Most young people confirm that the study is financially very exhausting. In addition to the cost of living it is necessary to buy a notebook, textbooks, regularly pay shipping and sometimes expensive tuition. Not surprisingly, there is often no money left for studying abroad or unexpected expenses. A solution in such situations may be a student loan that will help cover the costs of studying. What are the conditions for student loans and who is offering this product?
Unlike the Western countries, the Czech Republic is definitely not a paradise for student loans – as these are loans for students without income, their offer is quite limited.
As a general rule, banking companies require proof of regular monthly earnings and must obtain a guarantor if their income is insufficient. Banks tend to offer other types of products to young people, such as a credit card or an overdraft for a student account. Downright student loans are provided by very few companies.
What can a student loan be used for?
The student loan is a special-purpose loan and is intended to cover study-related costs. It can be used for example for:
- study abroad
- educational courses
- dormitory accommodation
Some companies only offer loans to college students, others offer loans to high school students. The purpose of the loan may vary – some providers only allow it to pay tuition fees, but most of them can also be used for other needs.
Benefits of student loans
Compared to regular consumer loans, student loans are associated with a greater number of benefits. These include:
- possibility to repay the loan after graduation
- lower interest rate
- possibility to postpone installments
- possibility of early repayment of the loan without penalty
Perhaps the biggest advantage is the ability to repay the loan after graduation and during the course of dealing only with interest. Of course there is the negotiation and maintenance of credit account without fees.
Conditions for student loans
Like other special-purpose loans, a student loan has certain specifics. It is obvious that it is provided only to persons who actually study. However, loan applicants must meet other prerequisites. The conditions for student loans are:
- ISIC card or other authorization confirming student status
- age to 26 years
- own a bank account
- (proof of regular income)
- (guarantor who guarantees the loan)
As these are loans for students without income, there is no need to prove regular earnings with some providers. In the case of a loan over USD 30,000, it is usually necessary to secure the loan by a third party.
Student loans are used to cover study-related costs. They can be used by both college and secondary school students.
Bank student loans
Banks offer special discounted products to students with low interest rates, zero fees and postponement options. These include, for example, Best Bank and its Lite Lender loan, which can also be used as a loan for high school students.
The loan comes in handy for anyone who wants to study abroad or need to pay a tuition, education course or a new computer.
Lite Lender loan parameters:
- Loan amount: 20 000 – 600 000 USD
- Who is it intended for: Students of secondary schools, colleges and universities
- Maximum maturity: 10 years
- Interest rate: from 6.9% pa
- Processing fee: 0 USD
- Early repayment: 0 USD
The Lite Lender loan is one that can be repaid after graduation. It is therefore only necessary to pay interest during the course of the event.
* The loan for secondary school students only applies to the tuition fees.
Non-bank loans for students
Although non-bank “student loans” appear to be real loans with benefits for learners, these are generally ordinary non-bank loans that are offered to all applicants without distinction. They are often advertised on the Internet as:
- quick loan for students
- loan for students immediately on account
- short-term loan for students
- SMS loan for students
- and more
While these quick loans for students, SMS loans and other types of micro-loans are accompanied by appealing slogans, some caution should be exercised before negotiating them. In most cases, very high penalties are charged for late payment, APRs reach extreme values and the contract includes an arbitration clause.
If it is a mere short – term loan for students and is sure that the loan repays without any problems in time, micro-loans can be the solution. Otherwise, it is much more sensible to apply for a bank loan or ask your family or friends.
An alternative to the above-mentioned loans may be the so-called P2P loan from Best Bank, where the interest rate starts at 3.99% pa annually. Just submit an online inquiry and reach other users with your life story. With a little luck, the money can be earned within a few days.