Student Loans in Germany

Student Loans

Student loans in Germany are offered by the state as well as by institutions and banks (private student loans). Some offerings only cover tuition fees for German state universities, others finance tuition fees for private universities as well as cost of living.
To receive a loan as foreign student you might need a guarantor in some cases, who can guarantee for the repayment of the loan. Banks and other financing institutions expect that you will work in Germany or EU after finishing your study. You might also need a certificate ofSCHUFA (creditworthiness check).

When you have found the right student loan, you can apply online or directly in the bank branch in your city. After verification of all the needed documents (like e.g. enrollment documents, CV, last exam grades etc.), the bank will prepare an educational grant agreement for the loan. After signing this agreement disbursements can start on a monthly or semester-wise base, or even as one time payment.
Depending on the interest payment model, disbursements can be reduced by the interest costs right from the beginning or interests are granted until repayment phase starts (after you have graduated and found a job, which is more expensive).Repayment period depends on your finances as well as on banks’ student loan criteria.

• Private student loans are offered country-wide e.g. by Deutsche Bank, Dresdner 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 e.g. by: KFW Bank, NRW. Bank (only tuition fees), L-Bank (only tuition fees).
• Private education funds (so called ‘Bildungsfonds’): CareerConcept and Deutsche Bildung
• Education funds offer to qualified and highly motivated students, funding for both cost of living and tuition fees. Repayment is income-based instead of interest-based, which means that after a successful application the fund determines a fix percentage rate of your gross salary per month which you will have to pay back over a determined period of time (usually between 4 and 5 years). Depending on your salary after graduation you may pay back more, the same sum, or even less to the education fund. This type of student loan is perhaps the most secure, because repayment always correlates to your financial status and the salary you get.

What to consider before applying for a student loan:

• Financing your tuition fees:
  Depending on the State where your desired University is situated, student fees vary between 375 and 500 Euros per semester (keep in mind that in Germany there are 2 semesters per year). See Tuition Fee Map
• Living expenses:
  The cost of living depends greatly on the city in which your university is situated in. You should consider 750 Euros per month. For more information on cost of living check our ‘Finanzbedarf-Check’ tool(basic German knowledge required). This article might also be very helpful.
• Applying for a student loan in Germany: Some banks offering student loans have a comprehensive application process and require the completion of an Assessment Center. Only few of them offer financing for your postgraduate degree or a second bachelor degree.
• Repayment plans and interest rates:
  Student loans differ in repayment plans and interest rates, so make sure to check which one suits your personal situation best
• Age restrictions:
  Most institutions offering student loans have age restrictions and do not finance studies beyond the average number of semesters for your degree (usually funding is offered for 12 semesters plus 1 more semester).
• Annual Interviews and Certificates:
  Keep in mind that some banks require annual interviews with the local banking consultant, an enrollment confirmation as well as a print out from your latest exam scores.