Change bank with current credit and despite overdraft – how possible?

There are many individual reasons for changing banks. The Payment Accounts Act sets the rules for banks and savings banks. But how is a change with a current loan or an account in the overdraft facility? An assessment at

The reasons range from cost savings to an optimized advisory service if the account holder wishes to change banks. The framework for an account change is set by the Payment Accounts Act enacted in September 2016. Legislators oblige banks and savings banks to do their best to support customers when changing their current account. Nevertheless, many consumers willing to switch shy away from switching accounts. The reasons lie on the one hand in uncertainties regarding the procedure. On the other hand, current credit contracts and / or the overdraft facility used raise questions.

Trouble-free checking account transfer

Trouble-free checking account transfer

When looking for a new house bank, thorough research of the market offer is recommended. This way you can find out which credit institution comes closest to your individual needs. If more favorable conditions are in the foreground, it is advisable to compare the performance of the direct and online banks present on the market. If the aim is to optimize the advisory service “on site”, a performance check by the traditional branch banks is worthwhile.

When it comes to changing the house bank and opening the new current account, the consumer receives professional help. Banks and savings banks take care of all the necessary formalities for their new customers. This applies to standing orders as well as direct debit mandates. The customer service also extends to the information of all those places that make regular payments to the new current account.

Experience has shown that temporary double account management is advantageous until all the formalities for the changeover have been completed. As soon as the new EC card with the associated secret numbers and the formalities for online banking are handed over, the old account can be terminated without any risk. This termination is possible without notice and free of charge.

Switching accounts with current loan contracts

Switching accounts with current loan contracts

A change of bank is fundamentally also possible for account holders with current credit obligations. In this case, when looking for a new house bank, ask if you could get a loan. The new financial institution will make this decision dependent on a credit check. On the one hand, it will request proof of income and, on the other hand, obtain Credit bureau information from the protection association for general credit protection.

Costs can arise when an existing loan is “moved” . Some banks charge a fee in the event that accounts are closed prematurely. A prepayment penalty in the event of early loan repayment that differs from the text of the contract can, in individual cases, result in costs on the part of the previous lender.

In order to initiate the smoothest possible change, it is advisable to inform the new financial institution in good time about the amount of the loan requirement and the desired repayment date of the old loan. An early questioning of the new loan conditions prevents unpleasant surprises. Because the new financial institution is not obliged to take over the existing conditions from the old loan agreement. Here it is important to use the negotiating room for negotiation that is possible.

Basically, the following options are available for credit contracts:

  • Keep the existing loan with the old bank and use the new current account
  • Transfer of the loan to the new bank.

If the account is in the overdraft facility

If the account is in the overdraft facility

Bank customers who use an overdraft facility in their checking account are aware of the high level of interest rates. Nevertheless, there is usually interest in setting up a “Dispo” when changing the financial institution. When changing the account, the potential customer should already indicate his or her desire for an overdraft facility in the current account application. As a rule, overdraft commitments and their amount depend on the creditworthiness of the new customer.

The new bank often takes over the overdraft facility, which makes it possible to redeem it directly when changing accounts. If this is not feasible, the old overdraft facility can be used until the liabilities have been completely discharged from the new checking account. In order to avoid the associated maintenance of two current accounts, it is advisable for the account holder willing to switch to a conversation with the financial institutions involved in the switch.

Conclusion and summary process planning

Conclusion and summary process planning

The explanations show that a bank change with current credit obligations and overdraft facilities is possible. A structured process planning is of great importance.

It is essentially based on the following four points:

  • Select a financial institution and clarify the granting of a loan and overdraft facility.
  • Sign a loan agreement if the conditions are acceptable.
  • After a short period of parallel current account management, close the old account.
  • Replace outstanding claims with funds from the new loan agreement.

When implementing this project, it has proven useful to talk to the two financial institutions involved about plans and wishes.


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