Many banks actively encourage their clients with low balances to overdraw their accounts. That means, if the customer writes a check or uses her debit card and has insufficient funds in the account, the bank clears the check by granting a temporary overdraft (a short-term loan), up to a specific limit. The customer is saved from the problems of bounced checks or interrupted shopping sprees.
Sounds like a good deal for the customers, right? That's what the banks say. They claim overdrafts are an added convenience to customers.
The truth is, they're often a very bad deal for the customers. Here's why.
When a bank grants a regular line of credit, the interest charged may be up to say, 20% or so. However, for overdrafts, banks don't charge interest -- they charge a flat fee on each transaction. This fee does not depend on the value of the transaction.
Let's see how that works. Overdraft plans fees may be as high as $35 per check. We'll assume a more conservative fee of $20 per check. If you have four checks totaling $200 that have insufficient funds against them and the bank automatically activates the overdraft and clears those checks, you will owe $80 in overdraft charges.
Unlike revolving lines of credit which you can repay at your convenience, an overdraft has to be settled in just a few days. Let's say the bank allows you to run the overdraft for 14 days.
A loan of $200 for 14 days incurring charges of $80 translates into an Annual Percentage Rate (APR) of 1043%!
A "convenience" for customers? Not at these rates.
What does this remind you of? It reminds me of payday loans and cash advances. Those are the other forms of lending which charge you such sky-high APRs. In fact, if you choose to repay a cash advance on due date and not roll it over, you'll likely be charged far less than what the banks charge you for an overdraft.
It gets even worse. Banks have software that ensures that your largest value checks and debits get processed first. There may be some logic to that. However, this arrangement also means that when there are insufficient funds in your account, instead of paying one overdraft charge on one large check, you pay several charges on several smaller checks!
Plus, most customers don't even realize that they are overdrawn until the bank notifies them about it.
Consumer advocates say that banks are perfectly aware that many people barely make it from payday to payday. These customers typically have very low balances. Rather than offer them a service that would be in their interests, banks extract high fees from them to cover bounced checks.
If you are caught short between paychecks, consider arranging funds from other sources rather than turn to overdraft protection. The best solution to the problem is to systematically build up cash balances so that you don't face such a situation in the first place.
Wednesday, September 2, 2009
Five Things To Check Out When You Apply For a Payday Loan
Are you thinking of going in for a payday loan to meet an unexpected expense? If so, look into these five things before you finalize one. This checklist can help you make smarter choices. You might even end up saving some serious cash!
First thing to consider -- do you really need that cash advance? Sure, you need cash right away, but have you looked at other options? The fact is, a payday loan is an extremely expensive source of funds, with Annual Percentage Rates (APRs) ranging from 300% to 1000%. So before you take one, see if you can arrange money by taking an advance from your employer or from your credit union.
You could also consider borrowing money from friends or family. Depending on your situation, credit card funding might be an option too, because it's usually cheaper than a payday loan.
Ask yourself how much you can really repay when the next payday rolls around. Work out an exact number you can commit to. Take a cash advance only for the amount you can repay, considering all charges as well. Obtain funds from other sources for any additional requirements you may have.
Here's why. If you choose to roll over all or part of the payday loan, you end up paying much more -- additional charges, late fees, etc. Your APRs start climbing rapidly and you may even find yourself trapped in a vicious cycle of payday loan debt. Stay clear of this trap.
Apply only for one payday loan at a time. Your application gets reported to a consumer tracking database used by payday lenders and banks. If you apply for multiple loans, the lenders may see the multiple applications and you might end up being rejected by all of them.
Go through the lender's approval criteria very carefully. Apply only to one where you can qualify. If you apply to a company that has stringent criteria and get rejected, that can actually hurt your chances of getting approved by another company with more relaxed criteria.
If you're applying online, ask yourself if the lender's website seems professional and well-organized. Do they have clear information and guidelines on the site? A comprehensive FAQ?
Most important -- do they have an SSL certificate on the application page? This indicates data is being transmitted securely. Secure pages have web addresses that begin with "https:" instead of "http:" and in addition, you'll see a lock symbol displayed in your browser. If a lender is using a non-secure page to collect information about you, find another lender!
