Personal Finance - confusing me!

[floody]

OK, I want to borrow some money. Not a huge amount of money; Around $3-5000, on a term of 3-5 years. I will most likely pay it out early.

I've made a few applications....No mainstream lender seems to want to have anything to do with me. I earn around $1400-1600 a month - not a lot, but I have pretty low living costs all up. I can easily cover the repayments of a loan up to about $200/month. No worries.
I think part of the problem is my income, via nightfill shifts at coles and youth allowance, is somewhat seasonal. I average about the same every month...but my weekly income may be $150 coles/$150 centrelink, or $300 Coles, $50 centrelink, if that makes sense. In the high season I could do up to $600 in a week at coles.
But lets say for the sake of argument I average between $350-400 a week.

I'm a student, I live defacto with my girlfriend. I own my car (~$10,000 worth), own all my contents and such. Only liabilities I have are a lowrate credit card with a $1300 balance/$1500 limit (soon to be largely negated, always paid up on time), and $30 a month for my washing machine. I pay $100 a week rent, other utilities at about $40/week (maximum, i.e. in winter when using a lot of electricity). HECS debt of course but I'm not clipping the threshold to have to pay that anyway.

So finance gurus, have I got any chance of getting a loan? I'm prepared to ho myself out to maybe 13%ish if need be.

I know if I earnt more I'd be able to loan easier, but If I earnt more I wouldn't want or need the loan as I'm very much a cash person. However I've also become a want-SX-Trail-Now person - I just don't want to save for the 2009 model.

[tinto]

However I've also become a want-SX-Trail-Now person - I just don't want to save for the 2009 model.
Does the shop you're buying from have the external facilities to finance it?
Most shops that sell stuff that's too big for credit card / too small for a loan will have something they can arrange for you with a smaller finance co, and they'll try to make it work. If they don't it's bad for their business. You should be able to haggle the rate with a smaller lender too.

I'd take a punt that the word 'centrelink' puts you on the shit-list of most mainstream lenders. Are you able to declare it as another form of income... i.e. not write centrelink on your application?

The more applications you make the more notes are made in your credit record. So I'd be wary of putting too many applications out there at once - if Bank X sees that you've got an application in at Bank Y, they're less likely to approve you in case Bank Y also comes through and your capacity to service both debts is reduced further. Even though you wouldn't necessarily accept both loans, the banks will protect themselves.

[protecon]

The fact that your on Centrelink and your income fluctuates would be an issue.
As far as your credit card, they don't pay attention to how much is owing - they treat it as a risk assessment ie it might as well be maxxed out.

You also need to show a history of consistant savings.
Try the Commonwealth, they'll usually be less anal than other banks (eg NAB).

Are you studying?

[m_g]

hey dude,
finance stuff sucks and Im no expert...but having a rather large personal/credit/HECs debt, I do know how to get loans!!

I get all my stuff through Commonwealth, mainly because Im too lazy to look around for the best deal...I got a 10 grand loan for my car when I worked casually (therefore, fluctuating income) so I dont think they looked at that- maybe other banks are...

However, I am paying around 17% for my loan (7 year term) and you said you only want maximum 13%, so maybe CBA is not the way to go for you...

Also, as has been mentioned, Centrelink does put a dampner on things...When I worked for a large retail sports store, giving out large retail finance for treadmills etc, I know noone ever got accepted in they listed centrelink as any form of income...
Thats just my experience, Im sure other finance types will have better advice...
But check out CBA if you havent already...
Cheers

[floody]

Yeah I definitely think the centrelink side of things would be an issue. Although it is consistent, but I guess thats no assurance for them.

I am studying, I am in the 1st year of a Bachelor of Teaching; my 2nd degree. I'm 24 years old.

Commonwealth turned me down originally a few months ago; I guess its too early to try again with them (I suspect once I've knocked over the credit card repayments - its one of their cards - I might have a better chance). I'm well aware and very wary of putting out too many applications; I've made 4 loan applications in total - the first was approved then my job disappeared so I had to turn it down, the 2nd was turned down by commbank, 3rd by the same mob who I'd applied with first and turned down, 4th St George. the first one was over a year ago, the others a few months apart this year.


Unfortunately the shop I would like to buy a new bike from does not do any sort of finance. Which I think is commercially silly , but thats another story.

So it does look like I've got fark all chance of getting any cash this way. I suppose I'll have to sell drugs or something (not really).

[floody]

However, I am paying around 17% for my loan (7 year term) and you said you only want maximum 13%, so maybe CBA is not the way to go for you...


I would go for a loan with a highish rate like that if I could manage it by paying weekly, pay extra in per payment with no penalty etc.
I did apply with commbank online, not in person, so perhaps I'll try it in a branch instead.

[ajay]

You work casual nightfill?

Does your work do hour aggreements or part-time contracts?
If so, get put onto a contract, that will go down much better with the banks...

You could apply for a larger limit on your Credit Card...

And yes, a one on one situation is much better as you can actually speak with the provider...

