On Lending

Banking and Saving strategies, maximizing interest rates, budgeting, GICs, HISAs.
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mragile
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On Lending

Post by mragile » 13 Jun 2017 11:22

I am planning to go into short term loan. That is lend for a few months. Anyone have any idea about this? What kind of interest do you ask for and how do you at least try to secure your money?
TIA.

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kcowan
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Re: On Lending

Post by kcowan » 13 Jun 2017 17:13

I gather you are going to make a loan to someone else since you asked about security?
For the fun of it...Keith

mragile
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Re: On Lending

Post by mragile » 13 Jun 2017 19:52

Yes kcowan.
I want to lend money to someone for a few months and he will pay back with interest.
Any ideas on interest and how to get some security for the funds?
Thanks.

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AltaRed
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Re: On Lending

Post by AltaRed » 13 Jun 2017 20:17

For a few months? Not much you can do cost effectively for a few months. Have the individual leave 'goods' worth the loan with you for the duration.No comment on interest. Depends on the amount loaned and the honesty/integrity of the person.
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deaddog
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Re: On Lending

Post by deaddog » 14 Jun 2017 01:40

Payday Loans charges 17% of Principle in BC. That's for 14 days which works out to over 400% per annum.
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mragile
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Re: On Lending

Post by mragile » 14 Jun 2017 07:05

AltaRed, I don't understand what you mean by 'not much you can do in a few mths'.

deaddog, say for 3 months, would the interest, say 17% interest be on the principal every 2weeks?

This is money I am saving for a house sometime next year. I imagine its better yield than leaving it in a bank, with depreciation and all. And I don't intend to do more than 20k at a time.
Any other ideas on how to grow money short term?

Thanks.

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AltaRed
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Re: On Lending

Post by AltaRed » 14 Jun 2017 09:23

mragile wrote:
14 Jun 2017 07:05
AltaRed, I don't understand what you mean by 'not much you can do in a few mths'.
Simple. I don't know how you think you can get secured collateral cost effectively for short term loans, so you would have to take physical collateral such as goods. Or hire a burly guy with a baseball bat to collect on unpaid debt the way the Mafia does. Seriously, this is a bottom feeding business that Payday loan type places have developed a business around. The clientele are typically not very reputable. And you need to look up the laws on usury rates to avoid running offside with the law.

Added: Seriously, if you want to save money for a down payment, do like the rest of us do (have done). Put the money into principal protected assets like HISAs at 1.5-2.3% or if a house is 5 yrs into the future, some of those juicy Oaken GICs. It is your savings rate (how much you put away into savings every month) that matters, not the performance return you get on your savings.

Edited: Spelling
Last edited by AltaRed on 14 Jun 2017 11:48, edited 1 time in total.
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mragile
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Re: On Lending

Post by mragile » 14 Jun 2017 11:36

Thank you thank you AltaRed!.
LOL though at baseball guy. No one needs the extra stress.

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Quebec
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Re: On Lending

Post by Quebec » 14 Jun 2017 19:26

AltaRed wrote:
14 Jun 2017 09:23
Seriously, if you want to save money for a down payment, do like the rest of us do (have done). Put the money into principal protected assets like HISAs at 1.5-2.3% or if a house is 5 yrs into the future, some of those juicy Oaken GICs.
I'll second that. Don't take any chances with your down payment!
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mragile
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Re: On Lending

Post by mragile » 16 Jun 2017 11:41

Thanks Quebec.

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