Student loan
Studying offers young people many opportunities, but first of all it has to be financed. If parents do not have the option of supporting their children financially or do not want to pay for their studies, other solutions must be found, but fortunately there are enough of them. So that no one can be forced not to study.
What is a student loan?
Student loans are loans for students that are offered either by the state or by private banks. Students themselves determine how high the monthly installment should be.
The KFW Bank is particularly well known, providing individuals with up to €650 per month to cover rent, books and other expenses during their studies. However, unlike Bafög, the entire amount is paid back at the end of the course. Nevertheless, such student loans offer some advantages, which we would like to discuss in more detail
Advantages
- In contrast to Bafög, support from a bank is not dependent on the parents’ income.
- No loan collateral is required, which is otherwise common with bank loans.
- Loans are granted regardless of the field of study.
- The submission of study certificates is no longer required.
- The student loan does not check whether the basic studies were completed after four semesters or not.
Only the duration of studies is taken as a benchmark, according to which the total amount is based.
Disadvantages
- Most banks have a set age range in which you are eligible for a student loan.
- The loan amount must be repaid in full after graduation.
- The maximum duration of study is specified.
- The repayment period is precisely defined.
Who offers student loans?
We will mention it once more: the KFW (Kreditanstalt für Wiederaufbau). It is the largest player in the student loan market. Private banks such as Deutsche Bank or Commerzbank arrange KFW loans if you apply for a student loan there. Other private banks such as Sparkasse, on the other hand, have their own models with different conditions. The Volksbank also offers its own models for financing studies.
How do I find the right bank for me?
This is probably the most important point of all, because there is not one perfect solution for everyone, but many individual offers for different life models. We recommend checking out the CHE (Center for Higher Education Development), which has taken a close look at 43 different student loans and classified them as reputable. Student loans, education funds and graduation loans were compared with each other in 2020.
On the other hand, extreme caution is required with internet loans from private individuals. And extreme caution means not even considering these offers.
How do I find the right rate for me?
It’s worth thinking about your needs in advance, as you will have to pay back the entire amount at some point. So ask yourself specifically how high your expenses and fixed costs are. Even with the highest rate of €650 from the KFW, you won’t be able to cover all of your expenses, depending on where you are studying or your course of study, but it’s not forbidden to work on the side. Once you have a plan for your studies, your everyday life and your financing, you will not only be able to find the best student loan, but also live and study in a more relaxed way .