FAQ for Personal Loans

Why Might I Need a Loan?

There are many reasons as to why people might borrow money. The first of these is to ease cash flow and another common reason is to settle debt.

The most common reasons people borrow money is:

  • Pay off debt
  • Wedding expenses
  • Child expenses
  • Home and renovation expenses
  • Education
  • Emergencies
  • Unanticipated cash needs

What to Consider Before Applying for a Loan?

One of the top factors that you need to consider before you take a personal loan is the interest rate, as this will determine the overall cost of the loan.

Other factors that you need to look at are the features of the loan, the loan terms, the application process and other such things.

What you Should Borrow?

You should only borrow what you need. Another factor to consider is your ability to repay the loan and if you can do so comfortably.

How Long Should You Have The Loan?

Your monthly repayment amount is influenced by the repayment term that you choose. You will need to look at what you can afford so that you can balance the repayment amount with the length of the loan

A longer repayment term will lower your monthly premium but the total interest that you will pay is higher.

What are a Credit Report and a Credit Score?

A credit report is a record of your credit history that is provided by the banks and other financial institutions. A credit report will be used as a reference by a lender for a personal loan.

A credit score is the numerical version of the credit report at a certain time. It is created through the customer’s credit account information.

What is a Monthly Flat Rate?

This is how the monthly repayment that needs to be made is calculated.

What is the APR?

The APR is the annual percentage rate and is an index of borrowing cost and is calculated on a yearly basis.

What are the Other Costs in Borrowing Money?

There is a handling fee that is charged for processing a loan and is charged on a yearly basis.

If you decide to settle the loan earlier, you may have to pay an early repayment fee.

If you are late in making your monthly repayment then you are charged a late repayment fee.

What is a Personal Installment Loan?

A customer is able to pay the actual loan amount ads well as the interest with a monthly amount for a certain period of time that will equate to the total owed.

What is a Revolving Loan?

This loan gives customers a revolving line of credit that can be withdrawn from at anytime. There is no fixed monthly repayment amount or repayment period. Customers are able to pay the minimum required and interest will be charged on an outstanding balance.


FAQ Medical Insurance

  1. What is Medical Insurance?

Medical insurance is a contract that you take with an insurance company. The insurance company will then agree to pay some of or all of your medical bills depending on your coverage type.

The insurer is paid a certain amount a month, which is called the premium.

  1. Why do you Need Medical Insurance?

Medical insurance needs to be in place so that the cost of any treatment that may occur is covered.

  1. Can Family Members be Covered?

Direct family members like children and your spouse that live with you are included as dependents in your medical insurance.

  1. Will I Need a Medical Examination?

Generally a medical exam is not necessary, but you will have to fill out a medical form where you declare any and all medical information. A medical report can be requested from your doctor.

  1. Will I be covered for any Illnesses or Injuries that I have before I Join?

Pre-existing conditions are usually excluded within the first two years of membership.

  1. Why do I Need Medical Insurance?

Health care can be expensive, so without medical insurance you will have to pay for any treatment or hospital stay out of your own pocket. Medical insurance will then protect you from these expenses and share the cost.

  1. What is the Difference between a Deductible, a copayments and coinsurance?

All of these are medical charges that you will need to pay from your pocket. The deductible is the initial expense that you pay every year to be covered for health services. A copayment is a specific amount they you pay towards each medical service. A coinsurance is a set percentage, which you pay towards the service.

  1. What Does Medical Insurance Cover?

The cover that you receive will depend on the policy that you choose and the payment amount that you make. But it might include in-patient treatments, day patient treatment and out patient treatment.

  1. How much will it Cost?

The amount that you pay per month will depend on the level of cover, the policy and your own circumstances.

  1. What are the Benefits?

The benefits of medical insurance are many. For one you will be covered in the event of an illness or injury where you have to go to hospital. You also have a range of network doctors and hospitals to choose from so that you get the best care.


FAQ Personal Finance

Personal finance is about self-evaluation, as you need to get a firm grip on your own finances.

