Study Loans- Germany

From the year 2005, when novel laws concerning the university fees were determined by the Constitutional Court of Germany, different loan schemes have been created. Until then some credit institutes had already proposed plans for student loans (German: Studentenkredite). Much later than the DKB (Deutsche Kredit Bank) had implemented the first academic credit supply together with Career Concept, the world's first provider of educational funds, in October 2005 the Deutsche Bank started to provide loans for the students. Nowadays, there are numerous offers from other private and public banks, as well as the KfW.

The "dbStudentenKredit" offered by the Deutsche Bank can be granted to all students at German universities, not considering their particular study area. But the age is limited to 30 years. A further condition for the grant of a "dbStudentenKredit" the credit is the complete study preparation and plan. All topics that a student intends to study should be included in this and furthermore career plans should be summed up. Moreover, the bank requests information regarding the creditworthiness of the students from the Schufa book that contains the financial details of German citizens. Those information supply the credit institutes with a some security.

In the 1st and 2nd Semester one can get a maximum of 200 euros per month for living expenses and tuition fees. Later on at a further stage of the study one gets up to 800 euros. The interest rate is variable. After a student has finished his studies the interest and the total amount of money that has to be paid back is determined by a new contract. In the first year after the end of study no repayments have to be made. In total the students have 12 years left to repay the loan (Studentenkredit) including the interest to the German bank. But it is also possible to settle the total debt at once.

The Kreditanstalt fuer Wiederaufbau (Credit Institute for Reconstruction), was founded after the 2nd World War with the aim to support the rebuilding of the German country. Since April 2006, the KfW development bank also offers a study loan for all students during their first degree.

The student loan finances the living expenses and has the aim to increase the total number of graduates and allow especially the students from non-wealthy families to study. But the latter task is actually the job of the BAfOEG, which is a grant to 50 percent, the rest is an interest-free loan. In comparison student loans (Studentenkredite) are more expensive (interest has to be paid for 100 percent of the loan).

Find out more about the student loan (German: Studienkredit)situation in Germany and visit my blog about Studienkredit. Various possibilities of student funding in Germany discussed further.

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