Loan advice!

[tim2x]

Hi guys I need some advice from the smart people at justcommodore forums.

I've recently become carless and jobless, now my previous job was a cash in hand garderner for about a year. Im starting a new job this week on the books at a retail store. Now im wondering, is there any chance that a bank or something would give me a loan for about $5000 to buy a car. as i need one for work and pretty much have no other option. I understand most people would not touch me due to me not having much employment history. but what are my options?



Thanks!

[minux]

You may struggle at a bank unless you have a history of saving. You might be best trying someone like GE etc who charge a higher interest rate but tend to give higher risk people such as yourself a loan.

Just do not apply to often, everything you apply for goes onto your credit report whether it is denied or approved.

[rch-13z]

It all really depends on your situation as a whole, most banks will look for the following: -employment history (length), residential history (how long you have lived at each place) and obviously that you can afford to repay the debt. A clean credit history will help so if you have any unpaid bad debt then most places will say no... inc GE...

Basically stability is always looked upon favourably...

Be careful when its comes to applying for a million different loans, because the bank will look at ho many times you have applied for credit & that can go against you when you have several applications noted within the last 3-6 months.

1st thing I would try to do is speak with the bank which you currently deal with because I good relationship will help with an approval

Hope this helps mate...

Cheers

[CSP]

I'll loan you the money... My name is Tony Soprano

[tim2x]

Hahaha cheers Fat Tony!


Hrm very fun situation might have to just call a few banks and see what they say.


Cheers guys.

[Troy711]

I'll loan you the money... My name is Tony Soprano

ehh, tony soprano... tony montana is where it is at meng

[vlv8vic]

The other option is to beg, borrow and steal and get yourself a $500 runabout. You'll apreciate it when you've not blown all your cash on interest, also if anything goes wrong with the new job you don't become jobless and carless again.
I always play it safe with money particularly when entering something new.

On the other hand a smaller loan wouldn't matter too much about employment history. They'll wanna know that you are safe to pay it off. You could go an even smaller loan and a cheaper car. Plenty of low cost options out there that don't equal massive interest and massive depreciation.

[Troy711]

thats a good piece of advice.. but not steal

[vlv8vic]

oh yeah don't steal! begging sucks also. Get a lift to work or use public transport for a couple of weeks until you can buy a bomb. A bomb doesn't necessarily mean unreliable either. My $700 camry did 1000km a week the first year i had it now does about 300 per week. I've only replace a timing belt ($20 and a day in the shed).

[minux]

Its only $5000, pay off 500/600 a month over 12 months and interest will be so minimal.

[VNexecutive]

the banks will probably want a guarantor. or whatever they are called. someone the loan payments can fall on if you happen to be unable to make a payment. normally parents/siblings or someone close.

[rch-13z]

with unsecured loans, most banks wont accept a gurantor but instead increase the interest rate which you pay in order to cover there risk...

ie current standard variable rate is approx. 14.45%. They may charge closer to 17% to cover their risk. Some people get loans someones else's name (ie mum,dad, dog of MRS)and you paying it back can get very messy.... Don't recommend it..

[vlv8vic]

Its only $5000, pay off 500/600 a month over 12 months and interest will be so minimal.

Yeah i'm more heading from hte direction that it's a new job and if jobs and cars are a problem already then caution should be used.

[azkwazere]

Its only $5000, pay off 500/600 a month over 12 months and interest will be so minimal.

Then hell cop a bad credit rating for paying it off too soo.

Banks want people who pay interest, if you get a one year loan, it wont do anything for your bank reputation. Get it for at least two years and pay it off in a year and a half. Interest is dead money however if you pay it, a bank is more likely to give you a loan in the furture. It sucks but thats how they work. They dont want to give money to those who will just get it back to them with no return... they want to make money.

Youd be hard up getting a loan from a bank so soon... they need either 3 months empkloyment or letters from employers with figures.

Ride it out.

aZk.

[VicCop]

Then hell cop a bad credit rating for paying it off too soo.

Banks want people who pay interest, if you get a one year loan, it wont do anything for your bank reputation. Get it for at least two years and pay it off in a year and a half. Interest is dead money however if you pay it, a bank is more likely to give you a loan in the furture. It sucks but thats how they work. They dont want to give money to those who will just get it back to them with no return... they want to make money.

Youd be hard up getting a loan from a bank so soon... they need either 3 months empkloyment or letters from employers with figures.

Ride it out.

aZk.

I agree with some of the first part. You don't get a bad rating for paying something off early. The other half of what you're saying is true though - banks want people who will end up paying interest.

I hear people complain all the time "I earn all this cash, no liabilities, I can easily afford that credit card but I got knocked back". Reason: there it is, you can afford it, there's the problem. What money is a financial institution going to make out of a person that's getting a 55 day or so interest free credit card and can easily afford to pay it off each time?

Even though that's credit cards, the same theory applied.

Anyones best bet to get finance:

* Little or no recent credit history. Remember, every credit hit on you gets erased after five years (except bankrupcy, that's seven). It's gone just like that, as if it never happened.

