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What is a student loan?

June 25, 2019 0 Comment


What is the student loan for?

What is the student loan for?

In general, the study should be financed with a student loan, if private funds are not sufficient to continue the studies. Thus, the student can get more time, for example towards the end and in the examination phases, when they are no longer sustainable with the job. Or if the rents in the study area are too high to be paid out of pocket. Student loans are freely applicable and variable in amount. Of course, they have to be repaid later along with interest. Some institutions offer the loans between 10,000 and 50,000 euros. The payment for a student loan is usually made monthly in installments, which the student can determine himself. In other cases, a loan can also be paid out in full, if perhaps a stay abroad should be financed.

Provider of student loans

Provider of student loans

Student loans were rather difficult to come by not so long ago and were not offered by all banks. There is now a wider offer for students who do not have good credit ratings and income levels. Education funding is very important nowadays and more and more institutions are offering good offers. 

How are student loans checked?

How are student loans checked?

Generally, every credit request is checked for creditworthiness. Of course, the institutes know that students do not yet have a large income and can only score with a small side job. Therefore, a separate procedure had to be used to check the creditworthiness. A first step is the inquiry of the credit bureau.Student loans or education loans, after all, also want to be on good terms and so it may be natural that a student receives a permit only up to a certain amount. Public education loans can only be paid up to a total of 7,200 euros, while banks can allocate up to 50,000 euros.

Requirements for student loans

Requirements for student loans

Grants are always tied to the borrower under conditions. So a certain age limit must be reached and the credit bureau should have no negative entries. In some cases, a guarantor may be needed to get the loan approved. The credit rating is of course the most important criterion. So also the income and expenditure are checked. Therefore, it is also important for a student to deal wisely with his income, even if it is not high. This shows a responsible use of money.

Furthermore, the loan is also tied to the duration of the study. Anyone who is within the standard period of study has a good chance of obtaining a permit. However, the institutions have different rules, so that exceeding the study period does not necessarily mean a rejection for a loan. It is also important that the applicant has German citizenship. Student loans for foreign students are possible.

Student loans as a possibility

Student loans as a possibility

Students should always be aware that the monthly incoming credit money is only borrowed and must be repaid. For this reason, the actual loan requirement should be determined before the loan request. This includes the cost of living, rent, tuition and other payments. These are offset against the given revenue. Now the need can be identified, which should not increase suddenly due to private amusements.

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