Students who leave their parents’ home to study and live in a university town often face significant costs. The rent even for a room in a shared flat, the livelihood, all the resources required for study and often travel costs ensure that the money is always scarce. Not all students have a secondary income, and at the latest in the last few semesters, they want to focus on the degree. For students who are not eligible for Federal financial aid and whose family budget is limited, a student loan is an option for funding.
- A student loan can compensate for a missing Federal financial aid claim or for too little Federal financial aid
- The financing of the study can be applied for via Intrasavings bank
- The repayment modalities are manageable
- A student loan calculator facilitates the calculation
1. Student Loan – what is it here?
Before it goes to the financing options, first a definition. As a student loan, sometimes student loan, only a loan is called, which serves to finance the study. Of course, students also have the opportunity to raise consumer credit to facilitate purchases. In this case, however, there is an installment loan or possibly the use of a credit line . The funding of the study should be conceptually delimited from it. Student loans are often the only way for many students to accept and complete the study of their choice, especially when their parents’ resources are insufficient or when several children’s education needs to be funded, given the rise in city center rents. Of course, there are a number of options for obtaining a degree or education through funding:
- Federal financial aid
- University loans and study scholarships
- Student loan, for example through Intrasavings bank
- installment loans
- Savings and Payments Plans
2. Student Loan: What Students Should Know
If a student loan is required, it is always worth the exact consideration of the conditions. No matter what funding is chosen, the interest should not be excessive. In addition, the loan must be able to cover the livelihood to fulfill its purpose. At the same time, the repayment must be considered before the loan application is made. What are the prospects for employment after graduation? And: can the program actually be completed quickly? For the correct assessment of one’s own financial perspectives and the possible burdens a student loan calculator can be called in.
2.1 What does a student loan calculator do?
Student loan calculators are easy to find online. The easy-to-use computers allow the calculation of the required loan for the desired monthly sum over a desired duration, namely the study duration. Also, the repayment period and the required monthly installments can be calculated on some of the available calculators. If you use the calculator, you can also use a credit comparison to determine which offer best suits your needs. This allows you to filter out reputable providers and save a lot of money on student loans. In summary, the following factors should be considered
- loan amount
- Monthly payout
- study period
- Repayment period and installment charges
3. What alternatives to the student loan are there?
3.1 Savings plans for studying: When the parents make provision
Lucky for all those whose parents have provided in advance. With an early savings plan, preferably directly after the birth of the offspring, can save up to the end of the school with a very small monthly saving rates a nice sum for the financing of education. Anyone who combines the savings plan with a payout plan can ensure that a certain amount is available each month. This type of asset formation makes a student loan superfluous, but wants to be planned on time.
3.2 Scholarships: Promotion without repayment
Particularly gifted students can hope for scholarships. However, these are not student loans in the true sense, since they do not have to be repaid. Scholarships are partly borne by industry to encourage future experts at an early stage through the promotion of young talent. Special gifted education organizations also award scholarships, as does the Bundeswehr. Some scholarships are subject to appropriate conditions, such as the obligation to later work at the funding institution at least for some years.
4. Federal financial aid: Federal funding for training
The so-called Federal financial aid is a monthly paid subsidy, which should create more educational justice and educational opportunities in accordance with the Federal Training Promotion Act. It is paid when the student and his or her parents’ financial resources are insufficient, and consists of a partial loan and a non-repayable grant. The advantage of the Federal financial aid is that it is an interest-free loan, the repayment of which must start no later than five years after the payment of the last subsidy rate. Thus, the conditions are of course favorable, but under unfavorable circumstances, the student receives no funding. This may be the case if parents earn too much but do not support their studies. In some cases, a parent who has long since broken off contact can be credited and thus block access to funding. If the maximum funding period is exceeded – that is, if the study takes too long – the previously existing funding can be discontinued. And last but not least, the funding that is available on a monthly basis is not always sufficient for a living. In these cases, a classic student loan is an alternative.
Federal financial aid: the conditions
- The student is a German citizen and less than 30 years old
- Monthly payout
- Eligible college
- Studying outside the place of residence of the parents
- Parental means are not enough
- Interest-free repayment from at the latest five years of the last disbursement
5. The classic student loan
If it must be a student loan, there are special financing solutions such as the Intrasavings bank Student Loan. The German Intrasavings bank, founded in the post-war years, is now the largest development bank worldwide. A student loan from the development bank is paid in monthly installments, which can reach a maximum of 650 euros. Thus, the credit accompanies the student during the training and allows him to cover the cost of living. Intrasavings bank charges the lending rates with the monthly payments. With increasing amounts of credit, the interest rates rise, so each year higher amounts are deducted from the monthly distributed sum. If a student receives a monthly sum of 300 euros, effective interest rates of 4.16% pa after the first year only pay 288.78 euros. After three years of study, more than 35 euros are already deducted monthly. However, in individual cases, the borrower can also make a deferral of interest with Intrasavings bank and later deduct the interest. Here, however, the development bank insists on performance records.
