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Locked: I need to borrow $30 000

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  • Nov 16th, 2004 1:46 pm
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Deal Addict
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Oct 4, 2003
3199 posts
61 upvotes
Kitchener - Waterloo

I need to borrow $30 000

Ok, I need to borrow money. I have two Line of Credit accounts (LOCs), and can manage that with both of them. I believe that I pay prime + 3% or so. That translates to about $180/month in interest.

I need to borrow this money AND make sure that it is the cheapest and best, securest way of doing business. I don't wanna wake up with prime at 7% (then add an extra 3%) for a 10% or so interest.

Any suggestions as to what is the best way I can borrow money, cheapest and safest?

Thank you so much for your assistance.
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Deal Fanatic
Aug 18, 2003
6287 posts
9 upvotes
Waterloo
Well the cheapest and safest is typicaly always through family. That way you can get off taking as long as you need, and not paying any interest(depending on what you work out).

Although this rarely is the easiest option, as a family member probably wouldn't have 30K to dish out.
Member
Jun 20, 2004
434 posts
1 upvote
Family might be cheap and safe, but if something bad happens, look out. Try not to mix family and finances unless its a last resort.

Regards,
McCauley Caulkin
[OP]
Deal Addict
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Oct 4, 2003
3199 posts
61 upvotes
Kitchener - Waterloo
I will also ask family of course, but only if they can. I will have to rely on borrowing this from "banks" or other "financial" places... I do not know what is the best and safest - LOC or loan or something else...

I might appear in the Top 10 Most Wanted in Toronto...
Deal Fanatic
Aug 18, 2003
6287 posts
9 upvotes
Waterloo
GW you really might want to consider talking to a financial planner about all this.

From what I can tell from your recent threads you've got alot of relationship,money, and property issues going on.

No offense, but getting advice from us RFD peeps might not be the best solution. Sounds like something you should really involve a profesional in so that you don't get burned really bad.
Deal Guru
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Sep 14, 2003
10286 posts
104 upvotes
Mississauga
Why not mortgage your house for the $30K. Say you're remodelling your kitchen. Or at least part of your house, if you don't have enough equity.
[OP]
Deal Addict
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Oct 4, 2003
3199 posts
61 upvotes
Kitchener - Waterloo
Carnage, it is just borrowing money. I want to get that out of the way somehow. This is outside the relationship and other problems on my head.

What about that mortgage my house for the other $30 000 as danfromwaterloo said? Right now my mortgage is $150 000 - I am able to get the $30 000 (cash/cheque) to pay my debt? I will then have a mortgage of $180 000?

My current mortgage rate is 4.39% for the next 5 years (locked). Will I continue to pay this rate for the new mortgage outstanding?

Anyone care to comment on this route?
Deal Guru
Aug 26, 2001
14699 posts
270 upvotes
North York
George W. Bush wrote:I might appear in the Top 10 Most Wanted in Toronto...

One can only wish...
Member
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Jul 10, 2003
335 posts
5 upvotes
marry an Italian girl. You'll have your 30G's+ in no time.
Deal Fanatic
Aug 18, 2003
6287 posts
9 upvotes
Waterloo
Only borrowing money? I wouldn't treat borrowing 30K as a simple thing.

But my point is that you're talking about somethign that we can't truly help you with. Sure you'll find alot of good suggestions from people here. But nobody here can give you a 100% surefire solution to what your asking. Simply becasue none of us know all the details about why you need it, what you're doing, and what every other factor that you have in your life is going on.

Pesronally I'd really suggest talking to someone who has some authority in what you're trying to do.

You can really get screwed over if you do the wrong thing when you're talking about a major loan of this kind.

I just think you're playing with fire whenever you rely on an internet forum for major financial advice or legal issues(not saying you have those, but they're in the same category as far as I'm concerned ).

But good luck man, you're going to need it. ;)
Banned
May 5, 2003
4879 posts
26 upvotes
Toronto, Ontario
Question on the same topic:

Say if I only have 30k left to pay on my mortgage. Of the 5 year fixed term at 4.49%, I still have 3 1/2 years left. Can I borrow say 150k (original mortgage was 260k) intead of taking a LOC since the 4.49% is lower interest and pay it off in the remaining term??
[OP]
Deal Addict
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Oct 4, 2003
3199 posts
61 upvotes
Kitchener - Waterloo
I need suggestions as to where should I be looking at. I may have to talk to a financial advisor. I was thinking of perhaps mortgaging the money.

Carnage, or anyone, know how that is done and whether that is also a safe thing to do? Just bump the mortgage a little to $180 000 outstanding.
Deal Addict
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Jul 15, 2003
1084 posts
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George W. Bush wrote:I need suggestions as to where should I be looking at. I may have to talk to a financial advisor. I was thinking of perhaps mortgaging the money.

Carnage, or anyone, know how that is done and whether that is also a safe thing to do? Just bump the mortgage a little to $180 000 outstanding.
have u checked out ing's rates ?
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Deal Guru
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Dec 3, 2003
14317 posts
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Mississauga
Here's 2 ideas....

1. If you should hapeen to have $30K in non-registered investments (outside RRSP), u could cash them in, pay off the bad debt, then borrow the $30K to buy back the investments. When u borrow to invest, the interest is tax deductible. Incidentally, my wife , who is financial planner has many clients doing this to buy cars. Its as easy as saying you're writing off the interest on your car loan!

2. If your parents have $30K in unregistered cashable vehicles (like T-Bills, Money Markets, or the dreaded GICS)...after inflation and taxes, most of these 'investments' turn out to be break even net-net. So, They put in $30,000 and 5 years later, the adjusted return is $30,000. Ask them to cash in and pay you the $$. Then u sign a promisory note to repay at 2pts below prime. THey are getting a deal because they will NEVER get that kind of return and since its a private loan, the gov't won't know about their capital gains so they won't apy taxes on the return and you will never get that kind of rate to borrow.
Heatware 47-0

"Giving money to government is like giving whiskey and car keys to teenage boys."
Sr. Member
Jan 2, 2003
742 posts
6 upvotes
You could also try a Home Equity Line of Credit (HELOC) depending on how much equity you have in your home.

The rates will be cheap as it's secured, and you should be able to borrow upto 90% of the equity in your home without too much issue.

Of course it depends how much equity you have in your home, but if you put a 25% downpayment you should have enough ??...(if you went with a 5% down high ratio mortgage though it may not be)...

As far as I know, these rates will all be linked to prime at a variable rate though - I'm not sure if you can lock in a HELOC loan at a low rate...

You could try taking out a personal loan at a credit union/bank etc. - they offer them unsecured for various purposes such as vacation, etc. and at a fixed rate with fixed blended repayments...so if you're really worried about interest rate risk, you can go that way...

Prime + 3 is an exhorbatent rate that shouldn't be charged on a line of credit unless your higher risk...?? ... :confused:
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