Interest free loans
Loan without interest at Islamic banks
Muslims are not allowed to pay interest. Interest payments and the acceptance of interest are therefore prohibited “haram”. This is what your beliefs say, and so it is lived in everyday business life. So it has been almost impossible for Muslims, for example, to finance a house in conformity with Islam through a bank. Now, however, loans can be made in accordance with Sharia law .
But how does that work?
For example, the bank buys the house and resells it to the customer at a premium . Now it is a trading business and thus profits may be made. The process is therefore “halal” allowed.
This “Islamic banking” is a form of the real economy. However, without speculation and investment in highly indebted companies. Also investments in “indecent business areas as well as in gun business are” haram “, that is not allowed .
Loan without interest for students
Many students receive BAFÖG and thus an interest-free loan. This is earmarked and serves exclusively the study and the assurance of the cost of living during the study time.
Loan without interest from the public sector
In order to buy an apartment or a house, families often receive an interest-free loan from the municipality. This is intended to promote immigration . The Employment Agency provides interest-free loans when working outside the country so that a necessary move can be financed. Even if the commitment is dependent on a driver’s license, this loan is granted.
In addition, an interest-free loan is granted if important appliances in the household are defective and a new acquisition is inevitable. Unemployed people can receive a limited interest loan from the Employment Agency to start self-employment or start a freelance job.
Loans within the family or among friends
These are subject to private agreements in certain areas. The interest claims belong to it. It can not be required to charge interest from friends or family members. However, all other modalities are to be fixed in writing in accordance with the law. This alone, therefore, to be able to fall back on the mutual agreements in the event of payment difficulties and recoveries. In case of uncertainty so rather turn to a lawyer for contract law.
Interest-free employer loan
However, the granting of an employer loan to the employee can not be linked to an interest claim. the handling is free decision matter of the lender .
5 ways to get loan without interest
Use the loan of the job center
Normally, interest rates have the function of protecting the lender from default and, at the same time, interest is the only way to earn money with the loan. Therefore, it shows that institutions that do not have to operate profitably but fulfill other main purposes can also offer loan without interest.
This includes, for example, the job center, which under certain conditions can issue an interest-free loan. This is the case, for example, when, unexpectedly, the washing machine breaks down or other important household items fail.
The job center then has an interest in helping people. Therefore, loans are provided quickly and easily if the repair, or the new acquisition from its own resources is not affordable. However, this type of loan is not usable for any purpose. The loan is strictly earmarked and can only be used for these urgent repairs, or purchase.
This loan is not only interest-free, but also associated with very low repayment installments. Even rates of a minimum of 10 euros per month can be arranged. This is to help needy people who getSnark to be able to finance this loan.
The public sector awards loans
Not only is the job center interested in helping people in distress or in education. The state also has an interest in people being able to educate themselves with the help of a loan, and with this financial means they can concentrate fully on their studies or their education.
The goal here is the promotion of individuals to enable them to have a better future. In this respect, the state is also trying to obtain “profit” from the loan, but the profit is not compensated with the help of interest, but with future economic performance.
For example, is known as such an interest-free loan. This is awarded to students or trainees who have low income to finance their livelihood. Furthermore, there are other positive terms of this loan. In this way, part of the loan can be waived if the study program or training is particularly successful. This is the case if, for example, the study was completed within the standard period of study, or shorter.
In addition, there are various subsidy projects of the Federal Government within the scope of which an interest-free loan can be taken up, at least for a limited period of time. However, the funds are earmarked and can only be obtained in close coordination with the sponsors.
Actually, it has already been mentioned that an interest-free loan from a private bank can not be possible. After all, the bank itself wants to make money and if no interest is taken, then the bank has only the risk of default, but no way to make a profit.
Therefore, while it may seem a bit insane, but in some cases it makes sense to offer an interest-free loan. Although the bank still makes a short-term loss in these cases, it hopes that this will have other positive effects that can be positive again, at least in the long term.
Thus, interest-free loans can be awarded as part of a promotion, which serve to attract new customers. The goal here is not to only lend the one loan to the customer, but to bind him to the bank in the long term. As a rule, there is no obligation to do so, so that a loan without interest can easily be taken out as part of the promotion. If then the bank continues to be used for further offers, for example the account management, then depends on the satisfaction and the desire of the customer.
However, the promotions are also limited to relatively low amounts. As a rule, up to € 1,000 can be borrowed and are freely available.
loan for financing
However, an interest-free loan can also be useful and helpful for consumer goods. So far, long-term goals have been described, which should be favored by an interest-free loan.
However, if a new car is to be purchased, then in the rarest of cases, the funds are available directly on the account. A regular receipt, through income, however, may mean that consumer loan is by no means risky. Rather, it is already an anticipation of future revenues.
In order to make car buying more attractive, sellers often work with banks that offer financing. As an additional incentive to purchase, financing can be at a zero percent interest rate. This basically has the same effect as giving the seller a small discount, or providing an extra extra. Because often the sellers then simply take over the interest costs, or there are other agreements with the financial institutions.
In any case, so can be used in the purchase of larger consumer goods such a loan. Even the installment purchase without interest rate is basically just a loan, which is granted by the seller. This shows clearly that some companies want to set additional incentives to buy through favorable financing conditions.
Interest-free loan from private
Another way to obtain an interest-free loan is when a loan is taken outside the private-sector banks. For example, a loan may be taken from a family member, or a close friend, or simply borrowed.
Building on a close basis of trust and years of friendship, it may well be possible for the friend to refrain from asking for additional interest. However, borrowing money always means that personal stress can suffer.
As it is already said in a proverb, so it is quite true that when money ends the friendship. Therefore, only amounts should be borrowed from friends who are both well repayable and on the other hand, not too big financial risk.
Then a good friend can also give up interest, if he can help by helping. However, borrowing from strangers should be avoided. These will not offer interest-free loans, but will always expect a return. Even if it is initially said that no interest is required, yet other benefits are expected to be provided.
Therefore, for small amounts that are only intended to help in a short-term emergency situation, family members or close friends should be asked to help them in this situation.