I. Before signing any loan contract: It is advisable to understand the terms and conditions of the loan to avoid being found in awkward position. The lender must let you know up front exactly what the cost will be and tell you about any additional charges or fees. This information is included in a document called the 'disclosure statement'. If it is not made available to you, you have a right to request for it.

G.Hidden fees/other costs: Consider the charges or any other fees such as processing fees or penalties for missed or late payment. Always factor in the interest rates

H.Your credit report and credit history: If you do not repay your loan, your credit history may be adversely affected as money lenders will always check your credit history before offering you any loan

F.Moratorium: In the wake of COVID19 and consequent lockdowns livelihoods incomes and many businesses have been disrupted. Speak to your money lender if you have adversely been affected by the impact of COVID19 on your ability to repay your loans. A considerable relief period may be availed to you during your loan term when you will not be obligated to make a payment. Terms and conditions apply!

E.Debt Problems:  If you are unable to meet up with your repayments talk to your money lender. They are able to offer debt advice or offer alternative repayment solutions. This may include restructuring your loan repayments to make it more affordable for you

2. Unsecured Loans :A. An unsecured loan is a loan that is not backed by any form of collateral. B. Usually the lender will give you a loan based on your income and credit history.C. Examples of such type of loans are student loans and pay day loans.D. Unsecured loans typically carry higher interest rate than secured loans.

1. Family and friends
2. Banks
3. Microfinance institutions
4. Village savings and loans groups
5. Financial cooperatives 
6. One’s employer.

1. To invest in assets or a business venture
2. To respond to an emergency
3. To purchase an item which costs more than what the cash they have in hand to pay for that item.

1. The total sum of the loan i.e. principal plus interest
2. Interest rate applicable
3. Any other charges
4. Monthly repayments and duration of the loan.

1. A loan is a sum of money that you borrow and has to be repaid before an agreed date, usually with interest.
2. Normally, the money is paid back in regular instalments

Credit management involves how you handle personal loans. This includes money you have borrowed and people that owe you money.

SACCOs have systems, procedures, committees and reporting structures that provide the safety of the members’ money.

Note: **Always read the terms and conditions before signing any financial agreement or contract**

B.Provide a source of fair loans and reasonable rates of interest

C.Savings do not attract charges

D.Joining a SACCO makes saving and borrowing easier and safer.

E.Access to financial services is nondiscriminatory and affordable.

F.Members have a say in how the SACCO should be run as they own the institution.

G.Earned net profits are shared between all members inform of dividends, based on a member’s shareholding percentage

A. a tool for savings

• You can accumulate savings within a short period of time.
• Saving small amounts regularly grows to become a large amount over time.
• You earn interest on your savings which are part of what you have borrowed lowering your borrowing costs further
• Interest paid on these savings is often higher than bank rates.

B.Usually there is a common bond among the members of a SACCO such as belonging to the same organization or living in the same geographical area e.g. if you are a teacher or an employee of a particular organization

C.Membership is voluntary within the SACCO’s common bond

A. Membership of SACCOs is made up of people from diverse backgrounds cutting across all segments of society, rural, urban, low and middle income earners, business persons, farmers, professionals and is open to all regardless of gender, race, religion or political affiliation

1. Savings
2. Loans based on share contributions, assets and deposits in the SACCO
3. Membership financial education and counselling
4. Insurance services
5. other financial services

1. A person buys shares in order to become a member of SACCO
2. SACCOs require a minimum monthly contribution towards shares from members.
3. A member may also contribute towards savings
4. The contributions from members are lent out or invested as authorized by their by-laws.
5. Share contributions are not accessible by members unless they choose to exit.

a.They are member owned financial institutions governed by a board of directors elected by, and from amongst the members

b.The primary objective of SACCOs is to mobilize savings and give members access to loans on competitive terms as a way of enhancing their socio-economic well-being.

c.Its belief is centered on "people helping people to help themselves"

d.Ownership is what makes a SACCO different from other financial institutions.

1.Secured Loans

1. A secured loan is a loan that is backed by assets (moveable or immovable) as collateral
2. In the event that the you are unable to repay the loan, the lender takes possession of the pledged asset (collateral) and may sell it to recover some or all of the amount originally loaned to the borrower. 

1 Secured Loans

C. It is important to note that secured loans attract lower interest rates as the risk of not recovering the loan are reduced by the pledge of collateral.

A.Shop around:You must compare the loans on offer and their costs and select the cheapest loan possible, do not take the first loan offer. B. Avoidances:Borrowing for consumption is not the best way to manage your finances.

C. Affordability: It is very important to work out how much you can afford to repay each month, as this will affect which borrowing option is best for you. Consider whether you can afford the repayments without compromising your other commitments.

D. Repayment Term: Consider how long will it take you to repay the loan and whether you can afford to pay it over the stated period. A loan is not a gift