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  Reply # 1501122 29-Feb-2016 07:23
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Low interest credit card with ASB as they only charge $2 for cash advance, or sometimes you can pay with credit card as part of your negotiations and not higher interest like some banks do.

 

But I agree, what is the point of having savings then taking out a loan?


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  Reply # 1501202 29-Feb-2016 09:17
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blackjack17:

kingjj:


Back to the OP's initial question, we got a loan from GE at 12% a couple of years ago for $6500 on a 2 year term. Like the OP was considering it was for a topup on top of money set aside for a car. We choose to do it this way and pay the bit extra in interest for 2 reasons: 1. We didn't want to replace one cheap car with another and than have to consider doing it again in 2-3 years and 2. We didn't want to raid our savings as we have that set aside to allow my wife to stay home for as long as possible when we decide to expand the family.


OP if you want to get a loan to topup your spending money than do it. It's your guys money and you can do what you want with it. We feel we made the right call for us at the time and got a great modern car that will well outlast anything we could have afforded otherwise. GE money were surprisingly good to deal with (although it did take a week or so to get it all sorted). We negotiated a rate that we were happy with and made it clear we would walk away if we weren't happy. This got us a 12% rate (or more accurately 11.99%) which we were happy with and no establishment or admin fees for the life of the loan. We also negotiated no penalty for early pay back and paid the loan a lot quicker than the 2 year term. All up we probably paid around $600-700 in interest which was worth it to not raid our long term savings account (which earned a comparable amount in interest during that time anyway).



 


Where are you getting 12% on savings?  I want some of that action



More like 16% considering income tax. Assuming that savings account is legit, of course.




BlinkyBill

 
 
 
 


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  Reply # 1501215 29-Feb-2016 09:36
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TeaLeaf:

 

She has her reasons for not wanting to use her savings. I do agree in most circumstances loans are a bad idea.

 

She doesnt have a credit card but thats a very smart thought.

 

Im presuming 10% is unlikely Ive told her 15%.

 

 

We've recently secured a car loan at 9.95%, so 10% may be achievable for you.

 

FWIW, we had approval for a car loan at a higher interest rate than this via AA Finance, but the dealership (John Andrew Mazda) negotiated a better rate with their finance company (UDC).


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  Reply # 1501225 29-Feb-2016 09:47
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dclegg:

TeaLeaf:


She has her reasons for not wanting to use her savings. I do agree in most circumstances loans are a bad idea.


She doesnt have a credit card but thats a very smart thought.


Im presuming 10% is unlikely Ive told her 15%.



We've recently secured a car loan at 9.95%, so 10% may be achievable for you.


FWIW, we had approval for a car loan at a higher interest rate than this via AA Finance, but the dealership (John Andrew Mazda) negotiated a better rate with their finance company (UDC).



I have a loan with UDC at 11% for my float, forgot about them!

Beware however their terms and fees for early payments are VERY high

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  Reply # 1501226 29-Feb-2016 09:48
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BlinkyBill:
blackjack17:

 

kingjj:

 

 

 

Back to the OP's initial question, we got a loan from GE at 12% a couple of years ago for $6500 on a 2 year term. Like the OP was considering it was for a topup on top of money set aside for a car. We choose to do it this way and pay the bit extra in interest for 2 reasons: 1. We didn't want to replace one cheap car with another and than have to consider doing it again in 2-3 years and 2. We didn't want to raid our savings as we have that set aside to allow my wife to stay home for as long as possible when we decide to expand the family.

 

 

 

OP if you want to get a loan to topup your spending money than do it. It's your guys money and you can do what you want with it. We feel we made the right call for us at the time and got a great modern car that will well outlast anything we could have afforded otherwise. GE money were surprisingly good to deal with (although it did take a week or so to get it all sorted). We negotiated a rate that we were happy with and made it clear we would walk away if we weren't happy. This got us a 12% rate (or more accurately 11.99%) which we were happy with and no establishment or admin fees for the life of the loan. We also negotiated no penalty for early pay back and paid the loan a lot quicker than the 2 year term. All up we probably paid around $600-700 in interest which was worth it to not raid our long term savings account (which earned a comparable amount in interest during that time anyway).

 

 

 

 

 

 

 

 

 

 

Where are you getting 12% on savings?  I want some of that action

 



More like 16% considering income tax. Assuming that savings account is legit, of course.

 

I don't think he is saying he earned 12% in interest, more like he earned $600-$700 in interest. Meaning his savings a more likely to be 6 times more than what he borrowed from GE. 




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  Reply # 1501420 29-Feb-2016 12:43
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thanks for those that tried to answer the question.

 

i didnt ask for captain obvious statements and judgements on savings vs loans.

 

the woman is a Dr and spent 8 years and university around the world, I think she can figure out these brilliant pieces of advice and judgement for herself.