Acting on the above points will help you make better choices about payday loans. The best solution is, of course, to get your personal finances into excellent shape so that you never need to borrow in an emergency.
First thing to consider -- do you really need that cash advance? Sure, you need cash right away, but have you looked at other options? The fact is, a payday loan is an extremely expensive source of funds, with Annual Percentage Rates (APRs) ranging from 300% to 1000%. So before you take one, see if you can arrange money by taking an advance from your employer or from your credit union.
You could also consider borrowing money from friends or family. Depending on your situation, credit card funding might be an option too, because it's usually cheaper than a payday loan.
Ask yourself how much you can really repay when the next payday rolls around. Work out an exact number you can commit to. Take a cash advance only for the amount you can repay, considering all charges as well. Obtain funds from other sources for any additional requirements you may have.
Here's why. If you choose to roll over all or part of the payday loan, you end up paying much more -- additional charges, late fees, etc. Your APRs start climbing rapidly and you may even find yourself trapped in a vicious cycle of payday loan debt. Stay clear of this trap.
Apply only for one payday loan at a time. Your application gets reported to a consumer tracking database used by payday lenders and banks. If you apply for multiple loans, the lenders may see the multiple applications and you might end up being rejected by all of them.
Go through the lender's approval criteria very carefully. Apply only to one where you can qualify. If you apply to a company that has stringent criteria and get rejected, that can actually hurt your chances of getting approved by another company with more relaxed criteria.
If you're applying online, ask yourself if the lender's website seems professional and well-organized. Do they have clear information and guidelines on the site? A comprehensive FAQ?
Most important -- do they have an SSL certificate on the application page? This indicates data is being transmitted securely. Secure pages have web addresses that begin with "https:" instead of "http:" and in addition, you'll see a lock symbol displayed in your browser. If a lender is using a non-secure page to collect information about you, find another lender!
Acting on the above points will help you make better choices about payday loans. The best solution is, of course, to get your personal finances into excellent shape so that you never need to borrow in an emergency.
Should You Ever Take a Payday Loan?
Payday loans have many names -- cash advances, signature loans and paycheck loans, etc. Payday lenders provide quick and easy short-term cash to those who need money immediately. That's the big reason why they're so popular.
However, payday loans come at exorbitant costs. This can -- and often does -- lead borrowers into a downward spiral of rapidly escalating debt. Let's look at the issue from various angles to get a complete picture.
First, the pluses. Here's why cash advances may hold enormous appeal for you.
You can have bad credit and still qualify for a payday loan. In most cases, no credit check is conducted.
The process is fast -- it takes as little as 20 minutes to complete. You can even find lenders who target approvals in 30 seconds!
There are no upfront costs -- so the buy-now-pay-later mentality can find full expression.
You can apply in person at a local outlet, over the phone or over the Internet.
You get funds deposited into your bank account in 24 hours.
Compared to some other sources for cash, payday loans are discreet -- no one else needs to know about it.
The transactions are secure -- your financial information remains private.
If you're faced with an emergency -- say, unexpected medical bills -- your only consideration might be to get money now. The speed and convenience of a cash advance comes in handy here.
So what are the disadvantages?
The most obvious one -- high costs. A payday loan can cost you say, $15 per two weeks. If you're borrowing only for two weeks, that doesn't sound like much. However, if you calculate the Annual Percentage Rate (APR), you'll see it comes to 391%!
If you don't think that's too much, let me ask you this question. If you invested money in the stock market, what would you consider a good annual rate of return? 20%? Maybe 30%? If you made a 20% return (on average) in stocks year after year, you'd be doing very well indeed. And this is for an investment that's generally considered high risk.
Now compare that with what the payday loan companies charge. You are providing them with a return on their money they likely won't get anywhere else on the planet!
There is another, less obvious reason why payday loans are dangerous. According to some estimates, over 60% of borrowers roll over a payday loan. Many take loans repeatedly, too.
