Personal loans guaranteed are available from many sources, and are relatively easy to obtain either through the Internet, finance company, bank, or even a credit card company for anyone with collateral. The quickest (and apparently most common) financing is payday loans. They are secured by the next paycheck, and allows the borrower to receive funds between paydays. They do not require a credit check when they are short term and $500 or less. There is a fee for this type of financing that is taken out up front, so actual funds received from a personal loan guaranteed is the amount less the fee.
When larger amounts are needed, such as to buy a computer, or furniture, or to pay tuition or vacation expenses, a credit check will most certainly be done. In that case, in order to avoid having several companies check credit (and thus lowering personal credit rating), it would be wiser to use a broker who would make a one-time check and pass that information on to possible lenders. A bank statement and paycheck stub will be needed to prove earnings enough to qualify for this personal loan guaranteed. Typical fees for personal loans guaranteed are 15-30% of the amount borrowed.
When one has to begin borrowing on future paychecks or on the home, it may a good time to review financial priorities. It is important to keep money in its proper place: "For the love of money is the root of all evil: which while some coveted after, they have erred from the faith, and pierced themselves through with many sorrows." (1 Timothy 6:10). Remember that God promises each person who believes in Him treasures unimaginable in heaven. Don't store up treasures here, concentrate on the best that is yet to come.
Another source is the home equity line of credit. The larger personal loans guaranteed by the equity in the home are good for debt consolidation, home remodeling and the like. The interest rate is lower than the payday loans. This kind of financing equates to a second mortgage, and if selling a home before it's paid off, that personal loan guaranteed comes out of the sale proceeds first. When counting on the proceeds of a house to make a down payment on the next one, this could present a serious problem. The best way to handle this kind of personal loan guaranteed is to stay put until both the loan and mortgage are paid off.
Unsecured personal loans with bad credit provide financial assistance to a consumer with poor financial history without the need for security or collateral to back up the agreement. These can be difficult to find, and the reason for this is that the lender is taking a huge risk offering money to an individual with a negative record. Consequently, if a person can find financing for an unsecured personal loan with bad credit, the terms of the agreement are going to be significantly different from loans offered to people with a strong credit history. If someone is in a position of wanting or needing an unsecured personal loan with bad credit, they should seek personal answers to a few hard questions. Most importantly, the individual must determine if the money is necessary and immediately needed.
Sometimes money is easy to find. In many cases, such as for a new business or a new car, this is a benefit. However, to people with poor discipline and poor financial history, this "easy" money is often extended through unsecured personal loans with bad credit. This is never a wise financial move, because more often than not the terms of the unsecured personal loan with bad credit make it almost impossible to pay off the obligation in a short length of time. This means the person who agreed to this assistance is paying exorbitant fees and interest rates. Often unsecured personal loans with bad credit are taken out for things that decrease rather than increase in value, such as for cars or expensive toys. This means the item being purchased is more than likely going to need to be replaced before the entire amount is paid off and the borrower is left with this choice they made that will continue to affect their financial record.
This type of agreement should be the last resort for an individual. First, an individual should decide if they absolutely need an item right now. If not, they should save their cash instead of choosing to sign an unsecured personal loan with bad credit. This way, the individual will be able to enjoy the item without the stress of repayment hanging over their head, and equally as important, they will not be paying more for the item, through interest and fees tacked on to unsecured personal loans with bad credit, than the item is worth. Ultimately, an individual needs to manage his or her finances so that even if the money is available, it does not mean it is a wise decision to borrow it. "All things are lawful for me, but all things are not expedient: all things are lawful for me, but all things edify not." (1 Corinthians 10:23)
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The main attraction of the no fee personal loan is the elimination of costly fees and frivolous charges that are all too often attached to loans of every type. Personal loans are often obtained on the basis of a borrower's good or excellent credit rating along with a regular income. There is no collateral involved in a personal loan. In the no fee personal loan, the borrower will usually pay a little bit extra in interest charges in order to escape the endless fees that can be associated with borrowing money. The lender in this case picks up all the fees, and may consider this set up well worth it, since higher interest rates can bring in more income for the lending institution for years to come. In most cases, sub prime lenders will not offer this option. Since the terms and interest rates for sub prime loans are already at quite high levels, there is very little room to raise interest rates higher or reduce fees.
