Borrowing for students is difficult, as they earn a small monthly income. Nevertheless, it is possible to obtain a small loan for students. The corresponding offers can be found at some special lenders. In addition, depending on personal circumstances, it is possible to obtain a small loan as a student at selected classic banks.
Small loan for students at classic banks
The easiest way to make a small loan by the student at classic banks, if he wins a parent as a co-borrower. Since most of the students live at the place of study and no longer in their parents’ home, only those financial institutions are eligible which do not require a joint residence when the student is jointly borrowed from their mother or father.
This is true for most, but not all, banks, so students look for clues in their credit comparison. It is also conceivable that one parent vouches for the student loan.
Often, credit institutions prefer to apply for loan credits jointly with students in the form of a loan, since the latter is at risk of non-recognition by the judge, especially if there is strong emotional ties between the student borrower and the guarantor.
Of course, the joint application for credit is also possible with persons other than the parents as with the partner or a grandparent. Without support, students receive a small loan from the financial institutions, which includes the BAföG and parental support payments in addition to possible employment earnings through the part-time job.
This applies to a small part of the classic banks, and each comes from the lending conditions that can be found on the respective website. Prerequisite for the recognition of the parental support payment as an income relevant to the student loan is that it is received by bank transfer to the current account of the student.
Special credit provider for student loans
Some mostly smaller specialist lenders specialize in lending to students. They offer loans through small amounts, with the amount limit often ranging from 1000.00 to 2000.00 euros. An advantage of these loans is that most providers of student loans only require the submission of a current certificate of study and refrain from proof of income.
At the same time, they usually offer favorable interest rates. The group of specialist provider of small loans for students and the credit card companies, the students are unconditionally a credit limit of 1,000.00 euros as well as offer the installment option for the monthly credit card statement. However, this form of lending is associated with significantly higher lending rates than the installment loan over a small amount.
Also possible is the inclusion of a small loan for students via a private loan placement website. In this case, the platform members who are registered as lenders decide whether to grant private small loans to students. Promoting fast lending is when the student provides comprehensive information about the planned use of funds.
Is HeW Student loan suitable as a replacement for a classic microcredit?
The right to a student loan from HeW Bank is given to most students. The payment of the loan amount does not take place in a one-time amount, but in monthly payments. The student may stipulate their amount between 100.00 and 650.00 Euro for each semester. Likewise, at the beginning of the semester, he can do without further loan payments.
HeW Bank does not require a proof of use. The student loan is thus an alternative to a small loan for students. Another advantage of the promotional loan is that the repayment obligation only starts after the end of higher education, while the monthly installments for ordinary student microloan immediately fall due after payment of the money.
5 Tips for Small Credit for Students
1. The collateral
A small loan for students, of course, must be covered by certain collateral. As a result, the bank has a guarantee that the borrower will repay the money in any case, or that the bank will have other means at its disposal to recover the money. As a rule, these securities also determine the interest on the loan. The less collateral the student can offer the bank or the company, the higher the interest rates will be.
For this reason, the borrower should always ask his parents or other acquaintances for collateral or a guarantor to lower interest rates. This may also reduce other fees on the loan, so that the loan will not be too expensive in the end.
2. The monthly installment and the interest
The rate that the customer has to pay every month usually determines the total cost of the loan. The longer the repayment term, the more expensive the entire loan will be. The duration and thus the monthly rate should, however, always be selected so that they can be worn by the customer in any case. Too high a rate can severely limit the maintenance and thus significantly reduce the quality of life of the customer.
However, too low a rate can ultimately lead to a very expensive loan. For this reason, an optimal calculation of the term and the rate should always be carried out before the loan is actually concluded.
3. The deposit
In many cases, a down payment can significantly reduce student loan interest rates. The down payment does not have to be very high and can of course also be taken over by parents or acquaintances. Especially with value purchases a down payment makes sense. As a result, not only interest rates but also the term of the loan are significantly reduced, so that the total cost of the loan with a down payment drops significantly.
4. Compare loans
Of course, before a borrower makes a loan, different banks and companies should be compared. The comparison is based not only on the monthly interest rates and installments, but also on the penalties and other costs that might otherwise be incurred for the loan. Above all, the interest and fees in case of default can be very high, so it is worthwhile especially leg comparison.
There are also direct loans that are only available to students and may need to be repaid later. These are particularly worthwhile if it finances the study and the money may not be repaid immediately.
5. Reduce the loan amount
Of course, money can be saved even if the sum of the loan is reduced. For this reason, the borrower should consider what amount is actually needed. In many cases, loans can also be taken by parents. Even a part-time job may possibly completely replace a loan. If a loan can not be avoided, however, the sum should be kept small.
An unnecessary loan always costs extra money. For this reason, a small loan for students should only be accepted if it can be safely repaid. By a detailed statement of the incomes and expenditures a meaningful calculation of the actually necessary loan sum can be accomplished.