How the transfer of the fifth Government Agency for pensioners and employees works
Employees of public administrations, state bodies, para-public bodies, as well as Government Agency pensioners can benefit from a specific form of access to credit: the transfer of the fifth Government Agency. It is a financial product that ensures different concessions, also compared to other convenient solutions. Let’s find out what are the advantages of the sale of the fifth Government Agency and the procedures for requesting it.
In the case of Government Agency employees or pensioners of public bodies, ministries and companies or state-owned companies, the assignment of the fifth assignment is allowed without having to indicate the reason or purpose that affects the request.
The installments that make up the repayment plan are directly withheld from salary or pension. Reduction that occurs by the employer or social security institution that pays the pension.
Person who takes care of deducting the monthly installment from the payee or pension slip of the borrower and paying it to the credit institution that provides the loan.
However, we must note that the installment cannot exceed the maximum threshold of 1/5 of salary or pension. Constitutive feature of any loan based on the assignment of the fifth. Delivery times are generally limited. As regards the interest rate, it remains fixed for the entire duration of the amortization plan.
Who can get the assignment of the fifth
As we have already mentioned, access to loans on the sale of the fifth Government Agency is reserved for civil servants, public administrations, state bodies, para-public employees and Government Agency pensioners. The applicant must also be aged between 18 and 65 and have regular Italian citizenship.
Usually applicants must have an open- ended employment contract, although assignments of the fifth are also provided to fixed-term employees. Provided, however, that the overall duration of the installments does not exceed the contract term of the work activity.
As far as pensioners are concerned, the presence of a presidential treatment with an amount higher than the minimum pension foreseen by law is sufficient. However, banks and financial institutions usually provide loans on the assignment of one fifth of the pension only to subjects who are less than 75 years old. However, some institutions carry the limit even up to 80 years.
In any case, the master limit for loans against assignment of the fifth Government Agency is considered taking into account the age that the applicant would have at the date set for the extinction of the debt.
Who is excluded
The assignment of the fifth can be requested by all pensioners and employees, even if they are temporary workers. However, there are limitations regarding pensions. In fact, those who perceive:
- pensions and social allowances;
- civil disabilities;
- monthly allowances for disability pensioners;
- income support allowances (VOCRED, VOCOOP, VOESO);
- family allowances;
- pensions with joint ownership for the portion not attributable to the person requesting the assignment;
- Exodus benefits pursuant to art. 4, paragraphs 1 to 7 – ter, of Law no. 92/2012.
The achievable amounts
The assignment of the fifth does not actually imply an upper limit on the figures requested. This sum varies according to the amount of salary or pension and the duration of the loan, which cannot however exceed 10 years, that is 120 months.
Specifically, the amount payable is defined on the basis of the transferable portion. Share representing the maximum amount that the monthly loan installment can reach. As the name of the product suggests, the monthly installment of the loan upon transfer of the fifth cannot exceed 20% of the monthly income or pension received by the applicant.
How is the transferable quota determined? Let’s take an example of calculation. Let’s assume that to request the loan is a pensioner who receives a monthly allowance of 1,200 USD gross. From this 300 USD will then be removed for tax withholdings, thus arriving at a net pension of 900 USD.
At this point, to calculate the transferable portion it will be necessary to divide the net pension by 5. In this way you will find the fifth part (20%) of the net pension, that is the transferable portion. In our case, the transferable share is equal to 180 USD (900: 5).
How to submit the application
Fortunately for potential customers, the elements to be attached to the application are not numerous. For employees hired in the public sector, the main aspects are:
- copy of a valid identity document;
- fiscal Code;
- document certifying the service status ;
- salary declaration issued by your administration;
- a copy of the last paycheck obtained.
According to current legislation, certain age restrictions must be respected in order to obtain the transfer of the fifth Government Agency. In theory there would be no limitations from the point of view of the age of the applicant, but de facto applications for applicants over 65 are rarely approved.