The amount of extra interest that may be charged in a no fee personal loan can vary. Some lenders may charge an extra quarter point all the way up to an extra three quarters of a point or even more. During the full life of these loans, this extra cash can add up. But a small increase in interest rate will not elevate the monthly payment in a large way and, for good or bad, the amount of the monthly payment is often what a borrower will focus on. Some lending institutions will offer the no fee personal loan as a creative extra selling point when trying to get potential borrowers to sign on the bottom line. When borrowers are plentiful, lenders do not need to get creative to entice clients. But in tougher markets, any extra feature that can help close the deal is often seen as a good thing. Such is the case with the no fee personal loan. If a borrower can see in black and white the kind of immediate savings that this types of loans can offer, they are more likely to move forward.
When applying for a no fee personal loan, a potential borrower does not always need to divulge information on the reason for the loan. The maximum amount of money to be borrowed can vary depending on the borrower's income and credit rating. Individuals with little in the way of a credit history may need to get a co signer before financing can be approved. Many financial institutions offer potential borrowers the opportunity to apply for these loans online. Doing this may speed up the application process somewhat. If a borrower is filling out an application on line, that individual should make sure that all of the information given is accurate and the telephone number that is listed for contact is correct. Any mistakes in this area can slow the process down considerably. In addition to longer term loans, short term lending is often available for qualified applicants. If a borrower wishes to pay the debt off earlier than it is due, this is possible, and can be done without paying any kind of penalty if this is part of the terms of the original loan. If possible, paying a debt off ahead of schedule is always a wise course of action. The Bible talks about the great wisdom of God. "The Lord by wisdom hath founded the earth; by understanding hath he established the heavens." (Proverbs 3:19)
The demand for the no fee personal loan has increased in recent years. Many borrowers are leery of the easy credit payday loans or are interested in attaining larger unsecured loans than are generally offered by payday advance lenders. At the same time, borrowers have no desire to pay for extra fees and would prefer that the lender absorb these charges. These conditions have helped make personal loans attractive to many borrowers. Home or car repair needs, unexpected medical expenses, family vacations, or any numbers of motivations to borrow funds exist. While credit cards and home equity loans can also offer solutions to these kinds of dilemmas, the signature loan has its fans. This is largely because there is no property that is put at risk with this type of financing. If the risk and as well as the assorted fees can be absorbed by the lending institution that is handling the loan, this can be a powerful selling point for potential borrowers. However, many financial institutions tend to shy away from this type of financing since there can be a limited amount of profit involved for the lender.
Using a credit card or a pay day advance loan may not be the wisest course of action for the borrower who is in need of cash. While these courses of action are usually the fastest and easiest ways to attain funds, the high interest rates and the possibility of increasing the total amount of the debt can make these lending alternatives more risky for the borrower than they are worth. A consumer who shops around for a no fee personal loan is generally choosing the more cost effective financial solution. Many experts feel that credit unions are the best sources for these kinds of loans. Credit unions tend to handle smaller loans more frequently than traditional banks. Whatever solution a borrower might eventually choose, careful research and a thorough understanding of the total cost of the loan is always a good idea.
Seeking a non secured loan can mean obtaining needed cash without placing any item of personal property at risk. These loans get their name from the fact that there is no collateral involved to serve as security for the debt that is being undertaken. The offering of collateral will in general reduce the risk to the lender since an item of value can be seized if the borrower should default on the loan. In the non secured loan, there is no such safety net. A lender is depending on the honor and good name of the borrower for assurance that the debt will be reimbursed. Of course, since there is more risk being assumed by the lender, there will be higher costs associated with these lending opportunities. These costs will usually come in the form of higher interests rates as well as the possibility of extra fees. However, if a potential borrower has excellent credit, these costs may not be excessively high. A borrower may have to be satisfied with a smaller loan amount when there is no collateral accompanying the loan.
There are many features that could influence the interest rates and any additional fees. A borrower's prior credit history could be a factor. Lenders understandably prefer to lend money to individuals with excellent credit and a solid track record for making good on any previous loans. With some lending agreements, the borrower is able to decrease the amount of interest paid if that borrower takes pains to make all payments on time. There are a number of different examples of the non secured loan. Some financial providers cater to individuals with poor or no credit. While it can be very easy to attain loans from these providers, the lending terms can be very steep. Anyone who obtains a poor credit non secured loan should expect to pay much higher interest rates. Many of these loans are extremely short term and are known as pay check loans or quick payday advances. The criteria for these short term loans will usually include little more that proof of age, Unites States citizenship, full time employment, and an active bank account. Longer term loans can be financed over a period of years and can be used for such things as home improvement, vacations, debt consolidation or any number of other purposes. These loans will also often require a minimum amount of documentation and offer speedy approval.