[floody]

No hour agreements unfortunately, It would be possible to go part time but unfortunately they aren't putting any more part timers on , they are moving to as many casuals as possible. Which is crap because I'm actually there more often than half the part time workers, and rostered hours would suit me far better.. Coles are a bit retarded like that.

[ajay]

No hour agreements unfortunately, It would be possible to go part time but unfortunately they aren't putting any more part timers on , they are moving to as many casuals as possible. Which is crap because I'm actually there more often than half the part time workers, and rostered hours would suit me far better.. Coles are a bit retarded like that.


Thats unfortunate man,

Get a job with the competition and they'll sort you out;)

A small, indepentent loan provider may be able to help you...:confused:

[bazza]

how good are your terms with the local shop?

see if you can work out a payment plan with them. if your buying a brand new bike and have been a good loyal customer im sure you could establish monthly payments with them on some sort of terms and conditions.

see if someone on here could get a legally binding contract done up or get legal advice on it or talk to the shop about it!

because if you can't get the money you can't get the bike!

see what they have to say about repayments! you never know if don't ask.

[floody]

No chance unfortunately Bazza.

I had honestly looked into it thinking "yeah, I can easily cover the repayments (double the repayments probably most months) why not" but obviously its not going to happen that way.
So I guess its time to face facts that I'm staying in the reality of bodging cheap shitheap old hardtails together and trail riding, rather than park riding/DH on a new dually. At least I'll have to get fit!

[Robb]

If you are about to pay your credit card off then that is $1500 available to you right there. Pay the credit card off and then apply for a larger balance to $3500 - $4000. Have you looked at applying for a larger limit on the card? (some cards are cheaper then the 14% personal loans anyway, depends on how often the interest is compounded though)
I have a virgin one which is pretty good, and I applied to get an increase on my commonwealth bank one when i had it and it was pretty simple.

Another issue is the fact you are trying to buy a bike with the money, not something that would be more recognised as an asset (ie. a car)

[floody]

Another issue is the fact you are trying to buy a bike with the money, not something that would be more recognised as an asset (ie. a car)

Doesn't seem to stop people getting loans for holidays and other crap though?

[Grip]

Floody, you need to seriously investigate Credit Unions. Community based, lower interest rates, easier and more personal to deal with. A lot of standard financial institues seem to want to put anything under 10-12 gs onto credit cards instead of a "loan"... geez, I wonder why? Big interest and less work for them. Bugger that. Good luck with it.

[W2ttsy]

thought about approaching the guy in this thread?

he might not have anything formal going at the moment, but im sure he could look at a once off for you if you put forward some initial conditions and other stuff.

W2ttsy

[scblack]

I think an important matter for you to keep in mind, is to keep your credit record as good as possible. Others have mentioned this also.

You probably do need to set an appointment with a bank officer, and speak to them honestly about what you earn, and get a good opinion, rather than going through applications, which appear on your record. The record is kept for 5 years I believe, and by then you'll have your teaching degree, and want a loan for a car etc.etc.

Unfortunately at your age, being a student makes it hard. I do not work with bank people, so can't help much for your current needs.

[TonyG]

Many years ago now, when I first left uni I worked for several Finance Companies and they lent to people in your income bracket quite freely. The only down side is you are in a higher risk lending bracket and therefore you will pay a very steep interest rate (I'd suggest over 20%). Unfortunately these rates are not negotiable. I think Grip had the best advice, go to a Credit Union as they specialize in the size loan you are after.

[floody]

Tried again...Income now up to ~$550 week clear after tax for the last few months, no centrelink benefits. Had paid out credit card etc - no joy with an increase on that either.
Talked to the usual suspects again (CBA who I've banked with for 20 years, Bendigo, a local credit union, few other options other than dodgy loan sharks in Tassie), now the excuse is not my income, but my term of employment (being just on a year currently).

Fark it. I think I'll just spend the next 3-5 years getting fit and saving a loan repayment worth of dollars every month, then have another shot at racing, haha.

That or I become a single parent somehow, get on the dole and someone will loan me 10x what I can repay.

[sxereturn]

Get rid of that credit card debt, and get rid of the washing machine responsibility too. You'll get one after that.

You need to understand what they look for...I was 18 when I got my $16,000 personal loan, 19 when I got my half of a $200,000 mortgage, and 20 when they gave me a $17,500 credit card (evil, evil things they are).

[sxereturn]

Sorry, I stopped reading the other posts just before yours.

Search around different banks. You should be able to get one. Cancel the credit card though, because it's still a liability even with no balance on it.

How about mum and dad?

[NeBoS]

Hmm, this is quite intriguing Floody..

Im a full time student recieving a centrelink payment every fortnight and I have a casual job. I dont have many assets, probably about $13,000 worth.

About 6 weeks ago i decided that i wanted a new car, so began looking around and worked out that i wanted to spend about $12,000.

Went onto my banks website (St George) and applied online and got approved for my asking amount of $9,000 (Interestingly, this is the maximum they were willing to give me, as i tried to refinance the loan for more).

So i got the loan with a $212.00 monthly repayment over 5 years and are likely to pay it off in the third year.

I have no credit rating, and i have never owned/used a credit card.

I cant understand how someone in a similar position cannot get a loan for less money??