Loans in later life

Many people who are already retired find it difficult to obtain a loan for pensioners from some credit institutions and banks. It does not matter for senior loans that the retirement pension is a secure income paid for the rest of life. The sole factor for banks is the increased risk of payment default due to the death of the borrower among seniors. Banks lack the certainty of receiving repayment in such cases.

Anyone seeking a loan for pensioners should therefore research carefully which institutional or private lenders are willing to grant such a pensioner loan and under which conditions. Loan offers should therefore always be compared. It is of course advantageous if the senior has good creditworthiness and thus a regular income and a positive SCHUFA record. Only negative entries at SCHUFA are frowned upon. However, the decision ultimately lies with the banks as to whether they are willing to engage with an older borrower.

Age restrictions for a loan for pensioners?

Seniors as early as 60 or 65 years old may already encounter problems when being granted a loan. Although the average life expectancy at this age is still 15 to 25 years, many lenders such as banks shy away from the risk associated with a loan for pensioners of advanced age.

In some cases it can be helpful to own larger valuables or a capital life insurance policy that can be provided as collateral for the loan for pensioners if needed. Those who choose this option must be aware, however, that the valuables may not be used or sold during the loan term. Only once the loan for pensioners has been fully repaid is this unrestricted use possible again. If the term therefore lasts several years, this should be carefully considered.

For people who are already 70, 75 or 80 years old, the situation becomes even more difficult. If they can obtain a pensioner loan at all, it is usually only possible with a short term. Even here there are various exceptions and a comparison is worthwhile.

Requirements for a loan for pensioners

For this reason, anyone who has not yet had success finding a suitable loan for pensioners should not give up prematurely, but should examine the full range of offers—which is often very confusing for laypeople—more closely. Comparing installment loans is worthwhile here as well.

Good chances of obtaining a loan for pensioners generally exist when a person from the borrower’s own family or circle of friends agrees to act as a co-applicant and guarantor. This person must, however, be creditworthy and have a regular, sufficiently high income. This is particularly important because the person concerned might be forced to take over the monthly installments for the loan for pensioners in case of doubt. Under no circumstances should taking over the guarantee lead to the guarantor being unable to meet their own financial obligations or to their livelihood being endangered. Therefore, the creditworthiness of this person is especially important and will also be checked with SCHUFA.

Many lenders offer their customers credit protection insurance. Whether and to what extent such insurance makes sense in an individual case cannot be answered definitively. A credit protection insurance can cover various risks that frequently accompany a payment default. Since pensioners can no longer become unemployed or unable to work, the credit protection insurance should only refer to a possible death during the loan term. Otherwise the cost is too high without providing real benefit for a loan for pensioners.

Loan for pensioners from MAXDA

Anyone looking for a reputable loan for pensioners and unable to decide can turn to MAXDA with confidence and submit a loan application there. This application for an installment loan must be filled out carefully and include personal details. These include not only the surname and given name, but also the date of birth, marital status and proof that wages, salary or pension are received regularly. Pensioners must therefore present their current pension notice and, if necessary, further proof of income.

It is also useful to provide a telephone number and an e-mail address on the loan application. This allows MAXDA to contact the relevant pensioner quickly if there are any questions and to clarify all open issues regarding the loan approval. MAXDA has many years of experience and excellent connections to various domestic and foreign lenders such as banks. For this reason, in the vast majority of cases we will succeed in finding a suitable loan for pensioners.

This applies regardless of the borrower’s age and income level. A monthly pension of at least €850 should, however, be available. Otherwise, a loan can only be realized by banks if a solvent guarantor can be found. Depending on income, loan requests between €3,000 and €250,000 can be fulfilled. MAXDA will provide further information on request; we are happy to provide telephone information. If required, an appointment for a personal meeting on site can also be arranged.

Loan for pensioners - terms and process

The term for a loan for pensioners can be agreed individually and usually runs over several years depending on the loan amount. It is primarily determined by the desired loan sum and the monthly repayment rate. Interest rates are the same for all customers and generally start at 3.99%. The mere fact that the senior is creditworthy is sufficient for MAXDA to grant a loan.

At disbursement the borrower can choose whether they want the money paid out in cash via post or transferred to their checking account. In this case MAXDA will strive to approve and disburse the loan for pensioners as quickly as possible. However, it may take up to three business days until the money is actually available. This is mainly due to the banks’ transfer processes.

Four weeks after disbursement the borrower begins repaying the loan. The amount of the monthly installments as well as the interest generally do not change during the entire term. The payment date can be chosen as either the 1st or the 15th of a month. All details are recorded in the loan agreement, which must be signed by both the lender and the borrower.

Anyone who wishes to repay the loan for pensioners in whole or in part ahead of schedule may do so at any time. MAXDA expressly emphasizes in this context that early repayment is always possible without difficulty.

Comparison of lending institutions

As already mentioned, the various lenders and their loan offers should be checked and compared with each other. There can be significant differences that need to be identified. Differences in interest rates are particularly common. Interest is calculated from the loan amount, the required term and the nominal interest rate of the bank.