This kind of lending opportunity may be known by several names including signature loans and personal loans. Attained mostly through the good name of the applicant and the size of the applicant's income, they can be a little more difficult to get than shorter term financing. Since there is no collateral attached, there is much less risk to the borrower. Within the category of the non secured loan there are different types of loans. Personal loans are repaid by the individual borrower. Unsecured business loans represent debt that is taken on by a business. A third category is something called the unsecured business loan with a personal guarantee. This last approach gives the lender a little extra cushion in that in the event of a business default, the lender can turn to the individual borrower for repayment. Anyone attempting to build a new business knows the importance of attaining funds to help the business grow. A non secured loan can provide those funds. The Bible talks about what a blessing it is to give praise to God. "I will praise the Lord according to his righteousness: and will sing praise to the name of the Lord most high." (Psalm 7:17)
There are many reasons for seeking a non secured loan. Some individuals use this unsecured debt to pay for such expenses as education, debt consolidation or even vacations and luxury items. Potential borrowers should always take care to make sure that the reason for borrowing justifies the debt that will be undertaken. In addition to the standard loan framework, there is also the availability of the unsecured personal line of credit. Using this approach, the borrower can attain funds at their own discretion, calling upon the line of credit only when needed and, consequently, only borrowing what is actually necessary. There are financial services that can help an individual or business decide what kind of lending approach is the best fit for them as well as matching the individual or business up with the appropriate lender. Those with a solid credit history as well as businesses with a healthy profit record and business plan can generally attain financing at reasonable interest rates and agreeable terms.
The main difference between the non secured loan and secured loans is the presence of collateral. Home mortgages are generally examples of secured debt since the house itself serves as collateral for the mortgage. Any time that a piece of property such as a car or items of furniture serve as security for a loan, that property can be taken away from the borrower if the borrower fails to make the payments. The benefit of unsecured loans is that there is no property that will be lost in the event of default. If a home is used as security for a mortgage, the financial institution that lent the money in the first place has the right to seize the home and place it up for sale in order to repay the debt if the borrower defaults. Many borrowers believe that unsecured loans are always a better deal that secured ones. As long as a borrower's credit score is high enough, the cost of this unsecured debt is not prohibitive.
Online personal loans can be obtained from among hundreds of lenders for practically any purpose through a simple application process that is completed in the comfort of home. It is a convenient means to acquire cash if there's a pressing need for money and obtaining it can be a very simple process. "The righteous cry, and the Lord heareth and delivereth them out of all their troubles." (Psalms 34:17) Whether seeking funding for debt consolidation, a home improvement project, next semester's college expenses, or even a much-needed vacation, the resources offering online personal loans are many. And with the abundance of competitors on the world wide web, the best deal should not be hard to find. While credit cards also offer a convenient means to finance these costs, the money from online personal loans is probably available at a much lower interest rate.
Since there are many resources from which to choose, set aside some time solely for looking into the best deal available. Investigate all of the terms, including the possible application fees, interest rates, finance charges and other associated costs as part of the research into the various online personal loan options. Of course, wise consumers would do this kind of research before agreeing to any kind of loan, whether a credit card, a home mortgage, or an online personal loan.
Some people shy away from submitting any financial information on the Internet because they fear identity theft and other security issues. As with any loan request, online personal loan applications require the borrower to submit personal information, such as name, address, social security number, and employment facts. To be sure that it is a secure Web site, the application page should have some indication of security. Look for a security symbol, which is probably a little locked padlock or a gold key in the lower left-hand or lower right-hand corner of the screen (depending on the Internet browser). This security symbol relates that the transmission of the data is encrypted and secure.
In many cases, the online personal loan application process takes only a few minutes and the approval time is just as quick. Lenders who offer this financing are accustomed to working with customers through electronic means. Although most lending institutions will have a telephone number available to speak with a representative, most people who pursue online personal loans are able to complete the entire transaction quickly, easily, and confidently through their home computers.
Student personal loans are made especially for people who are in need of funds for college, but can be used for things like books, food, living expenses as well as other basic needs, all to be repaid after graduation. Obtaining a college education takes intelligence, perseverance, endurance, goal-setting, and lots of money. The costs of education gets higher and higher every year and students have to find ways of financing their goals. The easiest way to pay for this education is to take out a student personal loan with careful prayer and much reliance on the Lord. "But I am poor and needy: make haste unto me, O God: thou art my help and my deliverer; O LORD, make no tarrying" (Psalm 70:5).
