Author Topic: The smartest (and dumbest) ways to borrow money (Read 3439 times)

islander · « **on:** October 24, 2012, 06:23:05 PM »

The smartest (and dumbest) ways to borrow money

BDO Money Matters
Oct 23, 2012

By Mark B. Aragona for Yahoo! Southeast Asia

Sometimes when things are tight and you find yourself needing a loan, itâ€™s tempting to grab the closest source of credit you can find. Your credit card, for example, is an easy way to borrow, but can be a double-edged sword if you end up defaulting on payments and getting bad credit history. Thankfully, you do have alternativesâ€”some you probably havenâ€™t even considered before:

Borrow from your mortgage. This works if youâ€™ve been paying for your home for some years and your homeâ€™s accumulated some value. You can unlock that value by borrowing back what you paid, essentially another loan secured by your house. Just be sure you can pay it all back, or you may end up without a roof on your head.

Use your life insurance policy. Under the impression that life insurance is only useful when you die? The cash value of your policy can be a quick source of funds. How much depends on the type of policy you have and how long youâ€™ve been paying for it. Traditional types of policies allow you to obtain loan thatâ€™s secured by the cash value, but variable types donâ€™t require you to return the cash since itâ€™s considered an investment.

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islander · « **Reply #1 on:** October 24, 2012, 06:24:58 PM »

Use a credit line. Got a cash investment like stocks, bonds, mutual funds, or a similarly liquid asset? Use it as collateral for a credit line at a bankâ€”that way you get a loan without having to touch your asset. This comes in handy in case of emergencies or to buy additional investments.

Borrow from SSS, GSIS, or Pag-ibig. If youâ€™re an employee, these are mandatory benefits. You might even have been paying their dues for years without knowing you can take advantage of their low interest rates.

Borrow from your company retirement program. If your company has one set up, this is another way of getting easy credit. Just watch the late fees, and know that the loan may become due and demandable should you decide to leave your job.

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BolBuhol · « **Reply #2 on:** October 24, 2012, 06:27:32 PM »

whahahahaahaha...........

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islander · « **Reply #3 on:** October 24, 2012, 06:37:32 PM »

whahahahaahaha...........

wa pa ko mahuman, to.

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islander · « **Reply #4 on:** October 24, 2012, 06:38:38 PM »

unya ra katawa ha? luya kaayo akong internet connection. maybe it's because of typhoon signal no. 2.

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islander · « **Reply #5 on:** October 24, 2012, 06:40:54 PM »

But for every smart way to get a loan, thereâ€™s a dumb way as well. Here are some credit no-nos you should avoid:

Borrowing from loan sharks. Even if desperate, you ought to think twice before getting into the water with these folks. At usurious rates of 20%-30% and just days to pay up, youâ€™ll be opening yourself up to a great deal of stress and sometimes even risk to your own life. Do yourself a favor and stay away.

Borrowing from pawnshops. Pawnshops offer loans in exchange for something you own. A common sight in our country, theyâ€™re generally a bad idea. Pawnshops charge exorbitant rates while only giving a fraction of your collateralâ€™s worth.

Cash advance on your credit card. By slipping your credit card into an ATM you can tap a portion of your credit for some much-needed cash. However, you can get slapped with flat fees right from the start, and the high interest rates start ticking the moment you get that money in your hands until you pay it all.

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Lorenzo · « **Reply #6 on:** October 24, 2012, 06:42:46 PM »

The smartest (and dumbest) ways to borrow money

BDO Money Matters
Oct 23, 2012

By Mark B. Aragona for Yahoo! Southeast Asia

Sometimes when things are tight and you find yourself needing a loan, itâ€™s tempting to grab the closest source of credit you can find. Your credit card, for example, is an easy way to borrow, but can be a double-edged sword if you end up defaulting on payments and getting bad credit history. Thankfully, you do have alternativesâ€”some you probably havenâ€™t even considered before:

Borrow from your mortgage. This works if youâ€™ve been paying for your home for some years and your homeâ€™s accumulated some value. You can unlock that value by borrowing back what you paid, essentially another loan secured by your house. Just be sure you can pay it all back, or you may end up without a roof on your head.

