Money Matters – Borrowing

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Plan for borrowing

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Need a loan or just some extra cash on the side? You may need to borrow from the bank. But, before you do, make sure that you have a plan. A plan allows you to prepare for borrowing, and lets you know if you will be able to make repayments, should the bank give you credit.

How does your financial checklist look?

You cannot borrow money until you determine your present financial situation. The simplest way to know your income and expenses is to do a checklist. Ask yourself if you will be able to afford repayments. If the answer is no, then you may need to adjust your spending habits.

Change your new year’s resolutions to financial resolutions

These help you get a grip on your finances, and start thinking carefully before you spend. It is also a way to set goals to pay off your debt by a planned date. Your main objective should be settling debt and avoiding getting into more debt. Remember to settle the debt with the highest interest first.

Signing the contract
Always read the fine print of every contract, so you understand the terms and conditions of your borrowing. What you are borrowing will have to be paid back with extra charges and interest.

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Borrowing and buying responsibility

Buying a car, house, or drawing up a will are events that most people face at some point. That is why it’s important to know the basics before you start.

Buying a car

You can buy an affordable car, and pay for it over a period of time. You can apply by calling your bank, visiting your nearest branch or through your dealership. The minimum income to apply for a car loan is R5 500.

Qualifying for a subsidy house

A subsidy is a once-off amount paid towards your house by the government, and is available to first-time buyers. Visit your local municipality and apply for a subsidy once your bond has been approved.

Drawing up a will

A will ensures that your assets and money are protected, and lets you control how your possessions are shared when you die. Your bank can help you draw up a will or you can do it online.

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