Understanding Various Types Of Non Property Based Loan Offers

If you are seeking a personal loan, you may not be aware that there is a variety of personal loans out on the market today. Each type of loan has its own pros and cons, all thought each type of loan has interest of course. All personal loans are installment loans, loans which have a set number of payments. Installment loans can be for terms as low as 1 month to as high as 30 years. Lets examine the various personal loan types and products on the market today, as well as common personal loan terms:

Fixed-rate loans

These personal loans will have the interest rated at fixed terms, meaning the interest will not lower or raise with the market. This can be for the entire term of the loan or for part of this term. This type of loan comes in handy if you expect that interest rates will rise. The interest rate offered will depend on your FICO score as well as a benchmark interest rate or index.

Variable-Rate or Adjustable Loans

These loans interest rates will fluctuate with the market. These loans are risky due to the fact that your interest rate could sky rocket, depending on the market. However you could also end up paying less interest in favorable market conditions. The maximum rate the lender can charge you is thankfully capped.

Payday Loans

These are personal loans for those who have terrible credit and basically cannot get a loan elsewhere. This is the last resort loan. They feature extremely high interest that often results in the borrower needing to roll the loan over, resulting in more debt. Some borrowers of payday loans become trapped in an ever increasing number of loan rollovers. Interest rates on these loans can be as high as 400 percent or higher.

Online Loans

There is a wide variety of personal loans that can be applied for online only. These loans offer the ease and convenience of being able to apply right in the comfort of your own home. You can find some deals with interest rates online, as well as being able to find non-prime lenders. Non-prime lenders are those who lend to sub-prime borrowers, or those with poor credit. One example of online lenders would be the various peer to peer lending platforms today.

Peer to Peer Loans

These loans are made between an investor and you. Once upon a time these loans were always through private investors, but today the various peer to peer platforms are flooded with banks making the loans. Today you would be hard pressed to find an actual “peer” making the loan. They make use of a variety of credit checking tools, some do not rely on just credit reporting agencies to make their loan decisions.

Secured Loans

These loans are backed or secured by some form of collateral. These loans tend to carry lower interest rates since the loans principle is backed up by your collateral. The risk is that if you default that you will lose your collateral. These loans are ideal if you are secure in your ability to repay the loan as agreed upon.

Unsecured or Signature Loans
These loans are not backed by collateral, rather they are backed solely by your signature and agreement to repay the debt. You need good credit to obtain these loans in most cases. These loans tend to have a higher interest rate due to the risk the lender is taking in lending to you without collateral.

Single Payment/Bridge/Interim Loans

These loans are paid back in one payment, with a lump sum of interest due on repayment. These loans are used for short term financing.

Uncovering The Most Common Myths With Credit Scores

Everyone knows they have a credit score, and how important that score is, yet there are so many myths out there that people continue to spread. Many people have misconceptions on credit scores and credit reports, so if you fall into this segment of the population do not worry, I am here to dispel several wide spread credit myths. The algorithms to calculate credit scores are vast and complex, but there are some basics to understand. It is better to fully understand the in’s and out’s of credit scoring and credit reports so that you can make more informed decisions based on fact and not myth or rumor. Below I will outline some of the more popular credit myths.

All credit score models are the same:

While it is true that most creditors will use the FICO scoring system, which is indeed based off of your credit report information there are other credit scoring models out there. One scoring system on the market ignores your credit report all together, the LexisNexis risk factor score, though it is often only payday lenders and store accounts that make use of this scoring model. The credit reporting agencies themselves have there own scoring system called the Vantage scoring system. There are several other scoring models out there as well, including in house metrics that individual lenders use.

You can pull your credit report and FICO score each year for free:
Party true. You can obtain a free credit report once a year from annualcreditreport.com but it will not list a credit score. You can use Quizzle for example to get an idea of what your FICO score is but it will not be exact, however it uses the same data that FICO uses to calculate your score and is often within 10 points or less of your actual score. Several credit cards will however provide you with your credit score for free.

Closing a credit card out or paying off a loan early erases its history from your credit report:
Many people believe once that loan is paid off or a credit card is closed that all of its history magically disappears from their credit reports. Nothing could be further from the truth, if you fall into this segment of the population that believes this I hate to break it to you but this information stays on your credit report for 7 years from the date of the last activity on the account. In some cases this information can remain on your credit report for as long as 10 years. If you have black marks on your credit card reporting my advice is to keep the account open and get your account up to date on payments.

