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Japanese loan payment question

musicisgood

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I'm going to take out a bike loan of ¥120000. The interest rate is 10.9% for 18 months. I need to know the payment of this. I'd go to a Japanese loan calculator and do it if I knew how. I know the rate is high, but I'm having the cycle shop handle all the paper work and he says when submitted on the net, he can get either approval or disapproval in about 20 minutes.
I actually was going to borrow ¥70000 at the above rate while I was in his shop, but changed my mine now.

Much appreciated.

Also, do these loan companies charge a large fee if I pay it off in a short time, that is my intentions anyway.
 
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Borrowing that amount of money at near 11% is probably one of the poorest potential financial decisions I've heard of. For that amount of money, if you have to borrow it, you cannot afford it.

Since you seem to intend to pay it off early, just save/skrimp and go hardship for that short while until you can pay cash.

Frankly speaking, and sorry to be so blunt, given what I know about you thru your posting history here, assuming that kind of debt is, well, one of the stupidest things you could do.
 

Mike Cash

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If you have any intention of getting a license that will let you ride more than just a 50cc scooter then it is doubly a bad decision to take out that kind of a loan on a 50cc as it will hamstring your going to school for the license and getting a bike both.

If you're in town where you can make do with a bicycle for your immediate needs for a while, I'd suggest doing that and saving up the money to get your license taken care of first. I understand you're hungry for the freedom and mobility but I have to agree with Johnny that it isn't a terribly good decision.

But to answer your question, they should tell you at the shop what the monthly payments will be. You should be able to pay off the remained early and avoid the interest for that period but there will probably be a stipulation that limits you to paying off the debt at once, not something that would allow for something like doubling up on your payments.
 

musicisgood

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If you have any intention of getting a license that will let you ride more than just a 50cc scooter then it is doubly a bad decision to take out that kind of a loan on a 50cc as it will hamstring your going to school for the license and getting a bike both.

If you're in town where you can make do with a bicycle for your immediate needs for a while, I'd suggest doing that and saving up the money to get your license taken care of first. I understand you're hungry for the freedom and mobility but I have to agree with Johnny that it isn't a terribly good decision.

But to answer your question, they should tell you at the shop what the monthly payments will be. You should be able to pay off the remained early and avoid the interest for that period but there will probably be a stipulation that limits you to paying off the debt at once, not something that would allow for something like doubling up on your payments.

It's just that in the next several months I need a low payment, and then get rid of the loan completely. I was going to buy a used scooter for 77000 yen and get a small 3 month loan on it, but the scooter was hitting over 6 years old, I said forget it, if I put down at least 50000 yen and qualify, that would be good enough for me and I'd surely
pay it off in a relatively short time if possible, if not, I'd hope the payments would be under 9000 yen a month. As I mention I changed my mind about that since leaving the shop and just wondered if someone here can go on a Japanese loan calculator and tell me what the payment would be, just to give me some idea, until I visit the shop in a couple of days.
 

musicisgood

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Borrowing that amount of money at near 11% is probably one of the poorest potential financial decisions I've heard of. For that amount of money, if you have to borrow it, you cannot afford it.

Since you seem to intend to pay it off early, just save/skrimp and go hardship for that short while until you can pay cash.

Frankly speaking, and sorry to be so blunt, given what I know about you thru your posting history here, assuming that kind of debt is, well, one of the stupidest things you could do.
I actually need transportation and I do have a govt retirement income come in each month, but a the moment I'm a bit strapped for cash and I really cant wait till Dec to pay cash for the bike.
 

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If you have any intention of getting a license that will let you ride more than just a 50cc scooter then it is doubly a bad decision to take out that kind of a loan on a 50cc as it will hamstring your going to school for the license and getting a bike both.

If you're in town where you can make do with a bicycle for your immediate needs for a while, I'd suggest doing that and saving up the money to get your license taken care of first. I understand you're hungry for the freedom and mobility but I have to agree with Johnny that it isn't a terribly good decision.