Due to the influx in such lending being offered, more and more college attendees are able to get an education. The lending volume goes up exponentially every year as students strive for better jobs and higher pay. There two types of student personal loans are federal and private. To receive the amount needed for a degree, it is wise to check into both types. College attendees will need to start on this early because it can take several months to receive the student personal loan, and no one wants to waste a semester.
The first thing applicants need to do is complete a Free Application for Federal Student Aid. This application determines whether or not college bound people are eligible for a student personal loan. Once they have received the results, applicants can look to see how much has been rewarded and develop a budget for how much is needed from their student personal loans. Students should not feel obligated to take out the maximum amount awarded because it must be paid back with interest after graduation. Next, before taking out any amount, applicants need to apply for as many scholarships as possible. This lending can be difficult to pay back after graduation, so it's wise to find as much free money as possible. Scholarships are given by government, colleges, and private corporations. They are awarded based on both need and merit, and can save college attendees a lot of money.
Last, applicants need to ask about the repayment options. Many lenders allow six months after graduation to begin making payments. This provides enough time to find a job and set up finances, a must for new grads working for the first time. It's wise to ask if deferment is possible on the student personal loan payments in case any financial problems or job issues come up. Although no one expects this to happen, it is best to have this option if necessary. Student personal loans can help anyone achieve their occupational goals, but students need to be wise when choosing how much to take out and at what interest rate. If they are not careful, the debt accrued could add up to more than those salary increases over a lifetime.
A secured personal loan means that the consumer is receiving financial assistance in return for some sort of collateral. Therefore, if the individual does not pay back this obligation, a lender will have something they can collect from the individual. This collateral can be a car, a house, electronics, etc. But it has to be worth something of value. Secured personal loans can pay for many different things. There are several things that the individual may need to look at with this type of loan. It is important to understand what personal and financial information will be needed, what lender to select, and how to go about pursuing this type of funding.
If the consumer needs money for funding a large venture like a business, they may want to look into a business agreement rather than a secured personal loan. Businesses are often unstable and require more specialized contracts. For a smaller expenditure, like a vacation or wedding, secured personal loans can provide the appropriate amount of funding. These expenses are far more stable and much easier to repay. The consumer will need to make a list of every expense that will be covered through the funding, in order to receive enough money to cover the entire amount needed.
The next step taken by the consumer should be determining if they are indeed the appropriate candidate for this form of assistance. Something that makes the individual suitable or a good candidate for a secured personal loan is if the individual has collateral that they can put up against the agreement. If there is no available collateral, the consumer may have to look into unsecured agreements. Secured personal loans are best for those people who have good collateral to use as security. These are also appropriate for those who have good credit ratings when it comes to their finances. Lenders want to be secure in their lending and take as few risks as possible.
After the consumer takes the time to determine what type of funding fits their needs, they can start looking into the lending companies available. Secured personal loans are offered through many different companies so it is important for the individual to spend some time in prayer. Also the consumer should talk to others about the decision that they are making. The Lord will guide a Christian when it comes time to make this decision. "That your faith should not stand in the wisdom of men, but in the power of God." (1 Corinthians 2:5)
Before finally deciding on obtaining federal student loan consolidation program, it is a must that prospective student borrowers learn more about important points on college loans. First, he must understand that there are two types of student debts, which are the government type of loans and the private ones.
Generally, private college debts are known to have much higher interest rates than the federal type of college loans. This is because private loans are basically unsecured type. This is the opposite of the government student loans, which have the backing and assurance from the United States government.
This means that if you have government loans, they can be refinanced at much lower interest rates than your private type of debt. If you possess both types of loans, you will have to merge federal college loans as a separate group from the private type. It is a must that you do not mix these two types in order for you to take advantage of the lower rate that government loans offer.
It is imperative that when you decide on merging government student loans, it should be with a federally approved lender. You can search the internet for a number of prospective lenders and request for quotes. Perhaps you can inquire from friends or family members who have actually consolidated their loans.
Likewise, when in the process of choosing a lender that will consolidate your federal or private debts, make sure that you understand every aspect of the program that he offers and see if they will work fully to your advantage. You have to make sure that in the end, you deal with the lender that can offer the best possible consolidation program terms and conditions.
For prospective student borrowers who are seriously contemplating on getting a student loan debt consolidation, these programs can be obtained either from a brick and mortar office of a lending company or from the numerous loan websites on the internet.
Student borrowers must be wise decision makers so far as finding and securing for themselves programs on student loan refinancing is concerned. This would only mean that the borrowers should not only understand the benefits and advantage that such programs offer, but likewise all the possible disadvantages that they might experience out these programs.
