Treat a personal loan from a friend or family member like you would any other loan. You must be prepared to meet all of your obligations on time until the loan is paid in full. A private loan just means a loan from someone other than a bank or lending institution, and the agreement is […]
While a loan agreement between family and friends may not be necessarily a legal document, it does protect both sides if the matter goes to court.
Formalising a loan agreement just means putting in writing something that may have been talked about. This is to clearly identify the relevant interest rates, loan terms and conditions.
A loan agreement should describe the loan terms, terms of repayments, interest, what happens if the borrower misses a repayment, the relevant dates, and persons involved. Each person involved should have a copy of the loan agreement, or have it electronically. This written agreement is legally binding.
The interest rate for a personal loan to give should be determined by the length of repayment and any national government approved interest rates for family loans. The annual limit for tax-free gifts to family members in Australia is $14000, so especially when you loan is beyond that, should you charge interest.
While you can give an interest free loan to a family member, financial planners don’t endorse this practice. To minimise pain and conflict, financial planners advise charging interest on the loan, treating it like any other loan. A minimum amount of interest for example, is an amount that will ensure that repayments keep up with […]
When considering committing to giving or receiving the loan, think about how you or your friend/relative will pay back the money. Consider the realities of your relationship with the person and ways can you safeguard yourself from anything going wrong in relation to money. Do you have a loan contract and a reliable way to […]
Before committing to a loan, think about how realistic the repayment schedule for the recipient of the loan is. Consider multiple ways to safeguard the loan from becoming embroiled in emotions if loan is from a known party. Ultimately, both parties should be aware of the obligations and responsibilities associated with taking on the loan. […]
Yes, you can! The way to build an interest only loan in the Credi platform is to enter the same amount in the fields ‘loan amount’ and select ‘balloon amount’, as well as entering your interest rate of course. The periodic repayment schedule will then reflect interest only payments with the final payment being the […]