But to answer your question, they should tell you at the shop what the monthly payments will be. You should be able to pay off the remained early and avoid the interest for that period but there will probably be a stipulation that limits you to paying off the debt at once, not something that would allow for something like doubling up on your payments.
Mike, you are right about the mobility part, but as I've been going back in forth on the train, which maybe another 7 days, which would be about 21000 yen for me, I just thought I'd take out a loan on the new bike since at the moment I'm not able to lay down the cash. And not look at the interest rate too seriously on a short term basis.
 
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It's just that in the next several months I need a low payment, and then get rid of the loan completely. I was going to buy a used scooter for 77000 yen and get a small 3 month loan on it, but the scooter was hitting over 6 years old, I said forget it, if I put down at least 50000 yen and qualify, that would be good enough for me and I'd surely
pay it off in a relatively short time if possible, if not, I'd hope the payments would be under 9000 yen a month. As I mention I changed my mind about that since leaving the shop and just wondered if someone here can go on a Japanese loan calculator and tell me what the payment would be, just to give me some idea, until I visit the shop in a couple of days.
You're talking these amounts of money (and loans) for a six year old piece of equipment..?!?!?

As mike asks--you are licensed for what you're thinking of buying, right???

I changed my mind about that since leaving the shop and just wondered if someone here can go on a Japanese loan calculator and tell me what the payment would be, just to give me some idea, until I visit the shop in a couple of days.
Fool.
 

musicisgood

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You're talking these amounts of money (and loans) for a six year old piece of equipment..?!?!?

As mike asks--you are licensed for what you're thinking of buying, right???



Fool.
I'm licensed for a 50 cc.
After thinking to pay 77000 for a 6 year old bike, forget it, if possible I'll go new and if the loan is around 9000 a month, I feel that is best for me. I intend to get my kogata license in the future, that is what Mike was talking about. It's just that this area is country and once out of the train/bus and bicycling area, a scooter/ car is necessary.
 

Mike Cash

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You could mail your stuff, send it by one of the many parcel services, or even hire an Akabou truck to move your stuff for you cheaper, quicker, and easier than you could do it by hauling it on the train as hand baggage. That's just throwing money away.

The kogata license is also practically throwing money away. You'd be limiting yourself to riding a 125cc and it would be no time before you regretted both the license and a 125. I know you're eager to spread your wings and even do some riding with some other people in your area. Trust me, they're not going to wait around for somebody on a 125 to catch up with them any more than they would a 50cc.

I just checked the fees of driving schools in your area and I had to check three before I could even find one that lists fees for the kogata license. There just isn't enough demand for most places to bother with it.
image-jpeg.23707


料金表 -山陽自動車学校-
 

musicisgood

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View attachment 23709 View attachment 23708

That should be a close approximation of the loan you are considering.

Morning Mike
Thanks for posting that for me. As you found out, I usually end up listing and following your advise. I think I woke up this morning with a clearer mind. I think you and the guys here are telling me "just don't do anything yet" till you're settled in. At least that is how I'm feeling and seeing things now at the moment. I'll be on the train in a few minutes and I'm going to think clearly what I just wrote here to myself.

you have a good day at work
 
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And you can find loan calculators in English as well. Just because your loan is in Japan, it doesn't mean you have to use a foreign language to do the mental calculation.
Check out this one here - you can easily plug in the numbers and sort it out for yourself next time.
Loan Calculator - The Calculator Site
And don't let the sales guys convince you that you have to do anything. You do not owe them anything, even if they are nice to you. You get no karma points by buying something just because the sales guy spend some time chatting with you. It is OK to say "I've changed my mind".
 

musicisgood

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And you can find loan calculators in English as well. Just because your loan is in Japan, it doesn't mean you have to use a foreign language to do the mental calculation.
Check out this one here - you can easily plug in the numbers and sort it out for yourself next time.
Loan Calculator - The Calculator Site
And don't let the sales guys convince you that you have to do anything. You do not owe them anything, even if they are nice to you. You get no karma points by buying something just because the sales guy spend some time chatting with you. It is OK to say "I've changed my mind".

