Being creditworthy as a working single or as a married couple is not a particular challenge. Regulated living conditions are one of the most important security criteria for serious loan offers.
The problem with credit during the separation year is the lack of financial planning security for the future. We will present you with the hurdles you have to overcome, how you can convince the bank with your loan application and alternative solutions.
Credit during separation year – comprehensive problem
It is not easy for a clerk to grant a loan during the separation year. The credit requirement and its meaningfulness are understandable. A partner moves out during the separation year. He needs money for the rent deposit, for new furniture and possibly even a vehicle.
But the approval does not depend on the clerk’s understanding of the difficult situation. He only has to assess the risks of separation for the desired loan. He needs secure proof of repayment ability even after the divorce. Without a guarantor or co-applicant, the loan approval is very risky from the bank’s point of view.
Main earners don’t necessarily have an advantage
For the main earner, his risk assessment does not include the income shown in the current income statement. It is much more important to clarify the question of future income after the divorce. The court calculates the maintenance to be paid by the main earner individually. However, the requirements are not binding on Heller and Pfennig. How much money the main earner has left for a living after the divorce can only be seen after the divorce decree.
In addition, there are divorce costs as an unknown risk factor. Some couples split up by amicable sharing of assets and debts, then divorce is cheap. If the values in dispute skyrocket, since the separation couple does not agree, only one is happy – the lawyer. Its settlement and the court costs are based on the amount in dispute. If the couples manage to get “right in the wool”, the conjugal fortune is often not enough to settle the bill. Additional, unpredictable amounts of debt also do not speak for risk-free lending.
Credit during separation year – dependent partner
The dependent partner also has to deal with similar difficulties as the main earner. What actual maintenance the partner has to pay is difficult to estimate. Previously, income from a part-time job provided security for lending, but now it is difficult. A smaller income is often not enough to exceed the newly defined personal garnishment exemption limits.
If the partner pays maintenance on a regular basis, there is no guarantee that this maintenance will be available in the same amount later. Especially when couples separate in a strife, the debtor does everything possible to pay as little as possible. He would rather accept a penalty from the authorities and additional costs to annoy the ex-partner. If necessary, he quits his job. He works as a freelancer with an opaque income, hides abroad or simply does not pay on time.
Interim conclusion – credit during separation year:
Lending for a regular installment loan without a guarantor is extremely delicate from a credit security perspective.
What credit opportunities remain – quick credit solutions
It is easier for the clerk to grant a loan as a short-term loan during the separation year. The bank can cancel short-term loans much more easily than a long-term installment loan. At the same time, typical short-term loans, such as overdrafts or credit cards, are among the “gold donkeys” of money transactions.
An example of the risk being worthwhile for the bank would be a small loan of over 3,000 USD: the bank earns only 32.14 USD on the 3,000 USD installment loan from the loan comparison with a one-year term. If she gave the money as an overdraft, she would earn (not including repayment) around 500 USD from the loan. (Calculation basis for Sparkasse’s dispo rate of 16.88 percent as of April 2016).
If a smaller loan is sought during the separation year, various online providers offer the microcredit as a risk loan. The small loan comparison shows interesting offers for 100 to 500 USD net loan amount.
Maturities for mini loans vary between 30 and 90 days. The credit requirements for most offers are very easy to meet. From around 500 USD net income, even in spite of poor creditworthiness, one can hope for a loan during the separation year.
Installment loan during the separation year – private investors
The names Good Finance and Best Lender stand for serious loan offers under difficult circumstances. Both portals are considered the market leader in credit brokerage from private to private. Loan requests for a loan during the separation year fit very well into the credit concept of private investors. Anyone who lends their money to a private investor decides regardless of the legal framework for commercial lending.
Taking on a higher credit risk than a bank is part of the winning strategy for private financing. However, the risks for investors are not clear. The loan presentation and the dialog show which loans are expected to be repaid.
The loan is also approved in the bidding process. Every investor only risks a very small loan amount. If enough donors trust the ability to repay and offer, the loan is granted privately during the separation year. A bank is now responsible for further loan processing. The bank accepts payment of the partial amounts from the various investors. Then she transfers the loan to the borrower in one sum.