Basically, one can say that teachers are still a very welcome clientele for every bank or savings bank, as well as for online credit intermediaries. This is mainly due to the fact that teachers are employed in the civil service and thus, unlike employees in the private sector, have a secure job with a relatively high income. Of course, there are some differences here too – customers are particularly welcome as lifelong civil servants, because their jobs are definitely safe, but also teachers, who are currently only probationary or public service employees, enjoy the financial institutions a good reputation and a loan for teachers is usually not a problem. Nevertheless, the credit line for a loan for teachers, as well as for the award of any other loan, depends on the size of the net income and the available collateral.
Normally, a loan for teachers makes the most sense to apply for a civil servant loan. Here, the terms are usually around 50 percent cheaper than a installment loan with a bank or savings bank.
A Civil Service Loan is a loan granted exclusively to civil servants, probationary officials and civil servants. The peculiarity of this form of credit is that together with the loan a life insurance policy is concluded. The loan and the life insurance have an identical term. This has the advantage that the borrower only pays the loan interest on the loan on a monthly basis and the loan is thus repayment-free throughout the term. In addition, the borrower pays the contribution for life insurance. At the end of the term of the loan, this is repaid with a one-off payment from the accumulated life insurance premiums.
Advantages – Civil Service Loans
In a public sector loan, that is, a loan for teachers, the financial monthly burden is relatively low, since only the interest on the loan and the contribution for life insurance must be paid. It should be noted, however, that premiums for life insurance are considerably lower if the policyholder decides to take out life insurance at a young age. Furthermore, the terms of a civil service loan are very flexible in their design.
Usually they are 12, 15 or 20 years depending on the desired monthly load. It should also not be underestimated that a life insurance policy, should the policyholder die before the expiry of the contract, represents a protection for the family, since the latter can pay the loan out of the sum that is then available as mortality protection. In addition, it is possible at any time, except in the first year after conclusion of the contract, to replace this loan for teachers prematurely by special repayments. It is also important that there are no processing fees for this form of credit. Furthermore, the interest rate is fixed for the entire term and for the civil service loan no credit bureau query is made. In addition, endowment life insurance usually generates fairly good surpluses, which are credited to the policyholder’s account at the end of their term.
Currently leading the market is the ERGO Insurance Group. Here is a civil servant loan with an annual percentage rate of 7.26 to 7.58 percent available.