Save to borrow schemes

R

RonanZo

Guest
Hi,

I have my wedding coming up next February.
My partner and I are both working towards lump sums, but I don't think that we will have enough in time for the wedding.

I started to look at BOI's save to borrow scheme.
If I save E150 for 12 months. My savings are E1800. I can then borrow 5 times this, which is E9000.

This sounds grand. However, I do not know what position I will be in financially this time next year.
Maybe I receive a lot of money as gifts and I want to pay off my loan in full, 2 weeks after I take it out.

My questions are:

  1. What is the best save to buy scheme around, BOI, credit union etc.
  2. Are there heavy penalties for paying off these loans very quickly. Is there a scheme which avoids all the interest repayments 'up front'.
I would much appreciate any advice.
 
Hi. The credit union does not penalise for early redemption or load the interest up front. You may only be allowed to borrow 3 times your savings.
 
At the risk of being a killjoy ... do you really need/can you really afford a €9K (or whatever) wedding? You can't really plan on reducing/paying off any debt based on cash gifts that may not materialise.
 
Ya clubman. I agree with you.
However, I have to prepare for the worst.
The plan is to save, and borrow if neccessary.
If Slims facts are correct above, then I'll go with the credit union.

Thanks.
 
CU are not necessarily the most competitive place to borrow from - their loan rates are misleading and the effective cost of borrowing is inflated further by the need to have c. 25% of the loan on deposit/in shares at marginal if any return. Many other lenders will not penalise you for early part or full redemption of a variable rate loan.
 
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