New answers tagged personal-loan
0
@Victor Yes Islamic Banks do provide consumer financing in the multiple ways, following are some simple models for your consumption:
Auto Finance - Bank purchases a car from the market and leases it to customer on a variable rental rate for a certain time period. In the end Bank sells this car to customer at a nominal price or bank can gift the car to ...
-1
@Pablitorun Sale and Buyback of a commodity or anything at a different price is not allowed in Sharia. The arrangement you told is 'Bai Enah' which is prohibited by almost all the scholars in the world including AAOIFI Sharia Standards, hence not being practised by Islamic Banks. Yes Sale and Lease Back is widely used by majority Islamic banks for providing ...
2
You are looking for something similar to loans when there is a structured settlement. This is generally done when a person is receiving payments spread over many years, but they want to receive the money now instead of a monthly or annual check for many years to come.
Your situation is different because your payout next year isn't 100% guaranteed. That ...
1
Leveraging investment is always risky because you could end have a big loss and end up owing more money than you have. You mention "safe" stocks, but keep in mind that in a market crash, no stock is safe. How sure are you that you can tell if the market is about to crash? What will you do if you get caught with your pants down, with your investment down 50% ...
2
You ask:
Any thoughts on how risky such a loan would be?
The simple answer is that it is riskier than whatever you invest in.
Other answers have addressed the possibility that the value of your investment drops.
There are other risks, including:
not being able to pay an interest instalment at some point
an unexpected call on capital
a margin call
not ...
10
You are contemplating leverage
In finance, leverage is borrowing money for investment, with the expectation (goal) of gaining higher gains than the cost of borrowing so that you end up with a net profit. This is the same principle behind margin accounts, where money is borrowed to hold an equity position you don't have the cash to cover on your own. It is ...
1
If
"10k€ ... 0.95% / year interest, payment in 3 years" means that you'll be paying a lump sum of €10287.71 in the autumn of 2022, then yes I would strongly think about doing it.
However
if your aggressive investments take a bath, you're still going to owe €10287.71. Of course, if you have an Emergency Fund, you can always use it to make up the ...
5
Pay off all debts right now and have my net worth reduced to my emergency fund (~5k€)
Paying off debt does not reduce your net worth - your net worth is all of your assets less what you owe, so it is a wash from a net worth standpoint.
Also note that "dividend aristocrats" are not necessarily "safe" from a wealth standpoint. The value of a stock goes ...
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