MonthJanuary 2020

Government Agency Loan Simulation: What it is, installment calculation and estimate

Simple and immediate Government Agency loans

Simple and immediate Government Agency loans

Even if you have a pension or salary, having access to credit for greater liquidity is something very important. In a historical and economic reality like the one we live in, money seems to never be enough. Life is constantly evolving with the creation of new consumer goods and innovations that require economic expenditure.

Furthermore, as the years go by, sudden situations such as health problems, accidents or exceptional events can occur. For those who are a civil servant and public administration, there are a series of advantages thanks to the Government Agency loans in order to access a series of guaranteed loans.

But what does this funding consist of? How can you really understand if such a loan is beneficial? The simulation of the Government Agency loan, with the calculation of the installment and the possible estimate, can be an excellent system in order to evaluate the different offers that are proposed by this assistance agency.

What are the Government Agency loans: Who can be entitled to them?

What are the Government Agency loans: Who can be entitled to them?

Government Agency is the acronym for identifying the National Social Security and Assistance Institute for Public Administration Employees. His duties were different, but among these he performed that of paying salaries and accumulating pension contributions.

In addition, those who were enrolled in Government Agency could take advantage of a series of sums that were made available every year for small loans. In 2011 the social security institution was incorporated into the Social Institute which was entrusted with the task of issuing forms of loans which are managed by the fund for the autonomous management of credit services.

In order to receive funding from Government Agency, Social Institute, it will therefore be necessary not only to be registered with the Social Institute ex Government Agency, but also to join the fund for credit management. In addition, the institution has made a series of agreements with various banking and financial institutions. Thanks to these, it will be possible to access greater liquidity at subsidized interest rates in a very simple way.

Once an application is made, the social security institution will directly provide the relative documentation to the lenders, in order to obtain the required loan. But what are the types of credit that can be accessed?

What are the loans: The types guaranteed

What are the loans: The types guaranteed

The loans provided for by the Government Agency are divided according to the amount to be disbursed and the number of installments necessary for the purpose of repaying the loan. The financial products that are issued by Government Agency, Social Institute are the following:

  • small loan: as the name implies, it is a loan of a very limited amount and which is repaid in installments ranging from 12 months to 48. The maximum amount that can be requested is around $ 5000. This type of loan was born with the idea of ​​intervening in case of immediate need by a state employee.
    In fact, in the event of illness or unforeseen expenses, the request can be made which will be fulfilled in a short time. Although the institution has a number of advantages, not all small loans are paid out. In fact, the maximum sum is always proportional to the subject’s perceived salary.
    The installments that must not exceed 48 months in the case of the small loan must be equal to a maximum of 20% of that received in the payroll in the pension plan. Furthermore, for those who have protested, are reported as bad payers, or already have a loan, it may be more difficult to obtain authorization from the institution for a small loan;
  • multi-year loan: it is a loan that can be longer than 48 months and has a duration of 5-10 years. In this case the amounts are higher and are established from time to time based on the request and in proportion to the employee’s salary.
    It should not be forgotten that the installment into which the repayment of interest and capital will be divided must never exceed 1/5 of the value of the salary received.
    The law allows in this way, to the civil servant, to return the money comfortably without burdening the family balance;
  • affiliated loans: they are part of multi-year loans, and foresee sums that can reach up to 60,000 / 70,000 $. This is possible thanks to the agreements entered into by the Government Agency with financial companies and banking institutions.
    The loan is in fact guaranteed thanks to the salary or pension of the worker, thus allowing access to money at a very subsidized interest rate.

The interest rates and the advantages of the agreements: APR and TAG

The interest rates and the advantages of the agreements: APR and TAG

Before considering an example of a simulation, it is important to understand what is meant by the interest rate. There are actually two rates. They can be fixed or variable. This means that in the first case, the interest will remain constant for the whole time of financing.

In the second it will be subject to the economic trend with the possibility of decreasing or increasing:

  • TAN: nominal interest rate. In a simplified way, it consists of the gain that is acquired by the lender. Almost always in the first installments the interest rate is returned first and then the capital received;
  • APR: it is the effective annual rate. It includes all the related costs that are expected to make the loan, from those of the preliminary investigation to the closing of the file. If you want to consider whether your loan is advantageous you must be very careful with the APR.

An example of simulation Government Agency loan: Calculation of installment and estimate

An example of simulation Government Agency loan: Calculation of installment and estimate

The Government Agency, Social Institute website provides members with a simulation system to independently verify the various possibilities of accessing credit. The format is very simple and provides a calculation of the installments and a quote based on different parameters: specific amount, ideal installment.

In the first case, the hypothetical ideal sum that you would like to receive is introduced and the program proposes the different types of loan envisaged. The type of loan, the duration and the reference rate with the gross amount will appear in the table. Once you have selected the one you prefer, there will be specifications including interest rates, costs and installments.

If, on the other hand, you want to pay a fixed amount, which cannot exceed 20% of the salary, the system will perform the simulation starting from this value. Here are two simulation examples, for small loans and multi-year loans:

  • gross loan amounting to $ 1300. The installments will be 12 of 110.80 $ with a rate of 4.25%. The interest amount will be $ 6.75 and the administrative fee will be $ 6.50, while the guarantee fund will be $ 2.21. The net funded amount will be $ 1284.54.
  • multi-year loan for an employee who requests a loan with a monthly salary of $ 1300. The installments cannot exceed $ 215.93, corresponding to 1/5 of the salary. A 5-year multi-year loan will therefore be applied with 60 monthly installments. The net amount granted will be 11,883.57. The one to be returned instead, equal to $ 12,955.79. The interest rate is equal to 3.50%.

Government Agency loan: The advances of 2019

Government Agency loan: The advances of 2019

The simulation system for Government Agency loans is a very useful tool in order to know in real time the maximum amount that can be requested. For 2019 everything will remain unchanged, given the functionality and simplicity of the procedure.