Certain groups of consumers find it difficult to obtain credit and loans because of their professional and/or private situation. Especially students, freelancers and unemployed people are considered “difficult” customer groups. This does not mean that these customer groups are generally excluded from the credit market. But what possibilities are there for obtaining credit for those consumer groups?
There are consumer groups for whom borrowing is not easy. And perhaps a loan for students or during periods of unemployment is not always the best idea. Sometimes, however, there is no way around resorting to credit even in somewhat precarious situations. For example, when unforeseen expenses are pending or when no well-off family can help. Here is a brief summary of what you need to consider when applying for a loan as a student, unemployed or freelancer.
Loans for students
Students who cannot commute during their studies and continue to live rent-free have to make their living elsewhere. For this purpose, students have access to funding such as Bfg and a KfW student loan. Those who receive this type of financial support are only granted an additional instalment loan in exceptional cases. It is somewhat easier if students contact the Studentenwerk or the student committee. They have the possibility to apply for additional small and mini loans for individual students – even if they receive KfW payments.
The chances of getting a private loan are better if students can show that they have their own income. Of course, the same conditions apply to them as to any other borrower:
- The amount of the loan is determined by the income-expenditure ratio.
- Loans for students are usually so-called mini or small loans.
- Conditions such as interest, duration and repayment rates vary accordingly.
- In addition to liquidity, creditworthiness (Agency) must also be guaranteed.
Students who receive neither Bfg nor KfW subsidies, but who have no income of their own or too little income, can improve their chances of getting a loan with the help of a solvent guarantor.
Loans for the unemployed
It is even more difficult for the unemployed to obtain loans than for students. They too have the possibility, via a guarantee, to be granted at least smaller sums on credit with a higher probability.
If it is a loan that is used to realise a business idea that will give the person concerned back his or her bread and butter, the chances of being granted a loan naturally increase exponentially.
Anyone who needs a financial injection during unemployment due to an emergency situation should first of all contact the responsible employment agency. This agency sometimes grants loans to unemployed people in urgent emergency situations.
If these attempts fail, it is possible to obtain information about normal instalment loans for the unemployed. However, the choice of providers is correspondingly small. Where the necessary securities are lacking, the willingness to lend money is usually rather restrained. However, there are providers who specialise in loans for the unemployed. However, unemployed people should exercise caution with providers from abroad (e.g. Switzerland). They often let their generosity be paid for with high interest rates. In case of doubt, a P2P loan is then an even better alternative. There, willing private individuals grant loans to potentially anyone who can describe their need for a loan in a comprehensible and trustworthy manner.
Loans for freelancers
Freelancers and the self-employed should turn to specialist banks for a loan. Normal private and branch banks usually do not include freelancers in their customer group and therefore often do not grant loans to freelancers and small or sole traders. If they do, detailed documentation on the business is often required even for small loans, or the loans are only granted on poor terms. However, if things have to be done quickly or only a short phase needs to be bridged, the effort involved is disproportionate to the loan required.
There are banks and providers that specialise in granting loans to meet the needs of freelancers. Especially direct banks often make it easier for freelancers to get a loan than house banks. In addition, self-employed people with small businesses can also use peer-to-peer platforms where private individuals, not institutions, grant loans. The extent to which these can be persuaded to do so varies from one individual to another.
In order to get a loan as a student, unemployed or freelancer, you have to expect some obstacles. Beyond the classical route, however, there are still ways to get a loan. A comparison of credit offers and a little preparation are already half the battle.
As a member of one of these consumer groups, however, you should always calculate well and consider carefully whether you really need the desired loan. If there is no way around a loan for students, freelancers or the unemployed, you should calculate as closely as possible and really only take out a loan for the amount that you urgently need and can afford to pay back.