largest bank in Austria. The bank has around 300 branches in the country. WunschKredit or Wishcredit with Bank Austria: Loans from 3,000 EUR to 50,000 EURTerm: 1 - 7 yearsEffective annual interest rate from 3.10 % p.a.Debit interest from 3.00 % p.a. Early repayment possible Requirements for a loan at Bank Austria: EU citizenshipMinimum age of 18 yearsMain residence in AustriaSalary or pensionGood credit scorePassport or ID Erste Bank The last large and well-established bank in Austria is Erste Bank. Erste Bank, also known as Sparkasse, is one of the biggest banks in Austria and in the whole of Europe. It was founded in 1819 as the first Austrian savings bank, hence the oldest bank in the country. You will find branches of Erste Bank in all Austrian cities, small and big. Click-Credit with Erste Bank: Loans from 3,000 EUR to 50,000 EURFlexible term up to 10 yearsEffective annual interest rate 5.7% p.a.Purpose of the loan isn't requiredPayment within 24 hoursEarly repayment is possible and is free of charge Requirements for Click-Credit: Minimum age 18 yearsMain residence in AustriaSalary or pensionProof of income for the last 3 monthsPassport, ID, or driver's licenseWebcam, smartphone, or internet banking You can open a free bank account with Erste Bank. I am a client of them for 3 years and can only recommend it. Alternative To the Loan: Get a Credit Card Once you have moved to Austria, it may be worth getting a credit card to help build up your credit history. Some banks will accept your application with little or no credit history. It's important to stick to the credit limit and always pay at least the minimum payment every month so you don't harm your credit score. 1. DKB - Cash Visa Card By opening a free banking account with DKB, you will get a free VISA credit card with up to a 100,000 EUR disposable balance. All DKB cards include free cash withdrawals worldwide. Highlights of DKB - Cash Visa Card: Free Austrian bank account and debit cardFree Visa credit cardWorldwide free cash withdrawal with Visa card at ATMsEnjoy maximal credit limit is 15,000 EURCash limit is 1,000 EURInterest rate is 6,90%Online bankingOpen account online Free emergency card and emergency cashUp to 20% online cash-backInternational student card (ISIC) for worldwide discounts You can also open a free bank account with DBK, where you can enjoy free cash withdrawal from any Visa ATM, even abroad. DKB also provides a free VISA credit card with free cash withdrawals worldwide. 2. Free MasterCard Credit Card As the name of the card says for itself - this credit card is free! The Free Mastercard Gold is the perfect credit card for Austria. It cost you nothing and at the same time comes with very useful features. Highlights of Free Mastercard Gold Card: Mastercard credit card25 EUR as starting creditNo monthly or annual fees No fees for payments in foreign currency - worldwide free paymentsFree cash withdrawals worldwideEasy application process (no PostIdent required)Travel insurances includedFree credit for up to 7 weeks (no interest rate applies)Flexible repayment possible 3. Erste Bank (Sparkasse) Credit Card Customers can choose between several credit cards while having a bank account at Erste Bank (Sparkasse). Highlights of Erste Bank Credit Cards: Wide range of Visa or Mastercard cardsDebit plus credit cardFree credit card in the first yearMonthly fee for the bank account is just 2 EURFree cash withdraws with debit cardOpen a checking account online in 10 minChoose between Mastercard or Visa Read more about credit cards in Austria in the dedicated article. https://russianvagabond.com/best-credit-cards-in-austria/