Foreign contract financing
Can I apply for a loan by presenting the foreign paycheck? So, that of loans for workers abroad is a highly debated subject and on which we intend to clarify. But first, let’s ask the following questions: why should an Italian citizen abroad apply for a loan in Italy? Or, why should an Italian bank or financial company deny a loan to an Italian citizen who has a foreign employer, that is, with a foreign paycheck?
Loan in Italy with a foreign paycheck: things to be taken into consideration, even by frontier workers. Essentially, there are 2 things to consider: 1) the applicant’s residence: if it is EU or extra EU; 2) a possible third party guarantor.
Loans for workers abroad: why is the EU residence of the worker important? The residence of the worker within the Europe Union is important because a directive already exists, implemented by all member states, which authorizes loans by an EU citizen, to banks or financial institutions from another EU state: you can consult it on apply for a loan in another eu country.
Applies both to those who are resident abroad
However, this directive does not bind a bank, which, despite the directive, could deny us the loan, for a reason that we will see later. This applies both to those who are resident abroad and also work there (with a foreign paycheck), and for those who are resident in Italy but work near the border (frontaliari) and therefore despite their Italian residence they have a foreign paycheck. But, speaking of EU directives, let’s now answer one of the questions about places: why should an Italian with a foreign paycheck ask for a loan in Italy?
Financing with a foreign contract: why ask in Italy especially if you are resident abroad? There are many reasons why he is asked in his native country, but we are interested in one. Is it not by chance that you are applying for a loan in another EU country because in the one where you live and work they have denied you the financing? For example. Why is there no requirement to obtain it and/or have you not paid a previous loan? Well, if so, know that you only waste time: according to that directive, all the databases and risk centers where they report this type of information have been centralized throughout the Europe Union! What does it mean? It means that if you have not paid a loan in France, they will know it in Italy, if you do not have the merit requirements in Germany they will know it in Romania, etc. etc. Let’s close now with the most important of the questions: loan in Italy with a foreign paycheck: why should they deny it? And, how to overcome the refusal?
Loans for workers abroad: why could they deny it?
The main reason why they can, indeed deny a loan with a foreign paycheck is precisely because there is a foreign employer, whoever he is! The foreign paycheck has a consequence: in case of non-payment of the installments, the lender would have difficulty in recovering the credit having to apply foreign laws because, even in the EU, this type of procedure is not yet harmonized by any directive, let alone if the loan comes from a foreign but non-EU paycheck: even worse!
Mortgage with foreign paycheck: all the details reported above also apply to a mortgage in Italy with a foreign paycheck even if, but this is our opinion, it would be a much safer operation for the bank as the mortgage would be marked on an Italian property therefore subject to the law of our country.
Loans for workers abroad: what solutions? If they were to make us understand that the financing would be refused because it is guaranteed by a foreign paycheck, we have solutions that consist in the presentation of some guarantees, one of which we have already anticipated: a third guarantor. The latter, for example, could be a family member who remained in Italy. Then, in the absence of this, but only if you have a property (a house or land), a loan guaranteed by bills of exchange might be fine. For the latter type of financing you can visit loans with bills and who makes them in 2020.