Credit despite sick pay

If an employee receives sick pay, it can be assumed that he has a serious illness. Sickness benefit is paid after six weeks of illness as continued wages. Many workers do not know what to do after their illness. Can he work again, is there unemployment or even Hartz IV? Questions that can gnaw on a sick person.

In the past, employees were protected against dismissal during a sickness certificate, but today the employee can dismiss the employee. This gives rise to fears of existence that often end in depression. In addition, many workers also have difficulties with their finances. A loan would have to be applied for, important purchases are in the house. But does the bank grant a loan despite sick pay?

The loan despite sick pay – the situation

The loan despite sick pay - the situation

Employees have less income while receiving sick pay. The professional situation has also become uncertain. Will the employee keep me busy? Can I still work? These are questions that can already strain an employee. In addition, there is the financially tense situation because sickness benefits are lower than the previous wages.

Banks are very reluctant to take out a loan despite sick pay. After all, neither the customer nor the bank knows how the customer’s financial situation will develop. Does he get unemployed or in Hartz IV? The situation is different for civil servants or civil servants. This occupational group receives their income longer before sick pay is paid. There is also no prospect of dismissal, the job is secure, the employee cannot be dismissed. This means that this clientele has a good chance of getting a loan despite sick pay.

But even the employee who does not work in the privileged professions has the prospect of a loan despite sick pay. If he knows that the service can be resumed after the end of the illness, the bank will agree to a loan despite sick pay. This would be the case, for example, if the employee had broken a bone. There is no telling when it will heal.

But there are diseases where the end is open, where the employee does not know how to proceed. Does the disability pension come from which no one can live or unemployment? This naturally reduces a customer’s creditworthiness and the bank rigorously refuses the loan despite sick pay. However, it does not intervene in loans that are still in progress if the employee pays the installments correctly.

The way out

The way out

The bank will refuse the loan in spite of sickness benefit under the given circumstances, unless the customer is satisfied with the overdraft facility that the banks provide their solvent customers. If a overdraft facility has already been set up, the bank could expand it. It can often be used to pay for the most urgent things.

However, the overdraft facility also has a catch, because on the one hand it is an expensive loan and on the other hand it should only be used for short-term use. If the employee could work again after his illness, the overdraft facility is not a problem because he could be rescheduled into an installment loan. If this is not the case, however, the income remains reduced, the overdraft facility can become a debt trap.

The employee should consider that interest is drawn on each quarter to use the overdraft facility. If nothing is returned, the amount will add up properly. If it then comes to the point that the banks no longer carry out transfers because the account is not funded and return debits arrive, then the employee has an urgent problem.
Therefore, the use of the scheduling should also be carefully planned.

The loan despite sick pay could be realized if the employee can name a second applicant or a guarantor. Both persons must be solvent, that means a sufficient income and a clean Credit Bureau.If a guarantor is found, it should be fully informed about the guarantee. For example, that the guarantee is a big risk. That the guarantee can possibly ruin him financially.

The second applicant must also be solvent; from the outset he has the same status as the borrower. Specifically, if the employee can no longer pay, the bank immediately turns to the second applicant. In most cases, a guarantor is only used when the borrower has gone through all legal instances up to enforcement. This type of loan should only be used if it is certain that work can be resumed after the illness and if there is absolute trust between the two borrowers.

The alternatives

The alternatives

The employee with his limited credit rating could, under other circumstances, receive a Credit Bureau-free loan from abroad. These banks do not query Credit Bureau, but there must be a minimum income. For a single person this is at least 1,100 dollars. The income must show an attachable portion. Permanent employment is also required. Proof is provided with a copy of the employment contract.

Since these banks also request bank statements, the bank will see that sick pay is being drawn. However, the foreign banks do not accept this, the loan despite sick pay is also rejected here. The reason that sickness benefit cannot be attached. Unemployed people also do not receive this loan, and unemployment benefits cannot be attached.

Those who receive sick pay still have financial worries about their illness. A small loan can often be taken out from relatives or acquaintances. If the employee is lucky, a written loan agreement should be drawn up.

There are portals on the Internet that offer loans to employees. There are two known ones, Fine Bank and Across Lender. There, the employee can create a profile and submit his credit request. Private investors do not see the conditions for a loan as narrow, but still insist on certain conditions. For example, the Credit Bureau must be clean. The interest rate level will also be higher.

If you see no other option, you can register there and confidently present your loan request. However, the employee has to bring time until lenders agree to commit to a loan.
There must also be no enforcement notices, reminders or disclosure notices, which is also a credit exclusion for private investors.

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