Definitely, forming a proper decision on obtaining the right student loan debt consolidation is a difficult task that you can make. Therefore, if you do feel that you are incapable of deciding which program is best for you, employing a professional loan consultant or adviser is the best thing to do. It is a must that you get only a legitimate and established lending adviser to ensure that you are receiving the best and most sound loan advice. Only a professional will know which type of program fits your loan requirements.
Indeed, when it comes to enjoying better and more convenient mode of repayment, college loan consolidation programs and schemes are a way to go. The consolidation and merging of loans helps students deal with multiple debts in a less stressful way. Not only are students given a single monthly due date, but the rate of interest of their new loan is much lower, which consequently means lower due every month.
Every year many people decided to take out a UK loan for one of a range of reasons, and this includes secured and unsecured loans, which are designed to cater for different people with different needs and circumstances. The availability of loans provides many consumers with valuable financial leverage, and these loans are used for many different purposes, such as carrying out home improvements, consolidating other debts, buying a new car, or even paying for a dream wedding or fabulous holiday. However, you don't need to be a NASA scientist to know no matter what you need your loan for it is vital that you make sure that you can afford the repayments before you commit.
Loans in the United Kingdom can serve as very useful financial tools, but they can also lead to unmanageable levels of debt if your finances are already overstretched, as this will be yet another financial commitment added to all of your other financial obligations, which can quickly tip you over the financial edge. It is important that you do your homework before you apply for a UK loan in order to determine how much you can afford to borrow – or whether you can afford to take out a loan at all.
The first thing that you need to do is look at your income and outgoings in order to determine how much you can afford to spare on monthly loan repayments each month. You should make sure that you do no stretch your finances to the hilt when working this out – remember you need some flexibility in your budget in order to accommodation any increases in bills, rent, mortgage repayments, etc. Once you have determined how much you can realistically afford you should then make sure that you do not exceed this budget - borrowing within your means is vital in this day and age.
You also need to determine exactly how much you need to borrow – try not to borrow more than you need to. This can be very tempting but remember whatever you borrow you have to repay, and the more you borrow the higher your monthly repayments will be. Once you have decided how much you want to borrow you also need to determine whether you want the loan to be a secured or unsecured one. For a secured loan you need to be a homeowner, and for an unsecured loan you need to have good credit. Remember, if you decide on a secured loan you must be extra careful not to over-burden yourself financially, otherwise you could risk losing your home.
You then need to compare UK loans from a number of providers in order to compare interest rates, repayments periods offered, terms, and monthly repayments. Some sites will boast of giving you the best rates using some new technology but more often than not it is better to get a quote yourself and deal direct with brokers. Remember, do not exceed the amount that you originally decided that you could afford based on your budget calculations. If you go trough your budget and taking out the loan will leave your budget stretched without any capacity to accommodation increased costs then you need to reconsider whether you really should take out the loan, and if you still need to borrow the money you should look at taking out a smaller loan so that your repayments are not as high.
Read More......The Office of Fair Trading has criticised a loan broker after receiving a series of complaints from unhappy customers. The complaints were made about Yes Loans, and the complaints related to the fact that many consumers were given the impression that YES was a lender and not a broker.
As a result of the complaints the company has been told that it must ensure that it is made clear that it is a loan broker that passes details of applicants onto other lenders, and that it is not an actual lender itself.
Loans through YES are designed for those with damaged credit, and because of this the loans that are offered through the broker are typically high interest loans.
Applicants were not happy when they were told that they would have to pay a referral fee for being introduced to a lender, as many were under the impression that YES was the lender and would be the company that provided them with the loan. The cost of the referral fee charges varied based on the size of the loan being taken.
The company has also been slated for failing to return brokerage fees as well as failing to be clear about being a broker and not a lender.
If a customer pulls out of the applications process or the company fails to find a loan for the applicant it must, by law, refund the referral fee, but in many cases it has failed to do this according to reports. It has now been told by the OFT that it must ensure that refunds are provided within thirty days to eligible consumers.
Read More......An official from the OFT said: ‘Many businesses charge an up-front fee for brokering loans for consumers, and customers should be aware that if they use a broker but do not accept the credit offered, no matter what the reason, they are entitled to a refund less £5. The OFT will continue to take action against companies who fail to do so.’
Due to the economic crisis, many car dealers have been forced to slash prices, and now thousands of people are looking to snap up a cheap car while prices are low.
However, recent research from uSwitch found that less than a third of bargain hunters looking for a cheap car think about car finance before they head to the dealer's forecourt. This could be an expensive mistake, because failing to find a cheap car loan can drive up the price you ultimately pay for your car by as much as 51%.
