Some Simple Yet Effective Tips on Getting a Loan

Due to bad credit, many customers have been rejected the loan. As the US economy is steadily recovering, investment in the housing market and other industries is increasing. The tendency to take a loan by individual consumers and also by small and medium businesses is also on the rising side.

The current scenario in the market is not as bad as it was in 2009, but it’s not too promising either. More so, small business owners can still secure a loan as they can hire a business strategist or look for options other than banks. But individuals may have to face difficulty getting a loan, especially if they have not-so-impressive credit.

Loan

The following tips could help them to get a loan.

Using Home Equity to get Low-interest Rate Loan

If there’s equity in your property and if you are making payments against the mortgage balance, the real value of your home will be more than market value. This could get you a loan that is tax-deductible and of low-interest rate.

Payday Loan and Cash Advances

Some people detest payday loan because it is short term. But they fail to notice one advantage that comes with a payday loan; payday loan is offered not only by banks but also by private storefront operations. However, this type of loan is banned in many states and charge an abnormally high-interest rate.

Cash advances carry interest rates that are less than payday loans. Another benefit of cash advances is that you can collect the money from ATM. But the interest will start to accrue as soon as the loan is obtained.

Both payday loan and cash advances are for short-term purposes. Don’t go for them if you need a loan for the long term.

Choose a Loan Based on Credit

If you have bad credit, getting a house loan could be immensely difficult, but getting car loan may not be that difficult. Besides, if you are unable to repay the loan, you can send the car to scrap yard and get money.

Similarly, if you are a student with solid academic credentials and have a poor credit rating, the wise thing for you would be to apply for a student loan as that is easy to obtain despite having bad credit.

Find a Co-Signer

A co-signer should be one, who knows you personally and have good credit. It is better than borrowing money from that person directly. Sometimes, people refuse to become co-signer because if the other party fails to repay the money, the creditor would ask him the make the full payment. So it totally depends on how you could pursue someone.

Make an Application to Credit Unions

First, you need to be a member of a credit union by depositing a token amount of money. Then you can apply for a loan. Credit unions are financial cooperatives, owned by members. The advantage of taking the loan from such organizations is flexible interest rate and better communication as those unions operate mostly from certain territories.

The tips mentioned above could help you get a loan, provided you know your expectation and abilities well. Other than the aforementioned tips, you can also try raising your credit score because a good credit score could increase your chances of getting a loan significantly.

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Why It Is Important to Know Your Credit Score?

In today’s busy world, where everything is available online- be it shopping, booking a movie, looking for property etc. The payment is easily made by just swiping your credit card. But there’s something which most of us neglect, to know your credit score.

So, what’s the big deal and how do things change by knowing the credit score? This is what you might be thinking. However, knowing your credit score can benefit you in various ways. Swiping your card is the easiest thing to do. But every time you swipe your card, your credit score changes. Every change in your credit score can significantly change your decisions. Before you know the benefits of a good credit score, you must know what credit score is and how is it calculated. Credit score What is a credit score and how is it calculated? A credit score is a statistical number that defines your creditworthiness. A credit score is the distilled version of your credit report. It is a 3 digit number which is calculated using complex formulas. The credit score ranges from: 300 to 850. A high score represents that the person is financially trustworthy. The factors involved in calculating the credit score are:
  • Your payment history
  • The length of your credit history
  • The number of accounts you have
  • The types of accounts you have
  • Your used credit vs your available credit
In short, your credit score not only shows how well you manage your debts but opens up to a wide range of benefits. So, let’s understand why it is important to know your credit score. 4 Reasons to know your credit score:

Your credit score gives the clear report of personal financial health

Do you know your credit score? You can get the clear report of your overall personal financial health just by analyzing your credit score. If your credit score is:
  • Low credit score implies: That you have more debts which you can’t comfortable handle. Also, it implies having too many credit cards at once.
  • High credit score implies: You have handled your debts well and you clear debts on time.
Every change in your credit score gives you the idea of your changing financial situation. So, it’s essential to do credit monitoring once every month to keep a check on your personal financial health. Check your credit score now to see know the status of your personal financial health. You can know your credit score online through multiple sources.