Use your life insurance policy. Under the impression that life insurance is only useful when you die? The cash value of your policy can be a quick source of funds. How much depends on the type of policy you have and how long youâ€™ve been paying for it. Traditional types of policies allow you to obtain loan thatâ€™s secured by the cash value, but variable types donâ€™t require you to return the cash since itâ€™s considered an investment.

In the words of my Lola Nating, "Ondoy Bran Bran, ajaw gajod pang utang!" Mao jud si Lola, if you really want to buy something, tigoma lang ang kwarta and buy it in cash.

Ingon to si Lola namo , "Ajaw gajod mo pang utang kai og hilig ka mag utang, ma pordoy gajod mo dali!"

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BolBuhol · « **Reply #7 on:** October 24, 2012, 06:43:56 PM »

wa pa ko mahuman, to.

aw way pagid ba? daw di mo makita hang siknal kag ginatabonang pirmingti hang imong dagway dao naowao ka kid sang Tb mingbirs hao. may ara ba tingkoling hang imon na simod hao daw naka songkab kag piniritong bowad sang karahay, may ara ba na ibidinsya sang simog mo hao?

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islander · « **Reply #8 on:** October 24, 2012, 06:46:11 PM »

Over-leveraging. Borrowing from too many sources can leave you bewildered, stressed-out, and owing much more on interest than you would have, simply because you forgot you owed someone money. As much as possible, borrow from a single source with low-interest.

And lastly, the Filipino favoriteâ€¦

Borrowing from family and/or friends. The terms may seem good. You may not even have to pay interest. But failing to live up to your agreements can damage a relationship, sometimes for good. And while you can always make more money, you canâ€™t always win back the trust of a friend or a sibling. The more that relationship matters, the more wary you should be of asking for a loan.

Ultimately, how â€œsmartâ€ you are at borrowing is determined by how well you handle the money once you get it. Borrow in order to buy additional investments, shift outstanding debts with high rates to those with low rates, or to pay for important and immediate expenses. Anything beyond these is courting trouble.

http://ph.news.yahoo.com/

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Lorenzo · « **Reply #9 on:** October 24, 2012, 06:49:41 PM »

Bwahahahaha! isles, tinuod ba ning saying nga ang mga bombay sa pilipinas ..money lenders ni sila? tinuod ba na?

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islander · « **Reply #10 on:** October 24, 2012, 06:49:57 PM »

aw way pagid ba? daw di mo makita hang siknal kag ginatabonang pirmingti hang imong dagway dao naowao ka kid sang Tb mingbirs hao. may ara ba tingkoling hang imon na simod hao daw naka songkab kag piniritong bowad sang karahay, may ara ba na ibidinsya sang simog mo hao?

ebidensiya hang akon simod nakaingkib hang imon tikod, to. akon simod nagtangag sang imon tikod apil imon tsinelas, haw, hahahahaw de karabaw.

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Lorenzo · « **Reply #11 on:** October 24, 2012, 06:50:54 PM »

oy , kahibalo man diay ka mag inilonggo, isles. da!

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Lorenzo · « **Reply #12 on:** October 24, 2012, 06:52:29 PM »

TB is becoming -- TBI -- Tubag Bohol kag Iloilo

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islander · « **Reply #13 on:** October 24, 2012, 07:00:54 PM »

Bwahahahaha! isles, tinuod ba ning saying nga ang mga bombay sa pilipinas ..money lenders ni sila? tinuod ba na?

they may, but i doubt if it's limited to them. considering our number in relation to these specific expats, more filipinos are into the loan shark business than the bombay. in fact, i saw only one bombay collecting from market vendors (which i presume is the day's payments of loans) in my whole life in our country. my best friend in high school was a bombay. they owned one of the biggest department stores in cebu at the time. (they've moved to hong kong later.) i didn't notice them getting involved with the loan shark business.

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