Civil servants not only have a very secure income, they also have a good credit rating. For this reason, getting a loan for civil servants shouldn’t be a problem in general.
Compare loan offers
Due to the fact that the loan offers are usually very diverse, it is advisable to carry out a comparison. Civil servants often benefit from similarly favorable interest rates as civil servants or civil servant candidates. Loans for public servants can be credit-dependent or credit-independent. In addition, they usually have very long terms, which makes low monthly repayments possible.
Application and approval
Once the right loan has been found, it can be applied for either online or in a bank branch. In the former case in particular, the loan application is checked very quickly and either approved or rejected within 24 hours. If the loan application can be met, the money will be transferred to the customer’s checking account. In most cases, a loan for public sector employees is freely available. There are only a few exceptions to this rule. This would be the case, for example, with a car loan or a real estate loan.
Every loan, regardless of whether it was given to an employee, an official or another person, must be repaid in monthly installments. The amount of these installments depends not only on the amount of the loan taken out and the term, but also on the annual percentage rate.
Although most civil servant loans are only open to civil servants or trainee officials, they can also be used by civil servants in certain circumstances. An important prerequisite for this is that the persons concerned have been employed in the public service for several years or decades and can provide faultless Credit Bureau information. In principle, however, each bank decides for itself who it wants to grant an official loan to and who it excludes from the outset.
A very significant difference from a conventional loan is the fact that in the case of a civil servant loan, capital life insurance must still be taken out in parallel to the loan contract. The official loan will not be repaid during the term. The borrower only has to pay the monthly life insurance premiums. The purpose of this procedure is to repay the entire loan amount with the life insurance. This always happens at the end of the term. If the life insurance has generated large surpluses, the borrower may be involved.