Anyone who is a Social Welfare recipient and has negative Credit bureau entries has no chance of getting a normal installment loan. The reasons for this are very simple. The Social Welfare performance is so scarce that it only provides the essentials for survival.
In no case is there any scope to make regular monthly repayments for a loan despite Credit bureau entry and Social Welfare. Different statements, such as those made repeatedly by various credit intermediaries on the Internet or in the daily press, are dubious.
Even those who do a part-time job should not have a realistic chance of getting a loan despite Credit bureau entry and Social Welfare. Anyone who works illegally on the side, takes out a loan and pays the installments for the loan with the money they earn even becomes a criminal offense.
Loans from the job center
Social Welfare recipients also find themselves in the situation that they have to finance larger purchases or repairs in their home that will not be delayed. It is not uncommon for the case that rent or energy debts have arisen and now there is a threat of termination of the apartment or discontinuation of energy supply. In all of the above cases, it is possible to apply for a loan from the joint venture or job center despite Credit bureau entry and Social Welfare. If you have a corresponding need, you should present your request to your service supervisor or your case manager.
All documents have been checked for accuracy
If there are valid reasons and all documents have been checked for accuracy, the loan is approved very quickly and may only be used for the intended purpose. This is a very significant difference from a conventional bank loan, which is almost always available for free use. The beneficiary must prove to his job center that the credit has been used properly. Otherwise, the loan approval can be withdrawn at any time. This is also possible afterwards.
Repaid in monthly installments
A loan despite Credit bureau entry and Social Welfare must be repaid in monthly installments. Interest is not charged here. The amount of the monthly installments is determined individually and is primarily based on the financial capacity of the borrower. If a loan is to be used to pay rent or energy debts, the loan amount is transferred to the landlord or the responsible energy provider. In addition, the Social Welfare receiver would have to expect that the rent or the monthly discount for the electricity would be transferred directly to the responsible authorities. This is intended to avoid further rental or energy debts.