Let's put in some numbers so that you can clearly see what rollovers imply.
Assume you borrow $400 for two weeks at a cost of $15 per $100 per two weeks. At the end of two weeks, you owe them a total of $460.
Let's say you don't repay the $400 at the end of two weeks. Instead, you request a rollover. So you pay them the lending fee of $60 and they agree to roll over the loan for another two weeks. The total cost of the loan at the end of 4 weeks may be as follows:
Original loan amount: $400Fresh lending fees payable: $60Late fees payable: $60 (assuming late fees apply at the same rate as lending fees)Lending fees already paid: $60Total: $580
At the end of this period (which is 4 weeks from the day you originally took the loan), you decide that you don't have $580 available and so request them to roll the loan over for another two weeks. Then this is what it can cost you in total at the end of 6 weeks:
Original loan amount: $400Fresh lending fees payable: $60Late fees payable: $60 Lending fees already paid: $120Late fees already paid: $60Total: $700
If you continue this process for six months (more specifically, for 24 weeks), this is what it may cost you in total:
Original loan amount: $400Fresh lending fees payable: $60Late fees payable: $60 Lending fees already paid: $660Late fees already paid: $600Total: $1780
For an original loan of $400, in a mere 6 months, the payday loan company will collect fees and charges of $1380 from you. That's 3.45 times the amount you borrowed. In APR terms that's 749.5%! If over 60% of borrowers roll over their loans, no wonder many payday loan companies are wildly profitable!
Snowballing costs can easily lead you into a debt trap if you get addicted to payday loans.
So what are the key points to keep in mind when dealing with payday loan companies? Two things:
First, avoid them if at all possible. The best way is, of course, to get your finances fully under control so that you always have cash and / or credit available to meet emergencies.
Second, if you do choose to borrow from payday loan companies, borrow only an amount you're 100% sure you can repay on the due date. If that amount is too low to meet your needs, get additional funding from other sources. Because rolling over cash advances is one of the worst things you can do to yourself.
However, payday loans come at exorbitant costs. This can -- and often does -- lead borrowers into a downward spiral of rapidly escalating debt. Let's look at the issue from various angles to get a complete picture.
First, the pluses. Here's why cash advances may hold enormous appeal for you.
You can have bad credit and still qualify for a payday loan. In most cases, no credit check is conducted.
The process is fast -- it takes as little as 20 minutes to complete. You can even find lenders who target approvals in 30 seconds!
There are no upfront costs -- so the buy-now-pay-later mentality can find full expression.
You can apply in person at a local outlet, over the phone or over the Internet.
You get funds deposited into your bank account in 24 hours.
Compared to some other sources for cash, payday loans are discreet -- no one else needs to know about it.
The transactions are secure -- your financial information remains private.
If you're faced with an emergency -- say, unexpected medical bills -- your only consideration might be to get money now. The speed and convenience of a cash advance comes in handy here.
So what are the disadvantages?
The most obvious one -- high costs. A payday loan can cost you say, $15 per two weeks. If you're borrowing only for two weeks, that doesn't sound like much. However, if you calculate the Annual Percentage Rate (APR), you'll see it comes to 391%!
If you don't think that's too much, let me ask you this question. If you invested money in the stock market, what would you consider a good annual rate of return? 20%? Maybe 30%? If you made a 20% return (on average) in stocks year after year, you'd be doing very well indeed. And this is for an investment that's generally considered high risk.
Now compare that with what the payday loan companies charge. You are providing them with a return on their money they likely won't get anywhere else on the planet!
There is another, less obvious reason why payday loans are dangerous. According to some estimates, over 60% of borrowers roll over a payday loan. Many take loans repeatedly, too.
Let's put in some numbers so that you can clearly see what rollovers imply.
Assume you borrow $400 for two weeks at a cost of $15 per $100 per two weeks. At the end of two weeks, you owe them a total of $460.
