Not only workers and employees, but also civil servants rely on loans to meet minor (or major) needs, have urgent repairs done, or manage acute financial emergencies. However, unlike most other consumers, civil servants can benefit from various benefits that they owe to their protected and highly respected professional environment. Not only do they get their credit at exceptionally low interest rates, but they can usually forego expensive optional add- ons, which are often required by banks for lending. Why is that and how does the application for a civil service loan work? We got to the bottom of these and other questions here.
All facts about the guidebook “official credit” at a glance:
- As a rule, civil servants earn above-average income and enjoy an almost non-terminable employment relationship
- For this reason, the risk of an official defaulting on the use of a loan is very low
- In contrast to the loan for individual entrepreneurs, students civil servants loans are therefore offered by banks
- Officials benefit from attractive interest rates and can take advantage of their credit without any costly security measures
- Nevertheless, civil service loans are offered, which are accompanied by life insurance or similar additional offers
1. Why are officials welcome customers from banks?
In contrast to entrepreneurs, housewives or students are officials for the banks to the type of customer, often and gladly loans are given. There are many reasons for this, but first and foremost, of course, is the above-average income that long-time civil servants usually receive. Also, the fact that an official is almost non-terminable and usually retains his job for many decades or even his entire working life argues for the award of a loan to a public sector employee.
Thus, the income of an official in the long term is safe, calculable and above average and also a sudden unemployment is very unlikely – optimal conditions for a loan. However, it is not just the borrower who benefits: Banks also assume a low risk of default, which is why civil servants and public employees are among the most welcome customers of banks. Not infrequently, therefore, particularly favorable civil servant loans are offered, which are characterized by some advantages.
Banks usually offer special tariffs only for civil servants as they have a secure job with a calculable, stable and high income. Since civil servants are basically almost irreducible, banks can also benefit from a low risk of default in lending to an official.
2. Advantages and disadvantages of civil servant loans under the magnifying glass
A civil service loan brings benefits in the first place: its stable and predictable income, which minimizes the risk of default, allows civil servants and civil servants to benefit from cheap civil servant loans, which are accompanied by low interest rates and attractive conditions. The reason for this is simple: Through rare dunning procedures, the costs of the banks for a civil service loan are reduced – and this cost savings can be passed on to the customer.
In addition, as civil servants have secure jobs, banks generally refrain from taking additional security measures, such as debt or unemployment insurance. Nonetheless, civil servants do not have to forego the conveniences associated with traditional installment credit: generally, a civil servant’s loan is cheap and has scheduled installments, terms of between 12 and 120 months, net loan amounts of up to € 100,000 and flexible options for special payments, In addition, civil service loans are usually characterized by long maturities, since a sudden unemployment is hardly to be feared. Despite all advantages, a civil servant loan comparison may not be missing if you want to benefit from the best possible conditions. If one has found the optimal provider in this way, one has as a civil servant in the use of a civil servant credit basically nothing to fear disadvantages.
Customers receive favorable civil service loans from providers such as Bank
Civil service loans are characterized by numerous advantages: As a rule, a civil service loan is to have a cheap and also residual debt insurance are hardly required for the lending, whereby the cost factor also decreases significantly. Predictable rates, a high degree of flexibility and long maturities make favorable civil servant loans especially attractive.
3. Civil service loan vs. Official Credit: Where are the differences?
Civil servant loans and civil service loans – which at first glance seem the same, are distinguished by small and subtle differences. The official loan is the loan we have already described in more detail in our guide: a loan for civil servants and civil servants – no frills and additional offers. Accordingly, this is basically simply an installment loan designed for civil servants as a target group.
When officials loan is instead a loan for civil servants, which is associated with additional services – usually is, this is a life or pension. The entire loan is hereby concluded as a term loan, after which only the interest will be paid during the term, while the actual loan repayment takes place only at the end of the term. At the same time, the customer pays into the life or pension insurance with the same duration and the same amount. However, clients must note in their official credit comparison that the APR contains only the mandatory costs, which the repayment itself does not include. The monthly rate is therefore more meaningful for the provider comparison.
The pure civil service loan is basically a installment loan for civil servants and civil servants who does not need any additional services. In contrast, a civil service loan is offered as a term loan with life or annuity insurance, in which the customer only pays the interest during the term and the repayment of the loan makes only at the end of the term.
4. The application for the civil service loan at a glance
At the beginning of the application is the comparison of providers or bank loan comparison 2019, in which the potential customer subjects the candidate providers to a civil service loan on the basis of their individual requirements. Finally, if he chooses a provider that is low on the risk that the loan could be declined and meets his expectations, he can start the application, provided that he meets the necessary conditions : These requirements are in addition to the age of majority a residence in Germany and also a regular income, a work outside the probationary period, sufficient creditworthiness and a positive Schufa information. In addition, the potential customer must be employed by his current employer for at least three months.
Of course, the actual application process depends on the company itself. But if you want, for example, with the experience Credit Bankive loan gather or take the credit of another popular online bank to complete, you can first make use of the loan calculator shows all the conditions of the loan. If you agree with these conditions, you can usually fill in an online form, whereupon the corresponding loan documents either by post to the customer or sent to download and print out.
If the customer has finally checked his loan documents, he can sign them at the marked points and send them back to the provider. To verify identity, most providers require PostIdent mailing, where the customer presents his identity card and the PostIdent coupon to the nearest post office, where a company employee will verify his or her identity. This step is designed to ensure that no unauthorized person uses a civil service loan on behalf of the potential customer. Once the application has been reviewed and approved, the customer will eventually be credited with his money by instant bank transfer to his account.
If the customer meets the necessary requirements for cheap civil servant credit, he can make the first step on the way to credit with a provider comparison. Then he can make an overview of the conditions with the loan calculator and, if necessary, can be forwarded directly to the online form. Once completed and signed, it must be sent to the company – for new customers in conjunction with the PostIdent legitimation process. Once the application has been reviewed and approved, the customer will be credited with his civil service credit to his account.
5. Conclusion: Officials enjoy special advantages in lending
In concluding, we can state that civil servants can benefit from various benefits when applying for a loan. Since they have a stable and almost non-terminable job, as well as a high and predictable income, civil servants hold a minimal risk for banks, so they can offer attractive terms for the civil service loan. Also residual debt insurance, which would also increase the cost, are not an issue here. However, civil servant loans often go hand in hand with a life or pension insurance and are finally calculated. In addition, the application for a civil service loan hardly differs from the application for a regular loan, since customers have to fill out here only an online form and the company must then submit the completed and signed application.