Settle Car??

[*SynergyX*]

This being the most difficult part.

this is not difficult when you cant afford a new car....

 

[rorz0r]

Practicality wise:
Register on wesbank online site if you haven't done so already. Generate a settlement figure. It comes with the bank details and reference to use.
Up your transfer limit and transfer that amount across. Keep a proof of payment for wesbank because they can be chops. Wait a few days then follow up and you can request the original Natis and close your account (You'll need to keep the natis in a safe place if you do so, and you'll need it to sell the car).

Finance advice wise:
If you settle your car and make the payments you were making on your car to the bond you will save (4% interest plus R57/month admin fee). If you simply hope to pay your car off over 20 years it will cost you a helluva lot more. If you keep up the "extra" payments you're making into the bond well beyond when your car would have been paid off you will save even more.

 

[SauRoNZA]

Finance advice wise:
If you settle your car and make the payments you were making on your car to the bond you will save (4% interest plus R57/month admin fee). If you simply hope to pay your car off over 20 years it will cost you a helluva lot more. If you keep up the "extra" payments you're making into the bond well beyond when your car would have been paid off you will save even more.

Well that would be exactly what he is aiming to achieve, because to pay it off in 10 years means he'll have to double the instalments.

Which brings him back to exactly what he's currently paying, so like I said it's making another mistake to fix a number of prior mistakes.

 

[Sinbad]

okay let me come clean
I have property so i want to take out a bond on the property

currently i am paying the car which is 2700pm, then my credit card is R2500pm, then some other dept is R1200pm, this adds up to R6400pm, currently i don’t have that cash (also thanks to life circumstances)
The loan amount on the house is 300k at R2700pm, so basically i will have R3700 extra, which is money i really need

So all i can do is take out a loan, but it’s not all bad, after i paid all my skuld is want to use the other 150k on home renovations and upgrades, with my current salary i wont be able to ever fix anything on the house, like in never....

Dont know if this will help
Bond at 8.0%
Car at 12%

And thanks for all the replies!!

You don't want to do this. Paying off your shorter debts over 20 years is going to cost you a LOT more in the long term.
If you had 300k cash lying around, sure... but don't borrow to do it.

 

[SauRoNZA]

Also @Lament have you actually secured this home loan with the bank or are you simply bargaining on getting it at that interest rate?

Because firstly I would say that interest rate is never going to happen. You would be lucky to get prime with a large deposit, which presumably all things considered you don't have, so you are probably looking at 9% or even more.


Then there's the fact that with your financial situation being what it is the chances of you actually getting a home loan are pretty damn slim.


Like I said I would highly advise you go chat to your bank about debt consolidation and see what they can do for you.

 

[mak2000]

Financially, makes sense to take out a loan at 8% and pay off a existing loan that incurs 12%. However, if you are going to pay this off and borrow more against the CC and Dept Store cards then not such a good idea.

Suggestion here would be that you pay off your CC and Dept Store Cards by borrowing againts the Homeloan but then you must cancel the cards.

Good Luck.

 

[Sinbad]

Financially, makes sense to take out a loan at 8% and pay off a existing loan that incurs 12%. However, if you are going to pay this off and borrow more against the CC and Dept Store cards then not such a good idea.

Suggestion here would be that you pay off your CC and Dept Store Cards by borrowing againts the Homeloan but then you must cancel the cards.

Good Luck.

Only if you pay it off over the same period (or very slightly longer)

 

[Noob-Noob]

Look, i understand what you guys are saying, making dept to pay of other dept is a bad idea, i have thought of that, but here are some things i considered
1.I want to renovate the house, one way or the other
2.If i pay an extra R500 into the bond per month (which i will be able to afford), it wil gown to 13 years
3.In 4 years one of my "savings planne" pays out, its +-100k that i can put into the bond at that time, and then i can theoretically say the car part is paid for.

Let me explain to you why i find my self in this situation, when i started working at my company, i was based in PTA, 10km away from my employer, everything was fantastic, last year they decided lets relocate us to Midrand, so where by my petrol was around R500 - R700pm, its now +- R2500pm, lets not forget the R500 tollgates, this is money i did not budget for, by this time i already had the car, and to make matters worse, the company is going through a financial crises, and we have not received any increase in the last 2 years, unfortunately Petrol went up, Electricity went up, my medical scheme went up, including my retirement annuity and insurance, clothes and all other living expenses skyrocket, and these extra expenses got to much and i had to start using my credit card, what choice did i have?

if i can pay of my car, my credit card and all the other small things, i will have breathing space again, but at the moment it feels like in suffocating, to top it all of im living in a house that's falling apart, my car needs new tires, i needed new shoes 2 years back, still wearing the last bit of life out of them....

