Credit despite parental allowance – what can you offer to the bank

After a baby is born, one parent usually stays at home to take care of the newborn. After all, there is nothing better than experiencing the first years of your life up close and building a close bond with your child.

But for this personal luxury, most have to pay a high price, because if only one partner goes to work, the income automatically drops. In the first year after the birth of your child, you will receive parental allowance, which is a fraction of your previous income. After that, you have a choice: stay at home or return to your old job?

Credit despite parental allowance – financial help for new parents

Credit despite parental allowance - financial help for new parents

Of course, high costs can also arise during parental leave, for example if the car breaks down or the living room needs to be renovated. With only a fixed income and parental allowance, it becomes difficult to cover all expenses. For this reason, many want a loan despite parental allowance. A loan in spite of parental allowance is possible if your partner earns enough and you have debt under control even without parental allowance. After all, the parental allowance is only paid for a limited period of time and is therefore not seen by the banks as a loan security. Of course, the chances of getting a loan increase if your partner earns a lot or if you can offer the bank other collateral (e.g. home ownership, appointment of a guarantor).

Credit despite parental allowance – saving is important

Credit despite parental allowance - saving is important

Since money is usually scarce during parental leave, you should save as much as possible. It starts with electricity and ends with credit. For this reason, it is important that you do not simply accept any offer, but that you inform yourself well and that you carefully treat your bank’s suggestions.

You can find a cheap and advantageous loan on the Internet, where there is now a large selection of online banks. This gives you the opportunity to choose the best offer. However, keep in mind that the quality of a loan is measured not only by low interest rates, but also by other conditions. Whether long terms, low monthly installments or opportunities for special repayments – the overall picture is crucial.

A loan despite overdraft is completely unproblematic

The overdraft facility is actually intended for emergencies. This is already shown by the extremely high interest rates, which are often called punitive interest rates for a reason. However, many people have to live with the fact that your checking account is often in the negative range. They worry that if you ever need it, you won’t be able to get another loan because of this debt. In fact, such concerns are unfounded. Even the legal situation will help you, so you should look for an appropriate loan.

Credit despite overdraft facility: The bank must offer you an installment loan

Credit despite overdraft facility: The bank must offer you an installment loan

For some time now, a law has been in place to help people escape the disposition trap. Basically, that says that the bank has to offer you a cheaper installment loan if your checking account is in the red again and again within three months. You will receive the corresponding letter with the offer by post – you may have already held one in your hands.

For you, the legal situation is good news and bad news. The good news: you can get your loan very easily despite overdraft. The bad: The loan is not free, you have to use it to replace your overdraft facility. Many banks will also delete your overdraft facility to ensure that you do not simply exhaust it immediately.

However, the whole thing can take a positive turn for you: The loan that is offered to you can be higher than your overdraft debt. In plain language this means: You can use the difference as you see fit. As a rule, you can easily get loan amounts of up to $ 3,000. If your overdraft facility is, for example, 1500 dollars, you have another four-figure amount that you can use as you see fit.

Loan despite overdraft facility without overdraft facility: mostly unproblematic

Loan despite overdraft facility without overdraft facility: mostly unproblematic

In the event that you need a loan despite overdraft facility that is not used to replace the credit line in your checking account, you should generally also have no difficulty in getting this money. In fact, most banks don’t care if you are overdraft or not. That doesn’t trigger a negative entry in the Credit Bureau or anything like that.

The only questions that interest banks (and all other donors) are: Have you been able to meet all your payment obligations so far? Do you also have enough financial leeway in terms of your monthly income and expenses to easily pay the loan installments and keep a little cushion for emergencies? So if this is the case, you will get the loan you want.

Credit despite receiving sickness benefit

Those who receive sickness benefit do not cure a small cold. The disease is more serious there. In addition to the illness, many customers express financial worries. But when receiving sickness benefits, the customer can expect that the house bank will reject the loan despite receiving sickness benefits. The reason for the rejection is that sick pay cannot be attached because it is a state benefit.
But there are other reasons.

The loan despite receiving sickness benefits – the prospects

The loan despite receiving sickness benefits - the prospects

Sickness benefit is always lower than actual income. If the disease can be cured, a rehabilitation measure is usually pending, which in turn reduces the income, apart from the co-payments for the hospital stay and the co-payment for the rehabilitation measure. So it is not surprising when a financial bottleneck arises.

