In this article we want to talk about Personal Loans for Pensioners, that is to say all those services dedicated to the older segment of the population: an increasing number of over 65, in fact, makes use of bank loans to cover unexpected expenses of various kinds, such as those concerning medical care, the purchase of goods (real estate, home appliances, etc.) or the subsidization of projects of children or grandchildren.
Retirees are a category usually favored by banks, because of the stability of income, as they can not undergo demotion or dismissal, but nevertheless encounter many difficulties due to old age: most of the services, in fact, are addressed to citizens who have not passed the sixty-fifth or seventy years of age.
However, it should be remembered that pensioners can take advantage of a particular category of loans: those with a transfer of the fifth, for which there is no need to present specific guarantees, or specify how the required sum will be used, thus leaving ample room for personal maneuver to carry out their projects in complete serenity and autonomy, without involving other people in the negotiation.
The transfer of the fifth to retirees
As we said, the overwhelming majority of services dedicated to retirees is set up as a transfer of the fifth: this means that, when the customer turns to the Bank, Social Institute assumes the task of repaying the sum obtained, directly withholding the amount of the monthly installments from the pension and paying it to the Institute in question, for a period that can not exceed, by law, the ten years.
However, not all pensions can be used for the assignment of the fifth, but the following categories are excluded:
- pensions and social checks;
- civil disability;
- allowance for assistance to pensioners with physical or mental disabilities;
- income or family support grants;
- pensions of bank staff.
What is the sale of the fifth?
Let’s take a small step back and illustrate the characteristics of the sale of the fifth, a way that allows various categories of customers, often excluded from common banking services, to access financing with less unfavorable conditions: in fact, it is mainly addressed to all those which, in the past, have been classified as bad payers and included in the Central Risks.
Through the assignment of the fifth, the customer delegates to his employer (or the institution that provides for the payment of the pension, in this case the Social Institute) the task of paying the monthly installments, withholding them directly from the salary: the sum withheld, however, it can not exceed one fifth of the total income, in order not to overburden the family or personal budget.
For pensioners, the operation is almost identical, even if some security measures are foreseen:
- the monthly payment can not exceed 1/5 of the net pension;
- the total reimbursement must take place by the age of eighty-five;
- the total amount must be equal to or less than 75,000 euros;
- the rate and interest rate remain constant throughout the duration of the loan.
This means that the maximum sum that the customer can get is proportional to the amount received monthly: if with a net pension of 1,600 euros, for example, the installment can go up to 430 euros, while with one that amounts to 800 euros, this can not exceed € 160, and the total, therefore, will be significantly lower.
Requirements for Personal Loans for Retired Persons
We now see the requirements for access to the transfer of the fifth, which all pensioners must exhibit at the selected credit institution: first, you need to go to an Social Institute office to calculate the maximum amount deductible from the pension and, subsequently, to draw up the Transferability Notice, an essential form to start the estimate and the negotiation.
Once the characteristics of the loan have been established (amount, duration, monthly payment), the client must present the following documents:
- identity card and health card valid;
- cud or pension slip;
- valid residence permit for customers of foreign origin.
Once the practice is started, in case of a positive outcome, the sum will be paid directly to the applicant’s current account, in a fairly short time; to speed up the request phase, it is possible to use the online procedure, through the form made available on the website of numerous Credit Institutes: in this way, the amount will be available within one or two days.
Security measures for pensioners
Once the negotiation is complete and the estimate is drawn up, Social Institute will check that the financing falls within the current legislation, aimed at defending the interests of the retired and ensuring non-exorbitant conditions: the overall rate, in fact, must be equal or lower at the maximum permitted by the anti-usury law, the monthly amount must not exceed 1/5 of the net pension and the contract must clearly indicate all ancillary costs.
In addition, Social Institute has established an agreement with most banks and banks, in order to keep interest rates lower:
- for loans of less than 5,000 euros, the interest rate can not exceed 8.45%;
- for loans exceeding 5,000 euros, it can not exceed 7.55%.
The advantages of the assignment of the fifth
At this point, therefore, it is clear that the transfer of the fifth constitutes a valid opportunity for pensioners who need a loan, and who do not have special guarantees. This mode, in fact, allows them to access even quite large sums, amounting to € 75,000, all in all short times, without involving a third person in the contract, and diluting the payment of installments over a period of ten years.
Moreover, for pensioners it is mandatory to stipulate an insurance cover, useful to guarantee a safety margin both to the Bank, to the family and to the client himself, in case of accident or death: the insurance cost is included among the costs of the loan, which can be calculated in the budget phase.
In conclusion, the transfer of the fifth is the most common way for all pensioners who want to obtain financing, as it allows over 70s to access banking services without presenting special guarantees. Moreover, thanks to the agreements stipulated between Social Institute and Credit Institutes, such packages often present much more favorable conditions, as well as the possibility of knowing in advance the amount of the installments and the total cost.
We also suggest that you periodically check the offers on the websites of the Banks and, in case of urgency, use the online procedure, which allows you to significantly reduce the time and bureaucratic commitments, and quickly obtain the desired amount.