 

[ToxicBunny]

This just sounds like an all around BAD idea...

You want to generate long term debt against a standing asset that you own to cover short term debt?... never a good idea at all.

 

[rorz0r]

Start looking for a new job?

 

[Noob-Noob]

Start looking for a new job?

Been trying for over 3 years now, came up in the IT salaries thread as well, i have 10 years’ experience but paid 100k under the "market related" salary for people in my field.

 

[CAPS LOCK]

If you are a client of ABSA + MTN best you quickly expunge that debt with the available cash

 

[Cius]

Pay of debt and stay out of it as much as possible. If you can switch from buying cars via debt to buying cars cash it can save you millions over your lifespan. Seriously. You are used to car installments so keep paying them but into something that earns interest and in 3 years when you want to replace your current car you can pay cash and never spend any money on interest for cars again.

 

[Noob-Noob]

Pay of debt and stay out of it as much as possible. If you can switch from buying cars via debt to buying cars cash it can save you millions over your lifespan. Seriously. You are used to car installments so keep paying them but into something that earns interest and in 3 years when you want to replace your current car you can pay cash and never spend any money on interest for cars again.

Its such a difficult decision, the final grant i received from the bank is R2900pm on 300k at 8% (including building insurance), R2900 is not that much on the one side, like i said earlier, it wil mean i effective have ± R3500 extra per month, and that’s money i seriously need, its been months since i have bough groceries, at night i go and visit my parents and mother luckily always gives me a meal, but that’s no way to live..., i have been single 6 months now, i simply cannot afford to get a girlfriend, and its embarrassing inviting someone over to my place since everything needs replacement....

Over 4 years that savings plan of mine pays out 100k, i should be able to get ± 70 for my car at that time so i can always use that money and buy a car cash instead of taking that money and putting it back into the bond

 

[ToxicBunny]

Dude, trust me, you are setting yourself up for massive failure going this route.

YOu are going from a 5yr debt cycle to a 20+ year debt cycle.

Rather try make extra cash on the side doing odd jobs like fixing peoples computers and such. Don't worry about not having a GF, given your financial situation its not important whether you have one or not.

 

[Noob-Noob]

Dude, trust me, you are setting yourself up for massive failure going this route.

YOu are going from a 5yr debt cycle to a 20+ year debt cycle.

Rather try make extra cash on the side doing odd jobs like fixing peoples computers and such. Don't worry about not having a GF, given your financial situation its not important whether you have one or not.

I understand what you are saying,
And if i was the one giving advice, i would have said the exact same thing, but what i have realized is finding one self in a situation is completely different than advising on one, i have been living like this for over a year now, each month im worse off than the last, and there simply is not time to work on the side lines,

I think im going to go for it, im going to be much beter of than I’m now, and honestly, over 10 years ±R3000pm is not going to be that much

Edit. i have just worked out, if i pay extra R1500 pm, i will still be R1900 better of than i was, and the 20 years will turn into 8 years, i think im going to do this, is it possible to setup and additional debit order for the R1500pm?

 

[Cius]

The issue with debt is the day you don't have a salary to pay the debt. That is when it becomes ruthless. Most people will at some point be without work for a few months and if you are heavily indebted that time will destroy you. I would really push hard to find a new and better job to start with but that is me. Heck, I would rather swallow my pride and move back in with parents than take on additional debt like that.

Best of luck either way mate.

 

[Noob-Noob]

The issue with debt is the day you don't have a salary to pay the debt. That is when it becomes ruthless. Most people will at some point be without work for a few months and if you are heavily indebted that time will destroy you. I would really push hard to find a new and better job to start with but that is me. Heck, I would rather swallow my pride and move back in with parents than take on additional debt like that.

Best of luck either way mate.

I think they give you a few months leverage if i should lose my job,
My parents will also be able to help me should things go far south, if i get a new girl in the coming months, and she has a good job, things will also start getting beter, and then we won’t have to worry about fixing the place..

 

[Jweb_@@]

Have you considered moving in with your parents and possibly renting out your place? Additional debt should always be the last resort.

 

[F1 Fan]

I really don't think you are thinking this through. Youv'e had an overwhelming response on this forum from people advising not to go through with this and still you sticking to it. It's totally your choice, but I think you need to atleast understand what people are saying.

You seem to be living in a place that you is falling apart, you can't really afford to fix it, and yet you want to with a loan and you complain about not being able to buy shoes. Just doesn't make sense dude. No offence. Sell the car, pay up the loan and buy a nice Tazz for 30k. Sell your property and move in with your parents for a few months, and settle your credit card. In a year, you'l have a decent amount in savings(from the house you sold) and you'l be able to buy a new place debt free.

I would love to know how much you earn though, given that you said you are underpaid.