Taking Out A Loan

[Methersgate]

 

Sorry boys i did not make myself  clear,

The loan is for the family in the Phils to take out not me,

They are asking for me to send money and they will pay me back next May, i have done this a few times already and yes they have paid me back too, but they always seem to make me feel guilty once it has been returned,

So i thought why dont they go and ask for a loan themselves, they earn good money so they can pay who ever they get there loan from, i know it may sound cruel , but it does make me feel awkward and angry too, plus they are not listening to my advice but just wanting more and more money, I have said NO already but that i am sure fell on deaf ears

 

 

The monthly income requirements can be rather high to be approved for a loan, also minimum loan amounts might not be suitable for bank loans. Maybe now that the law has been passed to allow full foreign ownership of banks things might change in the future. 

 

An idea of interest rates , https://www.bdo.com.ph/personal/loans/personal-loan

 

rates.jpg

 

Foreign ownership of Banks is still very new, nobody has been to Court yet. (and you can be 100% sure, somebody will!)

There is zero interest from the big international Banks, the interest is coming from one Malaysian Bank.

Taking out a bank loan is in practice impossible, even businesses are not allowed overdrafts in the British manner.

Edited July 27, 2014 by Methersgate

[sjp52]

A lot and I mean almost every Filipino I know either has a loan or has pawned off some of their stuff probably to never see it again. I think they call it a 5 / 6 loan, Very high interest rate. As soon as their loan is paid off they get another one. They get loans to have birthday parties and all kinds of non important things.

 

We all do borrow money some times but they dont realize that they are getting ripped off with that high interest rate. It took me quite a while to convince my wife they were a rip off. My wife pawned an Iphone I bought her when we first got together. It was worth around 20,000 pesos and the pond shop gave her 6,500 for the Phone and was charging her 700 pesos a month interest. I paid the pawn shop off and told her never to borrow or pawn again. She said she felt shame asking me for money, Thats why she did it and it was money for her brothers roof that badly needed repair

[RBM]

A lot and I mean almost every Filipino I know either has a loan or has pawned off some of their stuff probably to never see it again. I think they call it a 5 / 6 loan, Very high interest rate. As soon as their loan is paid off they get another one. They get loans to have birthday parties and all kinds of non important things.

 

We all do borrow money some times but they dont realize that they are getting ripped off with that high interest rate. It took me quite a while to convince my wife they were a rip off. My wife pawned an Iphone I bought her when we first got together. It was worth around 20,000 pesos and the pond shop gave her 6,500 for the Phone and was charging her 700 pesos a month interest. I paid the pawn shop off and told her never to borrow or pawn again. She said she felt shame asking me for money, Thats why she did it and it was money for her brothers roof that badly needed repair

Pretty sad how so many hard working decent people here seem to be a slave of the money lenders. Having a back ground in banking I find it appalling how they are ripping off ordinary folk. One only has to keep an eye on a pawn shop near months end to see the brisk business being done.

Most of the issue here is lack of education, as hard to believe as it may seem, the average person here does not understand basic interest rates, I have tried so many times to explain to no avail. Guess I'm off topic a little.

The OPS family may avail of a better loan if they try a rural bank, not sure but could be worth a try. Hope his family stay well away from pawn shops or loan sharks.

[stevewool]

Live within your means is the only answer, yes we all need that extra sometime in our lives and we hope that if it is so important there will be someone there to give us the hand that is needed,

[Methersgate]

A lot and I mean almost every Filipino I know either has a loan or has pawned off some of their stuff probably to never see it again. I think they call it a 5 / 6 loan, Very high interest rate. As soon as their loan is paid off they get another one. They get loans to have birthday parties and all kinds of non important things.

 

We all do borrow money some times but they dont realize that they are getting ripped off with that high interest rate. It took me quite a while to convince my wife they were a rip off. My wife pawned an Iphone I bought her when we first got together. It was worth around 20,000 pesos and the pond shop gave her 6,500 for the Phone and was charging her 700 pesos a month interest. I paid the pawn shop off and told her never to borrow or pawn again. She said she felt shame asking me for money, Thats why she did it and it was money for her brothers roof that badly needed repair

Yes, "Five and six" - "I give you five you give me si". Originated by Indian moneylenders and still generally used. 

Pawnbrokers give very low value on pledges and charge five and six.

On one occasion Kor, confronted with s seriously sick little boy and unable to get hold of me, pawned her engagement ring. I was not at all upset, saying that was what it was for, but was mighty relieved when she  redeemed it, as the pawnbroker had advanced 3% of its value!

You are right about the financial illiteracy, There is an NGO in Hong Kong running financial literacy classes for domestic helpers. 

The Malaysian Bank pushing for full foreign ownership is Maybank. 

Edited July 28, 2014 by Methersgate