The average purchase price for one of the top ten best selling cars is £13,631. If you took out a best buy loan, like one from Alliance and Leicester at 8% APR to pay for one of these cars, the ultimate cost would be £16,474. However, if you went for one of the more expensive loans on the market, higher interest payments could bring the cost of the car to a shocking £20,518, cancelling out any discount you got on the purchase price.
Don't fall into the car finance trap, read on for uSwitch personal finance expert Louise Bond's top ten tips for getting a cheap car loan.
1. Best buy unsecured personal loan rates are only available to people with a good credit history, so not all car buyers will be able to get them. However, it's still worth shopping around as there are still quite a few good deals. You can check your credit report for free before you apply.
2. Having the money ready before you start car hunting will strengthen your bargaining power as you can make the purchase immediately - you are effectively a cash buyer.
3. Some car dealers offer 0% finance on new cars, these deals are definitely worth considering if you can get one - you may have to pay a hefty deposit though.
4. When looking at car dealership finance, make sure you take into account the size of the deposit and the final payment as well as the monthly payments as this can really ramp up the overall cost.
5. Leasing deals can sometimes work out cheaper as consumers may not have to pay for servicing and repairs.
6. For consumers with a poor credit score, leasing could be next best available option as they are not actually buying the vehicle.
7. It is also worth looking at cars that have been pre-registered by a dealer. They only have a few miles on the clock so in effect you get a nearly brand-new vehicle at a second-hand price.
8. The collapse of a motor manufacturer can have a knock-on effect on a car's re-sale value plus the availability of vehicle parts - these factors should be carefully considered by potential buyers.
9. As well as haggling on the price, look for free extras such as extended warranties and service packages.
10. Finally, watch out for new Government initiatives. Ministers are currently looking at introducing a 'scrapping incentive scheme' where motorists will be offered up to £2000 to scrap cars over nine years old. This may be worth holding out for.
Read More......The Chancellor of the Exchequer, Alistair Darling, has recently expressed concern over the amount of interest that is being charged on loans that are taken out by small firms.
Darling said that he was very concerned that the rates being charged on loans to small firms were far too high, and in order to discuss this he called a meeting with banking industry executives last week at Downing Street. Darling said that whilst the base interest rate had dropped to its lowest level in history, at just 0.5 percent, loan rates appeared to be continually rising.
Darling went on to state that the government did not bail out the banking sector ‘out of some charitable act’ and he added that banks now had a responsibility to ensure that lending levels were restored. A number of major banks had to be bailed out by the government, with the use of taxpayer’s money, following the onset of the credit crunch, and the chancellor said that it was now time for banks to take responsibility and ensure measures were put into place to get lending back to reasonable levels.
Darling said: “The public will not understand it if they [the banks] don’t seem to be doing their part. I want them to rebuild their balance sheets… but at the same time, because of the particular circumstances we’re in now, because of the fact we’ve got this recession, we also need them to lend money. And that’s why we re-capitalised them to do that, and that means they’ve got to live up to the promises that they made.”
Read More......An official from the Federation of Small Businesses said that the chancellor had been “quite right to haul in the banks”. He added: “It is hugely important that Mr Darling keeps tabs on the banks to ensure they are lending money to firms, and at fair rates. Firms need to be able to reap the benefits of the historically low base rate.”
What do you need to know about student and graduate loans? First, it’s good to know that the interest on these loans is much lower than a typical personal loan. However, it’s also important to know that a student or recent graduate can become locked into a relationship with a lender through these loans, so careful choices is imperative.
Many students leave college with huge loans, sometimes in the tens of thousands of pounds. The average student now graduates with £13,501 in debt from student loans. It is estimated that two-thirds of all undergraduates have to borrow money from the Student Loans Company. Once a student enters the workforce, the repayment of student loans begins. The good news is that student loans only grow at the rate of inflation, and the interest on student loans caps at 1% above base rates, which is still low compared to many other forms of debt.
Repayment of student loans begins the April after you graduate. Once you hit the £15,000 a year salary mark, nine percent of earnings above that goes back to paying off the loan.
Graduate loans are offered for recent graduates to cover living and working expenses. Many new graduates need to find a place to live and purchase appropriate work clothes. The graduate loan is designed for these costs. While this may seem like a great option, be wary. Graduate loans are much more expensive than student loans, although still less expensive than traditional personal loans.
You may want to consider alternatives prior to seeking a graduate loan. Your new employer, for example, may be able to loan you money for start-up costs with a much lower rate. Career development loans are another option for those who are seeking professional qualifications. These loans are available from most high street lenders at a lower interest rate.
