Employment Terms Explained: Understanding Fixed-Term Contracts and Probationary Periods!
Obtaining a loan with a fixed-term employment contract can present some challenges, but with the right approach, it is possible to secure funding. Here's what you need to know.
Firstly, it's essential to understand that interest rates for loans with fixed-term contracts are often higher than those for permanently employed individuals or civil servants. This is due to the increased risk associated with temporary employment. However, accepting higher interest rates can increase the chances of obtaining a loan.
During the probation period, getting a loan can be particularly tricky due to short notice periods and the increased risk of losing the job. In such cases, it may be beneficial to conduct a thorough credit comparison to find the best loan options. Good creditworthiness (no negative SCHUFa entries) is necessary to obtain a loan.
One way to improve your chances of securing a loan is by offering to take out the loan with a second person or naming a guarantor. This spreads the responsibility for repayment and can make the loan less risky for the lender.
A framework credit, where an already approved credit limit can be drawn upon in full or in part as needed, can also be a viable option. However, loans for the self-employed present a higher risk for banks, so they may come with stricter conditions.
Banks typically prefer to lend to people with a secure job and high income to minimize risk. High income during the fixed-term employment contract can make it possible to obtain a loan. It's worth noting that a loan with a short term (to be repaid within the term of the employment contract) increases the chances of obtaining a loan.
Loans for smaller amounts, such as 500€ or 1000€, reduce the bank's risk of loss. In fact, many experts now expect a further reduction in the key interest rate, leading many banks to lower their credit interest rates.
Installment payment plans for purchases in a store or online may be easier to obtain than a bank loan, especially for smaller amounts. Additionally, a disposition credit is typically granted to holders of a checking account after 6 months.
When it comes to financing a house with a fixed-term employment contract, additional conditions must be met, such as the reason and duration of the temporary position, the amount of own capital contributed to the financing, and the presence of additional securities and a high income.
Lastly, be cautious of offers promising interest-free installment plans, as the interest may already be included in the price. Always read the fine print and consider all the factors before making a decision.
In conclusion, while obtaining a loan with a fixed-term employment contract can be challenging, it is possible with the right approach and understanding of the lending landscape. By being aware of the factors that influence interest rates and the types of loans available, you can make informed decisions and secure the funding you need.
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