More and more employers are starting to limit new employment relationships during the first two years of employment. This procedure is permissible without stating the reasons for the time limit; an objectively justified time limit may even be used for a longer period. Temporary employment contracts with professional athletes and artists, as well as in academic middle classes at universities, are generally common.
Whether a loan is possible without a permanent employment relationship depends on the bank’s approach to processing the application. Lending is easily possible if the loan is repaid by the end of the term. Above all, athletes and artists with multi-year contracts benefit from this option.
Is the submission of the employment contract required when applying for a loan?
If a financial institution requests a copy of the employment contract or asks about the nature of the employment relationship, it is highly likely that it will not grant a loan without an unlimited employment relationship with the customer. If the credit bank only requests the submission of proof of salary, it does not recognize the fixed-term employment relationship. The employer’s payroll usually does not contain any information as to whether the current employment contract was concluded for a limited or unlimited period.
It is unlikely that the loan officer knows that a particular company will only offer temporary contracts for the first two years of employment. As a result, temporary workers make sure that the bank they choose to borrow does not request a copy of the employment contract. With the submission of an employment contract, the loan can generally be taken up despite the temporary employment relationship if there is additional security. This applies particularly to car loans, where the vehicle itself serves as credit security thanks to the security transfer.
It is easier for the vehicle dealer to borrow without a permanent contract if the customer opts for a model with currently poor sales rates or for a discontinued model. In both cases, the Spin Lender is more than willing to grant loans because it sees its financing offers as a marketing method to improve sales. Anyone who requests an instant loan without proof of income reliably avoids the possibility of asking for the type of employment relationship.
As soon as consumers take out a loan without permanent employment, they themselves make sure that they can service the credit installments even if they do not receive a contract extension at the end of the current time limit. In addition to agreeing a long term with correspondingly low installments, security can also be achieved if the loan agreement explicitly grants the right to change the installment agreement. This is generally the case with some banks, with another group of banks, the price list contains information about the possibility of changing the contract by communicating the fee to be charged.
Cream banks almost always grant the overdraft facility without an open-ended employment relationship, since regular receipt of money is sufficient as a prerequisite and this is also the case for temporary employment relationships. In any case, borrowing without an unlimited employment relationship is also possible if a second person joins as a co-borrower. The prerequisite is that the co-applicant has an unlimited employment relationship.
Alternatives to bank loans without permanent employment
Payment in installments in the mail order business can usually be agreed as a dedicated loan without an unlimited employment relationship, since the seller only asks for the employment relationship or earned income in exceptional cases. A credit card equipped with the standard credit limit, including the option of agreeing a partial payment of the monthly statement, can also be obtained with a temporary employment contract.
An increasing number of issuers is content with issuing a new credit card by simply indicating the applicant’s earnings and does not request any data regarding the employment relationship. On the other hand, when applying for a loan via an online platform for money transfer between private individuals, loan seekers openly state that they want to take out a private loan without permanent employment. For the private lenders registered there, the temporary employment contract does not constitute a reason to reject a loan request.
Rather, they deliberately sign the request of a loan seeker without permanent employment, since they are based on social criteria and know that conventional banks reject the corresponding loan applications above average. Another prerequisite for successful borrowing despite the not unlimited employment relationship via a platform for personal loan brokerage is the exact specification of the intended use. Private lenders prefer to draw a loan request if they consider the reason for the loan to be eligible.