Loans For Every Occasion: Home Loans, Payday Loans, Student Loans And More...
Thursday, November 16, 2006
At some point in life, it is almost guaranteed that you will be
applying for a loan of some sort. Paying cash for products and
services is not only becoming obsolete, it's terribly
inconvenient. Today, credit is a way of life, and as more and
more people begin to shop online, plastic is the currency
accepted everywhere.
The most basic of loans is of course, the credit card.
Companies that issue credit cards make money every month that
you carry a balance, and they are betting on the fact that you
won't pay off the balance every month.
Some loans actually make good business sense. Why would anyone
want to shell out $300,000 for a new home when they could get a
Home Loan and pay $1,000.00 a month, and then deduct the
interest paid from their income taxes? That three hundred grand
could be put to work in other investments, and could conceivably
earn more for you than you are actually paying for the house!
And all that time, if you time it right, your house becomes
more and more valuable.
There are also times when for many people things just aren't
going well financially. An unexpected expense occurs and you
find yourself just coming up short on your living expenses.
Many types of loans exist for this type of situation, both
secured and unsecured.
Maybe you just need some quick cash to get through the
holidays, and intend to pay the loan off within the next few
pay periods. Companies offering short term Payday Loans abound
both on the Internet and off. Some with no credit check will
transfer up to $1,500 into your bank account within 24 hours.
Student loans, auto loans, small business loans, personal
loans, home loans, second mortgages, payday loans, government
loans, bad credit loans, loans to consolidate other loans -
there is a loan for just about any occasion out there.
The question is how much are you going to pay for your loan?
And the answer to that depends in most cases on your credit
history.
Your Credit History: Weather or not you get the loan, and how
much it will cost you.
It is never too early to start establishing credit, and the
best way to do this is with a credit card. If you are finding
it difficult to obtain a credit card because you have no
history, you can always buy your history by applying for a
secured credit card or line of credit. Put down $500 or $1,000
and borrow against it. Make sure the institution you are
applying to reports to the major credit bureaus, use the line
of credit and pay your bills on time, and voila - you have a
credit history! There is nothing wrong with carrying a balance
over, just pay the minimum or a bit more, and pay it on time!
Creditors like to think they will be making some money off of
you.
What Lenders are Looking For
While different institutions have different criteria, there are
some generalizations one can make about how they determine the
creditworthiness of an applicant. Make no mistake about it;
creditors are in the business of making money. If your credit
is less than perfect, it doesn't necessarily mean you won't get
the loan, but you will be paying more for it!
After receiving your application, a lender will then acquire a
credit report from one of the three major credit bureaus,
Equifax, Trans Union, or Experian. This is your credit history.
Taking into account such factors as your income, the balances in
your checking and savings accounts, the assets you own, the
length of time you have been at your current job and place of
residence, the amount you owe other creditors, and how promptly
you pay your bills, the potential lender will then make a
determination on if you will get the loan, and how much they
will charge you for it.
Frequent late payments, bankruptcy, repossessions, legal
judgment liens, or accounts being turned over to collection
agencies do not bode well for obtaining a loan. That being
said, most creditors realize that life happens, and such
legitimate circumstances like an unexpected illness, injury, or
the loss of your job do not necessarily reflect negatively on
your creditworthiness.
When Things Take a Turn for the Worse
If you are in the process of paying on a loan or loans and one
of these unforeseen circumstances befall you, talk to your loan
officer. Most loan institutions find it in their best interest
to work with the lendee, and will often make the necessary
arrangements to make it easier for you to make your payments.
Just remember, they want their money, and the last thing they
want is for you to default on your loan, or heaven forbid,
declare bankruptcy!
About The Author: Michael Talbert is an author that writes on a
variety of topics. Visit The Loan Station at
http://www.Loan-Station.net for more information.
posted by Dennis Cheesman @ 5:31 AM,