Let's say you don't repay the $400 at the end of two weeks. Instead, you request a rollover. So you pay them the lending fee of $60 and they agree to roll over the loan for another two weeks. The total cost of the loan at the end of 4 weeks may be as follows:
Original loan amount: $400Fresh lending fees payable: $60Late fees payable: $60 (assuming late fees apply at the same rate as lending fees)Lending fees already paid: $60Total: $580
At the end of this period (which is 4 weeks from the day you originally took the loan), you decide that you don't have $580 available and so request them to roll the loan over for another two weeks. Then this is what it can cost you in total at the end of 6 weeks:
Original loan amount: $400Fresh lending fees payable: $60Late fees payable: $60 Lending fees already paid: $120Late fees already paid: $60Total: $700
If you continue this process for six months (more specifically, for 24 weeks), this is what it may cost you in total:
Original loan amount: $400Fresh lending fees payable: $60Late fees payable: $60 Lending fees already paid: $660Late fees already paid: $600Total: $1780
For an original loan of $400, in a mere 6 months, the payday loan company will collect fees and charges of $1380 from you. That's 3.45 times the amount you borrowed. In APR terms that's 749.5%! If over 60% of borrowers roll over their loans, no wonder many payday loan companies are wildly profitable!
Snowballing costs can easily lead you into a debt trap if you get addicted to payday loans.
So what are the key points to keep in mind when dealing with payday loan companies? Two things:
First, avoid them if at all possible. The best way is, of course, to get your finances fully under control so that you always have cash and / or credit available to meet emergencies.
Second, if you do choose to borrow from payday loan companies, borrow only an amount you're 100% sure you can repay on the due date. If that amount is too low to meet your needs, get additional funding from other sources. Because rolling over cash advances is one of the worst things you can do to yourself.
Facts You Should Know About Types of Loans
When you set out to borrow, you often come across terms like unsecured loans, revolving loans, adjustable rate loans, etc. While these terms are more or less self-explanatory, it is still useful to be clear on their exact meanings and what they imply before you finalize a loan contract.
Unsecured versus secured loans
As the name implies, a secured loan is one where you offer some kind of collateral against the loan. The agreement is that if you default on the loan, the lender has the right (but not the obligation) to take possession of the asset you have pledged.
In most cases, this asset would be what the lender has financed. For example, when you take a home loan, you offer the home as collateral.
There may also be cases where you may need to offer additional collateral over and above the asset that is being financed. This happens, for example, when the lender is financing close to 100% of an asset that is prone to rapid reduction in market value. In such cases, the lender may insist on your putting up another asset so as to provide a reasonable margin of protection in case of default.
Unsecured loans are those where such collateral arrangements do not exist. These loans are granted based on your credit standing, ability to repay and other factors.
In cases where there's a choice available to the customer to take either a secured or an unsecured loan, the former may be offered at a somewhat lower rate. That is, assuming every other factor remains equal. This is because of the lower risk involved to the lender, who has recourse to a specific asset in case you default. However, this situation is comparatively rare in consumer financing, although it is more common in financing businesses.
Installment versus revolving loans
A revolving loan is one where you have access to a continuous source of credit, up to a pre-determined credit limit. If the limit is say, $10,000, you can borrow any amount up to $10,000. And typically, you can repay all or part of the amount you borrowed at a time of your choosing, within the overall tenor of the loan.
You pay interest only on the amount you borrow for the time you borrow it. Sometimes, banks may charge a commitment fee for making a revolving line of credit available to you. This fee is usually charged on the average unutilized amount of your limit.
You can also re-borrow the amount you have repaid. In effect, you have a loan that's always available to you on demand.
Unlike revolving loans, installment loans have a fixed repayment schedule. In most cases, the full amount of the loan is drawn down (i.e., borrowed) at once and both repayment schedule and amounts are fixed in advance. You do not have the option to re-borrow the amount that has been repaid.
Adjustable rate versus fixed rate loans
A fixed rate loan is one where the interest rate charged is fixed for the entire duration of the loan. The advantage is that you are immune to fluctuations in interest rates and can budget your cash outflows precisely. The disadvantage to you (the borrower) is that should interest rates fall, you lose in terms of opportunity costs. That is, you could have obtained a lower interest rate had you opted for an adjustable rate loan.