Since the loan seeker in most cases does not know what to do next, he can go back to work or become unemployed if he is not yet in debt in this situation. If the profession can no longer be practiced and the disability pension follows, the income will be drastically reduced. Then it would be difficult to pay a loan.

The banks also know this, of course, and are reluctant to take a loan despite receiving sickness benefits. If the customer can foresee when the sickness benefit ends and the income will flow again, a clarifying discussion with the bank employee of his bank could be helpful. However, the customer can assume that he will not receive a large loan with a long term. The bank is too risky for that.

The bank will offer the customer an increase in his overdraft facility. If it has not yet been set up, the bank could provide the overdraft facility. In view of his reduced income situation, up to three monthly salaries are not provided as usual. If the overdraft facility is not sufficient to bridge the bottleneck, the customer must provide other guarantees so that the loan is approved despite receiving sickness benefits.

The loan despite sick pay – the credit rating has to be right

The loan despite sick pay - the credit rating has to be right

The customer should know that, despite receiving sickness benefits, a loan is only approved under difficult conditions. As many of the loan seekers suspect, the Credit Bureau is the decisive criterion. But this is not the case, and creditworthiness based on income must also be available. There are three licensing criteria for banks. That is the sufficiently high income, the clean Credit Bureau and the permanent position. If the customer can fulfill this, a loan is approved without further ado.

If only one of these features is missing, there will be difficulties in lending. It is not only the current state of income, but the future is also open. In addition to unemployment, Hartz IV could follow in the worst case. Even if a disability pension were due, nobody can at least begin to live well with it.

If you can, you should wait until the financial situation is settled with your loan request. But nobody takes out a loan for no reason. Often it is important things that are done with it. But nobody should force a loan. Basically, there is always a different regulation when you try to do so. If the extended overdraft facility were sufficient, it could be used. At least until the right income is drawn again.

After recovery, the expensive overdraft facility can either be returned every month or converted into an installment loan. But if it has to be a loan, things cannot be put off, a second applicant or a guarantor could realize the loan despite receiving sickness benefits. If the customer can name a solvent guarantor, the loan will be approved despite receiving sickness benefits. Then the guarantor bears the credit risk.

The alternatives

The alternatives

Of course, it is up to the customer for what he wants to take out a loan despite receiving sickness benefits. Anyone interested in a desire to consume could be financed without a loan despite receiving sickness benefits. If it is a new television or a fully automatic coffee machine, these things can be financed through a dealer.

To do this, the customer usually only has to specify his employer and have a positive Credit Bureau. Existing mail order customers are even better off. If in the past all orders were paid on time, the customer can count on a quick credit. Of course not in cash, but as goods.

The customer could consult a credit broker. Especially in difficult financial questions, credit intermediaries can still arrange a loan despite receiving sickness benefits. There are two reputable platforms like Fine Bank and Across lender. However, these loans are more expensive than a traditional loan. In addition, the commission of the agent must be calculated.

If the customer wants to try a Swiss loan, which is also mediated by credit intermediaries, the customer must know that these banks require proof of their income. The decision is not accepted by the health insurance. With these loans, income is the be-all and end-all of a loan approval. There are high demands on it.

The customer does not need to inquire at the foreign banks, a loan refusal is guaranteed.

The customer should know the sickness benefit, the more loan applications he rejects, the worse his Credit Bureau gets. It is better if he makes so-called condition requests. Credit Bureau is not informed of this.

If the credit inquiries have failed and the mail-order company and the retailer have determined that the payment history is bad or the payment history is abnormal, they will not be able to order consumer goods.

The view seems to have gotten lost. The pawnshop could help as a way out. If there are valuable objects, such as high-quality media devices or valuable jewelry, this could be pawned. The pawnbroker checks the value on site and pays the customer the amount in cash. If the customer works again and receives his normal salary again, then he can trigger the objects again. He should observe the specified deadline, otherwise the things will be auctioned by the pawnshop. This is definitely a way out of a tight financial situation.

