The low-income loan is always linked to a certain credit line, which is usually not too high, since the borrower’s income is simply too low for a larger line. Since low-income earners have only a very low income, they can often only take out a very low-valued loan.
The term must also be precisely matched to the loan,
High monthly installments with a short term can quickly result in late payment, which in turn results in negative entries at Schufa and in high dunning costs. As a result, the loan for low-income earners is often limited to a maximum of around 10,000 USD, with many banks only providing microcredits of up to 2,000 USD. The maximum credit limit depends on the individual case and the exact amount of income.
The type of income is also crucial for the low-income loan, since insecure employment, such as temporary work, further reduces the credit rating. It is not uncommon for low-income earners to have to provide additional security in the loan agreement, which can be a guarantee, for example, but also attachable assets such as a car or property that has already been paid off. In order for the loan application to actually be approved, a provider with a high acceptance rate should be chosen in any case, since they tend to accept the loan even if their creditworthiness is poor.
Get a loan with low income
Also, a first-time rejection of the loan application should not make potential borrowers despondent directly, because banks always assess the creditworthiness a little differently in detail. A loan calculator not only allows you to find cheap banks in comparison, but also banks with a positive rating from previous borrowers and a high acceptance rate. All of these factors can be critical when applying for a loan if your income is very low.
The general rule of thumb is that loans with a minimum income of at least 850 USD are issued net per month. If the potential borrower earns less, he has to provide a guarantee in any case, since the regular income per month simply does not offer enough scope for the full payment of the installments on time. The loan for low-wage earners is issued much more often with direct banks than with conventional house or large banks, which is why those affected should rather go to a direct bank.
If the amount is smaller, the private environment can also be contacted if the bank has already given a rejection. Loans in the three-digit or a small four-digit amount can be taken out from friends or relatives, provided there is a good relationship and the financial means are actually available to the intended lender. In any case, there are always opportunities for a loan for low-income earners.