In practice, you can always choose to refinance the fixed rate loan at a lower rate if interest rates fall sharply enough to justify it. Bear in mind that your current lender may charge a pre-payment fee if you choose to repay before due date. So the difference in interest rates between your old fixed rate loan and the new loan should be large enough to justify a switch.
An adjustable rate loan is one where the interest charged fluctuates in line with a benchmark rate. This benchmark rate is usually the Prime Rate, which is what the US Treasury charges its prime (or best) borrowers. The advantage of an adjustable rate (or floating rate) loan is that what you are paying is more or less in line with the market. If interest rates decline, so do your costs and vice versa. The disadvantage is that your cash outflows for interest are unpredictable.
As a borrower, if you hold the view that interest rates are going to decline, it is best to opt for an adjustable rate loan. But arriving at the correct view consistently is easier said than done. Predicting interest rates is a game where even professional market participants and institutions frequently go wrong.
If it is important to you to be able to budget for your interest obligations in advance, a fixed rate loan may be the best choice. After all, you can refinance it should the interest rates fall significantly.
Keeping these basic facts in mind should help you make more informed borrowing decisions.
Unsecured versus secured loans
As the name implies, a secured loan is one where you offer some kind of collateral against the loan. The agreement is that if you default on the loan, the lender has the right (but not the obligation) to take possession of the asset you have pledged.
In most cases, this asset would be what the lender has financed. For example, when you take a home loan, you offer the home as collateral.
There may also be cases where you may need to offer additional collateral over and above the asset that is being financed. This happens, for example, when the lender is financing close to 100% of an asset that is prone to rapid reduction in market value. In such cases, the lender may insist on your putting up another asset so as to provide a reasonable margin of protection in case of default.
Unsecured loans are those where such collateral arrangements do not exist. These loans are granted based on your credit standing, ability to repay and other factors.
In cases where there's a choice available to the customer to take either a secured or an unsecured loan, the former may be offered at a somewhat lower rate. That is, assuming every other factor remains equal. This is because of the lower risk involved to the lender, who has recourse to a specific asset in case you default. However, this situation is comparatively rare in consumer financing, although it is more common in financing businesses.
Installment versus revolving loans
A revolving loan is one where you have access to a continuous source of credit, up to a pre-determined credit limit. If the limit is say, $10,000, you can borrow any amount up to $10,000. And typically, you can repay all or part of the amount you borrowed at a time of your choosing, within the overall tenor of the loan.
You pay interest only on the amount you borrow for the time you borrow it. Sometimes, banks may charge a commitment fee for making a revolving line of credit available to you. This fee is usually charged on the average unutilized amount of your limit.
You can also re-borrow the amount you have repaid. In effect, you have a loan that's always available to you on demand.
Unlike revolving loans, installment loans have a fixed repayment schedule. In most cases, the full amount of the loan is drawn down (i.e., borrowed) at once and both repayment schedule and amounts are fixed in advance. You do not have the option to re-borrow the amount that has been repaid.
Adjustable rate versus fixed rate loans
A fixed rate loan is one where the interest rate charged is fixed for the entire duration of the loan. The advantage is that you are immune to fluctuations in interest rates and can budget your cash outflows precisely. The disadvantage to you (the borrower) is that should interest rates fall, you lose in terms of opportunity costs. That is, you could have obtained a lower interest rate had you opted for an adjustable rate loan.
In practice, you can always choose to refinance the fixed rate loan at a lower rate if interest rates fall sharply enough to justify it. Bear in mind that your current lender may charge a pre-payment fee if you choose to repay before due date. So the difference in interest rates between your old fixed rate loan and the new loan should be large enough to justify a switch.
An adjustable rate loan is one where the interest charged fluctuates in line with a benchmark rate. This benchmark rate is usually the Prime Rate, which is what the US Treasury charges its prime (or best) borrowers. The advantage of an adjustable rate (or floating rate) loan is that what you are paying is more or less in line with the market. If interest rates decline, so do your costs and vice versa. The disadvantage is that your cash outflows for interest are unpredictable.
