View Full Version : Line of credit
silbergrau330
08-08-2006, 03:26 PM
Hey all,
Well Im looking to buy a bike at the end of the season (prob find a better deal, have more to put down). Im looking to buy a used GSXR 600 or something similar, and right now I have about $2000 that I can dispense. Since that is clearly short of the 5-7500 I will need (minus insurance, and gear), Im interested in taking out a line of credit. Im 20, no credit cards, no previous borrowing, what will be involved in acquiring a line of credit? What is the typical term of a LOC? Any info would be much appreciated so I have a little heads up when I go into the bank to get some more info!
Thaco
08-08-2006, 03:29 PM
are you a student? that always makes things easier... most banks require a minimum HOUSEHOLD(yes you can include your parents if you live with them) income of $30000/yr as for term, there is non, most are minimum x amount of $ or 2% of balance owing per month, it's revolving liek a credit card where you can pay back and take money off of it as you wish... but it (generally) has a much lower rate than a credit card.
A LOC remains open for as long as you want and has more flexible repayment options than a tradtional loan. But you're 20, have no credit cards, no previous borrowing= no credit. You may have difficulty getting an unsecured LOC and will most likely need a co-signer.
Of course, this begs the question, did you pay for an '04 330 with cash?
silbergrau330
08-08-2006, 04:17 PM
Originally posted by lint
Of course, this begs the question, did you pay for an '04 330 with cash?
I sold my testicles and my soul in order to purchase my car.
Yes I am a student. So basically, only option is to have someone co-sign, as my credit is non existent? Is it a flat rate for interest, or is it compounded over the payment period ie. I take longer to pay back, more interest (sorry but Im new to borrowing/lending/debt)?
silbergrau330
08-08-2006, 04:18 PM
Originally posted by lint
Of course, this begs the question, did you pay for an '04 330 with cash?
Now buy my 17" AC Schnitzer Type II's
Originally posted by silbergrau330
I sold my testicles and my soul in order to purchase my car.
Yes I am a student. So basically, only option is to have someone co-sign, as my credit is non existent? Is it a flat rate for interest, or is it compounded over the payment period ie. I take longer to pay back, more interest (sorry but Im new to borrowing/lending/debt)?
As you have no credit history it's going to be difficult to find someone to lend to you without a cosigner or some other way to secure the loan.
A LOC will have a revolving interest rate, tied to prime. The longer it takes you to pay off the balance, the more interest you pay. There is no compounding because it's not a fixed amount you're borrowing. You just owe X% of interest on the principle you have outstanding each month. You make payments whenever you want. Oh your credit situation also means that you're not likely to get a good interest rate either. Probably the prime + 4-5% range.
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