BAföG repayment in one fell swoop - pros and cons

02-17  Source: Network gathering  Views:3 


BAföG repayment in one fell swoop - pros and cons

Fast debt saves interest.

Approximately four and a half years after the end of your studies, please contact the Federal Office of Administration in Cologne a friendly letter. In it you will be informed of the amount paid to you BAföG total.

defer BAföG repayment

  • You will be asked to repay those loans granted as state support in installments. At the same time, the first due date for the first installment is named.
  • The loan must be repaid without interest. The amount a rate currently stands at 105 EUR per month. The Federal Office of Administration wishes quarterly basis may deduct three months installments by direct debit from your account.
  • If your income is below your personal allowance of 1,055 EUR plus 535 EUR for your spouse, and 485 EUR for each child, you can be exempt and postpone the repayment date.
  • If you start with the partial repayment, your household budget every quarter will be charged 315 EUR. Depending on what situation you are in, this may bring a significant burden,. If you are making in marry or have you bought a house and have to raise the debt service for the mortgage, your financial burden can be overwhelming.
  • Even if you repay your loan in one fell swoop, you strain your household budget. The advantage of the BAföG repayment in one fell swoop is also obvious.
  • You benefit from a substantial discount on your debt.

Profit and you pay off in one fell swoop

  • For when you repay your loan in one fell swoop or partially in larger amounts, grants the state a discount on the loan debt, which is calculated according to a table.
  • If you need to, for example, 5,000 EUR repay you get when you pay in a lump sum, a discount of 34% and pay only 3,300 EUR back.
  • If you have studied particularly well and quickly moreover, you can secure additional discounts.
  • When completing your degree until 31.12.2012 within the maximum period of funding, grants the state a 25% discount if you also belong to the 30% year's best. Depending on, there are other discount options, which you can use.
  • If you repay the reduced amount in one fell swoop, you save a lot of money. Even if you at a stroke overdraw your checking account for the BAföG repayment or take a normal loan would save you money. You will need only to compare the savings loan portion with the calculated for a Dispostitionskredit interest.
  • However, if you do not accept repayment in a lump sum to complete and your checking account from sliding due to the partial repayment of each quarter in the balance, pay, given the long repayment duration as a result probably more principal and interest back as if you are using the benefits of a total redemption.

Generally, you should also take to heart the principle that debts are best to pay as soon as possible. Each saved Euro is additionally earned money. In addition, you create space for surprisingly occurring financial needs.

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