Just about everybody needs a loan at some stage in their life. More those of us who are sensible with their money, and shop carefully for their loans use the money for sensible purchases that they need, at repayments they can afford.
Whether it’s a loan for a car or a big purchase; or a mortgage for a house or a flat, they’re a useful financial instrument that customers should not undertake lightly. However, there are people out there who’ll take on a debt for incredibly trivial purchases. We certainly do not approve of any of these, but these are genuine cases:
Possibly more worthy comes news from Australia that half of couple who opt for surrogacy to have a baby mortgage their homes to pay for it. With average costs coming in at over S$80,000 it’s hardly surprising that desperate families resort to finance and even risk their homes to have a family.
Then there’s plastic surgery. Looking for salacious stories to illustrate our point, we Googled “loan for breast enlargement”, we instead found clinic after clinic willing to lend money for patients wanting the procedure. Amazingly the market is so competitive, that interest rates are way, way down, with many offering interest free finance! However, for other cosmetic surgery procedures, patients aren’t quite so lucky, and have to pay a premium to get finance for their good looks.
It’s people who take out loans to buy strange stuff as part of a collection that puzzles us. An art collector we might understand where there might be an eventual return on investment. But decorative spoons? Or a complete collection of Beatles recordings? Each to their own, but obsession makes people do the strangest things.
But for a really extreme case of strange uses for a loan, take Ronnie Wood, bassist from the Rolling Stones. You’d have thought he would be (ahem) rolling in money, but back in the seventies, when the cash wasn’t exactly (ahem) rolling in, he took out a loan secured against his home, and spent it on home improvements. So far, so normal. It was what he did with the other sixty thousand dollars – which he reportedly blew on six weeks of hard partying.
The message is this: Only take a loan if you can afford it, and don’t lie to the lender over what you’re going to spend it on. But have fun!
Article by Jason Taylor – [email protected]