All you need to know about zero interest loans. Let’s see how this form of financing works, with the required requisites and the expected economic conditions. Finally, how to get a loan at a real rate, especially for young people and for all those who are without a paycheck.
Differences between Zero Rate Loans and Real Zero Rate Loans
If you are looking for a loan, there are certainly zero-interest loans among the most convenient solutions. This name is given to products of a different nature, so it is good to know the characteristics of each solution we can access. On this page you will see all the differences so you can choose the best zero rate loan based on what your needs are. First of all we must specify in detail what we are talking about. What is a zero interest loan? As easily understood, this is a form of financing that provides for an interest rate equal to zero. In this sense it is good to specify a fundamental aspect, which concerns precisely the interests we are going to pay. For any form of financing provided by a credit institution, the parameters describing the economic conditions are four: the amount received by the client, the repayment plan duration, the Tan and the Taeg. On the first two aspects there is not much to say, while especially for the less experienced it is good to open a parenthesis regarding the two different interest rates.
No doubt you have seen these percentage values very many times, without dwelling too much on their meaning or perhaps considering only one of the two rates. In reality there is an important difference between the Tan and the Taeg. The first is the nominal annual rate, and refers to the percentage of the amount received that each year the customer is required to pay for the interest on the credit received. So this is the “cost” related to the fact that the borrower borrowed a certain sum of money. The second interest rate that is specified is the Global Effective Annual Rate. The percentage of this rate contains what we have just said for the Tan, but adds to that expense all other incidental costs, which may include for example the costs of investigation, ancillary costs, any fees on the collection of installments that we will go to pay and the financing insurance we have the possibility to stipulate. So if we want to know the total cost that we will actually face to complete the reimbursement we will have to consider the Taeg, since it includes all the costs related to our financing.
This premise was necessary to consider the first important difference that there may be between two products that are called in both cases zero interest loans. The type that is easier to meet is that which is defined at zero rate because the Tan is equal to 0. This does not mean that even the Taeg is equal to 0, and therefore there will still be a cost related to financing. Many banks offer their customers this solution, which however must be carefully considered, as it may not be as convenient as one would expect from a zero-interest loan. In any case it is a form of financing that can be requested by a rather large clientele, and for this reason it may be the solution that is right for you. Next to this type of subsidized loan there is one even more convenient, which to distinguish it from the first is called a real zero rate loan. In what real sense? In the sense that in this case also the second interest rate is reset, and therefore can be a decidedly cheaper solution to be held in strong consideration. By choosing a real zero-rate loan, you can be sure that the amount we are going to repay will be the same as we received, since there will be no cost associated with the loan.
From this description of zero interest loans we understand the great convenience compared to classic loans. However, a doubt may arise: why credit institutions should be willing to offer this form of financing if it does not provide for a profit? In this case there are two answers, and refer to the two types of zero-interest loans available on the market. The first is for anyone and it is zero-rate consumer credit. This is a loan that can be used at the time of purchase of a good or service in a commercial establishment affiliated with a credit institution. Usually dealers and large furniture stores offer this type of loan, which in most cases provides only the 0% Tan, although in the case of special promotions you can take advantage of the real zero rate loan. So in this case the retailer will take care of the interests, with the advantage of being able to sell their product. The second case in which this form of subsidized funding can be received is by participating in the calls for proposals promoted by Invitalia and by the various Regions, so they are incentives for the production and establishment of new companies, which have the objective of reviving the entire economy of the country and not to obtain a gain from the loan granted.
How to get a real rate 0 loan for young people up to 35 years
We have seen the general characteristics of zero interest loans, which represent one of the most convenient solutions for all those looking for a loan. Let us dwell in particular on the real zero-rate loan for young people. As we have already said, this form of financing is an advantage promoted by the Italian State in order to improve our economic situation, which unfortunately is not certain of the best. One of the main problems of our country is certainly youth unemployment, which has reached unsustainable levels. The idea on which the real zero-rate loans are based for young people is that boys and girls are a resource and certainly not a burden. Thanks to these loans, a great opportunity can therefore be obtained to “create” one’s own work activity. If you are wondering how you can get a real zero-rate loan for young people, then what you absolutely must have is a great idea in mind. Often children have potentially great ideas, but they need an initial expense that many are not able to deal with.
The various Regions publish from time to time the calls for tender to obtain the desired zero-interest loan. On the same announcement all the requisites necessary to access the credit are shown taking advantage of the facilitation. With regard to real-interest-free loans for young people, the applicant’s age must necessarily be between 18 and 35 years. Unlike traditional loans offered by lenders, in the case of subsidized loans no economic requirements are required. The latter is precisely the main reason why many young people can not receive funding by turning to a bank. Nowadays it is very difficult for a boy to have a paycheck, and the only possible solution would be the presentation of a guarantor who could be a parent. In the case of zero-interest loans offered by the various institutions, the requisites required concern the sector in which it operates and the eligible expenses, that is, those expenses that can be met through the money received on loan. On the basis of this definition it is therefore clear that we are not talking about a personal loan, with which it is possible to face any type of expenditure, but rather a finalized loan.
