Social Welfare recipients receive state benefits either because of existing unemployment, as a member of a community of needs or if their income is insufficient for their subsistence. The state benefits for Social Welfare recipients are sufficient to earn a modest living.
Loans are reputable if they follow the legal provisions and do not have an excessively high interest rate. The most important distinguishing mark for serious loans also for Social Welfare recipients is the non-calculation of preliminary costs, since the legislator expressly prescribes that costs can only be calculated when a loan is granted. The costs incurred in the rejection of rejected credit inquiries are considered to be the business risk of a credit broker or a credit bank and must not be charged to the customer prevented.
Interest is charged to Social Welfare recipients
Since the money is just sufficient for a modest livelihood, Social Welfare recipients want low interest rates. However, the bank can only approve a serious loan for Social Welfare recipients if it reflects the increased default risk in the calculated interest rate. So that the recipients of unemployment benefit II do not pay too much for their loan, they compare loan terms from several banks. With the exception of low lending to personally known customers, the bank usually requires a loan from Social Welfare recipients to provide a guarantor or joint borrowing with a second person who has a regular income.
In addition to low interest rates, borrowers with ALG II payments also pay attention to low monthly installments, which can be achieved through a long loan term. Under no circumstances should Social Welfare recipients be deliberately misled into the loan application, even if some providers of instant loans refrain from providing proof of income. This behavior allows the credit bank to terminate the loan upon discovery even if it is properly repaid and is also punishable by law.
Personal loans and installment purchases through Social Welfare recipients
Almost all mail order companies only require the presentation of a certificate of earnings if the amount of the order is high, so that payment in installments is easy to obtain as a serious credit for Social Welfare recipients. When making use of this form of borrowing, Social Welfare recipients take care not to over-finance themselves and to pay all installments on time. The repeated late payment receipt by the mail order company deteriorates the internal creditworthiness and ultimately leads to a rejection of later payment requests.
Although personal loans are processed via websites operated by licensed commercial banks, the credit decisions are made independently by private donors. A cheap and reputable loan for Social Welfare recipients can be taken up on these pages, since many private lenders use social criteria both in the basic award decision and in the required interest. Before applying for a loan, it is advisable to check whether the right to an interest-free loan from the job center exists for an urgently needed purchase.