Hi Majestic
I want to thank you for your help. As of now, as it is really at the end of motorcycle season, I'm going to go for my chuugato license. I went to another shop now where I live and found a used Kawasaki 250 for about 2100000 yen, which from what I've seen is, well, what others are selling for. I'm on hold now for everything, but the bike and license is going to take place at some point. The interest rate at this places is at 8.9%. What do you think of that rate?
 

Mike Cash

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I would recommend asking the dealer for a 見積書 (mitsumorisho) you can take to your bank and try applying for a loan from them first. The interest rate will be waaaaay lower than that. Also, get your license in hand first, then worry about the bike. You're looking at at least a couple or three weeks to get the license taken care of.

On a 250 you don't have to worry about shaken, since it doesn't apply, but you do need to check how much 自賠責 (jibaiseki) it has remaining. If it has expired or will expire soon after you get the bike then you need to budget for that as it is illegal to ride with it expired. You should also carefully inspect the tires on any used bike. Not so much for remaining tread as for signs of age, as there's no telling how long they've been on the bike. If they're dodgy then you need to budget for replacing them. Try to check how much brake pad/shoe remains as well. If not much, that's another expense that can come up on you.

You really need to get yourself at the very minimum a proper riding jacket with pads (back, shoulders, elbows, chest) and proper gloves with pads (palms, knuckles). Komine makes quality equipment at an affordable price. A "three-season" jacket will do you for a while. You can usually get optional removable insulated linings for more warmth in winter. Later on get yourself a mesh jacket (with pads) for summer use. Safety gear pays for itself the first time it touches pavement with you inside it. You can pay for the gear now or you can pay for the casts and bandages later. You and I are both in that time of life when things don't heal as fast as they used to. You can save money by trying the stuff on in a store, writing down the model numbers, then going home and ordering off of Amazon.

If you EVER plan to add a carrying box to the bike, you need to do your research BEFORE you decide what bike to get. Not all bikes have mounting racks available for them. Some just never had an aftermarket rack made, and some are just old enough and out of production long enough that you'll play hell trying to find a rack that fits it. NEVER assume that when you get ready to put a rack on the bike it will be a simple matter of going down to the store and getting one. It can even be a pain in the aśś for newer bikes still in production. Ask me how I know this. If you're going to be like me and be "bike-only, year-round", you WILL need a storage option on the thing and something better than that one-size-fits-all strap-on soft-sided stuff that is fine if you only need storage a couple of times a year when you take a special trip or something.

It is said that a boat is a hole in the water you pour money into. In Japan a motorcycle is the dry land equivalent.
 
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musicisgood

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I would recommend asking the dealer for a 見積書 (mitsumorisho) you can take to your bank and try applying for a loan from them first. The interest rate will be waaaaay lower than that. Also, get your license in hand first, then worry about the bike. You're looking at at least a couple or three weeks to get the license taken care of.

On a 250 you don't have to worry about shaken, since it doesn't apply, but you do need to check how much 自賠責 (jibaiseki) it has remaining. If it has expired or will expire soon after you get the bike then you need to budget for that as it is illegal to ride with it expired. You should also carefully inspect the tires on any used bike. Not so much for remaining tread as for signs of age, as there's no telling how long they've been on the bike. If they're dodgy then you need to budget for replacing them. Try to check how much brake pad/shoe remains as well. If not much, that's another expense that can come up on you.

You really need to get yourself at the very minimum a proper riding jacket with pads (back, shoulders, elbows, chest) and proper gloves with pads (palms, knuckles). Komine makes quality equipment at an affordable price. A "three-season" jacket will do you for a while. You can usually get optional removable insulated linings for more warmth in winter. Later on get yourself a mesh jacket (with pads) for summer use. Safety gear pays for itself the first time it touches pavement with you inside it. You can pay for the gear now or you can pay for the casts and bandages later. You and I are both in that time of life when things don't heal as fast as they used to. You can save money by trying the stuff on in a store, writing down the model numbers, then going home and ordering off of Amazon.

