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A budget check is part of the creditworthiness check. It aims to protect borrowers from over-indebtedness in the course of taking out a loan. Those who grant loans are obliged by law to carry out a budget check on the basis of the Consumer Credit Act.
Knowing one's own financial situation helps to make reliable decisions. For this reason, prospective borrowers should also carry out a budget check in the event of major expenditure or the taking out of a loan.
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1. Budget check according to the Consumer Credit Act
Lenders are obliged to check the creditworthiness of the applicant. According to the Consumer Credit Act, the applicant is considered creditworthy if he or she can repay the loan without having to claim the non-attachable part of the income. Consequently, the attachable income must be determined in order to be able to make statements about creditworthiness. This is done as part of the budget check.
To calculate the attachable income, all monthly recurring income is compared to the monthly payment obligations.
On the expenditure side, the most important items by law are:
the rent actually owed
the taxes owed according to the withholding tax table
obligations reported to the Consumer Credit Information Office (IKO)
are to be taken into account.
On the income side, all recurring income is taken into account. These include for example:
Monthly net income
Secondary and additional income
Income of the spouse
Income of other contractors
Alimony and maintenance payments
If the difference between income and expenses exceeds the subsistence level, the consumer is considered to have creditworthiness.
2. Personal budget check
Before taking out a loan or making a major purchase, consumers should know their monthly disposable income. A comparison of income and expenses quickly reveals which additional costs can be accepted without risk.
Income includes, for example:
Own net income
Net income of partner
Family and care allowances
Other income (e.g. additional income, rent, etc.)
For example, the following should be taken into account for expenses
Housing costs rent (incl. heating and ancillary costs)
Housing costs for own home (mortgage interest, heating, water, insurance, etc.)
Costs for current loans
Electricity and gas
Telephone, internet, mobile phone, TV fees, cable fees
Food and drink
Taxes (state, municipal, fire tax, etc.)
Mobility costs (monthly tickets, petrol, toll sticker, vehicle tax, etc.)
Costs for pets
Subtracting all expenses from the available income results in the maximum available budget that should be spent on purchases and investments in order to protect oneself from future financial bottlenecks.