Loan with a limited employment contract is usually issued for 24 months

If an employee wants a loan, the bank asks about the employment contract. However, if the employee can only submit a temporary contract, the bank will reject the loan with a temporary employment contract. The term of an employment contract will be shorter than the term of a loan. A fixed-term contract of employment is usually issued for 24 months. Within this time, there is then the option of a loan with a temporary employment contract.

The loan with a fixed-term employment contract – the starting point

The loan with a fixed-term employment contract - the starting point

The huge boom in agency workers is gradually diminishing, but temporary employment contracts are increasingly coming into play. Not only the young professionals, but also highly qualified employees at universities and research institutions are affected. Even the state is leading the way in chain contracts in the public sector.

Unions are critical of fixed-term contracts because workers are influenced in their entire life plans. There is simply no financial predictability. Good earnings often do not help either, because the time limit shows up as a risk with a loan.

The employee with a fixed-term contract is handicapped in his financial planning, because banks are rather skeptical about a loan request under these circumstances. It is workers who need a loan for a car without not coming to work. But banks prefer to lend to employees with secure jobs and to officials who may have completed their trial period.

Banks see a loan with a fixed-term employment contract as a risk that the employee will be without income after the fixed-term contract. Protection against dismissal is also causing problems for banks. Without income, however, means that the monthly installments can no longer be paid. An employee should also see this for himself when looking for a loan with a fixed-term employment contract.

A fixed-term contract usually lasts two years. If a loan can be paid during this period, it will also be approved. No loan is usually approved for longer than the time limit.

Therefore, the worker should ask the questions:

  1. what are the chances of an extension of work?
  2. can I quickly find a job again?
  3. can the rate possibly be paid by unemployment benefits?
  4. are real assets available that may be sold to repay debt?

If you can answer the questions positively, you can look for a lender who still approves a loan. However, not every bank will give its yes to a loan.

Exceptions to a temporary employment contract

Exceptions to a temporary employment contract

Before applying for a temporary employment loan, an employee should draw up a budget. All income and expenses should be recorded in it. If there is financial scope, there is a good starting point for a loan.

Then a little preparatory work can be done. With a loan comparison, the employee can run through some scenarios for loan offers. He can enter the loan amount and the loan term and will then see the monthly installment to be paid. He can do this until a rate appears that could also be paid in the event of unemployment.

It is not only unemployment that often makes it impossible to pay loan installments. Nobody is certain that they will get a serious illness. Then there would be an incapacity for work, with a pension that is probably not generous. The rate should also be adjusted accordingly. Now that the amount of the installment is certain that the employee can safely afford, he should look for a bank.

Also when comparing loans, he sees not only the interest rate on a loan, but also the terms and conditions of the lender. It could then be seen which lender also approves a loan with a time limit. The collateral to be submitted will then probably be listed.

Sometimes banks also approve a temporary employment loan if the loan seeker has a good credit rating. One thinks of a scientist in a research object or a teacher. Officials with their probationary period also have a good chance of getting a temporary employment loan.

If the loan amount is so high that it cannot be paid within a two-year period, a loan could perhaps be concluded. However, the customer’s credit rating must be impeccable. Lending also works if the loan seeker has been a customer of the bank for many years.

The banks then know about the customer’s finances and will then check whether all liabilities have been paid on time in the past. To do this, the customer’s Credit Bureau is queried. If the Credit Bureau is burdened with negative entries, then there will be no loan with a fixed-term contract anyway, because then the bank has a double risk.

That’s how many loan offers you get

That

In summary: Anyone applying for a loan, regardless of which bank, must have a sufficiently high income, an unencumbered Credit Bureau and permanent employment without a fixed term. If the amount of income is correct and the Credit Bureau is clean and the permanent position without a fixed term, the loan seeker has the best conditions for a loan.

The credit opportunities are increased if a guarantor can be named. However, this must be solvent. The aforementioned credit terms also apply to him. However, a guarantor should be an unconditional confidant. Think of the partner or the parents or grandparents. The guarantor must also know that if the borrower defaults, he must continue to pay the loan.

If the customer has the prospect of an extension of the employment contract, a personal interview with the bank and a corresponding certificate from the employer could also result in a loan with an unlimited employment contract. This is especially important if it is known that the employer always extends the fixed-term contracts.

Overdraft facility, which almost all employees are likely to have, offers a quick credit solution. Banks provide it to customers who have regular income. According to how high the income is, the bank provides up to three net monthly salaries. If someone now earns 2,000 USD net, the overdraft facility should already be 6,000 USD. However, this loan is expensive and should only be used for a short time.

