Loan against SSIA

[kraggy]

Just wondering if anyone knows; is it possible to get a loan against your ssia.

I'm due 9k in may but would like a loan of 4k this month.

i've low earnings at the moment but my ssia stands at 8k at the mo.

will they let me borrow against that?

Thanks

 

[Froggie]

I cant see why they wouldnt, but all you can do is ask.

 

[Bank Manager]

The rules of the SSIA scheme prohibit a lender from lending against an SSIA (e.g. taking the SSIA as security against the loan).

However, from a bank's point of view you have demonstrated the ability to save on a regular basis, and I would suspect would be more than willing to look at your loan application in isolation from your SSIA. Monthly repayments would have to be made on the loan (you couldn't opt for a bullet payment from SSIA maturity proceeds).

When your SSIA matures you can decide how to use it, and if you decide to clear your loan at that stage, then you are perfectly entitled to do so (if you are considering this route, as it seems you are, then don't opt for a fixed rate loan).

Hope that's of some help.

Best of luck.

BM

 

[kraggy]

Thanks folks,

BM, what do you mean by a bullet payment from my ssia?

 

[CCOVICH]

A bullet payment is a once-off or substantial payment on a loan.

E.g. if you borrow €4k now and receive €9k in 2 months time, you could pay €200 for the next 2 months (regular/scheduled payments) and then pay off the outstanding balance with your SSIA proceeds (bullet payment).

 

[ClubMan]

Is a bullet payment different from a baloon payment?

 

[RainyDay]

Make sure any loan you take out in these circumstance is a variable rate loan, which allows you to make additional repayments without penalty. Most fixed-rate loans will not allow you this flexibility.

 

[CCOVICH]

Is a bullet payment different from a baloon payment?

No, I wouldn't have thought so myself. Baloon payments would generally come at the end of the term, while bullet payments could be made in the interim (but that's getting technical).

Make sure any loan you take out in these circumstance is a variable rate loan, which allows you to make additional repayments without penalty. Most fixed-rate loans will not allow you this flexibility.

Unless of course it is a Tesco fixed rate loan, which is generally competitive, AND always allows you to repay early without penalty.