 

What she is doing with her savings is none of your business and irrelevant.

 

i expected people to stick to the question when I raised the topic.




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  Reply # 1501454 29-Feb-2016 13:01
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It seems the cheapest rates outside the credit card idea is 10-14% depending on how much being borrowed, other than dealer finance in which they seem to get some incredibly low rates.

 

Thats all I needed to know.

 

Thanks.


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  Reply # 1501463 29-Feb-2016 13:15
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TeaLeaf:

 

Wanting to top up our car spend amount without hacking our savings.

 

Who is the cheapest to approach for a small loan of $5-7k?

 

 

You could try Harmoney.co.nz 

 

Their interest rates seem to be low compared to banks and finance companies. 

 

A would-be borrower who owns a house, has a good credit record and steady income appears to be able to get a loan for about 9.99%. They grade you from A1 to F5. The higher your grade, the lower your interest rate. The lower your grade, the more likely you are to default (so they demand higher interest). 

 

(Disclaimer: I'm an 'investor' in Harmoney and have so far contributed to about 40 peer-to-peer loans since September - with good results so far). 

 

 

 

 





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  Reply # 1501472 29-Feb-2016 13:21
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chevrolux:

 

All the people saying 'don't buy if you dont have the cash'.... do you own a house? If yes, did you pay cash? if yes, I want your job/pay packet.

 

Taking out a loan on a car is no worse than taking out a mortgage. As for the cost of interest, perhaps the OP values there comfort/enjoyment over a few hundred dollars - an extremely good reason to spend a bit more on a car.

 

Marac is who we do our vehicle leasing through at work. I think they do personal vehicle loans too. Very easy to deal with and have lots of partners you can buy from.

 

 

I generally pay cash for cars. My 'formula' is the best car I can get for under $10K. It's kind of a sweet spot for compacts and sub-compacts: new enough to be reliable, cheap enough to be affordable and old enough to know whether it's a lemon or not. 

 

 





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  Reply # 1501474 29-Feb-2016 13:22
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thats a non issue, dont see the harm in promoting your business, or your part of a business.

 

thanks, Ill pass that on.

 

her other option is to apply through one of her european banks where some of her savings is tied up in various banking products. but it would be a personal loan as i doubt they would take a car as assett. still worth her asking.


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  Reply # 1501483 29-Feb-2016 13:32
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TeaLeaf:

 

thats a non issue, dont see the harm in promoting your business, or your part of a business.

 

thanks, Ill pass that on.

 

her other option is to apply through one of her european banks where some of her savings is tied up in various banking products. but it would be a personal loan as i doubt they would take a car as assett. still worth her asking.

 

 

It might also be in some other currency. NEVER do that in NZ unless you have an income in that currency. The risk is terrifying. Our $ drops 20% against the Euro and your loan just got bigger and your payments with it. Of course it could go the other way, too. Or both ways over time. Eeek. 

 

 

 

 





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  Reply # 1501537 29-Feb-2016 15:18
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I still have some UK Accounts. The UK Banks are happy with continuing existing services but generally require a UK address for any new product - such as a personal loan. Presumably to allow a UK Credit Check. So that may be a non-starter.


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  Reply # 1501590 29-Feb-2016 16:26
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Ignoring the conventional wisdom (and I work for a finance company) Put it straight on the credit card. If they charge you a 3% card fee so be it. They cannot negotiate a difference price depending on the payment method, so if they say we'll do this Corolla for $9999 for cash, say great, and hand over your card. But they can add the credit card percentage. 

 

Then apply at a bank you don't have a card, and get a balance transfer and then pay it off with interest free period (last time I looked some a doing a year). As far as I'm aware Dr's seem to be earning between $160k-$400k pa according the news lately so it should be knocked off in no time!

 

I'm still curious why the savings can't be touched, if they're getting a good return I'd love to know where. I've got a house deposit barely scraping ahead of inflation. And to think I had a Raboplus savings account about 6 years ago getting 8.5%!!


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  Reply # 1501598 29-Feb-2016 16:46
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Most of the banks are doing one year interest free for balance transfers on credit cards.

 

Westpac also do a reduced rate (about 6% I think) for the life of the debt, i.e. until you pay it off in full.


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  Reply # 1501634 29-Feb-2016 17:22
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Linuxluver:

 

You could try Harmoney.co.nz 

 

Their interest rates seem to be low compared to banks and finance companies. 

 

A would-be borrower who owns a house, has a good credit record and steady income appears to be able to get a loan for about 9.99%. They grade you from A1 to F5. The higher your grade, the lower your interest rate. The lower your grade, the more likely you are to default (so they demand higher interest). 

 

(Disclaimer: I'm an 'investor' in Harmoney and have so far contributed to about 40 peer-to-peer loans since September - with good results so far). 

 

 

 

 

Certainly a better idea than paying 15%+ interest from a lender.


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