Amount of the Loan Portion
The loan portion typically accounts for 50% of the total BAföG funding, with a maximum loan amount limited to 10,010 euros. This means that even if the funded amount during the vocational training (Ausbildung) was higher, the recipient must repay a maximum of 10,010 euros.
Start of Repayment
The repayment of the loan portion begins five years after the end of the maximum funding period. This means that graduates generally have five years before they must start repaying. In exceptional cases, this period can be extended, for example, in cases of unemployment, low income, or parental leave.
Instalment Payments
Repayment is made in quarterly instalments, currently amounting to 390 euros. This means that the borrower pays a fixed amount every three months to the Federal Office of Administration (BVA), which is responsible for managing repayments. The repayment duration depends on how quickly the loan amount is fully settled. Early complete repayment is possible at any time.
Discounts and Reductions
Repayment discounts can be granted under certain conditions. If the loan amount is repaid in one sum early, a discount on the total amount is granted. The amount of the discount is determined by the remaining debt and the timing of the repayment. The sooner the repayment is made, the higher the possible discount.
Deferral of Repayment
If the borrower has a low income, they can apply for a deferral of repayment. A deferral means that repayment is temporarily suspended. The requirement is that the borrower’s income is below a set threshold, which is regularly adjusted. During the deferral period, no interest is accrued.
Forgiveness of the Loan Portion
In certain cases, the loan portion may be completely or partially forgiven. These scenarios include:
- A forgiveness for graduates who completed their vocational training (Ausbildung) especially successfully (e.g., as top of their class).
- A forgiveness due to permanently low income, if repayment is unreasonable.
- A forgiveness in the event of permanent disability.
Repayment Abroad
If the borrower is abroad during the repayment phase, they are still obligated to make repayments. The Federal Office of Administration accepts transfers from abroad, and the borrower must ensure that payments are made punctually. The options for deferral and repayment discounts also apply to borrowers abroad.
Procedure in Case of Payment Default
If the borrower fails to meet their repayment obligations, the Federal Office of Administration may impose late fees and, in the worst case, initiate legal proceedings. To avoid such actions, the borrower should timely apply for a deferral or a modification of the repayment conditions in case of financial difficulties.