Tag: low interest rate

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Personal Loans

Criteria for Incurring a Personal loan

debt consolidation

In order to achieve your debt management goal, it is important to consider the basic rules to adhere to when obtaining a personal loan.

Can I Pay for the Personal Loan with Cash?

When you incur a new debt one of the first things you need to keep in mind is the fact that you eventually need to repay it. Consider your income and the amount of money you need to cover your monthly expenses. Check if there is any additional monthly debt. If there is none, it may be useful to look for another loan alternatives-such as a home equity loan, or debt consolidation loan. These options can help you accelerate the reduction of your inefficient debts, reduce your total interest payments and at the same time, give you enough money to boost your income.

For example, home equity loans can increase the equity you have in your home. If you intend to borrow later for investment purposes, you can use the equity to secure your loan. Debt consolidation loans can also reduce the overall debts plus interest and fees. If you roll all your credit card debts, personal loans and other existing debts into one, you will have more control over your financial obligations. You can also save money on the process, and you can enjoy the convenience of paying only one lender each month, instead of multiple lenders at various payment dates.

Should I Recycle my Debt?

Debt recycling is replacing inefficient debt with a debt that can efficiently boost your income and reduce overall debts.  Unlike debt consolidation, it is focused more on wealth accumulation than debt repayment. Take a careful analysis of your financial situation. Do you want to accumulate wealth over the long-term by using surplus cashflow to lower your inefficient debts? If so, it may be time to replace your debts with efficient debt such as an investment loan or business loan.

You can put your money in your investment portfolio and take advantage of its tax-deductible interests. While personal loans are not tax-deductible, the interest expenses on business loans have tax benefits. But, be careful when managing your money. It is true that you can use the money to create wealth by engaging into business, adding capital to an existing endeavour or putting money into investment funds—but you must be prepared for the risks. Eventually, you need to repay the loan and if you fail to do so, you may have to pay higher interests in the process.

Is it economical?

While a personal loan can play an important role in helping you meet your short-term and long-term needs, it must be managed and structured effectively to minimize the overall cost of the loan. For example, you may have to pay a higher interest for a personal loan payable within a year, than one payable within 3 months. Compare interests with other lenders, offering similar loan products and check which one can give you the best rates. Include the overall cost of the loan, not just the APR in calculating its cost.

Ask about the possibility of increasing the size of regular loan repayments on a regular basis.  This will reduce the interest charged and the principal on the loan. But, you may have to pay for the early repayment penalty. so, it is important to inquire about this matter before you sign up for the loan.

Understand the cost of debt

The lowest interest you will pay on a loan is probably 30% considering the time it takes you to pay the loan especially when you have bad credit and unstable cash flow. Even home loans are not cheaper either, more so considering the other charges associated with the loan. Worst, when you default on payment and interests accumulate overtime. It is also clear that the more you miss payments, the longer the time it takes you to repay the loan and the more the interest and other fees you pay.

It is therefore in your best interest to look for a personal loan that offers the lowest possible minimum repayment rate and charges for you. But, if you have a bad credit situation and you cannot submit financial documents like income tax return and payslip that banks and mainstream lenders require, you may have to turn to ‘cheap to service loans’ that are usually the most expensive.

It is important to look for a specialised non-bank lender such as Australian Lending Centre that provides low-cost loans to people who are usually turned down by banks due to poor credit and absence of documentary requirements. Resorting to cheap service loans is not worth it, considering the financial cost of credit you can incur in the long run.

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Personal Loans Interest Rates

Why Patients in Debt Turn To Low Interest Rates When Applying for Loans

patients in debt

It’s definitely costly to be sick nowadays and patients in debt are particularly vulnerable. Despite the government’s efforts in promoting healthy workers, healthy eating and active living, illnesses still arise and more often than not people aren’t financially ready for it. No wonder many patients look for low interest rates loans when in need for financial security.

The No-Work-No-Pay Policy Scares A Lot Of People

Would you rather go to work than call in sick and risk losing your job in the process? Many people drag themselves into work while they are sick simply because they cannot afford to call in sick. If you are a casual or on a contract without sick pay benefits, you might be forced to report for work despite your doctor’s advice.

It’s not uncommon to hear stories of people suffering from injuries or illnesses to work through their discomforts so that they can still receive their wage. Some people don’t even bother applying for sick leave if they know their company is restructuring or cutting down on costs and firing employees.

Some people take a few days off but immediately return to work after using up their statutory sick pay, even though their doctors’ may advise them to take a longer break. This can actually harm your future health and mean you need to take more time off down the track.

Although the Australian law requires employers to give their employees’ sick leave benefits it is worth noting that the number of days covered may not be enough for a person to fully recover. That’s why some employees’ will come back to work earlier so that they can keep their job and receive their wages in full.

Many Self-Employed People Have No Comprehensive Medical Insurance

While Medicare, gives you access to free hospital treatment and subsidises your out-of-hospital medical treatment, you may still have to shoulder some out-of-pocket expenses if you need elective surgery. Some people still take out private health insurance products from top companies like Medibank, Australian Unity, HCF and the HBF. The most common health insurance coverage includes the following: Lifetime Health Cover, Medicare Levy Surcharge, and Private Health Insurance Rebate. But, there are times that the insurance coverage is not enough to foot the bill.

There are many things you need to pay for, and being sick doesn’t help at all. Patients in debt can save money by doing the following:

Groceries

Food takes up most of our money, with it being one of our basic necessities; we can’t really go without it, and so minimising the costs used for them might be the best option. If you’re used to eating out you should start cooking homemade food, not only is this cheaper, but it’s also healthier.

When buying groceries, you should make sure that they will last you an entire week without having to go back to the market again. Remember, this should turn out cheaper than eating out every day, so buy only the ingredients that you’ll need. If possible, look for discounts, or you could even look for some vouchers and/or coupons that might be lying around your home.

Transportation

Going to and from work can be such a hassle. Having your own vehicle might be more beneficial on your part because you can budget the money you use on fuel. However, as with everything in life there are other expenses attached to owning your own car; this is where public transport has the upper hand.

The key to budgeting your transportation expenses is to average your monthly expenses and then create a budget based off that figure.

Bottom Line For Patients in Debt

You need to pay your debts each month, and unless you find personal loans with low interests for patience in debt, it is difficult to keep up with your payments.

Bills might come knocking at your door on the 15th or the end of the month, so you should make sure that you have money set aside for them. Everyone has debts they have to pay. Do everything possible to pay on time and you’ll eliminate them in the near future. Australian Lending Centre offers loans with low interest rates that you can fall back on at troubled times. If you’re interested in applying for an affordable loan, make an enquiry today!