Officials enjoy special credit advantages due to their professional status. Because of the above-average secure income they are welcome customers at banks and credit institutions. This is most likely expressed in the civil service loan, which was designed especially for this group of people. The cheap official loan is now offered by a variety of banks and is most worthwhile for long-term financing.
Finance on the cheap official loan
The special feature of the civil service loan is that in addition to the normal loan agreement, a capital-forming life insurance is completed. At first glance, this may sound like a double burden, because besides the expenses for the loan now also insurance premiums have to be paid. But on closer inspection it can be quickly determined that this constellation pays off for the official. This has namely during the entire term to make any repayment payments, but only interest payments.
The capital-forming life insurance is used to repay the loan amount at the end of the term by means of the lump sum. This initially results in a great advantage in the form of a much longer term. The loan itself is thus ultimately a bullet loan with a special form of repayment. From a security perspective, too, this approach has its advantages, as a life insurance policy is a safe investment with minimal risks (depending on the investment strategy of the insurance company).
Usually, the capital invested in life insurance also generates a surplus. This also benefits the official, and the insurance is used for repayment. By the way, the cheap official loan is not tied to the conclusion of a capital-forming life insurance policy. Alternatively, a pension insurance with capital option can be completed. The right to vote is important because it has to be used at the end of the term in order to be able to repay the loan amount in full.
The favorable official loan brings with it another advantage: The fixed interest periods are much longer here than with normal installment loans or real estate financing. While 10 to 15 years are usual here, the official loan can often come up with 20 or more years, which offers the applicant a high degree of costing certainty. In terms of interest rates, too, the civil service loan offers better conditions, as the effective interest rates are often below 5%.
For what purposes is the civil service loan suitable?
According to its long-term interpretation, the cheap official loan is most suitable for larger purchases, such as real estate financing or the purchase of a new automobile. However, civil servants should inquire in advance which credit institution offers this loan, since by no means all banks have such a loan in their assortment. However, the favorable civil service loan is not awarded without the fulfillment of certain conditions, because despite the professional status (which must be proven as such), emphasis is placed on the fact that there is no negative credit bureau entry and therefore no other loan is running.
This is especially true for automotive banks in a vehicle financing. In order to make these as cheap as possible, it is advisable to take the cheap official loan at another bank to pay for the car in cash. As a result, in addition to the favorable financing interest and cash discounts can be negotiated, with which the car is ultimately even cheaper.
The official loan also offers a very good opportunity to replace existing and above all expensive loans at low interest rates. Offers about such loans are most likely to be found on the internet and comparisons, making it easy to find a suitable loan.