Is a Loan Application Smart with the 2016 Economy?

Mar 07, 2016

You’ve read the news. You kept an eye on the what’s happening lately. Is it smart to make a loan application in 2016?

It happened again. The SARB hiked the interest rate once more. What now? What will happen to the economy? It truly isn’t a nice situation. Loans became harder to repay. The costs in servicing debt have increased a lot lately. Regarding interest rates, the credit market became even tougher to make a living from.

Loan applications will not be easy now. South Africa is on the brink of a “junk status”. This means that South Africans on average aren’t entirely reliable when it comes to repaying debt. This means that credit providers will stiffen their rules and regulations to ensure that only those who will repay a loan will qualify for it.

What now?

But what if you need and emergency loan? Something has happened during the course of this year and now you are cash strapped with no means of getting out of trouble. Please just remember there are few factors that determine the price tag of a loan. Use the Fincheck pay day loan comparison page to make sure you at least start by comparing – rather than just accepting the first option you receive. A payday loan can help you, but it will not make you wiser. Make sure that when you apply for an emergency loan that it’s first of all unavoidable – your only option out of trouble is this loan. Secondly, make sure that you can afford to repay this debt even if it becomes more expensive to manage it in the future.

The economy in 2016 won’t look good. A personal loan is not the tool with which to finance your month to month budget shortcomings. A personal loan will serve you better if you use it for something that will add to your standard of life (after you’ve taken into account the effect of monthly instalments on the loan).

Regarding the initial question – is it smart to make a loan application in 2016? That answer is entirely dependent on how you manage the loan and your ability to repay it with upcoming increases in costs. A loan won’t cure your spending habits. Make sure that you have a smart perspective before you make a loan application in 2016.

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