One of the first things you are asked when searching for homes in Germany is the Schufa Score. Not only is the Schufa score used when you are searching for homes but it is used when you are applying for a new internet connection or a bank account. In the simplest terms, Schufa is a credit score that tells your ability to pay the bills.
How can I create my Schufa record?
It is automatically created when you register your address, opened a bank account, or when you registered for your internet upon moving to Germany.
How is Schufa Calculated?
The simplest answer is, it’s based on if you paid your bills on time and in full. Schufa collects your financial history, your expenses, unpaid bills, court judgments, loans, fines for calculating the score. Although Schufa does not publish how the underlying algorithm works, you can read the details about it here.
Where is the Schufa score used?
It plays a major role in almost every step of your life in Germany. The score is checked by
- Internet companies
- Phone companies
- many other places
How to get your Schufa score?
- Free Schufa Report – You can request a free Schufa through this link, but do note that some landlords might not accept this report and it is intended more for a personal reference. Also the free service can be used only a couple of times per year
- At the bank – Many banks offer a paid services of providing you Schufa report even if you are not their customer. Check with your local bank.
- Online Services – Alternatively you can get a report online using any of the below websites.
How to improve your Schufa score?
- Pay all your bills and instalments on time. Don’t delay. Especially the TV tax
- Avoid Loans and Financing
- Close unused bank accounts or credit cards
- Keep a low balance on credit cards
What is a good Schufa Score?
- A score over 97.5% is a very good Schufa score (= very low risk)
- A good score is 95% – 97.5%
- With a score of 90% – 95%, there is already an increased risk
- A significantly increased risk is connected to a score of 80% – 90% (making it difficult to obtain a loan)
- A score of 50% – 80% indicates a very high risk (credit application can be rejected faster and more frequently)
- At a score of 50%, the risk is considered to be critical