Parental leave serves as an exemption from work in the first months after the birth of a child. Instead of pay, parents receive parental allowance, the amount of which in most cases amounts to sixty to sixty-seven percent of the net earnings lost.
The reduced income is offset by additional expenses for the maintenance of the baby and, at least for the first child, for the purchase of basic baby equipment. Since the corresponding costs as well as parental allowance are predictable, the need for a loan in spite of parental leave can be avoided by taking out a loan in good time. It is important to plan the credit installments so that future parents can pay them during parental leave.
Borrowing from a bank during parental leave
Parents often assume that the bank grants them a loan despite their parental leave, as they will return to their employer afterwards and will receive their previous salary again. This view is not in line with the interpretation of most financial institutions, which tend to regard parental allowance as a provisional state payment and the resumption of work as secured.
In fact, the employer is obliged to keep the employee employed after parental leave, while the employee can decide to leave the job temporarily. For this reason, despite parental leave, commercial banks are most likely to grant a loan if the customer can present an already concluded agreement on future work performance or if both parents apply for the loan together.
Borrowing during parental leave through private lenders
As an alternative to a bank loan, the application for a loan can be made via a website for the granting of private loans despite parental leave. The private individuals registered there as members base their decisions on a high percentage of social criteria and therefore prefer credit inquiries from parents.
Formally, a recognized commercial bank acts as a lender, but the actual decisions are made exclusively by private lenders. The platform operator, on the other hand, handles the practical handling of the private loan, so that the lenders and loan applicants do not get to know their contact details and bank details. This ensures data protection regardless of the extensive information about the reason for a personal loan application.