Maintaining control over student debt is important as it may have a great affect on a person’s ability to later purchase a home and invest in a pension. Because the daily financial stresses for students are great, many feel they need more loans to cover the expenses, which in turn leads to more years of repayment. One recommendation is to set up two accounts with the loan monies. Students then pay themselves with one account to the other.
While increasing student debt is a trend, the good news is that fewer graduates are now getting into further debt.
Read More......Whilst credit conditions have been particularly difficult over the past couple of years, since the onset of the global credit crunch, it has been reported recently that some lenders have been relaxing their loan terms, enabling consumers to enjoy easier access to loans and greater affordability.
Figures have shown that requirements needed to get a home loan have been relaxed by a number of lenders, although many mortgage deals still demand minimum deposit levels of at least 25 percent from lenders.
One financial industry groups has recently reported that there has been an increase in the number of mortgage deals that are looking for higher deposit levels from borrowers, which will prove to be good news for groups such as first time buyers, who have struggled to get mortgages over the past year, partly due to the huge deposits that lenders have been demanding from borrowers in order to gain access to their better rates.
One industry official from the mortgage group stated: “We are seeing a number of mortgage providers slowing reducing their strict criteria and are increasing the number of products available to those that can raise a 15% deposit, be it at a higher initial interest rate.”
One mortgage broker added: “As lenders find the pool of customers who can put down a 40% deposit is shrinking, they are being forced to ask for smaller deposits.”
Over 50 percent of lenders were looking for a minimum deposit of at least 25 percent in December.
Read More......However, on industry expert said: “What we have seen over the past few months is a change in lenders offering their best interest rates at 70-75% loan-to-value rather than 60%.”
It has been alleged in a recent report that around 80 percent of loans that were approved by the Halifax Royal Bank of Scotland before the financial crisis hit were actually given approval without any income checks being carried out.
This means that in the vast majority of cases loans were approved by HBOS without proof of income that would determine whether or not the borrower would actually be able to make repayments on the loan.
The claims were made by a former senior employee of HBOS, which has now been taken over by Lloyds TSB after becoming another financial victim of the credit crunch and suffering huge losses.
The former senior employee, Michael Bolton, reportedly stated: ‘HBOS had five brands, all offering products without proof of income. It was offering a lot of self-cert, a lot of buy-to-let that needed no proof of income and a lot of Halifax’s mortgages were ‘non-verified income’ loans, which was essentially fast track. Before the credit crunch, as much as 80% of HBOS’ loans were going through without full proof of income.’
One mortgage broker said that before the global credit crunch hit the nation in 2007 many lenders who dealt with mortgages and loans tried to fast track applications by using the credit scoring system.
In the case of HBOS many loan applications were fast-tracked in this way, being approved at the time of the application in many cases, which meant that a traditional underwriter that would normally check things such as proof of income would not be used.
The broker stated: ‘A lot of mainstream loans were fast-tracked in the past, but HBOS went further than most lenders in that area of the market, in relation to bigger loans, so I would not be surprised if 80% were without full income verification.’
Read More......A spokesperson from the Halifax responded to the claims by saying: ‘Our underwriting approach is carried out in a responsible manner. We have one of the best underwriting approaches within the mortgage market, and the performance of our prime mortgage book is broadly in-line with many leading competitors in the market.’
It has been revealed recently that the lack of credit card availability for many consumers could spell good news for unscrupulous loans sharks out there, as an increasing number of consumers may find themselves having to turn to loan sharks when they are struggling financially simply because they cannot see any other option.
Since the onset of the global credit crunch the availability of credit cards has dropped through the floor for many consumers, especially those with low incomes or bad credit, and in the current economic climate many may find themselves having to look elsewhere if they are desperate to get finance.
Industry experts are worried that as credit card and loan availability continued to dwindle during the recession a rising number of Brits will turn to loan sharks for their financial needs, and could then find themselves getting burned as a result of the crippling interest that these sharks demand even for relatively small loans.
Whilst strict regulations and laws have been put into place with regards to loan sharks experts reckon that with the rising number of traditional lenders being more stringent with lending this practice is actually on the increase.
A recent report from the New Local Government Network claimed: “The diminished availability of regulated sub-prime credit is creating conditions where a sizable number of people have little option but to borrow from illegal sources. At least 165,000 people already use loan sharks in the UK and we can expect the number to rise sharply.”
It was also claimed in the report that there are certain areas where consumers are more likely to fall victim to loan sharks, and these areas were Stoke On Trent, Gateshead, and Manchester.