As a borrower, if you hold the view that interest rates are going to decline, it is best to opt for an adjustable rate loan. But arriving at the correct view consistently is easier said than done. Predicting interest rates is a game where even professional market participants and institutions frequently go wrong.
If it is important to you to be able to budget for your interest obligations in advance, a fixed rate loan may be the best choice. After all, you can refinance it should the interest rates fall significantly.
Keeping these basic facts in mind should help you make more informed borrowing decisions.
What You Should Know About Home Equity Loans
A home equity loan is essentially a type of second mortgage. You'll be borrowing money against the value of your home. This carries risk, but can be worth it in the end if you know what you're doing.
The most common type of home equity loan is a "closed end" home equity loan. This type of loan essentially allows you to borrow a certain amount of money against the value of your home. You cannot borrow more money on the same equity loan, so if you need more money later, you'll have to try and take out another loan.
Most people find that getting a home equity loan can go a long way toward helping them to get out of debt. Since you're borrowing money against your house, there is a greater chance that you'll end up with a lower interest rate than you're used to. This will probably result in a much lower monthly payment than most other loans.
One reason to get a home equity loan is if you are in a lot of debt and have several high interest payments to make each month. If you can get enough money in an equity loan to pay off your other debts, you'll be able to effectively consolidate all of your debt into one low monthly payment.
It is essential, however, that you make sure that you're able to meet your monthly payments after you get a home equity loan. After all, if you start missing payments, you might lose your house. Therefore, you should make a very careful assessment of your financial situation before you apply for the home equity loan. If you do not think that you'll be able to pay even the low monthly payments on this loan, then don't take the loan. If you're considering the laon for debt consolidation purposes, you might be better off looking at one of the many other debt consolidation options that are available to you.
The closed end home equity loan is not the only loan of its type. If you are looking for something that's a little more flexible, then you might want to go with a home equity line of credit instead.
A home equity line of credit works very similarly to a loan, and can definitely help you reduce your interest rates and monthly payments. The major difference, however, is that a line of credit will allow you to borrow more money against your house when needed - in some cases, up to 125% of your home's value.
While a home equity loan is better in most cases, the line of credit is a good idea if you're not sure how much money you need to borrow right away. With the line of credit, you can increase the amount of money you've borrowed against your house easily.
You will more than likely also want a home equity loan if you have a lot of credit card debt. While credit card interest rates are traditionally very high, home equity interest rates are fairly low. Since it's likely that you've ended up with several credit cards, you will probably have a lot of debt that you can easily consolidate with one home equity loan.
A home equity loan may be right for you if you need to consolidate debts quickly, and you're sure that you'll be able to pay off the home equity loan without missing any of your payments. If you are taking the loan for debt consolidation, be sure you have the discipline to use all of the loan for that exact purpose!
The most common type of home equity loan is a "closed end" home equity loan. This type of loan essentially allows you to borrow a certain amount of money against the value of your home. You cannot borrow more money on the same equity loan, so if you need more money later, you'll have to try and take out another loan.
Most people find that getting a home equity loan can go a long way toward helping them to get out of debt. Since you're borrowing money against your house, there is a greater chance that you'll end up with a lower interest rate than you're used to. This will probably result in a much lower monthly payment than most other loans.
One reason to get a home equity loan is if you are in a lot of debt and have several high interest payments to make each month. If you can get enough money in an equity loan to pay off your other debts, you'll be able to effectively consolidate all of your debt into one low monthly payment.
It is essential, however, that you make sure that you're able to meet your monthly payments after you get a home equity loan. After all, if you start missing payments, you might lose your house. Therefore, you should make a very careful assessment of your financial situation before you apply for the home equity loan. If you do not think that you'll be able to pay even the low monthly payments on this loan, then don't take the loan. If you're considering the laon for debt consolidation purposes, you might be better off looking at one of the many other debt consolidation options that are available to you.
The closed end home equity loan is not the only loan of its type. If you are looking for something that's a little more flexible, then you might want to go with a home equity line of credit instead.