Closing out credit cards will boost your credit score:
Many people feel that simply closing out one or more credit cards will provide a boost to their credit score. Nothing could be further from the truth, in fact it could actually do the opposite and lower your credit score. A huge part of your credit score is how many accounts you have, as well as your credit utilization ratio which is a metric of how much of your available credit you are using. When you close down one or more credit cards your debt stays the same but your credit pool shrinks which in turn increases your credit utilization ratio ratio and this is what lowers your credit score. Lenders view people with a high credit utilization as a risk. it is far better to leave the account open unless you are paying an annual fee, in which cases id advise finding a new credit card without an annual fee with the same credit limit, then closing out the card with the annual fee. I should mention annual fees are often negotiable if you call the credit card company.

Your credit score lowers when you pull your own credit report or check your credit score:
The only inquiries that lower your credit score are when creditors pull your credit report and only when you have applied for credit. The only other inquiry that lowers your credit score is when debt collection agencies pull your credit report. When you pull your own credit report this is called a soft inquiry and it only shows to you, creditors will have no idea that you pulled your own credit report. Soft inquiries will never affect your credit score. The damage done by a hard inquiry will fade away over the course of 6 to 12 months time.

What are the financial rules that you can bend a bit

For personal finance there is supposed rules to achieving financials success in life. Some of these rules are hard coded and need to be followed. But some rules are outdated and some rules are made to be bent or broken. Some established financial rules can actually ruin your finances depending on certain life situations. Here are a few personal finance rules that under certain circumstances, you should consider breaking.


Avoid Using Credit Cards:

Popular good finance advisers recommend to not use credit cards or only use them sparingly. Yet using credit cards responsibly can help build your credit rating, provide you with a safety net in the case of an emergency and make you eligible for rewards such as cash back or travel miles. The key to using plastic is to pay of the balance every month in full. By paying off the entire balance off as soon as you receive your statement you avoid any and all interest. When used correctly a credit card can be an interest free 30 day loan when you need money the most.

Tax Refunds And Exemptions:
When you receive a tax refund it is because the government has been holding onto your money for a year and earning interest on your money before handing it back to you. Tax refunds are not a source of “windfall” money, it is money you worked hard for. If you work a 40 hour work week you have worked a total of 2,080 hours, and every hour you work you are paying taxes. When you receive your paycheck the government withholds some money. You should consider adjusting your withholding to avoid having too large of a refund and to increase your take home pay. The key is to avoid too little withheld and end up owing the government money at the end of the year. You should talk to a tax accountant to find the best amount of withholding. While you will not get a fat tax refund you will have more money in your pocket all year long, money you can leverage towards earning you interest instead of letting uncle Sam make money on your dime.

You Have a lot of Money In order to Invest:

This is not true at all. Some of the richest people in the world started off poor or middle class. They saved money and invested money. Some of these people did it little by little. You can begin investing with as little as $50 dollars per month. Also just because you might not have a huge income does not mean you do not deserve the assistance of a financial planner, everyone can use a little help with financial planing.

Save 10% of Your Income
This rule is as old as the hills and quite outdated for many people. 10% may not be enough for whatever goal you are trying to achieve such as retirement savings. You should decide what amount of money you need and then work backwards from there. If you were to slow to start saving for example you might need to save more than 10% to get to your goal, for example someone who didn’t start to plan for retirement until they hit their late 30s will for sure need to save more than 10% of their income towards retirement. It all comes down to what you are saving for, what the deadline is and how much you can afford to save.

Most so called financial rules are in place for good reasons, but everyone is different, You need to examine your finances and life situation and just use rules as general guidelines rather then absolutes written as stone, as this article has shown.