If you EVER plan to add a carrying box to the bike, you need to do your research BEFORE you decide what bike to get. Not all bikes have mounting racks available for them. Some just never had an aftermarket rack made, and some are just old enough and out of production long enough that you'll play hell trying to find a rack that fits it. NEVER assume that when you get ready to put a rack on the bike it will be a simple matter of going down to the store and getting one. It can even be a pain in the aśś for newer bikes still in production. Ask me how I know this. If you're going to be like me and be "bike-only, year-round", you WILL need a storage option on the thing and something better than that one-size-fits-all strap-on soft-sided stuff that is fine if you only need storage a couple of times a year when you take a special trip or something.

It is said that a boat is a hole in the water you pour money into. In Japan a motorcycle is the dry land equivalent.

Hi Mike
I'm going to go over all this in the morning. It sure is sound advice and many thanks. Before I act, I will contact you first about the purchase, right now I'm going to check into the chuugata license here and in Ogori, which has free bus ride to it. About a 30 minute ride. There's only about 45 days of biking left for the season here and maybe I'll get a better price on the bike as winter sets in.

OK, off to my Japanese study now. Thanks, Mike.
 
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The interest rate at this places is at 8.9%. What do you think of that rate?
You often hear that Japan has negative interest rates. You also know that banks pay you only 0.01% in interest. So in the macro view of things, the shop's interest rate of 8.9% is quite high. (But you probably also know that credit card companies charge customers up to 20% in interest, so these things are relative).

In the real world, if you want to purchase, for example, a home in Japan, you can probably get an interest rate of around 3% from the banks. Auto/bike loans are inherently riskier than home loans, so obviously the banks will charge more - I would guess about 5%. But I just looked at Mitsubishi's web site and they have a used auto loan for 2.9%. That sounds like a really good deal to me. No doubt a ton of conditions apply. The banks want to see a stable income, some other assets they can use as collateral, etc... If you are short on cash and assets, you become a riskier customer, and the banks may not loan to you at all, then you will be forced to find a loan from a different place (like the bike shop) and they will charge you more.

So I'm not surprised at the 8.9% rate, but it does feel high to me. Do as Mike says, and see if you can get a cheaper loan from the bank. Or resist the urge to buy now, and instead save up the cash so you don't have to get a loan. (Sorry if I'm sounding like your old man). If you could score some part-time teaching gigs, you should be able to get 210,000 in no time.
 

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You often hear that Japan has negative interest rates. You also know that banks pay you only 0.01% in interest. So in the macro view of things, the shop's interest rate of 8.9% is quite high. (But you probably also know that credit card companies charge customers up to 20% in interest, so these things are relative).

In the real world, if you want to purchase, for example, a home in Japan, you can probably get an interest rate of around 3% from the banks. Auto/bike loans are inherently riskier than home loans, so obviously the banks will charge more - I would guess about 5%. But I just looked at Mitsubishi's web site and they have a used auto loan for 2.9%. That sounds like a really good deal to me. No doubt a ton of conditions apply. The banks want to see a stable income, some other assets they can use as collateral, etc... If you are short on cash and assets, you become a riskier customer, and the banks may not loan to you at all, then you will be forced to find a loan from a different place (like the bike shop) and they will charge you more.

So I'm not surprised at the 8.9% rate, but it does feel high to me. Do as Mike says, and see if you can get a cheaper loan from the bank. Or resist the urge to buy now, and instead save up the cash so you don't have to get a loan. (Sorry if I'm sounding like your old man). If you could score some part-time teaching gigs, you should be able to get 210,000 in no time.
Well today I went to the driving school and found out about the cost. 136000 yen. The idea of saving up gets more real by the hour. One thing I got going is that winter is around the corner and in Dec, Jan and Feb, no biking really.
So it's a good time to save up or buy and try to have the bike shop take payments and they keep the bike till paid in full. You guys think that is a good idea.
 

