Credit also when receiving parental allowance
When a child is born, it is usually a happy event. However, such an event is often associated with a financial burden. The initial equipment for the child is not exactly cheap, and as soon as the baby grows out, many new things have to be bought. The parental allowance, which is based on previous income, is intended to further secure income in an acceptable amount. As a rule, it is 67 percent of the last net income earned. Its duration is limited to twelve or a maximum of 14 months.
Parental allowance is non-attachable income
Due to its time limit, banks do not count parental allowance as income. This is because it is often not sure if parents return to their jobs after this time. Many loan providers therefore refuse a loan despite receiving parental allowance. However, if the partner has collateral or a correspondingly high income, the bank can change its mind.
As a result, however, parental allowance is evaluated as the receipt of unemployment benefit I or the receipt of social benefits. If a single mother receives parental allowance, this is not attachable. In the case of couples, both partners can jointly apply for a loan, especially if the mother receives parental allowance but the father still has a fixed income.
Banks are concerned about granting loans because the relatively short term of parental allowance is an element of uncertainty. Even if people on parental leave have a good credit rating, banks often do not grant loans.
Take out a loan despite parental allowance
The easiest way is for a loan to be taken out by the parent who is not on parental leave. The partner who continues to work full-time or part-time applies for the loan. If their salary is high enough to take out a loan, they will receive it regardless of the parental leave of the other partner. However, this variant is not possible for single parents who are on parental leave.
If a bank does not grant a loan during parental leave, it may be able to grant an overdraft facility. If, however, the overdraft facility is also exhausted, a department store loan can be taken out at mail order or department stores. The prerequisite is that there is no negative Credit Bureau entry. In this way, consumer goods can be bought at department stores up to a certain amount and only paid later.
Various providers grant a micro short credit. At the beginning, 500.00 USD will be awarded, which amount may be increased to 1,000.00 USD. However, the term is usually only about 90 days.
Anyone who needs a loan and is on parental leave can agree with the bank that it will grant a small loan with a term of less than 14 months. The parental allowance is guaranteed by the state throughout its term, so that a bank does not have to worry about default.
If both branch banks and direct banks do not grant normal installment loans, credit marketplaces are another way of obtaining capital even during parental leave. Loans between private individuals are brokered on these credit marketplaces. It is not just the numbers that are decisive here, but a reliable and serious demeanor and a good presentation of the borrower. A comparison of different offers is always worthwhile for loan seekers.