Retiree Loans | everything you need to know

After working hard for many years of our lives and enjoying the fruits of so much effort, we may still have dreams to fulfill , such as having a long and well-deserved vacation or perhaps buying a car. However, it is possible to believe that when you are retired it is difficult for a financial institution to be willing to grant you a loan, but it is a mistake to think this way since the situation is totally different.

It is possible to obtain liquidity, even with the same conditions of other types of loans and is that for financial institutions, the retiree sector is very precious due to the fact that income is obtained on a fixed monthly basis.

Conditions to opt for a loan for retirees

Although the conditions to request a loan when you are retired are the same as in the case of other types of people , age is often an impeding factor for some financial entities.

The ideal is not to exceed 75 years of age by the time the loan is to be paid off, since if it is a high amount, the monthly installments increase considerably. In these cases, it is best to have a younger guarantor or co-owner to act as a backup for financing.

Another outstanding feature that we can face is solvency, and in this case the entity requests a series of documents such as proof of pension, financial solvency or information about the last job that was had. Which will serve as support to demonstrate that you are capable of facing credit payments.

On the other hand, being a retiree who has a pension justifies that you have a fixed monthly income and that it shows that we have a solvency as well as other income such as the collection of other pensions or pension plans.

Retiree Loans | everything you need to know
Retiree Loans | everything you need to know

Requirements to apply for a loan for retirees

The requirements are much simpler than those required of the economically active population, but we have to consider that each financial institution has particular requirements, however the most common are:

  • DNI .
  • Proof of address.
  • The last electricity / water / garbage bill.
  • As in any type of loan, we must not have any negative history in terms of previous financial obligations, since even if there is a fixed income, the entity will reject the request due to a bad credit score.
  • Last Income Statement .
  • Bank account to transfer the loan money.

Where can I go to apply for a loan for pensioners?

  • There are state institutions that offer credit products for retirees through social programs and with the best market conditions.
  • Banks also offer this type of financing, especially if it is where we collect the pension.
  • Another practical and simple way is to make an online application through the different platforms of entities with private capital.

Although banks offer much more attractive interest rates, private equity entities have the speed and can even be done comfortably, online and with less demanding requirements.

Profiles to apply for a retiree loan

Within retirees there are three types of borrowers :

  1. Early retirees : those who have more access to this type of loan as long as they have life insurance.
  2. Retirees under 75 years of age : in these cases it is also necessary to have life insurance and be sure that the expiration date is not of that age.
  3. Retirees over 75 years old : here you must have a guarantor to be able to opt for a loan.

Type of loans for retirees that we can request

If we are retirees or pensioners, we have many credit options to cover our needs, when we have unforeseen events and require small amounts or when larger amounts are required, among these are:

Mini credits

At present, retirees are one of the livelihoods of many families, taking care of basic expenses and the institutions are aware of this. These types of loans are perfect for any unexpected expense that involves the breakdown of the economy in the family.

They are requested online and once the request is made, an immediate response is obtained. If approved, in less than 15 minutes the money will be available in the bank account that has been provided.

These are loans that are in great demand and that is why private financial institutions have many financial products, so it is good that we make a comparison of at least three different companies to make a decision.

You have much more information in our updated mini loan guide with all the available options and tips to choose the most appropriate one.

Personal loans

Although it is a very accessible type of credit, sometimes it is difficult to qualify. On the other hand, the financing is higher and must be repaid in monthly installments . The interest rate of these loans is more competitive than the mini credits, although because they are high amounts, it takes longer to receive it.

When we are going to select this type of credit, we must take into account details such as the amount to be requested, the rate (if it is fixed or variable), which will allow a calculation of the refund of the money to the entity that is chosen, the term to return it, as will be the amortization system and how much the granting costs amount.

Credit cards and lines

These are well-known financing systems where you only have to pay the money that is used, on the other hand the financing is instantaneous and they have advantages such as withdrawing cash and obtaining discounts on purchases. In return, they have to pay interest and often commissions.

Loans between individuals

If none of the previous solutions suits you, you can resort to looking for private capital. There are private lenders who can offer you amounts similar to those of the banks with fewer questions. Of course, we usually talk about higher commissions than when it comes to banking entities.

What are the advantages of credit cards?

  • They not only serve as a form of payment, but we can use it as a means of financing .
  • It is possible to make purchases without spending money instantly and return it later in easy installments.
  • We can get a credit card with proof of pension.
  • Although the established limit appears in the contract, over time the amount can be changed .
  • It is possible to defer payment when we cannot face the debt although this generates an increase in interest.

Credit lines

Although this is a service widely used by companies, some entities have credit lines for individuals, following the same conditions, term agreements and amounts that can be withdrawn as many times as necessary but that do not exceed the limit.

Another characteristic of this type of product is that, if in the end the money is not needed, only the costs that are generated by issuance will have to be paid, without added capital and without interest.

Home Equity Loans

These are credits that allow us to guarantee the home or property of our property that will serve as collateral when we need a loan with a high amount. They are an excellent option when we have insufficient income and outstanding debts must be covered.

One of the advantages of this type of loan is that it can be obtained regardless of the amount of income or if it is on the list of defaulters. The amount that can be obtained depends on the value of the property, which will be used as collateral and if you have any other mortgage or cargo.

Although these loans are a solution for a certain population, they are not easy to hire or negotiate directly with banks. It is best to apply for a home equity loan with the help of specialized companies, who are responsible for searching and negotiating with banks and thus find the best option.

Is it possible to request a loan for retirees with Credit Checker?

Being on the Credit Checker delinquent list will greatly reduce the options to obtain financing. Banks are not going to grant us any loans, in fact, even credit card requests will be rejected.

In the case of private equity companies, they also do not grant loans to retirees if there are outstanding debts. Although it is possible to find entities that grant mini loans under this condition, as long as the debt does not exceed a specific amount and that it is not related to any financial entity.

The most recommended thing is that we pay the pending debts to get off the Credit Checker list , in this way there are more options that we will get for financing.

What happens to the loan if the retiree dies?

Death is an event that nobody wants to talk about, however this is an event that cannot be avoided and that must be considered. If we are an elderly person, we must talk with the family about the emotional and economic consequences once they are no longer present.

Fortunately, there is no need to worry since, as banks require life insurance at the time the application is made, it is they who will cover the loan in case this type of event occurs.

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