Family Allowances
The family allowances represent a significant financial aid for every family. Thus, in Belgium, parents receive monthly aid of €90.28 for the first child; aid of €167.05 for the second child and aid of €249.41 per child from the third child onwards.
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Can these amounts be considered to evaluate your total income to obtain a loan?
The answer is decidedly negative. You cannot rely on your family allowances to obtain a loan, regardless of the form of the loan, the amounts borrowed, and the duration of the loan.
Why? It is the Belgian legislator who intended to protect family allowances and reserve them for the purpose for which they were created. Similarly, your family allowances are not seizable, which would not allow a financial institution to seize them in case of default.
Besides work income, are there other incomes that can be considered for obtaining a loan?
Of course, the legislator allows you to include in your income for obtaining a loan:
- Rental income, that is: the income you receive from renting a building, part of a building, and more generally any real estate property you own. However, the legislator limits this consideration to 80% of the rental income amount;
- Investment income produced by financial investments (securities account) or interest received on your savings account;
- Legal pensions except pensions paid as aid to the disabled;
- Income received as a replacement due to disability;
- Declared income from a supplementary professional activity;
- Allowances received from your mutual insurance.
What are the other incomes or allowances that are not considered?
Besides family allowances, the following are not considered:
- Unemployment benefits because, like family allowances, these benefits are not seizable and therefore cannot be considered a useful guarantee for a financial institution;
- Income received in violation of the current tax obligations in Belgium (undeclared income). Indeed, any product of a tax offense constitutes a criminal offense under Belgian tax law that can be prosecuted in the criminal court. The banking institution that would accept to consider the product of such an offense would therefore be complicit and guilty of money laundering and concealment.