The financial background is often a major reason for many aspiring students why these newbies carry around the idea of not tackling their academic education. If there is no financial support from the parents, it can be very tight for any student with the financial survival while studying. If you do not get a job during your studies or if you do not have time to work, you will not be able to study without financial resources.
A remedy for this creates a student loan in such a situation. These student loans were created by the banks with special terms of contract , especially for students.
In the case of a student loan, the bank that then grants this loan waives a check on the creditworthiness of the borrower. The reason is that a student, if at all, only has a very low income in the rule. Thus, in a student loan usually no proof of income or other evidence about the financial situation is required.
The only requirement for such a loan to be granted is proof that the borrower has registered at the relevant university . Otherwise, the borrower is not entitled to a student loan.
Features of student credit
A special feature of a student loan are the payment methods for such loans. The borrower does not get all the loan amount, as for example in a car loan, transferred at once, but he receives this monthly partial payments or installments. This ensures that the student receives financial support every month and that he is not tempted to spend the entire amount. This allows the student to cover his monthly living expenses.
Thus, students taking such a student loan no longer have a major concern in their daily lives. After that, the question of how to financially consider the current or next month, initially no longer.
Also in the repayment area there are significant differences compared to other types of loans and financing. While a normal loan is ready for repayment installments or repayment at the time of its disbursement, student loans have a different approach. The bank guarantees the borrower, ie the student, that he or she can concentrate fully on studying at first.
Only after the graduation the student gets a deadline. After the end of this period, then the repayment begins in the form of monthly installments for the student loan. As a rule, this is already in the phase where the student earns money.
Usage reasons for instant loan for students
Students who are interested in a loan should take a close look at the definition of this term. If a student takes out a loan to set up a home or to buy a vehicle, it does not correspond to a traditional student loan that aims to finance a student education. Normally, such cases are conventional installment loans, which may well be tied to a purpose as home loans or auto loans.
This type of loan must be clearly distinguished from a loan to finance the study. Of course, students can take a installment loan, which, for example, serves to make important purchases that are uncontractable. In general, however, these people do not have regular and fixed income in the required amount. That’s why banks often need additional security, which can be done with the help of a guarantor.
A parent or parents often jump in as guarantors who are liable for the loan of their children with their own assets. Students receive special conditions from the banks for such a loan, partly because an early customer loyalty of future graduates can be an advantage. These installment loans are concluded on the one hand with and without earmarking and can be used accordingly.
This form of loan for students can also be completed as an express loan. The immediate check and decision on a short-term loan is associated with a quick payout, furthermore, the agreed terms are cheaper than the overdraft interest in an overdraft.
Special loans for students
Not every person who studies plans both forward-looking and long-term, so funding needs can be correspondingly short-term. In principle, it is possible to take out a quick loan on the Internet. Most of these are special financial products from abroad, most of the lenders are banks from Switzerland. These special loans were designed specifically for the financial market in Germany.
For foreign banks, the Don Quixote query is a foreign word, so these loans are awarded under strict conditions. For a loan from a Swiss lender, the requirement is a fixed salary and a certain amount of income is required. BAföG payments, however, are not included in the income.
The classic student loan
Often students do not have the opportunity to get a quick loan, but for this group of people there is another option to get their studies funded by a bank. If a loan is needed specifically for study, it is not a conventional installment loan, but another type of loan.
Here, there are differences in both the payout and repayment types as well as the conditions for granting. Such a loan is paid out in a certain monthly amount, thereby a person can make a living during the study period.
Normally, the interest is deducted directly from the respective monthly payout. Over time, the amount of the interest payment becomes larger as the sum of the loan increases with each monthly payout. However, if a proof of achievement is presented during the first or second study, there is the possibility of agreeing to a deferral of interest. In these cases interest will only be due at a future date.
The repayment modalities
After the credit period has ended, the so-called grace period begins, during which period only the loan interest is repaid. This regulation was created to give graduates enough time to look for a permanent job. Students who find a suitable job quickly can shorten the waiting period.
If the waiting period expires, then the borrowed student loan must be repaid in the form of monthly installments. The rate height can be selected within a certain frame itself, since the runtime adapts accordingly. However, this term may not exceed a certain period. If, for example, a student loan is used that has a period of seven years and a monthly disbursement rate of € 650, the repayment amount exceeds € 54,000.
The better the conditions of the repayment to the current situation in the respective student life is adjusted, the easier this high financial burden can be made. When comparing offers for student loans, therefore, other conditions that are important should be considered in addition to the interest rate.
Examples of another important condition are the period in which the repayment start can be delayed, the offered opportunity to change the rate of the loan and a special repayment without any additional costs.
Finance the study by credit
A loan for people who are still studying can secure a living. The life phase, which takes place at the University, is associated with many costs, which can not be completely secured by BAföG or other services. It is particularly difficult for the young adults, who can not claim social benefits and are dependent on their own financial resources.
With a student loan for this group of people, it can be avoided that low-paid part-time jobs must be taken which can have a negative effect on both the length of study and the grade scale. In addition, time-consuming internships and exams demand a lot from the students, so there’s no time to work on the side.
The result of taking out a loan is that students can concentrate much better on their studies, which leads to positive changes in study results and duration. More and more banks are offering loans to these clientele, as lenders assume that the repayment is subject to a low default risk.
After graduation, this group of people receives a relatively high starting salary, so in most cases repayment of a loan is not a problem for college and university graduates.
Financial bottlenecks during study balance
Almost every student is affected by financial bottlenecks during their studies. In addition to the rental payments, living expenses and tuition, the existing budget can withstand little additional expenditure. Especially the rents of the university cities are getting higher. An out-of-home accommodation is often not an optimal solution, as it takes a lot of time and money to get to the university. In addition, rural and quiet areas are not necessarily preferred by students.
Normally, the money you need to buy a car or stay abroad is lacking. If a student wants to take out a student loan, they need to be aware that there is always the risk of over-indebtedness. Not every university graduate automatically receives a job that is well paid. Some people with a successful degree do not find a job at all.
However, after an agreed period after graduation, repayment of the financial product is due and problems can quickly arise. For this reason, persons who are interested in a student loan should inform themselves extensively on the Internet or even seek advice.
The risk of over-indebtedness also applies to short-term loans, because the monthly installments must be repaid despite the tense financial situation of the students.