Read More......A recent report has suggested that banks in the UK are slyly trying to make more money from customers by increasing their personal loan rates, which some campaigners have described as being underhand.
Over the past six weeks or so it is claimed that some lenders have increased the average rate of interest charged on their personal loans by 1 percent, despite the fact that the base interest rate is still at its lowest level ever at just 0.5 percent.
One price comparison website claims that the average personal loan rate now stands at 9.07 percent, which is an increase from 8.74 percent a year ago, when the base interest rate was ten times higher than it is now.
One industry official said: ‘Hiking loan rates in the current climate is just making an already difficult situation practically impossible for consumers. Much as we understand that the banks are struggling, these are big hikes to swallow. With all eyes on mortgages and savings, it seems loan providers are slipping under the radar slightly.’
Around one and a half million consumers are said to have opted for a personal loan last year to consolidate other debts in a bid to reduce monthly outgoing. However, with loan rates rising like this many may find that this is no longer an affordable or viable option, leaving them to look at other solutions to reduce their debt repayments.
Read More......One consumer stated: “I recently looked at taking out a personal loan, and was shocked at the interest rates being charged. With the base rate so low I thought that personal loan interest rates would have also fallen, but this simply isn’t the case – quite the contrary in fact, with most of them having increased.”
Secured Loans – Finding A Suitable Secured Homeowner Loan
If you are a homeowner in the UK you may be eligible to take out a homeowner loan. Secured loans are loans that are secured against your property, which is why they are only available to homeowners. With secured homeowner loans you can enjoy increased borrowing power depending on the level of equity in your home, as well as longer repayment periods, which can help to keep your repayments to a minimum.
There are a number of lenders that offer secured homeowner loans, with many operating online, including high street banks and building societies. It is therefore a simple process to actually browse and compare homeowner loans in order to find one that suits your needs and your pocket. A number of factors will determine whether you are able to get a secured loan and also how much you can borrow. This includes your equity levels, your income, your financial and employment status, your credit rating, etc.
If you have poor credit you may still be eligible to take out a secured homeowner loan, as the secured nature of the loan means that the lender can afford to take a risk on those with bad credit. However, you may find that the interest rate that you pay is significantly higher than someone with good credit would pay. Again, it is important to compare different bad credit secured homeowner loans in order to find the best rate of interest for someone in your circumstances.
Before you commit to a secured loan you should give careful consideration to whether you can afford it, as there are pitfalls to consider. If you cannot keep up with repayments on your secured loan you could face losing your home, so do ensure that you are able to afford the repayments.
When looking for a suitable secured homeowner loan you should make sure that you compare the different loans on offer from a range of companies. The interest rates, terms and conditions, and repayment periods can vary from lender to lender, so you need to make sure that you take the time to compare what’s on offer before you make your decision. You can do this with ease and convenience using the Internet, where you can browse and compare from the comfort of your own home.
Alternatively, you may wish to use a broker in order to find the most suitable loan, and there are a number of good specialist brokers to choose from. This will save you the hassle of having to go through each lender’s website and make separate applications – instead you can just make one application, which the broker can then use to find you the most suitable and affordable loan for your needs. Again, you can use the Internet to find a suitable broker, and you will find that these brokers have access to a wide range of secured lenders that may be able to offer you a good deal on your secured homeowner loan.
Read More......It has been claimed recently that despite the fact that the base interest rate is at an all time low of 0.5 percent the rates being charged on many mortgage loans and general loans are continuing to increase, meaning that consumers are unable to benefit from the cut in base rate in many cases.
In fact, the report claims that loan and mortgage interest rates have been rising at record levels, with the average rate on a five year fixed rate mortgage increased by 0.63 percent to 5.56 percent in June.
The June increase is said to reflect the highest increase in fourteen years when records began. During the same month the rates on personal loans also increased, with the average rate on a £10,000 personal loan rising by 0.97 percent for the months, taking the average rate to 10.32 percent.
Again, this was said to the largest increase on record. This comes despite the fact that the base interest rate has been held steady at just 0.5 percent since April of this year, which is just a tenth of the level that it was at in October of last year, before a series of dramatic base rate cuts.
The government has been taking various measures that include ploughing huge sums of money into the economy and the financial sector in a bid to try and encourage financial institutions to lend and try and reduce borrowing costs for consumers. However, despite this action the rate of interest being charges on many loans seems to be going up.
However, one industry official said that rates had not fallen at all ‘but have risen further as lenders respond to increased demand by pushing rates up even more’.