What is credit without Postident?

Loan seekers who apply for an online loan keep hearing the term “postident” and wondering what that is. The Postident is prescribed by law and is a personal identification based on the identity card, i.e. an identity check. Previously, no loan could be granted if the postident was not available, but a few things have changed. There are other ways to get an online loan without Postident.

The initial situation

The initial situation

This includes that some providers are satisfied with a copy of the ID card. The employment contract also serves as proof of identity. Copies of bank statements and proof of salary are also recognized. The technology did not stop at the Postident, of course, and there are some providers who now offer the Video-Ident.

Anyone who has previously applied for an online loan may have already been asked to make the Postident. This has to be done at the post office. The customer thus carries out an identity check based on his name, place of residence and age. A postal employee checks the data of the postident with that of the ID card and issues a corresponding certificate.

This is prescribed by law with regard to the Money Laundering Act. The loan seeker must also identify himself when applying for a loan in a branch. This process is also required when opening an account. Gone are the days when a bank employee simply ticked the box next to “person known”.

Usually this is for a customer who lives in the city and a post office nearby has no problem. Only the opening times could be problematic if, for example, the customer has a long working time in the evening. Then Saturday would still be available.

However, if the customer lives in the country where there is a post office in the next town or even further, it looks worse. These branches also often have short opening hours. Anyone who works has problems there. It should also be mentioned that the postident’s process can slow down a loan application. Because a credit without Postident is not approved.

The loan seeker does not have to fear costs for the postident. Normally the lender bears the costs. The costs incurred can then be found in the total costs of the loan without Postident. The actual process of the Postident is not long, it is done quickly, the customer does not have to plan a long wait. Often, the identity control certificate with the necessary credit documents is sent to the lender, which should then be there the next day.

Alternatives to the postident

Alternatives to the postident

If the customer applies for a loan without a Postident in a bank branch, the Postident is not applicable. The employee will determine the identity of the customer based on the presentation of the identity card at the counter. The customer should note that his identity card is still valid. It is important here that the customer must adhere to the opening hours of the bank.

In general, the customer can assume that where there is no post office or bank branch. The customer can also assume that an online loan always has better terms than that of a branch bank.

The customer can avoid legitimation at Swiss Post if the branch bank is connected to an online bank. The customer can then legitimize himself at this branch.

Foreign banks that provide online credit without Postident often occur, especially when it comes to a small loan amount, that a copy of the ID or an electricity or water bill is sufficient. Whether this process is ultimately faster remains to be seen, because not everyone has a copier at home. Not everyone also has a smartphone, which the customer could switch to by photographing the ID and sending it to the bank by email.

That would be an alternative, but not all foreign banks accept this option and many of these banks do not offer particularly good conditions for a loan without Postident.

The video ident

The video ident

A new development on the financial market can be seen in credit without Postident with video legitimation. To do this, the customer must have a powerful computer and a webcam, plus a valid ID card. Age, place of residence and name are entered in the form provided. An employee then uses video chat to compare the data with that on the ID card. The ID is held up in front of the camera.

The next step is to take photos of the identity papers. The customer receives a so-called TAN via SMS, which he has to enter in a previously specified field. After that, the authentication via the PC is completed. There are a total of 10 steps required for the video ident. Providers who do this have noted this on their pages.

Once the identity check has been completed, the credit documents for the loan without Postident must be sent by post, if this has not yet been done. Salary slips, bank statements and a copy of the employment contract and a small household bill are required as credit documents. The online identity check has a little catch, it cannot be offered for 24 hours.

Informational

Informational

Not all online banks offer video ident. Online banks do not have a special area with extra employees, this service is outsourced. Large providers such as the company WebIF Solutions from Berlin have been approved by the Federal Financial Supervisory Authority. Swiss Post has also responded to this new development and is offering its own procedure. The name Postident Video.

The customer is then not with a bank employee of the commissioned bank, but with an employee of another company. For this reason, no additional questions should be asked unless they concern legitimation.

Other banks also provide the loan without Postident. Here, the legitimation of the transmission of ID copies by e-mail is carried out by uploading image files. However, this process is not yet so widespread, primarily the video ident is used.

The online legitimation does not only refer to the credit without Postident, securities accounts, current accounts or credit cards can certainly be provided online, whereby it can be legitimized online.

In general, however, a new identity check is no longer necessary if one has already been carried out at the bank.