Students are generally reputed to be in short supply at all times. Federal financial aid and Nebenjob are the classic income of a student and together are usually sufficient to produce sufficient and modest income. However, if larger purchases are made, or even the above mentioned income is insufficient to maintain the standard of living, the question quickly arises of a loan for Federal financial aid recipients.
What options do the banks offer?
Banks and other banks are often struggling to give credit to students. A loan for Federal financial aid recipients can fail, among other things, that not enough income is available. Because the student loan is not attachable and therefore can not serve as security. The remaining income often only generates from a 400 USD job. No income, therefore, with which to finance particularly large investments, let alone secure high loans.
However, one credit that lets banks talk is the disposition credit. The loan amounts are rather small here compared to the classic installment loan, which means that short-term bottlenecks can be bridged. A big advantage of the credit line is its flexibility, since it is used almost always and can also be repaid flexibly. It only requires one – usually informal – agreement with the house bank, so that the credit is released or the checking account can now be kept in the target.
The amount of credit granted is reflected in the line of credit, which is the maximum amount that can be used to keep the account on target. It is measured by the income of the borrower and usually corresponds to two to three times the monthly income. As a loan for Federal financial aid recipients, the credit line therefore offers little leeway. In addition, there are the relatively high interest rates that are demanded for a claim. Therefore, the loan should also be repaid as quickly as possible, so as not to risk excessive debt.
The installment loan comes as a loan for Federal financial aid recipients rarely in question, since at the latest here is the low regular income for a rejection will be decisive. However, there is still a chance of lending if the applicant involves a guarantor in the contract. However, this in turn requires the required collateral, ie above all a regular income in sufficient amount and no credit bureau.
The guarantor always comes into play if the applicant himself can no longer or insufficiently fulfill his credit obligations, the debt service. If this is the case, the guarantor is liable directly and has to pay the interest and principal payments, if necessary until the loan is repaid in full. The situation is similar with a co-applicant, who, however, is liable from the beginning on his own and should guarantee punctual repayment. Of course, both variants require a certain amount of trust between the individual participants. In practice, it is therefore often the case that close relatives or good friends help out here to make the loan possible for the Federal financial aid recipient.
Credit from the dealer
Not only banks, but also merchants are able to provide a loan for Federal financial aid recipients. This is the so-called trade credit, with which a certain article is financed. Needless to say, a trade credit is tied to the purchase of a specific item, which is why it is severely restricted in terms of flexibility. The advantage, however, lies in the fact that usually no proof of merit must be provided and otherwise the creditworthiness of the student is not tested in any way. Exceptions to this are occasionally offers that involve banks in their financing. With this loan for Federal financial aid receivers can usually finance electrical appliances or consumer electronics products for which a single monthly income would not be enough.