Good credit rating perhaps?Originally Posted by supersunbird
Good credit rating perhaps?
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There is a difference between a secured personal loan and an unsecured 'micro'-loan. In terms of a normal loan, you put up some form of security (car, house etc) whereby if you default on your payments, the lender has recourse to sell your secured items to recover outstanding loan amounts.
Unsecured credit does not have this fallback for the lender. Thus it is more risky, and thus much higher interest rates.
Both are governed by the NCA (National Credit Act).
Financial institutions are allowed to charge a maximum of 32.1% interest on an unsecured loan, whereas they can only charge 22.1% on a secured loan.
My credit card is at 18% interest. Rather go that route.
Those are the bastards that are always sending me offers of loans. I have to wonder where they got my address though. I move to another flat in the same building but all the offers are addressed to my old flat number.
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Yup stay away from Personal Loans if you can...I loaned R60 000 from Standard Bank...I'm paying close to R100 000 back... bunch of sharks.
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Dude - they gave you credit - what are you whining about?Yup stay away from Personal Loans if you can...I loaned R60 000 from Standard Bank...I'm paying close to R100 000 back... bunch of sharks.
Banks are in it for the money. You can't complain because they made cash off of you... if they hadn't given you the initial R80k then you wouldn't have been able to do whatever it was that you did with the cash
Firstly, not everyone will get that sort of interest rate on their credit card. Secondly, if someone is going for a microloan, they either can't get a credit card, or they have maxed out all other avenues of lending (cards, overdrafts, loans etc)
True...and we all know this :P not whining, I'm just expressing the fact that IF one can stay clear of personal loans, they should...it was for a deposit on a house, bank didn't give me a 100% bond so had to loan the rest...which in my case was necessary as i was a 1st time buyer, if it wasn't for this reason I wouldn't have gotten it.. :P
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Yea - also had no idea where they got my details, as I used to get their marketing for years earlier and just ignore it.
When I needed money I approached them and got this huge interest rate - so I mailed them and said something alone he lines of 'I've tried to use you and you're double the rate of my credit card. As I now in future you cannot help me, please remove me from any and all marketing'
So far, so good
As I am sure everyone here is aware ,these interest rates are purely dependant on an actuarial calculation of general risk profile.
Things to keep in mind when applying for a loan.
General rule of thumb,if you do not deposit any money as collateral, you can expect an estimated 1/3 of your loan amount to be added on as insurance and initiation fee.WHY? because the bank feels as though they are taking a big risk with no guarentees and requires a large return.
In lamens terms if someone came to you and asked for a loan and gave you a chocolate,you would feel that deal is a little sweeter and easier to swallow than the person wanting a loan and offering nothing in return for you giving them the loan
You will generally above the average tax threshold of around R5000(IE you earn more than R5000 a month) get your loan if it is
10% of your average cost to company,ie Gross eg R5000 x 12 = R60 000 x 10% means your can expect to have a R6000 loan accepted.Keep in mind these are estimates and change depending on your credit rating
What is your credit rating?
It is a financial agreement between yourself and a registered Financial service provider, meaning you borrowed funds,are paying back something,owe something,to a provider that was licensed in the first place to give you credit for whatever it is you owe money on
Banks,are not a fan of earners starting in the work place, so will increase return required,increasing your loan amount. Those of you with a 2nd job will always get preferences,as bank feels you are improving and becoming a valuable client
Get a loan from you current bank if you can,improves your chances of landing another one down the line,bonds and car finance easier to obtain,benefits also given as you now are in a sense locked into that bank for a minimum amount of time,so they want to look after you to make you feel as though it was a good choice to take that loan with them and for future loans and credit
Summary:
Get loan with current Bank
Nothing more in terms of a personal Loan of 10% of CTC
Young people in risk profile under age of 21 will struggle
2nd Job earners will generally be given preference
ALWAYS READ THE FINE PRINT. It is never the advertised amount,that is excl cost,insurance,collateral,VAT and initiation Fees.
Wish you luck on the loan!
O and quiksilver.
You made the comment of using your credit card for the loan.
YOU DO NOT WANT TO DO THIS!!!
WHY?
Because the loan amount will be an interest rate apportioned and it will be an annualised interest payable monthly.
Whereas your Credit card is providing you with short term credit. that 18% is monthly,effectively you are paying more,as you have not stipulated how long you will be paying that amount back.
Be my guest and try this,you will cry when that credit card interest comes back let alone paying the capital portion back
This is why the LOAN was created.It allows you to budget for bigger things, on a stipulated amount of time
Credit card=Short term,smaller items(Supposed to be) or for emergencies as I need a direct inflow of cash RIGHT NOW.
Agreed - credit cards are a different form of credit. You should be using this for really, really short term debt at relatively low amounts (< 3 months).
I borrowed R7000 + 800 initiation fee, from Direct Axis in January and they gave me 31.2%..took the loan and I called FNB to transfer budget amount to straight on my credit card, paying 9%..payed off the loan 2 weeks after I found about FNB promotion.. and this month I just paid the credit card...and interest on my credit card is 22% which I am looking into cutting it to 17% or so
Have you looked at Capitec?
And have you tried alternative methods of getting the money?
I know you said you're low to medium income, but 8k.. is not a major amount of money. Is there any way you can save up for a few months instead of taking a loan?
Or if you need to pay someone for something - perhaps rather try to negotiate a payment plan with them, where you pay them R1000 per month for the next 8 months, plus maybe a little bit of interest.
Have you looked at Capitec? http://www.capitecbank.co.za/persona...g/credit/rates
And have you tried alternative methods of getting the money?
I know you said you're low to medium income, but 8k.. is not a major amount of money. Is there any way you can save up for a few months instead of taking a loan?
Or if you need to pay someone for something - perhaps rather try to negotiate a payment plan with them, where you pay them R1000 per month for the next 8 months, plus maybe a little bit of interest.
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