Loans to officials
Repayment of the civil service loan It is used as a total loan, at the same time a life insurance for life insurance policies is completed. The official loan, which is also referred to as a civil service loan in Germany, is essentially characterized by very flexible conditions. Will all my loans have to be repaid with the new official loan, including my auto finance?
The civil service loan, which is also referred to as a civil service loan in Germany, is characterized by very variable conditions. Due to the high level of collateral, credit institutions grant long maturities, higher loan amounts and lower repayment rates in connection with these loans. All this makes the Civil Service loan very interesting and ensures that the monthly installments to be paid by the Borrower are low.
In principle, the lenders are very flexible when it comes to loans to civil servants. This means that the borrower can use the loan amount in principle for the rescheduling of loans. In many cases, this is also a prerequisite for the use of funding for civil servants. As a rule, a Civil Service loan can only be used when it is used to repay other financing operations.
On the one hand this should make it easier for the borrower to process the loan and on the other hand it should provide more clarity about the monthly costs. In this case, very different loans must be replaced by a civil service loan. In principle, repayments are necessary for all loans secured by wage or salary assignments.
Because this situation also involves lending to officials with a certain residual risk, the lenders in practice ask for repayment of the financing. But there are also several exceptional cases of the civil service loan. This means that not all existing bonds have to be repaid with this loan. They do not have to be replaced by the Civil Service Loan, but they can remain untouched.
This concerns both leasing and loan agreements for a passenger car. These can remain unaffected after the use of a civil servant credit as well as the own mortgage lending. In principle, however, debtors should turn to the lender.
Civil servant loans: How does it work?
Donors calculate lower returns if they are confident that this expectation will be achieved. This also applies to loans. If the lender expects 100 or more loans with high defaults, he will attract the interest to compensate, or he expects high securities or guarantees. If it is assumed that almost all loans will be repaid with 100 or more granted loans, very low interest rates can be charged.
Collateral is only significant if a loan collapses and the lender wants to get its capital back in this way. Assuming that the loan is fully repaid, usually only one security is expected: ordinary and permanent employees may be dismissed, so that a fixed salary is a guarantee, but it is not as secure as a permanent job.
The officials have an indefinite employment contract, and even if they are exempt from the service, they still receive funds. As long as the official borrower does not die, the lender can track repayments. This means that special loans for longer-term employees are granted at lower interest rates. Group of people eligible for an official loan: depending on the specific situation, the lenders can reject or change the questions about the loan.
Civil servant loans are not regulated separately under German law as this form of credit, but are subject to the same rules as other loans. Because officials are a large group of people, it makes sense to grant loans tailored to their specific situation. However, each donor can set his own terms and conditions. There are no binding guidelines for civil servant loans.
However, there are also loans where only interest is paid to repay the actual loan amount at the end of the period. However, the lender has the risk of loss that the borrower does not pay. However, this risk can be compensated if another financing product is closed, in which the capital is saved at the end of the repayment term.
The borrower pays interest on the civil service loan, pays the contributions for the capital insurance and hands them over to the lender. Under certain conditions, this loan financing can be cheaper than a standard installment loan.