Credit despite debt is quite possible with Hartz 4 – income. However, the credit options are extremely limited. The loan volume is in no way comparable to a “normal” loan from the house bank. The article explains the possibilities.
Credit despite debt and Hartz 4 – difficult credit requirements
The prerequisites for a loan in spite of a Hartz 4 income are extremely bad. Hartz 4 is not suitable for being recognized as usable income for the loan application. ALG 2 is a social transfer benefit that is linked to the need. This means that it is not eligible as income for any loan request. In addition, the amount of benefit is significantly below the garnishment exemption limit. Even an income of this size is not enough for a normal credit approval.
The already existing debts make the situation even worse. It is already a remarkable feat to survive on a Hartz 4 income while at the same time performing a debt service. Despite the recognition for this achievement, the proper service of an additional payment obligation is even less likely. In order to be creditworthy, you have to work on the requirements.
Create conditions that enable a loan
A loan in spite of debt and Hartz 4 is possible if and a solvent guarantor or co-applicant enters into the loan liability. The problem of making the repayment properly is no less. However, the lender can, if necessary, hold the co-applicant liable. This limits his risk. Alternatively, valuable property security could be used to secure credit. Self-owned debt-free residential property would be suitable for this. In addition, the Credit Bureau must still be clean.
Despite these efforts, the house bank is likely to reject the loan request. In these cases, only a credit intermediary or a personal loan can help. It should be borne in mind that a risk loan, which in this case is beyond doubt, always costs more than an ordinary installment loan. It is therefore almost always advisable to forego the loan if possible.
Easy credit options
Not infrequently, it is the desire for a surety loan that is responsible for finding loans under such difficult conditions. The consortium has ordered the move and now the future landlord is asking for a deposit. In this case, the ARGE must provide the loan for the deposit without interest.
If the credit request arises from an emergency situation, for example the washing machine repair cannot be carried out, then the churches often help. In acute emergencies, charities also intervene with small interest-free loans. Unfortunately, there is no legal claim to this loan despite debt and Hartz 4. Any pawnbroker can make use of an instant loan that allows the last days of the month to survive.