I Want a Loan – Where Can I go to Get the Best Deal?

What is the Problem?

This comes from Adrian, in Colchester, Essex:

"I want a loan. Where can I go to get the best deal?"

DON’T DO IT!

Consider whether you really need a loan, and or whether you really need that large purchase. If you can get by without it, great. If you can’t live without the item, save for it, because products, fashions and technologies change over time. Unless it’s an emergency, or for something which is essential, the chances are you will regret doing it; you’ll regret spending the cash, and you’ll regret paying the interest. Take it from this "hunk-like" old-codger: I've been there and done that! 

If you absolutely must get a loan, then perhaps consider the following: this is something that parents, grand parents and extended families should consider doing for their children, grandchildren and or loved ones...

The Outline Solution

• What if parents, grand parents, uncles and aunts, banded together and loaned funds to their offspring, at interest?
• A proper contract can be drawn up and the loan is paid back with interest.
• The net effect is that you get your loan, but the profit stays in the family, as opposed to being handed to a third party Bank.
• Long term, you benefit, because ultimately when your grandparents and parents leave this mortal plane, you are likely to inherit some, if not all, of that wealth.
• What was once a loan, has now become an investment. Plus, you may end up having children of your own and the process can simply roll over.
• From the point of view of parents, grandparents and other relatives; off-spring can be "coached" in the ways of money management, and if something goes wrong, parents are more likely to know the true underlying problem

Possible Arguments Against You

• As a society, we have bought into the “buy now – pay later” culture, and Banks and other financial institutions are cashing in.
• This has handed way too much power to the Banking Industry, which is, in itself, a monopoly. (Please investigate the nature of money and money creation).
• Inter family loans, can cause problems, but the risk of problems can be minimized so long as it’s all dealt-with formally, and any failure to repay is not rewarded with further finance.
• It may be wise to ensure that any "loan" requires the signature of 2-3 “elders” from different family units (eg one parent, one grandparent, one uncle/aunt).
• One downside is that you will not be rewarded with a good "credit rating", but you can always obtain a letter verifying that you repaid the loan, and your bank statements will prove it! Then again, why would you want to obtain expensive SYSTEM based credit?
• The upside is: you will not be punished with a poor credit rating if you have a few hiccups along the way.
• This will not work for everyone, but it does make sound financial sense.

The Almost Legal Info

• If you are absolutely intent on taking a ‘loan’ from a Bank and or other ‘Financial Institution’, then make sure you first understand how loans are created. If that doesn’t put you off, nothing will!
• Shop around, perhaps using a comparison website to save the leg-work. But when it comes to applying, apply direct, as it is highly likely that the comparison website is earning some kind of kick-back, or commission, which may inflate the interest rate you pay!
• When you have finally found a reasonable deal make sure you agree up front, that once the loan has been ‘re-paid’ you will get your ‘security’ back – ie the original loan agreement bearing your "wet-ink" signature.

Helpful Paragraphs:

• Banks and finance companies are raking it in and that is because most borrowers do not understand the first thing about how a ‘loan’ is actually created, on the books of the Bank.
• The Bank itself never risks a penny when "making" a loan, and it never loses a penny, even if the loan doesn’t get repaid! If that sounds strange to you, check the GetOutOfDebt Webinar in the ToolBox or watch this: Money: The Game Changer
• ‘Cash’ is a promise to pay money: check your Bank of England Notes.
• Now ask yourself “what is money?”

Need More Help?

If you want a more detailed guide to money, loans and credit cards, how they work and how to challenge them, please go to the "ToolBox" and obtain the GetOutOfDebt Webinar.