Subscribe to 1 credit in Belgium

You wish to obtain, borrow money in the country of Tintin? In this case, you will have to meet several criteria to benefit from a personal loan in Belgium. Indeed, the credit organizations are strict and meticulous concerning the viability of the files and unfortunately, yours can be refused when it seemed, in your eyes, valid. In this article, we will explain what are the conditions for obtaining a credit and we will also see why your personal loan is sometimes refused.

The conditions to be respected to obtain a loan in Belgium

The conditions to be respected to obtain a loan in Belgium

In fact, if you are French, no Belgian law can prevent you from obtaining credit in Belgium. But in reality, banking establishments grant very little credit to people who do not reside in Belgium and therefore do not earn money in the flat country.

Here we summarize the basic conditions for obtaining a credit, a personal loan.

  • Be of age: it is imperative to be of age to benefit from a loan
  • Obtain regular income: it is quite logical that the bank requires regular income to grant you credit. If your file involves too much risk, it will be refused by the bank.
  • Having a current account in Belgium: this is a quasi-compulsory condition to benefit from a personal loan. You must reside in Belgium or Luxembourg. However, you do not have to be Belgian to get a credit. And we will see that there is a (legal!) Way to open a checking account in the flat country and have a better chance of being granted a loan.
  • Know how to manage your money: good financial management is mandatory to be loaned money by the bank. As an applicant, you must consult the Best Bank in order to verify that you are not on the black list or on a banking ban.

However, banks are more open to lend to people who are not residents, but who wish to invest in real estate in Belgium. Be careful though, because you will need to have a high salary and have financial stability to obtain a loan.

Do you meet these conditions? Great! You will need to open a local bank account. Which is a breeze. You simply have to present the following documents:

  • A valid passport or identity card
  • Fill in an opening request form
  • Send a proof of home such as a water or telephone bill for example

Be aware that some banks give you the possibility, as a non-resident, to pre-open an account online. When you have answered all these administrative procedures, you will have to wait about a week to obtain the means of payment for your new bank account, card, code etc.

You should also know that Belgian banks cannot access data from the Fine Bank’s FCC file (Central Check File), linked to the ban on issuing checks or having a bank card in relation to payment problems. Same thing for access to the FICP file (File of credit repayment incidents to individuals).

Assessment of your debt capacity

Assessment of your debt capacity

Your debt ratio can go up to 60% depending on your income and the bank that gives you the loan. In short, you have to earn a salary, dividends, or annuities much higher than the repayment of your credit each month. This is an essential criterion for obtaining credit. Indeed, a good debt ratio gives the banker certainty that you will easily pay your monthly payments.

What if your credit is declined?

What if your credit is declined?

It is customary to say that bankers are cautious. Indeed, they do not lend money to the first comer, and especially not to an insolvent person in the eyes of the bank. Unfortunately, like everywhere, some credit requests are refused in Belgium. Many individuals and companies thus see their dreams sometimes shattered in view of a too fragile situation. Some major risks can cause your loan request to fail:

  • The risk of finding yourself in over-indebtedness: this is of course a real reason which will cause the bank to refuse to lend you money. Your banker wants to be certain that you will not go into debt and present an insolvent profile after a few years
  • Reason for non-repayment: the banking establishment can refuse you the loan if it considers that you are not able to repay the monthly payments of the loan.

If the case arises, it is because your file is fragile, that you do not present enough guaranteed, or that you do not have a stable job and income, for example:

National Bank filing: logically, if you are registered with the National Bank of Belgium and you have debts to repay, then your credit will be refused. However, it is possible to borrow from the bank if your filing is regularized. In this case, do not hesitate to obtain information from several banking establishments.

  • Mediation and collective debt settlement: your credit request will be immediately refused
  • Avalanche of credits: if you have taken too much credit in a very short period of time, you will be blocked for a new loan

Getting a loan in Belgium: the loan offer

Getting a loan in Belgium: the loan offer

Belgium is not known to offer interest rates very attractive. They are also more interesting in France. This adage is also valid for all types of credits. Most Belgian credit companies are controlled by French banking groups. The Belgian credit offer is mainly focused around installment loans and housing loans.

