Personal Loan

Xperia

Xperia

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G'day,

A quick question - I applied for a micro loan of R8000 over 12 months from ABSA today.

They want to charge me 33% annual interest plus a R52 /mnth service fee, plus an initiation fee. Grand total R11600.00

Is this really the going rate for a personal loan nowadays?

Surely there must be better options.

Thanks.
 
I applied for one 2 months back at Direct Axis and it was similar.
 
Almost any credit is better than a personal loan. So yes the answer is that anything else is a better option
 
Do yourself a favour and stay far away from personal loans because that's pretty much the rate you're looking at anywhere. If you can, save up instead. In fact you're probably even better off using your credit card.
 
Incl fees it's 45% over the year. Under correction but even credit cards are less than that.
 
Thanks for the advice fellas, problem is that I have very little choice at the moment...
 
:wtf: I had to apply for a personal loan late last year but my interest is 17%. Don't you have any credit history?
 
I don't really unfortunately, I've been overseas for almost my entire working life. And having just returned, my only history lies with my car purchase (6months) and Telkom. I don't have credit cards nor any accounts.
 
Xperia said:
I don't really unfortunately, I've been overseas for almost my entire working life. And having just returned, my only history lies with my car purchase (6months) and Telkom. I don't have credit cards nor any accounts.
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Thats why its so high for you then. As has been suggested, if you have a decent income payslip, rather get a credit card with a limit sub 20k or lower if you can and use that.
 
No credit history whatsoever,low to average income earner will be nailed with Interest,them's the breaks of loans :)
 
I'm not sure how you can get so low :/

Maybe it was the fact I went through Direct Axis
 
Dolby said:
I'm not sure how you can get so low :/

Maybe it was the fact I went through Direct Axis
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Went through my plat banker and I have a very good credit record, especially with absa. They're always nagging for me to take a loan but I don't need it. I did back then unfortunately for medical reasons.

*Edit* also depends on amount and term.
 
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.
 
Dolby said:
I applied for one 2 months back at Direct Axis and it was similar.
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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.
 
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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