A home equity line of credit works very similarly to a loan, and can definitely help you reduce your interest rates and monthly payments. The major difference, however, is that a line of credit will allow you to borrow more money against your house when needed - in some cases, up to 125% of your home's value.
While a home equity loan is better in most cases, the line of credit is a good idea if you're not sure how much money you need to borrow right away. With the line of credit, you can increase the amount of money you've borrowed against your house easily.
You will more than likely also want a home equity loan if you have a lot of credit card debt. While credit card interest rates are traditionally very high, home equity interest rates are fairly low. Since it's likely that you've ended up with several credit cards, you will probably have a lot of debt that you can easily consolidate with one home equity loan.
A home equity loan may be right for you if you need to consolidate debts quickly, and you're sure that you'll be able to pay off the home equity loan without missing any of your payments. If you are taking the loan for debt consolidation, be sure you have the discipline to use all of the loan for that exact purpose!
Saturday, August 1, 2009
A Renter in Debt? Take Out a Bad Credit Personal Loan
On average, homeowner households earn 95% more than renting households per year. With 26% of a rental households disposable income being spent on renting, in comparison to 15% of homeowners on their houses (not including maintenance), it is unsurprising that people who rent find it harder to manage and turn to bad credit personal loans for help.
It�s easy to fall into the rent trap. As monthly rents take over � of their income, debts for renters can easily pile up. It is very difficult to make any savings towards a deposit for a home and very easy to get bad credit if you skip payments on things like credit cards to try and make ends meet. Fortunately, renters with bad credit can still apply for a bad credit personal loan.
A bad credit personal loan is an unsecured loan. This means that unlike a home equity loan you do not have to pledge a valuable item such as a home or a car to guarantee repayment. If you rent this makes perfect sense as you do not have a home to pledge anyway!
A really useful thing to know is that a bad credit personal loan can be used for just about everything including:
� Buying Christmas presents
� Furnishing a rented home
� Paying off credit card bills
� A new car
Most companies that offer bad credit personal loans are not interested in what the money will be used for, they are merely interested in whether the person taking out the loan will be able to make the repayments or not. If you have bad credit then you will need to seek appropriate lenders who offer a personal loan for people with bad credit, but there are an abundance of specialist lenders available.
The main advantage to using such a loan is that unlike a credit card, the credit is non-revolving. This means that the interest rate and the term of the bad credit personal loan are fixed at the outset. The monthly repayments are always the same and this makes it far easier to allow for in a monthly budget.
As these loans are unsecured and for bad creditors, they do carry a higher interest rate than a home equity loan, but if you do not have a home then this narrows your choices substantially.
It�s easy to fall into the rent trap. As monthly rents take over � of their income, debts for renters can easily pile up. It is very difficult to make any savings towards a deposit for a home and very easy to get bad credit if you skip payments on things like credit cards to try and make ends meet. Fortunately, renters with bad credit can still apply for a bad credit personal loan.
A bad credit personal loan is an unsecured loan. This means that unlike a home equity loan you do not have to pledge a valuable item such as a home or a car to guarantee repayment. If you rent this makes perfect sense as you do not have a home to pledge anyway!
A really useful thing to know is that a bad credit personal loan can be used for just about everything including:
� Buying Christmas presents
� Furnishing a rented home
� Paying off credit card bills
� A new car
Most companies that offer bad credit personal loans are not interested in what the money will be used for, they are merely interested in whether the person taking out the loan will be able to make the repayments or not. If you have bad credit then you will need to seek appropriate lenders who offer a personal loan for people with bad credit, but there are an abundance of specialist lenders available.
The main advantage to using such a loan is that unlike a credit card, the credit is non-revolving. This means that the interest rate and the term of the bad credit personal loan are fixed at the outset. The monthly repayments are always the same and this makes it far easier to allow for in a monthly budget.
As these loans are unsecured and for bad creditors, they do carry a higher interest rate than a home equity loan, but if you do not have a home then this narrows your choices substantially.
How to Make Sure You Become a Profitable Trader
Regardless of your trading style; day trading, swing trading, or position trading there is a simple step by step plan you can use to improve your odds for success.