If you want to succeed in money then you always need to look at your life, your goals and your choices.

Here are 10 questions that you should ask yourself in regards to personal finance.

What was the Last Money Mistake I Made?

Usually this is a spending mistake and involves you spending money in some way that you shouldn’t have, but why did you make this mistake? What was the situation for this spending?  You need to find the reason as to why you spent the money so that you can avoid this in the future.

Am I Realistic in Savings for Retirement?

You should head to a good retirement calculator that you can find on the Internet and see what you pace looks like. Realistic numbers are 3% inflation and 7% return on investments.

This will help you to determine if you are on track for when you want to retire.

What Can I Do in Terms of Education for my Children?

The first thing that you need to decide is how you intend on helping your children through their college years. If you are going to help then you need to look at what you are saving for this.

Do I Have a Will or Life Insurance to Protect Dependents?

If you are a person that has dependents in your life then they will be your main priority to make sure they are looked after, once you are gone.

It is a good idea to get a term life insurance for this situation.

Is my Emergency Fund Big Enough?

It is a good idea to have a good amount in a savings account that can be used for emergencies. If you do not have an emergency fund right now, then you need to start one.

What is my Plan if I Lose My Job?

What would happen if you lost your job? Do you have a plan to get more work? You need to thing about these things and have a plan in place, as you will need to survive financially in the event you become unemployed, this is where your emergency fund comes in.

What Happens if you Lose your Spouse?

The loss of a spouse can have financial implications for you, so what is your plan if something happens? This is where an emergency fund will help or another financial plan. You need to explore all of your options in the event that this happens.

What about the Big Expenses?

If you know that big expenses are coming in the next year, you don’t have to panic; instead you can start saving for them right now. If you know a certain bill is coming for a certain amount, divide it into chucks and save that amount each month, so that you can pay it easily.

What about Future Expenses?

This question makes you look further down the road. If there is a purchase that you plan to make in the next 5 or so years, you can set a goal for when you want to reach this by. You can set an approximate date and figure out how much you are able to save each month to get there.

What Can I Do to Improve My Income?

Personal finances is dependent on your income so you need to think if you are able to change your income level through getting a better position, finding a different job or picking up a part time job.


FAQ Debt Consolidation

  1. How Can You Consolidate Debts?

You are able to consolidate debts with a debt consolidation loan ort you are able to sign up to a debt consolidation management company that offers this service.

  1. What is a debt Consolidation Loan?

This is a low interest loan that you are able to use to pay off your existing debts.

  1. What is a Secured Consolidation Loan?

This is where the loan is taken against collateral like a house. The collateral secures the loan and if you fail to pay the collateral is seized by the lender and sold to recover the money.

  1. What is an Unsecured Debt Consolidation Loan?

This loan will not require any collateral.

  1. An Unsecured or a Secured debt Consolidation Loan?

The collateral will generally lower the interest on a secured loan, which means that your monthly repayments are lowered. A secured loan is then preferable as it is easier to pay off, but the condition is that if you are unable to pay then the collateral can be seized.

  1. Is a Home Equity Line of Credit worth Considering as a Debt Consolidation Loan?

This is worth considering if you have enough equity in your home. The more equity that you have then the less interest you will have to pay and the more that you can borrow.

  1. Do I Need to be a Homeowner to Consolidate my Debts?

This is not necessary. You are able to take an unsecured consolidation loan if you do not own property. This will have a higher interest rate though.

  1. Is a Debt Consolidation Loan Different than a Debt Consolidation Mortgage?

A debt consolidation mortgage will allow you to take out a new mortgage to pay off other debts. You are then left with just the one mortgage payment. A debt consolidation loan can pay off your debts.

  1. Do Debt Consolidation Services Charge Fees?

A debt consolidation program will require you to pay some fees.

  1. How Can Debt Consolidation Simplify my Monthly Payments?

With debt consolidation, your various debts are replaced with just one debt. This new debt will usually have a fixed low interest rate and a longer repayment period. You monthly payable amount is reduced and becomes one single fixed payment.