Money in old age: a loan for pensioners
Especially in old age you can quickly need some money. You want to treat yourself to a nice trip, your own house has needed some renovation or you want to pay for the children’s wedding. If you have not saved enough money, then you still have a loan. However, a loan for pensioners and seniors is not comparable to traditional loans. This has some special conditions, which you should take a close look at before. Many banks and credit institutions already offer special loans for retirees.
Money in old age: a loan for pensioners
- Getting a loan is not easy
- The right conditions
- Pensioner loan from 65 years
- Request a free credit check according to § 34 BDSG
- Detailed reflection of own finances
- Get offers from various financial institutions
- In low-interest phases, fixed interest rates and the longest possible terms
- No hasty contracts
This is mainly because the German population is getting older and older. In this respect, the pension is getting smaller and you can often get problems. That is why loans for pensioners are becoming increasingly important. Pensioners also have special wishes, which they want to fulfill.
Getting a loan is not easy
A loan for retirees is not always easy to get. Various banks and credit institutions are moving forward with caution in these cases. This is because pensioners have a higher risk of disease and death . Thus, the banks fear the risk of a personal bankruptcy of the borrower. This can happen quickly if it has to be ill or cared for.
In most scenarios , a residual debt insurance can help . Such insurance secures the loan amount should the borrower fall ill or die. Thus, the rates could not be paid.
If you have a residual debt insurance, then it is a bit easier to take a loan for retirees. Nevertheless, it is still a big act. Many providers demand significantly higher interest rates or limit the repayment term extremely.
With a loan for retirees one must always be aware of one thing: the conditions are in most cases much worse than it is with borrowers outside the retirement age.
The right conditions
Of course you can vote the banks and credit institutions a little more cooperative. This is just possible through impeccable SCHUFA information , regular pension income of around 1,000 euros a month and other securities. With these prerequisites, a good starting position is created as a pensioner. In any case, you should submit a pension notice and documents proving your livelihood to the banks.
If there are other sources of income, then these can also be detected. If these basic requirements are not met, then it is really hard to get a loan for retirees. Very few financial institutions will make such a loan possible.
Pensioner loan from 65 years
Another important topic is age. With loans, the higher the age, the more complicated it becomes to get a loan. At the beginning of 60, the chances of getting a loan are still pretty good. But if you are already over 65 years old , it will be really hard. Only a few banks lend to pensioners up to the age of 79 years.
Good to know:
When looking for a loan for retirees, you should also keep an eye on the internet. There are often good and suitable offers here. However, high interest rates and other conditions are required for these. Otherwise, a comparison in the search can help. The internet will also be useful in this area.
Request a free credit check according to § 34 BDSG
Prior to granting the loan, it is essential to obtain a free credit report from Schufa in accordance with section 34 BDSG. This can be requested once a year free of charge. The document can be requested either by post or online.
Postal applications are to be directed to the service center of the credit agency. An informal letter asking for the individual credit rating according to § 34 BDSG is sufficient. For identification, copies of the front and back of the valid identity card must be attached to the cover letter. Letters must be provided with the following address:
Schufa Holding AG
Private customer service center
PO Box 103441
An online application for the receipt is also uncomplicated . For this purpose, users must follow the menu items “Private customers” or “Data overview according to § 34 of the Federal Data Protection Act” via the internet presence of the credit agency.
The personal credit information should be promptly checked for correctness. Erroneous data can be revoked and deleted in accordance with § 35 BDSG.
Detailed reflection of own finances
In the run-up to a loan request, the careful exploration of personal finances has the highest priority . Therefore, a detailed listing of all valuable assets such as home ownership, equity, securities and precious metals should be prepared. It is also important to explicitly name one’s own financial scope for action.
Potential borrowers must therefore determine their freely disposable monthly income . In the course of this, the monthly net income, which consists of the respective pension payments and optionally other income, such as lettings, is to be compared with the monthly expenditure.
In this context, possible rental payments, including ancillary costs, ancillary ancillary costs, mortgage lending rates, current loans and household and insurance expenses should be taken into account. In addition, it is advisable to set a fictitious value for hobbies or unforeseen costs and to include this in the calculation.
Get offers from various financial institutions
Some reputable financial institutions offer explicit “senior loans”. Such as the “Sparda – Bank”, which has a strong branch network . Postbank also offers private loans without age restrictions. Therefore, it is worthwhile for seniors to compare different credit models and the respective providers. There are often significant interest rate differentials between the individual banks. Therefore, consumer advocates recommend to obtain several offers. So not only the house bank should be requested.
The purpose of the inquiries was to draw specific attention to the purpose of the loan, since many banks are also granting purpose-assigned loans in addition to freely available loans.
The effective interest rate is considered the “price tag” of a loan. This value includes the borrowing rate, the fixed interest period and the respective repayment rate. In addition, the effective rate covers agency and processing fees . Therefore, a comparison of the individual offers can be achieved via this value.
For exact comparison, however, the terms of payment must be identical. The personal consultation includes the valid ID card, the last 3 pension statements, the bank account statements for the past month, proof of real estate ownership or securities, and optional receipts for monthly rental or lease income.
If potential borrowers have only low pension benefits, the involvement of a second co- debtor may be worthwhile. The same borrower should have regular income and good credit. In this way the credit conditions can be improved.
In low-interest phases, fixed interest rates and the longest possible terms
In phases characterized by low interest rates, fixed interest rates and long-term maturities should be agreed. If the base rate is below the average of 6.5%, this is considered a low-interest phase .
By contrast, variable interest rates and short maturities should be concluded in so-called high-yield phases. If the loan is used for real estate financing, the consultant must explicitly ask for specific funding opportunities. Therefore, it must be carefully examined whether state subsidies can be claimed.
Energetic building and renovation are subsidized. Corresponding funds are awarded by KfW (Kreditanstalt für Wiederaufbau). In addition, regional institutions such as the IFB (Hamburg) or NBank Niedersachsen subsidize various construction projects.
In general, it is possible to split Keditbeträge . In this case, different fixed interest rates can be agreed. According to consumer advocates, this option should be chosen if the borrower is sure to pay corresponding installments after z. B. 5 years to be able to replace.
No hasty contracts
A second person should accompany the borrower to the financing discussion . A division of roles is advisable. So only one person takes over the active communication, the second person focuses on listening. A period of reflection should be granted to the borrower.
Consumers should not under any circumstances press and push for hasty signatures. In this context, blank signatures should be avoided. In addition, the documents should be carefully examined. Copies of all documents must be requested.