Title Loan Restrictions Will Vary From State to State

Curious about car title loans? We are going to take a look at the pros and cons of these personal loans, and will use Ohio as our example state. Car title loans provide one of the fastest ways to receive cash loans, especially if you have other pressing financial commitment or a less than perfect credit scores. A car title loan or auto title loan allows you to borrow cash against the value of your vehicle. Based on the value of your vehicle, the lender determines the amount of money you can receive. Borrowers can expect anything from $200 to $10,000 or as much as $20,000 or more in certain cases. The documents required to execute the transaction, include; a clear car title, verified address and state issued ID. The duration of repayment on most car loans can to go up to 36 months or more. When undertaking such a transaction, the lender keeps the title of the vehicle as security, while you keep your vehicle. In case a payment default occurs, depending on the agreed terms, the lender can attach and sells the vehicle to recover the owed amount.

Ohio has instituted several rules aimed at curtailing predatory lending by lenders; the rules governing title loan lenders are constituted under the Ohio consumer laws and statutes. Chapter 537 of the laws stipulates that the lender must sign a written agreement before advancing any loan to the borrower. The laws in Buckeye state allows lenders to charge up to 30% interest on loans. When it comes to repossession, the law requires the lender to notify the borrower of his intention to repossess the vehicle. This allows the vehicle owner to remove any personal effects from the vehicle and possibly hand over the vehicle to the lender at a designated date and time. Borrowers are also given up to 10 days to take back their vehicle, if all the required commitments and payments are made. After repossession and before the lender sells the vehicle to recover the owed amount, he must notify the borrower 10 days in advance about the time, place and sale details of the vehicle.

Car title loans are underwritten a bit different that a personal loan, but the borrower is generally free to use the proceeds are spent is entirely up to the borrower. What the borrower needs to do is make the agreed monthly payments on time to avoid the consequences that come with dishonoring the agreement. Before signing any binding agreement, it is important for the borrower to read between the fine lines. Borrower should also inquire from the lender; information regarding vehicle repossessions and recovery costs. Under the law, car title loan lenders are obligated to keep customer information, including personal details confidential.

How Reducing Debts Is a Key Move in Reducing Stress

It is true that worrying about debt can weigh down on a person. For this reason, you will need to develop a way to curb your expenses, which will allow you to not only be better financially, but health-wise as well. The debt that most Americans face includes student loans, credit cards, mortgage loans, and car loans. Reducing those debts could feel like a never-ending battle uphill, but it is a battle that could be won. You will simply need to work hard, develop a plan of action, and follow through. Taking positive steps toward reducing your debt is a key move in reducing stress.

Debt and Stress

Stress from financial debt has led to serious medical conditions for millions of Americans. Some health issues that have been caused by stress from debt include: back pain, neck issues, head pain, and stomach problems. Stressing over mountains of debt has been the cause of ulcers, heart attacks, and severe depression with many Americans. In fact, Edward Driscoll of Braintree, Mass reported in USA Today that he suffered from ulcers, and his wife suffered from panic attacks, all because of the stress they felt over $10,000 worth of debt that they had accumulated.

The chronic worrying about debt has caused many health issues for Americans, which is why you will need to find ways to reduce your current debt; this could be the key move in reducing stress, as well.

Methods to Eliminate Debt and Stress

There are some methods that you could try out that will help you eliminate debt, and the stress that is caused by worrying about the overwhelming bills. The first option would be to target the bills that are the highest – in terms of interest rates and fees. You should pay them off first, because these high rates and fees being eliminated will free up money for other bills, or personal needs.

If you are unable to pay your bills off in full, the next option would be to make more than the minimum payment. Paying the minimum does not help you decrease the debt; instead, you are simply paying on the interest, but the balance is not actually decreasing. It is always best to keep a track of your monthly expenses, and make the necessary cuts. By keeping track of what you spend each month, you are likely to find something that you could live without.

Eliminating the debt in your life could help you reduce the stress that you have been encountering. There are some additional things to consider when trying to consolidate, do you need to take out a personal loan or home equity loan, what guidelines are in place, how long will you need to repay the money, etc. The fear of not knowing how you will pay this debt off could be life-threatening, which is why you want to do everything you can to get your debt under control. It is always best to start up an emergency-situation fund; this allows you to use the emergency funds that you have saved up, instead of using a credit card or applying for a loan. Live within your financial limits; going outside of those limits could have serious consequences, and stress is one!

