Mar 24, 2018
I introduced Zidasha to a friend and he wants to know if he can use his house as collateral for the loan?
Mar 24, 2018
No, he cannot, because Zidisha loans do not require collateral.
All Zidisha loans are offered at 0% interest rate.
Other lending organizations charge an interest rate *and* fees.
Zidisha charges fees only.
Also, Zidisha is a *micro*-lending organization.
The maximum amount that ever could be borrowed is the equivalent in your currency of $10,000 U.S.D. It usually would take *years*, though, to work up to qualify for that amount on Zidisha.
Dave makes excellent points (please see below).
I hope your friend does follow Dave's advice. :)
Fitri Fauziyah, Christian Golo and dave2319 like this.
Mar 24, 2018
Mary, I don't know what options are available in Ghana but I would never recommend secured loans (ones that require collateral) unless absolutely necesssary.
Personal/unsecured loans (ones that don't require collateral) are a much better option for borrowers.
As it says on a very big UK money advice website: "Secured loans give the lender security, not you. It's far, far, better to take a normal unsecured personal loan than one secured on your house."
At the very least, unless things in Ghana are notably different on that score, I sincerely hope your friend never approaches any financial institution and puts forward that suggestion.
Laurie, Fitri Fauziyah, Christian Golo and Joost like this.
Mar 25, 2018
I hope you are aware of the challenges associated with using land as collateral for loan in Ghana? You should have allocation paper, site plan, indenture and lease and then the bank would have legal charge on the land you are using as collateral to secure the loan. All these things come with fee.
All these would cost you between USD 2000 to 5000, depending on the location of the land plus the cost of buying the land.
So with the banks in Ghana, unless you are taking a loan in excesses of about USD 20,000 or more, they may not accept land as collateral. The reason is simply, it makes the loan too expensive if you are accessing say USD 8,000 and using land as collateral.
To Mary and her friend, at Zidisha, our only collateral is faithfulness and trustworthiness. Just be faithful in repaying lenders back your loan to them on time. At Zidisha loans are given to the borrowers by lenders based on trust and faith and that it would be pay back to lenders on time.
Laurie, Fitri Fauziyah and dave2319 like this.
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