The documents required for the pensioner
Pensioners who wish to obtain a loan with a fifth-year loan must first submit the personal documents, i.e. identity card and tax code. To these must then be attached the pension slip and the certification of transferable quota.
The latter is a document which indicates the maximum amount that the loan installment can have. The pensioner must personally request the fee by going to an Social Institute office.
However, in the event that the pensioner turns to a bank or financial institution affiliated with Social Institute, it is not necessary to present the transferability notice. In this case, in fact, the transferability notice will be processed directly by the credit institution, thanks to the electronic connection with Social Institute.
Given the particular structure of the loan, the loans on assignment of the fifth do not provide for the presentation of collateral, such as pawn or mortgage rights on the home. However, these types of transactions find a further form of guarantee in the TFR accrued by the worker or in the pension due, in the case of loans on assignment of the fifth of the pension.
Retirement and severance indemnity are intended to protect the financing institution in the event of loss of job or death of the debtor. The current legislation also provides for the subscription of a compulsory insurance policy.
Coverage that must ensure the payment of the amortization installments against sight and employment risk. However, it is necessary to specify that the insurance policy intervenes only for the sums still due and possibly exceeding the TFR or the pension due.
With the insurance coverage, the family members and heirs of the applicant are protected in the event of premature death, but also provides coverage of the remaining installments against the provider. And it is for this reason that the loan is almost risk-free for the lender.
We would like to remind you that in addition to Social Institute, the institution in which the Government Agency is incorporated, the role of provider can be interpreted by partner banks. Banks and financial companies have entered into an agreement with Social Institute Management of Public Employees, aimed at granting loans and mortgages. Special rates and conditions are provided for members and public pensioners and their family members.
The Social Institute conventions
In order to limit the interest rates applied to the loans on the sale of the fifth Government Agency of the pension or salary, Social Institute has prepared a convention. Agreement that was signed by several banks and financial companies active in Italy.
Requesting a loan on assignment of the fifth to an affiliated credit institution guarantees the beneficiary the application of favorable rates compared to the market averages. To find out which banks and financial institutions have entered into the agreement with Social Institute, you can consult the complete list of partner institutions.
The Fine Bank offer
Among the various banks that provide loans on the sale of the fifth Government Agency we find Fine Bank. The lender offers products on assignments of the fifth dedicated to both public workers and former Government Agency pensioners.
In both cases there are no commissions for managing the case or stamp duty. The commissions for the preliminary investigation of the case are also zeroed. We also remind you that civil servants who request a loan on assignment of the fifth can benefit from special concessions if they apply using the NoiPA system.
Not only. Civil servants who need significant sums can simultaneously apply for two loans, one on assignment of the fifth and one with delegation of payment.
But let’s take some examples. Let’s assume that an ex Government Agency pensioner requests a sum of 12 thousand USD to be repaid with an amortization plan that extends for 10 years (120 months). Tan and Taeg are fixed at 6.46% and 6.65% respectively. The monthly payment to be paid is 136 USD.
If, on the other hand, we take into consideration the loans on sale of one fifth of the salary offered by Fine Bank, the offer advertised on the official website of the financial company is as follows. By requesting $ 13 thousand to be repaid in 120 months, the monthly installment to be repaid is $ 144. As for rates, the Tan is fixed at 5.95% while the Taeg stands at 6.11%.
Among the credit institutions affiliated with Government Agency we also find Unicredit. The bank provides loans on assignment of the fifth Government Agency accessible to both employees and public pensioners. Loans that can be repaid with an amortization plan ranging from 24 to 120 months.
The monthly installment is deducted directly from the payee’s paycheck or pension check. As for the maximum amount that can be financed, this varies according to the category to which the applicant belongs.
Specifically, a maximum payable amount of $ 72 thousand is provided for civil servants. For Social Institute pensioners (including those pertaining to the former Government Agency management), on the other hand, the maximum amount payable stands at 69 thousand USD.