Covid-19 Loans: Has Covid-19 Impacted Your Income?

When we rang in the New Year, who would have guessed we would face a global pandemic that would creep into every country and continent across the world. That some of us would lose businesses, lose our jobs or take massive salary cuts. We are living in extraordinarily difficult times.

The business gurus and commentators say there is a new ‘normal’ we all need to get used to which includes working from home, working in shifts or teams and often as a result, reduced hours. Unfortunately, this new way of doing business has resulted in company retrenchments, dismissals and forced resignations across almost every industry, with some being harder hit than others. As of today, hair & beauty salons, restaurants, certain manufacturing concerns and gyms to name a few can only operate under reduced capacity and with major restrictions in place. Many businesses have been unable to bring in an income since lockdown in South Africa started on 26 March 2020.

When faced with this situation, UIF registered employees can claim from the Unemployment Insurance Fund. The problem with UIF is that it does not pay out the full wage or salary. This leaves an income shortfall. Families expenses are generally fixed and there is very little opportunity to reduce monthly living costs. For example: school fees, rent, bond repayments and food are all fixed costs.

The good news is that there are a number of temporary financial solutions available to the public:

1. Pension Loan
If you have given notice to your pension fund or provident fund that you want to make your policy paid up, it is possible to secure a short- term Pension Bridging Loan from accredited private lenders.
2. Property Secured Loan
If your home is bond-free or has a bond that is less than 40% of the property value, it is possible
to secure a Loan Against the Property in some circumstances, to help you free up cash to cover expenses.
3. Loan Against a Movable Asset
It is possible to use your valuables like gold, diamonds, art, antiques, jet skis, cars, bakkies, motorbikes and other loose assets, as security for a loan.

When faced with the daunting prospect of retrenchment, do not panic. There are temporary financial solutions that enable families to make it through the tough times. For more ideas and financing solutions click here: www.nhfinance.co.za