Mike Cash

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I doubt you'd get the shop to go for a layaway plan.

The driving school I linked you to there in your city is about 30k cheaper.

If I can ride all year in Gunma, why can't you ride in the winter there? You get a lot of snow or something?
 

musicisgood

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You could mail your stuff, send it by one of the many parcel services, or even hire an Akabou truck to move your stuff for you cheaper, quicker, and easier than you could do it by hauling it on the train as hand baggage. That's just throwing money away.

The kogata license is also practically throwing money away. You'd be limiting yourself to riding a 125cc and it would be no time before you regretted both the license and a 125. I know you're eager to spread your wings and even do some riding with some other people in your area. Trust me, they're not going to wait around for somebody on a 125 to catch up with them any more than they would a 50cc.

I just checked the fees of driving schools in your area and I had to check three before I could even find one that lists fees for the kogata license. There just isn't enough demand for most places to bother with it.
View attachment 23707

料金表 -山陽自動車学校-

Mike, I believe this site is in Shimonoseki, which is over a 2 hour train ride from where I live.

There are 2 sites here, one is down the road from me and that one is 136000 yen, the other one is in Ogori, there is a JR bus which is free to take to the school if I buy the bike from that shop. They also give a cash back of 10000 yen and a riders pair of gloves. That place cost 134000 yen. 10000 yen for me is a big savings too. Not sure what one I'll choose. Since I don't have a job at the moment Ogori is fine, but if I land employment, I think the one down the street is ok. The one in Ube is around 106000 yen I think. But at the time, I think I was just talking about a 125 cc bike. Monday I'll hit the pavement for job searching.
 

Mike Cash

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I thought you were in Shimonoseki. What city are you in? It is easy enough to check all the places online.
 
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Financially-speaking, layaway is not a great option. You have to give up your cash upfront, and you don't get anything in return until you pay it off. The bike shop gets a bit of your cash, and they still have the bike... they hold all the cards. Forget about layaway. The world is full of used cards and used bikes. These things aren't appreciating in value.

Since you say that 10,000 yen is a big savings, you have to look at the loan option above (the one that Mike posted), where you end up paying 10,620 yen in interest. Instead of that particular bike costing 120,000 yen, it ends up costing you 130,620 yen. If 10k yen isn't that much money to you, then, in the long run, the loan is no big deal. As it sounds, I think the better option would be to see if you can find work, and try to build up a nest-egg first.
 

musicisgood

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I thought you were in Shimonoseki. What city are you in? It is easy enough to check all the places online.
Mike, I didn't qualify for housing in Shimonoseki. At that place they gave me a referral to Yamaguchi city, where an NPO organization helped out with housing. Got lucky, no deposit and furnished apartment for 20000 yen a month. Sorry if I hadn't posted that. I know I didn't have internet until a few days ago, so I may have over looked posting it to you here on the forum. Maybe I did. There are only 2 places that I know of now , one in Yamaguchi city and in Ogori. They are about the same price though. Ube is about 30000 yen cheaper maybe, but its over a 1.5 hour train ride and the 17 hours of instructions probably will eat up the difference in price.
 

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Financially-speaking, layaway is not a great option. You have to give up your cash upfront, and you don't get anything in return until you pay it off. The bike shop gets a bit of your cash, and they still have the bike... they hold all the cards. Forget about layaway. The world is full of used cards and used bikes. These things aren't appreciating in value.

Since you say that 10,000 yen is a big savings, you have to look at the loan option above (the one that Mike posted), where you end up paying 10,620 yen in interest. Instead of that particular bike costing 120,000 yen, it ends up costing you 130,620 yen. If 10k yen isn't that much money to you, then, in the long run, the loan is no big deal. As it sounds, I think the better option would be to see if you can find work, and try to build up a nest-egg first.

I agree with you on that. What I found out though is that the 250 cc bikes don't come cheap. Used ones that is. They want like 249000 yen for bikes up to 10 years of age.
 
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