Your credit score helps you to protect yourself from frauds

You can check your financial situation by analyzing your credit history and credit report. Your credit score can show if you’re financially vulnerable from the way you handle your finances. Every late payment you make or having lots of credit, all this will be visible in your low credit score. If you’re among the people who never miss out any bill, do on-time payment, have zero debt and a small handful of credit cards then, your credit score will automatically be high. Additionally, the credit score helps you to protect yourself from frauds. How will you know if your credit card is being misused by someone else? In this tech-savvy era, anyone can easily misuse your credit card just by knowing your credit card number and other particulars. Credit card frauds both online and offline have become a common threat these days. So, it’s very important to be cautious when it comes to managing your credit card. Fraudsters can buy new credit cards on your name if they know your SSN. Because of such events, your credit score can take a slide down. So, it is very essential to know your credit score and monitor every small change that happens. If you feel there’s some change in your credit score which you feel suspicious then check with your credit card provider immediately.

Your credit score will fetch you a discount for life

Having a good credit score can easily get money from credits or bank at good interest rates. Not only that you can enjoy benefits such as a loan with low-interest rates, get approved for a mortgage loan, extra competitive for a new job or rental property etc.

Your credit score shows how you can mold your finances to a better shape

Your credit score can point out mistakes and act like a coach by showing a way for better financial management. Act according to the way your credit score recommends to mold your financial future to a better shape.

Summing up:

Hope you would have understood the importance of knowing your credit score. Start evaluating how you can avail of the benefits of your credit score. Also, if you feel your credit score is low then look for ways to improve it.]]>

Customers are Facing Problems of Hidden Charges Associated with Prepaid Debit Cards

As the average household debt is an all-time high in the US, consumers really need to think prudently before taking a loan and falling into the vicious spiral of debt. However, the bulwark to their prudence seems to be the offers made by debit card companies.

The prepaid debit cards come in handy in situations where money is required on an urgent basis. The advantage of such cards is that they can be refilled easily. No wonder the popularity of prepaid debit cards has consistently been high. Some even argued that prepaid debit cards are the best way to avoid debt. More so because a study done by Pew Charitable Trust showed debit card users have previously used conventional financial services.

Prepaid Debit Cards

Problem is, prepaid debit cards have other flip sides. One of them is hidden charges. A website called bankrate.com analyzed 30 different prepaid debit cards and found multiple fees to be associated with almost all of them. Such fees are monthly maintenance fees, card activation fees, and fees on ATM withdrawals and balance inquiries.

The difference between these fees is that some are small while others are big and burdensome. The trend seems to be keeping the fees low when a company is entering into the market; but as soon as it makes a brand name, it tends to increase the fees and to the anguish of customers, federal disclosure regulations don’t apply to prepaid cards. This allows companies to keep the real charges out of sight.

Cardholders, as a result, end up paying more, sometimes way more than what they are supposed to pay. When cardholders inform the companies about the hidden charges, the customer service department disconnects their call or put them on waiting for so long that they themselves end the call. Majority of customers don’t complain to the Consumer Financial Protection Bureau as they consider it trivial.

Regulatory authority needs to monitor the extra charges. When a prepaid debit cards customer receives a monthly statement by mail, a service fee is attached and more than 50% prepaid debit card companies charge up to $6 for each statement. Activation fee is another cliche that normally cost from $3 to $8.

Some consumers have become so pissed with the extra fees that they have thought of discontinuing the prepaid debit card and moving back to traditional methods. A person called Gail Fiorentino said, “You have to watch for the fees and you have to pay extra for them so sometimes you wonder if they’re worth it…”

There are plenty of other customers with the same question in mind. It’s best for debit card companies to regain their trust before customers discard using the cards and before the regulatory agencies take steps.

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