Our credit union here at work posted a sign on their door saying that members can apply for this special offer: $1000 loan at 9.9% which will be paid back through automatic payments at about $40.55 per pay period; every two weeks. It's a one year loan. I'm not a member but thinking about it. Although $81 a month payments seem high. If I'm figuring it right.
well, my math shows: Total Intrest: 1000*.099=$99 Loan Total: 99+1000=$1099. Payments: 1099/26=$42.27 I personally wouldn't spend 100 to borrow 1000. I'd save for 6mos and borrow from myself for free. Just me...
Unless, of course, you're rebuilding your credit. If you are, then the $100 might be a cheap price to pay for a positive tradeline. It also establishes you with the credit union. You may want the positive history with them when it's time to buy a car.
The reason for the payments being $40.55 is that the principle reduces each month and the interest is calculated on the balance outstanding, as with a 30 year mortgage. The total interest charge at 9.9% for 12 months is $54.30, not $99.00.
