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SCHUFA - well known and feared. It is not uncommon for SCHUFA to thwart some people's plans. A bad SCHUFA score means that a loan is not granted by the bank, online purchases are only possible on account and even mobile phone contracts are rejected due to poor creditworthiness. We will inform you about the topic of SCHUFA so that you can avoid negative SCHUFA entries and improve your SCHUFA score over the long term.
What is SCHUFA?
SCHUFA is a German business credit agency under private law in the form of a stock corporation. It collects information about consumers and obtains its data from other credit agencies. SCHUFA informs its contractual partners with their stored information about the creditworthiness and creditworthiness of third parties. Said contractual partners can be divided into three categories:
A contractual partners : credit institutions, banks, credit card companies and leasing companies. These partners only receive positive and negative characteristics about a person from SCHUFA.
- B-contractual partner: companies that offer deliveries and services against credit.
The companies only receive negative features from SCHUFA via a consumer.
- F contract partner: debt collection agency
Collection companies are only provided with the address details of the consumers.
How is the SCHUFA score composed?
It is not known exactly how the SCHUFA score is composed. SCHUFA uses the payment behavior to calculate how likely a person will meet their obligations. SCHUFA's contractual partners can use this score to evaluate whether they want to be contractually bound to a person. This is shown on a scale from 1 percent to 100 percent. The higher the value of the SCHUFA score, the better the creditworthiness and creditworthiness of the person.
Which data are interesting for SCHUFA?
SCHUFA stores the following data:
- Date and place of birth, if applicable
- any other addresses, including earlier addresses
- the personal SCHUFA base score
SCHUFA receives information about the following from its contractual partners:
- Bank accounts
- Credit cards
- Leasing contracts
- Telecommunications accounts
- Mail order accounts
- Installment payment transactions
- Loans and guarantees
SCHUFA does not store any information about:
- Wealth and income
- Marketing data (buying behavior or the like)
- Attitudes towards life and memberships (e.g. religious, political, etc.)
- marital status
How do I improve my SCHUFA score?
- In order to avoid a bad SCHUFA score, payment defaults should be avoided first of all. Those who duly settle open bills will not receive a SCHUFA entry. If a reminder is not paid and the debt collection agency's claim is not received, a procedure will be initiated. Only that leads to a negative SCHUFA. If an invoice is paid too late, this does not have a negative effect on the scoring process.
- In the event of late payment, the bank must be contacted immediately and financial support requested. If a loan is taken out from a bank in order to be able to meet liabilities, this does not have a negative effect on the SCHUFA score and thus also not on the consumer's creditworthiness. Immediate action is rewarded and minimizes the risk of a bad score.
- Everyone has the right to obtain SCHUFA information free of charge once a year. The information can be checked independently. If information is discovered that does not correspond to the truth, a request can be made to delete this data and thus improve the score. Documents which substantiate the falsity of the data can be enclosed. The responsible credit agency should also be contacted immediately. SCHUFA is not obliged to check entries that are wrongly wrong. However, the responsible credit agency is obliged to correct the incorrect information. Mistakes happen - so it makes a lot of sense to request a free SCHUFA information once a year.
- Several small loans have a worse effect on the score than one large loan with a bank. Apart from that, a single loan from a bank is more manageable for the consumer than several small ones.
- A large number of current accounts worsen the SCHUFA score. This is similar to that of loans. For the consumer himself, a current account with a bank is clearer than several accounts and has an additional positive effect on the SCHUFA score and thus also on the creditworthiness. So avoid unnecessary risk and limit yourself to one account with a bank.
- Credit cards are part of everyday life these days and people can no longer imagine life without them. However, several credit cards should be avoided in order to improve the SCHUFA score. If you only have one credit card, there is a high probability of a good score.
- If credit offers are obtained from several credit companies, this can have a negative effect on the score if the respective companies do not send a Schufa-neutral credit request to SCHUFA. As a consumer, you should insist on a Schufan-neutral request. Only when the decision on a loan offer has been made can the lending company submit a loan request to SCHUFA so that there is a low risk of a negative impact on the SCHUFA score.
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