Loan with BOI

Dirk_Diggler

I currently have a graduate account and I've been working for past year but have made no savings (paying off cards/loans/paying for a car/etc). I'm contemplating taking out a graduate loan soon but I'm unsure as to whether I'll be in employment in a few months time. Will the bank still grant the loan to me based on my income in the last year or how does it work exactly?

Thanks.

stepbar

Dirk_Diggler wrote: »

I currently have a graduate account and I've been working for past year but have made no savings (paying off cards/loans/paying for a car/etc). I'm contemplating taking out a graduate loan soon but I'm unsure as to whether I'll be in employment in a few months time. Will the bank still grant the loan to me based on my income in the last year or how does it work exactly?

Thanks.

Don't be going telling the bank that!

First things first, I work as a lender for said Bank. I would assess a loan based on the following criteria (not in any particular order or importance)

1. Repayment Capacity
2. Employment Status
3. Track record

If I'm happy with the above, I'll put up an application and if it's approved by the system great. If not it will go up the line for approval. That's how it works.

dotsman

Dirk_Diggler wrote: »

I currently have a graduate account and I've been working for past year but have made no savings (paying off cards/loans/paying for a car/etc). I'm contemplating taking out a graduate loan soon but I'm unsure as to whether I'll be in employment in a few months time. Will the bank still grant the loan to me based on my income in the last year or how does it work exactly?

Thanks.

It will be based to how much you are earning now. You may be asked to provide evidence of this, usually in the form of recent payslips and/or bank statements.

Lying about your income would constitute fraud. Although this wouldn't be a big deal should you make all the repayments, but if you were to go into arrears, you may find yourself totally screwed.

P.S. How do you expect to pay off the loan if you're not earning?

jor el

Dirk_Diggler wrote: »

I'm unsure as to whether I'll be in employment in a few months time.

Nobody can really tell if they're going to be in their job from next month onwards, so there's no need to volunteer any such information. The banks will assess you and decide for themselves whether they think you're a safe debtor or not.

If the reason you think you'll be out of a job is that you're planning a round the world trip or something, then it's not a good idea to be getting a loan. If you think your company is going under, or that your job is just in peril, then it also might not be a good idea to get a loan as you'll still have to pay it.

Scuba_Scoper

If I was taking out a personal loan, in view of the current economic climate, I think I might look at some of the payment protection policies that the lenders sell....

Dirk_Diggler

Thanks for the replies guys. Why would it not be considered a good idea to take out a loan if I was planning on travelling a little bit?

1. Repayment Capacity
2. Employment Status
3. Track record

What exactly is meant by repayment capacity? My employment status at the time of application would be 'employed'. Track record...I've never missed a repayment on my current loan, is that what they're checking there?

dotsman

Dirk_Diggler wrote: »

Thanks for the replies guys. Why would it not be considered a good idea to take out a loan if I was planning on travelling a little bit?

1. Repayment Capacity
2. Employment Status
3. Track record

What exactly is meant by repayment capacity? My employment status at the time of application would be 'employed'. Track record...I've never missed a repayment on my current loan, is that what they're checking there?

It would not be a good idea to take out a loan to go travelling as you have nothing saved so far. The interest will be piling up on the loan while you are away and when you return you will either have no job, or at best a job of similar income. If you have been unable to save so far (because, I assume, you cannot do without several hundred euro a month), what makes you think that you will suddenly be able to do without several hundred a month in repayments when you return?

Repayment Capacity: The ability to repay the loan. A Responsible Lender (there's a few dodgy ones out there!) will only lend you money if they can guarantee, beyond reasonable doubt (there will always be unforeseen reasons you might get into trouble), that you can repay the loan (and interest).

Track Record: Yeah, that's pretty much it, but they would also look at your savings history (or lack of).

Dirk_Diggler

I will have about 4-5k in my bank account by the time I'm considering taking out a loan - this way too small?:(