Capital One Quick Silver Highlights List Of Top Credit Cards For January Of 2014

January 1, 2014 – Dateline Chicago, Illinois

Welcome to 2014, the editorial staff from bestcreditcards2014.co has been hard at work reviewing hundreds of credit cards over the past month in anticipation of the New Year. The start of 2014 brings optimism for consumers in the market for a new credit card as many of the top issuers have improved and enhanced some of the top card offers from last yearas they cultivate marketing offers geared towards attracting consumers in an improved economy. This is great news for current card holders and customers seeking new credit cards as the offers will likely include larger rewards, more cash back, longer periods of zero percent and new perks such as credit score monitoring.

The Quick Silver by Capital One was selected as the top overall credit card available in the market out of hundreds of credit cards. The card falls under the category of cash back/rewards cards one of the most sought after categories for consumers. What makes the card unique is that it offers 1.5% cash back on all purchases which is the highest percentage of all cash back credit cards. The Quick Silver Card also comes with a zero percent interest rate for purchases and balance transfers for the first 12 months, taking you into 2015. As an added incentive their is an opportunity to earn a $100 bonus if you accumulate over $500 in purchases during the first 90 days the card is use. Rounding out the top 5 credit cards identified as the top offers for January include: DiscoverIT (1% cash back, zero percent interest for 14 months), Bank America Travel Rewards (1.5 points for each $1 in spending), Slate from Chase (top choice for balance transfers), Capital One Venture Rewards (2 points for each $1 in spending on travel).

Consumers searching for the best card in 2014 should start by idenifying their spending habits and financial goals. With hundreds of cards to review and choose from finding the best card is really a unique proposition relative to your own goals. Whether you are searching for a balance transfer, travel rewards, student or zero percent credit card you will find dozens of credit card offers worth considering. The good news is that each category is reviewed and sorted at bestcreditcards2014.co making the process of finding the right card super easy.

Steven Moore

Guide To How Personal Loans, Cash Advance and Secured Loans Are Different

Personal Loans, Cash Advance and Secured Loans

Personal Loans

Personal loans are offered by financial institutions and are to be used for personal expenses. The amount for the loan varies from bank to bank, but most banks offer from the low hundreds, some payday loans are up 1000 and many unsecured lenders are now offering loans up to around $25,000. The amount of the loan one receives depends on credit history and background. Personal loans are unsecured, making it different from a mortgage or car loan. In the event of a loan default in a personal loan, the bank repossesses nothing. There is no collateral. The time frame for paying back a personal loan also varies on the agreements and terms of the loan. However, these can last from 12-36 months. Since personal loans have no collateral the interest rates tend to be much higher compared to other types of secured loans. However, a benefit of personal, unsecured loans is that most banks offer them at fixed rates, meaning they cannot change the interest rate during the loan agreement.

Credit Card Cash Advance

A cash advance is made when a credit card holder borrows against their credit limit to obtain cash. This is usually done through an ATM. There are many risks to doing this: there is an initial fee on the cash advance that varies from 3-9% (depending on one’s credit history, background and amount of debt one already has), then the debtor is charged a very high interest rate on the cash advance, which can reach nearly 30% APR. Interest accrues immediately on cash advances, unlike traditional credit card purchases that offer a grace period. Credit card companies will also use monthly payments to pay off lower interest payments, meaning it can be very hard to pay off cash advances on top of normal credit card payments. If one is not careful, a cash advance can end up costing hundreds of dollars more than the initial advance.

Secured Loans

Unlike personal loans, secured loans have an asset or collateral. These loans are often taken out for large purchases, most often cars, homes, or purchases of land. These loans come in either fixed or variable rate interest. Often the higher the purchase, the more likely a loan will be variable rate. Loans of this size also have a maximum threshold, meaning that a loan will only over up to 70-90% of the home price, meaning that one must pay a down payment up to 10-30% of the home price. Defaulting on these loans can entail a loss of car, home, land and much more.

When one is taking out a loan, all possible outcomes and possibilities should be weighed. cash advances
are to be used sparingly, if not at all. Financial planners often say to use this as a last resort; and secured loans are common for anyone planning on purchasing a car or home, which is very common in the United States. All loans carry a large burden and should be planned for accordingly. Making smart, educated choices and reading the fine print of all agreements can help one avoid defaults and even declaring bankruptcy. Know what is fixed rate interest and what is variable. Be sure to understand all risks when entering into a loan agreement too.