* Young. Lets face it, if you're young and stupid and have some reasonable amount of spending power you're more likely to sign anything they put in front of you and not think about what you're getting yourself into. Banks want people like that. Especially if it's for a car that you're probably drooling over before you've even started the buying process.

* Earning. Some job that gives you a payslip each fortnight/week that they can have one glance at it (without even looking at the numbers) that has your employers name on it. Some of them check this all out with a phone call.

* Spending. Most just grab your income and subtract your declared spending from it. That's how they work it all out. Do the sums yourself that you're putting on paper and see for yourself if your payments are affordable. They also love it if you're living with your parents, you're guaranteed to be accepted as you have loads of disposable income. With your spending, some of them tend not to check to see of there's any expenses you don't put down (HINT HINT!).

But really, if you need to borrow, pay it off quicker. I just finalised a seven year loan not long ago on a car that I got rid of earlier this year. The loan was finished some months before its expiry but it was still a pain in the ass.

Finance isn't my way anymore, I take the work lease option. All expenses (fuel/servicing/tyres/last minute repairs) all paid for before tax. Yes, I'm that idiot at the petrol station on the week's expensive day, because the price of petrol makes no difference to me. At the end of the three years I throw it away and get a new one. I'll never buy another car the same way again.

[minux]

Then hell cop a bad credit rating for paying it off too soo.

What the hell? You do know how credit files work right?

Defaults, applications and court judgements are the only things recorded on it. VEDA do not get informed of paying out a loan too early(this is why the Australian credit system stinks, you can go all through your life without one default, get that one default and say buh bye to credit for 5 years). That being said, a 12 month loan is the best possible option. Any longer is pointless on such a small amount.

[rch-13z]

your right minux, obviously the banks dont want you to pay it out early... but if anything that will look better to the bank which you currently deal with... VEDA only get defaults(paid/unpaid) as well as bankruptcies and stuff like that...

But best thing is to jam as much money into a loan as possible and get ahead... Then if something happens eg. lost job... then you have something to fall back on... Rather than going into arrears and have a bad rating...

[`daj0pe]

banks doesn't give you a credit rating anywhere!! other financial institutes do...

[rch-13z]

if you default, banks will pass info to Veda... But internal credit history always helps when applying with the same place later on...

and also banks do call each other for references when it shows as an 'inquiry' on your credit history...

[pow3rslave]

a couple of times i've missed my credit card payment, and been slogged with a extra fee and a stop of funds, how ****ed am i for future credit?

i only ask because i've heard everything from overdue videos to late phone bills can bite you in the ass with these.

[rch-13z]

if you miss a credit card payment or 2... no need to worry...

Trust me you would know if your bank has an issue with the way you pay your credit card... It may effect you getting an increase within a 3-6 month period of being late on your card...

But I know what you mean about late videos and stuff...

[minux]

banks doesn't give you a credit rating anywhere!! other financial institutes do...

Nobody gives you a "good" credit rating...the only credit rating you can get is a bad one

Just for anyone who has fallen into the trap of defaulting and is being hassled by debt collectors, take what they are saying you owe, then work it out to 20 cents in the dollar. Offer them and 90% of the time they will take it and disappear. I have a friend in debt collection, they buy these debts for as little as 1 cent in the dollar he says it is amazing at how many people are happy to cough up the full amount when they can get away with clearing the debt for 1/5th of what they actually owe.

[sleek_vp]

It all really depends on your situation as a whole, most banks will look for the following: -employment history (length), residential history (how long you have lived at each place) and obviously that you can afford to repay the debt. A clean credit history will help so if you have any unpaid bad debt then most places will say no... inc GE...

Basically stability is always looked upon favourably...

Be careful when its comes to applying for a million different loans, because the bank will look at ho many times you have applied for credit & that can go against you when you have several applications noted within the last 3-6 months.

1st thing I would try to do is speak with the bank which you currently deal with because I good relationship will help with an approval

Hope this helps mate...

Cheers

actually ge will say yes if you have bad unpaid debt instead they'll slug you with a 28% int rate my loan is a paid bad credit loan which is 16.75% and good credit loans are like 12 or 13% id try ge if your in a hurry mate

[VicCop]

If you're about to get defaulted, they will generally let you know.

You can cop a default from unpaid phone bills.

I've heard the crap about unreturned videos being a problem but I find that hard to believe unless the debt built up is absolutely huge. I think there is a specific minimum amount the debt has to be before it is able to be put onto a credit file.

The biggest trap is the mobile phone contracts. The worst part is these providers' useless 'assessment' process. You'll be approved as long as the figures look good (which could be anything you tell them) and that you don't have a bad history with them, and only them.

In actual fact you could have a bad history with outstanding owing with Telstra and Optus. Then you can walk into a Vodafone shop, tell them you're a millionaire and you get approved like that. You would think it would be to their benefit if they actually talked to each other about their customers' history and cross reference it.

[rch-13z]

actually ge will say yes if you have bad unpaid debt instead they'll slug you with a 28% int rate my loan is a paid bad credit loan which is 16.75% and good credit loans are like 12 or 13% id try ge if your in a hurry mate

Yeah your completely right, its good for its cause.. But other than that why pay more than you have too...