A loan as a pensioner is not impossible, but requires care when applying.
In fact, this is not easy and pensioners are considered a risk factor in many banks! In this article, you will learn how to increase your chances of getting a pensioner loan and how to make your financing a success despite your advanced age.
Basically, the older you are, the more difficult it is to get a loan. If you are about 32 years old and 63 or 65 years old, you are more likely to get a promise than people aged 70 or 75. The risk of credit default increases for the bank every year. Check your personal finances before or when you withdraw and bring important investments, such as age-appropriate renovations in your own home, a few years earlier.
Keep the term and loan amount low
You significantly increase the chance of a loan as a pensioner if you request the smallest possible amount and a short term (12 to 36 months, except 48 months) from the bank. So plan your financial needs carefully and, if in doubt, choose a smaller amount.
To offer collateral
A house offers the bank security and increases the chance of a loan.
You offer the highest security in the form of regular income. With the pension you basically have good prerequisites, as it is paid securely and monthly. With each additional source of income, such as additional private provision or income from renting and leasing, you move one step closer to the loan.
You can earn further plus points if you apply for a loan not with your partner but with two people, for example with your spouse. The risk of loan default is divided between two shoulders, which means that many banks grant loans to pensioners much faster.
The usefulness of a residual debt insurance is often discussed controversially. This insurance applies when the borrower can no longer pay his installments. However, this protection makes the loan more expensive. For pensioners, residual debt insurance is often inevitable, since this also signals further collateral to the bank and the application is rather approved. You can find the option to take out this insurance in the loan application to the bank.
If you also inform the bank about your assets, a paid-for property or a car can work wonders.
Checklist loan for pensioners
The sooner (younger) you apply for a loan, the better
Don’t choose too large a loan amount, calculate realistically and conservatively
Ideal duration 12-36 or 48 months
Provide the bank with collateral (house, apartment, rental income etc.)
- It is best to apply for the pensioner loan in pairs
- Think about taking out residual debt insurance