Are you looking for a loan despite parental allowance? Would you rather not endure the negative view of the loan officer, but rather see your loan request fulfilled?
Lending during parental leave is far from being as easy and straightforward as young parents would like. With information about the loan during the baby break, we support your loan search and name serious problem solutions for you.
Credit despite parental allowance – the hurdles
Credit despite parental allowance is not the problem of the population for whom parental allowance was designed. When the legislation reorganized the child-raising allowance into parental allowance, the “elites” of society should be specifically encouraged to bring up children.
It was intended for couples who, after completing their university education, are both employed in high positions. Studies showed that these couples wanted to have children, but were not willing to forego the high second income. In order to achieve the goal of sweetening executives’ desire to have children, a real income equalization for top earners should be created.
In the case of extraordinarily good income, from the point of view of lending, it is manageable if an income is largely replaced by social transfer payments. The remaining income is still so high that nothing stands in the way of lending. The most important pillar of any loan assessment remains satisfactory. The net income subject to social security contributions is calculated in such a way that a sufficiently high attachable share of income can be demonstrated.
The parental allowance itself can be used to pay the installments, but not to secure the loan. Social transfer payments by the state – parental allowance and child benefit – are not attachable, making them unsuitable for securing the loan claim in the event of problems. Couples whose household income does not meet the minimum requirement for lending – loan security through attachable work income – expect problems with credit despite parental allowance.
Prepared for parenthood – survive parental leave financially
At the beginning of parental leave, young couples often face problems that they could easily have avoided. Lack of preparation is the decisive wrong decision in the past. The necessary financing was postponed far too long. Experienced parents know from the first day of pregnancy that many purchases are necessary when the child is born. From the changing table to the stroller, everything can be ready when an addition to the family sees the light of day. Nevertheless, nobody succeeds in being prepared for everything.
Very small credit requirements could be covered by the overdraft facility during parental leave. The overdraft facility is the most expensive credit solution. – But for sums between 1,000 and 2,000 USD, with the limited time horizon of just over a year, the interest would be manageable. If the need for loans is greater, short-term loans do not help to avoid problems with a loan despite parental allowance. For economic reasons, larger purchases must either be paid out of savings or financed through an installment loan.
Secure payment of an installment loan would be possible, as parental allowance ensures real solvency. The problem of securing loans for loan approval could be solved by a solvent guarantor or co-applicant. For the guarantor or co-applicant, preferably the couple’s parents, the liability risk remains manageable. – Because the money to pay the installments is actually available. It is only attachable.
Creditworthy despite parental allowance without guarantor – possible loan options
In spite of parental allowance and being without a guarantor, it can be possible to choose the right provider and adjust the loan amount accordingly. Online banks place relatively low credit requirements on the granting of small loans (loans of up to around USD 3,000 net loan amount). The loan options can be probed risk-free by attempting a loan using a credit comparison calculator.
The advantage of the non-binding preliminary credit check using the credit comparison is that Credit Bureau receives no notification of this. The Credit Bureau does not deteriorate no matter how many non-binding credit attempts are made. Should the hoped-for provisional loan approval fail to materialize, a slightly higher-priced loan offer could still be approved. – Because the higher interest rate is appropriate, providers take slightly higher risks. A higher risk with credit despite parental allowance could mean that a lower attachable income component is sufficient for lending.
Another alternative could open up if property security would justify the security of the loan. Many of them paid into additional old-age provision, for example life insurance, before they wanted to have children. The life insurance or the vehicle letter of the paid car is recognized by many credit institutions as a means of securing loans. If all the solution options mentioned so far are not fruitful, the alternative is the private loan despite parental allowance.
Loan during parental leave – address private donors
Financing offers via private donors are not comparable to regular bank loans. Instead of automated programs and clerks involved in tight regulations, people are free to decide on lending. With the loan from private to private, many things can be possible that would be excluded in the case of financing requests via commercial providers.
There are two decisive factors in favor of a loan despite parental allowance among private donors. The most important thing, money for repayment is certainly available during parental leave. The second reason to be positive about a loan in spite of parental allowance is human understanding.
Most investors who act as lenders are themselves parents. They have only survived the difficult initial period and are back on secure financial feet. Those who once looked for a loan despite parental allowance could not forget the difficult hurdle. Understanding the exceptional situation of young parents leads to lending that might otherwise have been out of the question.