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Bank loan question

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  • 08-01-2012 9:08pm
    #1
    PeterB11
    Registered Users Posts: 170 ✭✭


    I don't have a bank A/C at the minute. I am thinking of opening up with AIB, maybe a savings A/C aswel as a current A/C.

    I'm looking for a small personal loan of €1500 to get a small car on the road. If I had savings of say €400-€500 in a savings would they accept this as some sort of guarantee or something I could use as safety for the loan?
    Or would they straight up refuse me.

    I am currently unemployed, and need transport for work and a night course.
    Hoping to be starting college in September too.

    Thanks


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    #2
    dotsman
    Registered Users Posts: 3,635 ✭✭✭dotsman


    I'm a little confused as to why you say you are unemployed, yet also need the car for work. Is it that you are currently not working but starting soon and will need a car for it?

    Unfortunately, if you are not working right now, you are unlikely to get a loan, as the loan repayments will be based on your current earnings.

    Likewise, the €400-€500 is no good as a security for 2 reasons. Firstly, a loan is granted on the basis of repayment capacity, not on the security (the security is just added protection for the lender). Secondly, bank's don't bother with securities for such small amounts (except for students and parental guarantees etc). The profit on a loan of €1500 is so tiny, it is greatly outweighed by the added administration/legal costs associated with a security.

    Your best bet is to open the current account for now (in time, that will benefit you), and look for the loan from a credit union (which deals with small, higher risk loans) or from parents etc.


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    #3
    PeterB11
    Registered Users Posts: 170 ✭✭PeterB11


    Yeah sounds confusing but I was off the road for a while, resulting in me having to go on benefits, in the process of getting my license back and need to be back driving to get to work (I'm a plasterer). I actually can't get work or get to jobs without transport.

    Secondly, I have a loan already with the CU and they won't top it up until X amount is paid, so I'm in a bit of a Catch 22.

    Anyone have any ideas at all as to what I can do?
    Saving is almost impossible on benefits at the moment and would take me ages to get the amount I need.

    I could afford €25-35 a week in repayments but can't get sorted :/


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