The installment loan

It is the equivalent of consumer credit in France. This type of credit is often attached at an expense like buying a vehicle for example or an object of your choice. The loan conditions are strict and if you take out this type of loan, you will not face any unpleasant surprises.

You can buy back installment loans and combine them into a loan to benefit from better loan conditions. It is no coincidence that many brokers are interested in this mode of credit.

Housing loan

The mortgage or housing loan is a standard mortgage, offering fixed rates or variable rates. The banking establishment may, via the mortgage, seize the property if you are no longer able to repay your loan.

Personal credit: discover our free guide

Browse our guide and discover everything you need to know to take out your personal credit in the best conditions and at the best rate.

Among other things, you will discover:

  • How much you can borrow against your income
  • How To Use a Credit Comparator
  • Projects you can fund
  • How to compete
  • How to Apply for Credit
  • The documents you need for signing your credit agreement

Personal Credit: How Much Can You Borrow?

Personal Credit: How Much Can You Borrow?

It all depends on the income and expenses you already have in progress.

The good question you should ask yourself is: “How much do I need to borrow to complete my project?”.

Whatever you say, any request for personal credit is motivated by a goal. No one borrows money just to say to borrow money. Before getting started with your personal loan application , it is important to properly calculate the budget you need.

To do this, list everything you want to buy or pay (if we are talking about invoices) and indicate the cost of each item. Then add up and you get the amount you need to complete your projects.

As of this writing, depending on your income, the maximum allowable expense / income ratio is 60%.

Personal credit comparator: our advice for use

Personal credit comparator: our advice for use

Take your time to compare all the personal credit offers offered by our partners found on our loan comparator. Do not hesitate to change the amount you wish to borrow several times. Also modify the period over which you wish to repay your credit. The rates of certain credit companies change depending on the amount and the duration chosen.

To go to the page dedicated to personal credit comparison, click on the following link: personal loan comparison.

Projects you can finance with personal credit

Projects you can finance with personal credit

You can finance various projects such as:

  • Your children’s studies
  • Buying new furniture
  • Your holidays
  • Buying a used vehicle
  • The purchase of computer equipment
  • Your marriage
  • The purchase of musical instruments
  • An operation

There are still many other projects that you can finance a personal loan.

How to play the competition?

How to play the competition?

The best way to get competitive is to apply for credit online. Once the various proposals have been received, you simply have to put them in competition with the personal credit organizations concerned.

To do this, contact each bank, each broker concerned and submit the best proposal received and voila. Expect new proposals which will surely be better than the best.

Procedure for submitting your credit request online

Procedure for submitting your credit request online

  1. Click on the “REQUEST AN OFFER” button at the chosen partner
  2. If necessary, make a new simulation on the partner’s site
  3. Click on the button inviting you to make your request and start filling out the form
  4. Please specify the credit goal, what you will do with the requested funds
  5. Regarding your income, indicate the average of the last 3 months received
  6. If you have credits, precisely fill in the details of each credit (amount, duration,…)
  7. Do the same with credit lines, credit cards, account overruns,…
  8. In the comment block, indicate if you have a company car, petrol card,…
  9. Confirm that your request has been sent as soon as you have completed all the required fields

Take the time to properly complete your personal credit application, it is very important!

A carefully completed application is more likely to result in an agreement.

Accepted income

Accepted income

  • Professional income
  • Retirement income
  • Unemployment benefits
  • Mutual income
  • Work accident annuities
  • Meal vouchers
  • Family allowances (taken into account by certain organizations)
  • Support payments received (taken into account by certain organizations)
  • Rental rents

Denied income

Denied income

Income from the following situations is not taken into account:

  • CPAS allowances
  • Income from Article 60
  • Income from the SPF Social Security (Black Virgin)

Mandatory documents to sign your personal credit agreement

Mandatory documents to sign your personal credit agreement

You will still need to provide the following documents:

  • Front / back copy of your identity card
  • Bank card (this is proof of the account where the funds will be paid)
  • Last 3 proofs of income (salary, family allowances, unemployment, mutual insurance, pension,…)

PLEASE NOTE, identity cards A are refused.

Rights and obligations of the lender

Rights and obligations of the lender

In matters of personal credit, lenders have obligations to inform prospective borrowers.

We invite you to consult the SPF Economy page on this subject: information obligation.