Yes, I am financing a bicycle. No, I don't need your judgement.

[daniemare]

**** sakes - you will sign a 2/3 year contract with planet fitness without a second thought. Do you pay cash up front for that? If not, what’s the difference between that and buying a bike on finance?

Gym contract has no interest

Gym contract can be cancelled (per CPA, they cannot charge “rest of period” as penalty)

 

Both not applicable to your finance deal

[J Wakefield]

Agreed. Finance what you like, I couldn’t care less, we are all adults here.

 

But don’t come and cry later when it becomes evident that the lender is making money off of the agreement. Only your granny will lend you money because they like you. Other people do it as a business.

 

100% but that outcome is a 50/50. Anyone who finances anything has to understand that. My brother for example tells me I should never finance property due to interest and term. Problem is I am not at his financial level or have 5bar lying around. Same with someone on a bike.

 

If it goes tits up, that is their issue to deal with and not slate the lender.

[Allrounder]

Gym contract is still 1200 a month. Why is that okay to pay? but not to buy something for yourself?

[Allrounder]

100% but that outcome is a 50/50. Anyone who finances anything has to understand that. My brother for example tells me I should never finance property due to interest and term. Problem is I am not at his financial level or have 5bar lying around. Same with someone on a bike.

 

If it goes tits up, that is their issue to deal with and not slate the lender.

And with rent prices, you will never get to 5bar to buy your own place. 

[Escapee..]

7 pages later and OP is probably looking at an E-bike 

[Patchelicious]

And with rent prices, you will never get to 5bar to buy your own place.

Renting is a good option in some markets.

 

As an example. The house I just sold is being rented out for the same amount I was paying on interest alone and I had put a hefty deposit down.

 

If you had to buy it at 100% bond with the levies and HOA fees, the rent would equal about 60% of the total monthly costs if you bought. And of the ownership option only about 10% of the costs would go to reducing the capital outstanding.

 

In my opinion, in this market, I would rather rent and save the 40% difference.

[Mamil]

Cell phone contracts too... just credit agreements.

[Patchelicious]

7 pages later and OP is probably looking at an E-bike

Makes sense, if he can’t wait to save up for a bicycle, he probably wants a shortcut to fitness too.

 

 

 

 

 

 

????

[Patchelicious]

Cell phone contracts too... just credit agreements.

Yeah not exactly the same is it?

 

One is a necessity and the other a luxury. Also not much on the way of options other the existing contracts.

[Long Wheel Base]

100% but that outcome is a 50/50. Anyone who finances anything has to understand that. My brother for example tells me I should never finance property due to interest and term. Problem is I am not at his financial level or have 5bar lying around. Same with someone on a bike.

 

If it goes tits up, that is their issue to deal with and not slate the lender.

Unless you win the lotto, or have a loaded Daddy(or brother) then you have to finance property. I have a few rental properties and it took financing 3 before I was able to buy the next 2 cash. The first one I financed was R490 000, I highly doubt I would ever be able to save that amount of cash. That was also 10 years ago, the same size property now is going for R800 000. I think for most of us, having R800k cash is near impossible.

[Pure Savage]

Renting is a good option in some markets.

 

As an example. The house I just sold is being rented out for the same amount I was paying on interest alone and I had put a hefty deposit down.

 

If you had to buy it at 100% bond with the levies and HOA fees, the rent would equal about 60% of the total monthly costs if you bought. And of the ownership option only about 10% of the costs would go to reducing the capital outstanding.

 

In my opinion, in this market, I would rather rent and save the 40% difference.

All depends on the market is the key, invest in what you know.

 

I know the inverse has worked where picked up houses in new developments with 100% bond and including HOA and rates the rent has covered all costs to date. *There was a R10k deposit required. So effecticly have paid R10k for a R900k asset. 

[Patchelicious]

All depends on the market is the key, invest in what you know.

 

I know the inverse has worked where picked up houses in new developments with 100% bond and including HOA and rates the rent has covered all costs to date. *There was a R10k deposit required. So effecticly have paid R10k for a R900k asset.

Hence me saying some markets.

 

Also when talking about lower end properties, eg R900k flats the rent is often closer to the bond costs.

[Kranswurm]

Not when you shorten the term to 10 or 5 years 

Hence me saying some markets.

Also when talking about lower end properties, eg R900k flats the rent is often closer to the bond costs.

[Allrounder]

If you manage to pay double the monthly payment, it will still take you 8 years to pay of the bond. 

[Shebeen]

Cell phone contracts too... just credit agreements.

Not really. If you do the sums a cellphone contract is in your favour over buying phone cash and getting SIM only. BUT the cellphone companies have now got your debit order loaded and know on average you are going to end up spending more over the term.

[BaGearA]

Gym contract is still 1200 a month. Why is that okay to pay? but not to buy something for yourself?

My virgin active red is 68 a month and down to 54 due to medical aid benefits