The retiree loan or payroll loan is one of the fastest ways to get a loan, because the loan payment installments are deducted directly from your receipt as a retiree. Under current rules, retirees and pensioners can apply for loans that commit a maximum of 35% of their income. Understand better about retirement credit, below.
There are many options for granting credit on the market today, and this can be good news because it adds advantageous conditions to the consumer. However, when applying for a retirement loan, it is essential to know each option in depth.
Especially those that are quick and convenient. Nowadays, online personal loan and payroll loan are alternatives that fit this situation. Hence, it is worthwhile to better understand how both work.
Want to know how to make an assertive decision when it comes to applying for the best loan for retirees? Just continue reading this post!
What is a loan?
In short, the loan is a credit offered by financial institutions, which generates a debt with the applicant.
In addition, during the pre-determined period for the settlement of this amount, interest, fees and tariffs which vary from where the loan was made – and which are included in the contract.
It is a good option for those who need money quickly, to get out of debt, for example, or even to fulfill a personal dream, such as buying a property or car.
How does applying for a retirement loan work?
It is worth noting that the process does not differ from any other type of loan on the market.
The difference here, basically consists of the requested documents and payment terms.
Initially, institutions may require the submission of the following documents:
- personal document with photo (it can be the ID or the license, for example);
- proof of residency (such as accounts in the name of the person applying for the retiree loan);
- proof of income can also be requested – normally, the IRPF (Individual Income Tax) declaration is good for this case.
Also, for those who still don't know how to do this type of tax return, take the time to read the article, “How to file an income tax return: simple step by step”.
To complete the understanding of what is a payroll loan, how about watching the video below? Then we explain what care should be taken with this modality.
Now, let's see what are the points to pay attention to when applying for credit for any type of financial institution?
What are the points of attention?
The first one is the payment method offered by the institution. For example, people who take out a personal loan can do so through the following options:
- nominal check;
- automatic debit in current account.
The payroll loan, in turn, has a feature made especially for retirees. That's because, the installments will be deducted directly from your retirement payment.
Security mechanisms prevent the installments from being much higher than a certain percentage of that amount, which makes the risk of indebtedness less.
It is no secret that institutions profit based on the rates and interest charged for their services. And the retirement loan is no exception.
It is important to research, between the different companies, to identify the lower rates and interest. Which is less of a debt for you, in the end.
O loan amount it is fundamental as well. As we said, the payroll loan has some restrictions that avoid a financial trap for the applicant.
By law, each installment cannot exceed 30% of the monthly retirement benefit. Something that requires good personal financial planning, therefore, to deal with the day-to-day accounts without exhausting resources.
Read too: All about what it takes to retire [+ cálculo]
Differences between personal loan and personal loan for retiree?
If you still don't understand what differentiates the personal loan and the personal loan for retirees, let's take a quick comparison:
- the form of payment already highlighted above, with the payroll already automatically discounts the portion of the social security benefit;
- the personal loan count with higher interest rates, since the guarantees of return – for the financial institution – are lower (greater risk of default, therefore);
- the amount granted is variable, also. In the personal loan, the requested amount is analyzed based on the applicant's income and credit analysis.
- the deadline for payment, in short, must be analyzed. The personal loan offers about 4 years to pay off the debt. The payroll loan, in turn, varies between 6 and 24 months (Up to 2 years, therefore) – but there may be conditions that facilitate the extension to up to 72 months, which is the maximum term.
The payroll loan has the percentage limitation and the age limitation:
- those who are up to 79 years and 11 months old can request up to R $ 80 thousand,
- after 80 years completed, this value drops to R $ 30 thousand.
Both have their characteristics very well defined, which helps when applying for a loan for retirees.
But, in general, the payroll loan is one of the most popular alternatives because it takes into account, primarily, the average profile of retirees.
What to avoid when applying for a retirement loan?
To finish this post, understand a little more what are the cares that must be taken so that your loan does not become a financial trap in the medium and long term:
- research the financial company well. Research about her reputation in the market (such as on her social networks and on specialized websites, such as Reclame Aqui);
- make sure the company is real. There are many frauds done on behalf of real institutions;
- do not take out phone loans. Opt for the virtual modality – directly on the website or application of the suitable company – or in person;
- be very careful when sharing your personal data. Only share them when you feel secure in the company you are dealing with;
- carefully evaluate all loan conditions for retiree;
- compare the amounts charged with your current cost of living. This helps to avoid indebtedness and will help you choose the best loan for retirees.
So, do you think these tips will help you save more money, to the point of being able to honor the commitments made through your retirement loan?
But, if you are not retired and need a loan we recommend that you access one of the articles below, to seek solutions to your debt:
Now, if you know someone who can also benefit from the information contained in this post, share it on your social networks!
HR Consultant UK can help if you have any questions about Retirement loan: how does it work and what care is needed?
. Our HR consultant in London can assist you if you live in London. Suppose you live further afield thats not an issue! Visit our HR Consultants Near Me page to find the best consultancy nearest to you.
See you next time!