Young people are just beginning their independent lives. You are starting an apprenticeship, want to get a driver’s license or move to your first apartment. These things always cost money, which is often missing. A lot of money is not yet made in training and may just be enough to make ends meet.
A car can be helpful to get to university or training place and nobody wants to live with parents forever. Banks know that young people in particular also have wishes that don’t want to wait long. For this reason, loans are granted to young people.
What are the requirements?
If you want to apply for this loan, you should know a lot in advance. If the applicant is not yet of legal age, the signature of the parent or guardian is required for the loan. Without this signature, no bank grants a loan. This is because the loan with a low salary, like the training salary, is not sufficiently secured. Banks do not take any risks when lending and want to have the borrowed money back.
Another criterion that young people must have when granting loans to young people is that they no longer work during the trial period. During the trial period, the employment relationship can be terminated from one day to the next by both the trainee and the boss.
Conditions of the bank
Loans for these people are granted on special terms. So it is usually only a small loan, the loan amount is not higher than 5,000 USD. In this way, the bank wants to prevent young people from getting into excessive debt. If you already have a fixed employment contract in your pocket, you will also be able to take out higher loan amounts. The interest on loans for young people is low, because the loan should not burden young people too much. Today’s young customer is tomorrow’s high-earning customer. Thus, many banks lure with attractive offers.
What should be considered
A budget should be drawn up before taking out loans for young people. This is where expenses and income are entered to see if there is any money left at the end of the month. This amount can be used to determine a loan amount and thus a repayment rate. The first way should lead to the house bank, because this, where the current account has already been opened, knows the finances of the applicant very well and can give valuable tips and provide urgent advice on loans for young people.