The loan with promissory notes is an increasingly fashionable credit solution and the demand for which is constantly expanding, characterized by the fact that bills are replacing monthly installments and are the payment instrument to be used to repay the debt contracted month after month. This financial solution is, in turn, preferred by the same lending institution since the bill of exchange is a title of credit to the order, with complete and executive literality which gives the right to raise a protest, if the debtor is defaulting and insolvent. We see in this guide to better understand how loans with bills reserved for public and private employees work, what are the economic charges applied for this type of loan and which banks or agencies in financial activity are the major players in providing this solution.
Loans with bills for civil servants in agreement with social security
If you are an employee of the public sector (hired with a permanent and fixed-term employment contract with a minimum duration of 3 years), in addition to being registered in the Unitary Management of Social and Credit Benefits constantly fed by the contributions of the subjects, then you can access the form of social security Government Agency Loans in agreement with banks and financial institutions.
Where the Agreement between the Social Security Agency and the Bank or financial institution has been signed, for the civil servant in possession of the requirements established by the Regulations for the disbursement of social security Loans in article 2 (“Recipients of the service”), it is possible to benefit of the subsidized rate loans repaid by payment of promissory notes.
Loans with bills for private employees: requirements
Employees of the private sector who want to request the most expensive form of loan through the release of bills of exchange as a form of loan, must meet certain requirements that can be ascribed below:
- minimum working seniority: 2 years
- TFR accrued: 2 years
- be hired with a permanent or fixed-term employment contract (to be assessed as appropriate)
- receive monthly paychecks.
In the case of a private employee hired with a fixed-term employment contract, it is possible that the presentation of a fixed monthly income (annuity, rental fee, etc.) may be required to allow the repayment of the bills. These are conditions that usually lenders or agencies in financial activity require to grant a loan guaranteed by bills.
What documents must be submitted to be issued with a loan with bills?
To apply for a loan with bills of exchange, public and private employees must submit the following documentation to the Bank or Agency in financial activity to which they intend to apply for financing:
- regular employment contract;
- monthly paycheck;
- valid identity card;
- fiscal Code;
- utility bill to verify the tax domicile;
- goods (if any) that are subject to guarantee with the signature on the bills.
How much is it possible to request for an employee?
The maximum amount or the maximum financial capital that can be obtained with the loan contract with bills of exchange depends on the professional profile and the type of employment contract through which the worker is hired. The cases relating to the subordinate employment contract are as follows:
- Public or ministerial employee, the maximum financial capital up to 80,000 USD
- Private employee, maximum financial capital up to $ 50,000
The maximum capital disbursable by banks and financial companies depends on several factors: in this case of employee employment, the main variables are those of TFR ( Employee severance indemnity ) and of the paycheck accredited monthly by the employer or by the public administration where you are on duty, in the case of public employment. Very often, due to the crisis and economic instability and the loss of job security, the creditor institution increasingly requests, in addition to the paycheck and the accrued TFR, also the issue of an additional guarantee.
What guarantees for employees?
The type of loan with bills of exchange is very peculiar in that in the presence of the bills of exchange, the creditor can request the release of additional guarantees such as a pledge (if it is a loan aimed at the purchase of an asset or the quantity of fungible assets), life insurance policy, surety policy, job loss risk policy, signature of a guarantor (mallevadore).
To protect the credit disbursed, banks and agencies in financial activity to guarantee themselves in case of insolvency of the contract, require the simultaneous subscription of a life insurance policy that protects the underwriting subject in the event of the occurrence of fortuitous events such as premorence, accident serious, illness, permanent disability. This insurance coverage also “protects” the subscriber’s family unit from any risks and events that jeopardize family income, especially if it is a single income group.
Another form of insurance policy required (even if optional) is that of employment risk which can affect and occur even in the case of workers hired with permanent employment contracts. The insured benefit, in this case, it consists of the amount of the residual debt still due at the time of the event, after deducting the interest on the installments not yet expired (financial discount) and deducting any sums left to guarantee the loan ( TFR of private employees ).
Insured capital for employees
As regards the insured benefit, in the event of payment of the premium by the debtor and subscriber of the loan guaranteed with bills of exchange, the Beneficiary of the insurance is not the same as the insured but, rather, the Bank or the creditor body that granted the financing. In case of loss of job, the insurance company will refound the creditor but will retain the right of recourse on the insured.
For civil servants, the insured capital is equal to the discounted value at the nominal rate (TAN) of the contract of the residual amounts resulting from the currency effect at the time of the event less the accrued employee severance indemnity. For private employees, the sum of the insured capital is equal to the discounted value of the amounts residues resulting from the exchange rate net of the amount of all sums owed by the company to the employee at the time of termination of the employment relationship. It is important to note that not only the severance indemnity set aside but also any other sum due by the company to the employee at the time of the termination of the employment relationship.
How to pay the loan changed?
Since this is a loan signed with the release of bills of exchange, bills of exchange are debt securities that can be used as collateral and as a form of payment to replace the monthly installment, in the case of a “traditional” loan. In commercial practice, it is possible to sign only one promissory note that acts as a guarantee for the entire loan and, in this case, the payment of the loan must be made by RID (direct debit from the current account) or by payment of the postal slips. Alternatively, the loan with exchange effect provides for the subscription of as many bills as the loan installments, according to the amortization plan. In this case, the payment is made by paying the bills at the bank counter.
Fast loans with bills for employees
Lawful question is that of whether fast loans really exist. In fact, as the crisis progressed and with the increasingly demanding demands of employees, the financial and banks had to adapt, providing for the possibility of taking out fast loans. There is talk of less than 48 hours from the receipt of the application by the potential subscriber to the disbursement of the financial capital.
For the employee (private and / or public) who needs a sum to finance an imminent purchase or expense, it is possible to send their request electronically by filling in a contact form and sending some documents. Through this rather simplified and streamlined procedure, it is possible to obtain a reduced capital: up to $ 5,000. In this case of fast loans with bills, the financial or banks offer the required capital even without guarantees. If the amount requested is of a small amount, the signature of a third party guarantor or other forms of loan guarantee is not required, if the monthly income indicated on the documents submitted is sufficient.
Foreign exchange loans: how much do they cost?
Loans with promissory notes compared to the traditional form of traditional loan, due to its peculiarity of being assisted by the release of bills, have a more expensive cost and require the debtor to bear costs, expenses and extra commissions by the debtor who must adequately evaluate and with due attention.
- expense for taking out life insurance
- expense for underwriting employment risk policy
- loan agreement registration fees
- expenses related to the stamp duty
- investigation costs and opening costs
- collection costs
- other one-off charges (to be assessed depending on the bank or other funding body).
Loans with bills for protested employees or bad payers
For all employees who appear to be reported among the bad payers or protestors databases (Crif), the possibility of obtaining credit and accessing the credit market is given.
In this case, if the employee is reported with negative merit among the CRIF databases and is in possession of a monthly paycheck and is hired with an indeterminate employment contract, the loan exchanged with Capital Lender may be disbursed. it is a lean and fast credit solution which provides for the withholding of the loan installment directly on the paycheck and the signing of a single bill of exchange to guarantee the entire amount of the debt. The employer undertakes to pay the installment of the obligation, retaining it from the salary received by the employee.