To obtain a real zero-rate loan, it is necessary to consult the list of active calls, available on the website of your region. These calls refer to different sectors of the economy, so they can obtain the desired amount, for example, young farmers, but also those who work in commerce, information technology and services. So once you find the notice that is right for you, just fill in the application, entering all the required data. In the application it is important to clearly describe the project you have in mind, as well as present a detailed business plan. The expense plan must include all expenses related to the start of the activity, with the costs related to each item entered. If all the requisites required and specified in the announcement are respected by the candidate, the applicant will move on to the next stage in which an interview is held. At this stage it is very important to show that you have great skills and expertise in this area. Considering that the real zero-rate loan is a great opportunity for all young people, every year there are many requests, and therefore only the most deserving can get the amount of money they need to make a change in their lives from the point of view working.
Zero-interest loans even without paychecks: to whom they are addressed and eligible expenses
As we have already said, zero-interest loans can also be requested without a paycheck. In addition to young people there is another category of “privileged” clients to receive these subsidized loans. In this sense, female entrepreneurship is also favored, with dedicated projects that we will see better later. Any small entrepreneur can still access zero-interest loans even without a paycheck. This is indeed one of the great advantages over classic personal loans. What we need to look at is above all those who address the project and the eligible expenses. If the activity that you want to start belongs to the branch of the economy considered and the expenses that you have to face are included in those foreseen by the project, then there will be no problems in receiving the desired zero-interest loan.
What are the eligible expenses that are usually specified in the notices? First of all, in order to start, for example, an industrial or agricultural activity, there may be a need for the purchase of machinery, which is financed both for the new and used. In the same way, all the necessary raw materials can be purchased by counting on zero-interest loans for micro, small and medium-sized companies. In addition, all expenses related to advertising and dissemination of the brand are also financed, thus also organizing events for the promotion of its products. Among the non-payroll customers who can choose zero-interest loans there are also all self-employed and those who want to set up an individual firm. In this case, for example, the purchase of IT products for both hardware and software is financed, with licenses for programs useful for their work. The eligible expenses depend on the type of project to which you intend to participate, however in general these expenses include everything that is strictly connected to the performance of your business.
Best calls for zero rate loans: where to look for them and how to participate
To conclude our analysis of zero interest loans, let’s see which are the best currently active tenders that allow us to receive the amount of money we need to start our business. Where to look for them? On the website of your region you will find all the information about the various projects reserved for residents. From our analysis we will illustrate some that we think are very interesting.
If you are resident in one of the regions of Southern Italy, you know how much the problem of unemployment is felt, especially the youth problem. There are more and more those who decide to change city or even country looking for a job. ” Rest in the South ” is the project that seeks to stem this “brain drain”, as it is commonly defined. The regions involved are Abruzzo, Basilicata, Calabria, Campania, Molise, Puglia, Sicily and Sardinia, and in particular can obtain a zero rate loan all young people under 35 years working in the sectors of agriculture, aquaculture, fishing, industry, services and tourism. With “Rest in the South” construction works can be financed, which can constitute up to 30% of the business plan, machines, programs and IT services, purchase of raw materials and not only. In total, up to € 50,000 can be received, of which 35% is non-repayable, while the remaining part is disbursed in the form of a non-repayable loan.
The project that takes the name of ” New zero-interest companies ” is also very interesting. This type of facilitation is valid throughout Italy, so this is a valid opportunity for all young people between the ages of 18 and 35, and women without any age limit. As described by the name of the call, this is aimed at all those who are interested in starting a new business, although in reality even companies established no more than 12 months can submit the request. The eligible expenses are all those related to the start of the company itself, even if in this case it is only 75% of the total expenditure plan to be financed. The remainder will be paid by the customer, through own resources or through a classic bank loan. The maximum eligible expenditure is equal to 1.5 million, and the loan will be at zero interest rate with a duration of 8 years.
Among the most interesting calls, there is also ” Smart & Start “. This project is aimed in particular at those who are interested in starting an innovative start-up. Precisely this is the fundamental aspect that is sought, as the beneficiary of the loan at zero interest rate will have to present a project ” high technological and innovative content ” as reported in the announcement itself. “Smart & Start” can be requested for spending plans ranging from 100,000 euros up to 1,5 million euros. The amount payable by means of a zero interest loan is generally equal to 70% of the total expenditure, while the duration of the loan will be equal to 8 years. This percentage rises to 80% if the innovative start-up is made up of young people under 35 or women. Finally, in the event that the company is based in Abruzzo, Basilicata, Calabria, Campania, Molise, Puglia, Sardinia and Sicily, the loan will be 20% non-repayable.