A credit comparison can often find lower interest rates
5.1 Flexible student loan solutions
The advantages of Intrasavings bank include the very flexible range of financing solutions. Not only does the promotional bank offer an educational loan for financial support during training, there is also a career development and further qualification Federal financial aid, and there is also a Federal financial aid bank loan for students who have exceeded the maximum funding period.
5.2 Intrasavings bank: repayment of the student loan
At Intrasavings bank, graduates have a so-called 18-month waiting period – during this period, the monthly interest is collected, but no repayment installments. The purpose of the waiting period: after completing the training, the student should be given the opportunity to look for a job before starting to pay off the loan. Those who find a permanent position immediately after graduation can, of course, immediately start repaying the loan. The borrower certainly has an influence on the monthly installments. The only restriction at Intrasavings bank: within 25 years, the loan must be removed. In addition, the promotional bank offers the opportunity to adjust rates twice a year on certain dates, ie to reduce or increase them, and special repayments can be made at any time free of charge.
Intrasavings bank student loan: the conditions
- Students are German or EU citizens or family members of EU citizens aged 18 to 44 years
- Monthly payout
- Regardless of income
- For degree programs at state-recognized universities
- Interest rate approx. 3.55% p. a. is deducted monthly
- Repayment begins after a waiting period of 18 months
6. Further financing solutions for students
6.1 Installment loans for students
Installment loans are also eligible for financing. This is the case when students need to make a purchase they depend on, such as buying a used car. Typically, financial services providers insist on collateral, such as proof of a fixed monthly income. This is not the case with students, so in most cases it is necessary to provide guarantors. For students, these can be parents or close relatives. Even with installment loans for students, the credit comparison is worthwhile, because the conditions can be very different. Some banks offer special financing solutions for students on good terms because they want to attract the borrower as a customer.
Installment credit: the conditions
- proof of study
- Guarantors, such as the parents
- One-off payment, earmarked or free, approx. 0.89% p. a.
6.2 Disbursement credit for students
The ability to overdraw the checking account, many banks also accommodate students. If this is used, however, one must expect high interest rates – higher in any case than they would have accrued in the case of an installment loan. Therefore, overdraft should only be used if an emergency actually occurs. Otherwise, the interest burden may burden the narrow student budget excessively.
7. Which loan for which situation?
The comparison of financing options illustrates the different conditions and costs. Above all, the interest rate differs greatly – while the Federal financial aid is interest-free, the interest rates of a Intrasavings bank student loan are higher than with a conventional installment loan, but are collected in a way that is compatible for many students. An interest extension is also conceivable. Installment loans can already be taken out with comparatively favorable interest rates, but here too the terms and repayment terms should be examined. At the Federal financial aid and at Intrasavings bank, the student benefits from a waiting period and a very long period of deduction, which is not given for installment loans.
Here is the question of what the amount is needed, and for how long. Covering the cost of living while studying for three to six years of average study duration can certainly best be achieved with Federal financial aid or a Intrasavings bank loan. If only a one-off purchase or a semester abroad to be funded, an installment loan may be the best solution.
Online there are numerous promotions and discounts, so you get much better terms
8. So it works with the student loan
Anyone who has compared the offers and now wants to take out a loan must undergo different application procedures. When it comes to a student installment loan, follow these steps:
- Use credit comparison and choose the cheapest provider.
- Have the necessary documents, such as proof of studies and information on securities and guarantors.
- Complete the application and submit, in many cases, this is possible online.
- Wait for the bank to examine it and submit a loan proposal.
- Go through the legitimization process through PostIdent or VideoIdent.
- Accept the payment of the loan amount.
An application for a student loan from Intrasavings bank can be made online on the Förderbank’s website. The application process as well as the necessary documents are explained in detail. However, not every applicant receives a commitment from Intrasavings bank. If the corresponding study or performance records are not submitted or not submitted on time, the bank reserves the right to reject the application. Applicants who have once taken an affidavit can also be turned away.
9. Conclusion student loan: Worthwhile option for financing the training
If only with a financing study or further education can be tackled, worth a student loan, sometimes also a installment loan. Students whose parents can not support them are not always given Federal financial aid, and secondary employment is not an option for all students. A student loan can help cover the cost of living so that the student can complete his education quickly and without distraction. For example, Intrasavings bank awards classic student loans for training financing on favorable terms. But even installment credit can come into question in individual cases, because many banks grant students good conditions. Here, however, is often the teaching of guarantors, for example, the parents, a condition. A installment loan can help to make much-needed purchases, but it can also help finance one or two semesters abroad if the student and his family’s resources are insufficient. Here the conditions of the banks differ. Therefore, in each case, a credit comparison should be used and the amount of the loan, the duration and the monthly installments calculated with a student loan calculator, so that the best offer can be determined.