Student Loans and Repayment
Giving out student loans and concessions are viewed as a means to pave the way to higher education for youngsters whose parents can't afford to fund their children's education otherwise. The federal law that regulates these student loans and grants is called "Bundesausbildungsforderungsgesetz" (Federal Training Assistance Act) or "BAfoG. Eligible groups include high school students, part-time and full-time university students, second path education students, and students of schools for professional training.
The student loan is a low interest loan from the state with the aim of supporting students during advanced education. It is granted for uttermost of 24 months and amounts up to 300 Euro per month. Repayment begins four years subsequently the first payment of the loan. Student loans in Germany are offered by the state as well as by institutions and banks. Some offerings only cover tuition fees for German state universities; others finance tuition fees for private universities as well as cost of living. However, student loans are only limitedly available to international students.
Student Loan Method
To receive a loan as an international student you need a guarantor, who can guarantee for the repayment of the loan. Banks and other financing institutions need a certificate of SCHUFA, i.e. creditworthiness check.
- Apply online or directly in the bank: You can apply online or directly in the bank branch in your city for the student loan.
- Verification of documents: All documents like enrollment documents, CV, official transcripts, last exam grades etc. needs to be verified and then the bank will prepare an educational grant agreement for the loan. After signing this agreement disbursement can start on a monthly or semester-wise basis Depending on the interest payment model, disbursements can be brought down by the interest costs right from the beginning or interests are granted until repayment phase starts. Repayment period depends on your finances as well as on the banks' student loan criteria.
Student Loan Providers
- Private student loans are offered country-wide e.g., by Deutsche Bank and Deutsche Kreditbank (DKB). Some banks of Sparkassen Group or Volksbanken/ Raiffeisenbanken offer regional loan programs as well.
- State student loans in Germany are offered by: KfW Bank via your regional bank, NRW Bank (only tuition fees), and L-Bank (only tuition fees).
Student loan from the KFW bank
The student loan from KfW Bank is available for family members of German citizens, EU citizens who have legally been residing in Germany for at least the last three years on a continuous basis, or educational residents.
BAfoG bank loan
Both German and international students are entitled to receive a BAfoG bank loan. The BAfoG bank loan supports those students who either exceed the standard period of study, wish to prolong their studies or pursue in-depth studies or additional, postgraduate study.
Students who wish to receive BAfoG must meet the following requirements:
- below-income and/or come from a low-income family
- be married to a German citizen,
- be a German citizen, or
- permanent resident in Germany (student status does not qualify), or
- a refugee, stateless individual or person seeking political asylum (as defined by the government), or
- an EU citizen who resided permanently in Germany or who pursued employment or vocational training in Germany prior to beginning her/his studies in Germany
- The student’s former employment or vocational training must be related to her/his present field of study.
BAfoG for International students: International students can receive BAfoG if have already lived in Germany for some years or plan to stay in Germany for a long period of time. Also, you have to be younger than 30 years at the beginning of your studies. Your application will be verified regarding your and your parent's earnings.International students can claim the BAfoG if:
- one parent is a German citizenship
- they have or have had a German spouse
- they are a legitimate asylum seeker, stateless or a refugee
- one parent was legally employed in Germany for three years within six years before the beginning of studies, or
- they were legally employed in Germany for five years before the beginning of studies.