1. Start by paper trading until you can be consistently profitable on paper.
2. Regardless of how much money you have, start trading with a small amount of money and work up over time.
3. If you are a day trader, avoid the very small time-frames like 1 or 2 minute as you get a lot of signals which can lead to overtrading.
4. Make sure that all your entry criteria are met for the trade setup. Don't jump the gun until everything is in place.
5. If there are no clear signals in the market, then do nothing. Forcing trades alsmost always ends up with losses.
6. Always place your protective stop immediately after entering the trade!
7. In your studies you will be exposed to many techniques. You will improve your results by concentrating on only one or two strategies. Get real good and consistently profitable with them first.
8. Don't watch too many markets or stocks at one time. This leads to too much confusion and indecision about which trade to take.
9. Win, lose or draw don�t deviate from your strategies or change things.
1. Start by paper trading until you can be consistently profitable on paper.
2. Regardless of how much money you have, start trading with a small amount of money and work up over time.
3. If you are a day trader, avoid the very small time-frames like 1 or 2 minute as you get a lot of signals which can lead to overtrading.
4. Make sure that all your entry criteria are met for the trade setup. Don't jump the gun until everything is in place.
5. If there are no clear signals in the market, then do nothing. Forcing trades alsmost always ends up with losses.
6. Always place your protective stop immediately after entering the trade!
7. In your studies you will be exposed to many techniques. You will improve your results by concentrating on only one or two strategies. Get real good and consistently profitable with them first.
8. Don't watch too many markets or stocks at one time. This leads to too much confusion and indecision about which trade to take.
9. Win, lose or draw don�t deviate from your strategies or change things.
What is a Home Improvement Loan?
A UK Home Improvement Loan Can Give You The Home You Want.
Looking to increase the value of your property? A Home improvement Loan could be the easiest and cheapest way to make improvements to your home.
Are you planning an extension to your home, would you like to have double glazing, a new conservatory, patio, or a new heating system, or are you undertaking the general up keep of your home but finding it hard to pay for?
A home improvement loan may well provide your solution. The loan can be repaid over any term between 5 and 25 years, depending on your available income and the amount of equity in the property that is to provide the security for the loan. With competitive rates and a quick decision a home improvement loan could well be just what you need to enable you to finance your dream improvements.
A UK Home Improvement Loan is a low cost, low rate, cheap, low interest loan secured on your UK property. As the home owner, it frees you up to do whatever improvements you want on your property.
With a UK Home Improvement Loan you can borrow from �5,000 to �75,000 with low monthly repayments.
A UK Home Improvement Loan is great if you want to raise a large amount; are having problems getting an unsecured loan; or have a bad credit history � you may be able to get a UK Home Improvement Loan even when you have been turned down for an unsecured loan.
Get the home of your dreams without moving house with a UK Home Improvement Loan.
Moving property is expensive � solicitors, estate agents, stamp duty, new soft furnishings � the list seems to go on and on. And most of this is money down the drain. Why move home when you can get a UK Home Improvement Loan and save money?
With a low cost, low rate, cheap, low interest UK Home Improvement Loan, you can afford the extension, new kitchen or bathroom, conservatory, landscaped garden, redecoration you want right where you are, in your own home. You can add value to your property and save all those moving costs too.
A UK Home Improvement Loan can help you with:
A new kitchen or bathroom
An extension or loft conversion
A conservatory
Landscaping your garden
New furniture
You can even use it on non-house expenditure like a new car or repaying credit card or other debts.
Home Improvement Loan rates are variable, depending on status.
Your monthly repayments will depend on the amount borrowed and term.
You may freely reprint this article provided the author's biography remains intact:
Looking to increase the value of your property? A Home improvement Loan could be the easiest and cheapest way to make improvements to your home.
Are you planning an extension to your home, would you like to have double glazing, a new conservatory, patio, or a new heating system, or are you undertaking the general up keep of your home but finding it hard to pay for?
A home improvement loan may well provide your solution. The loan can be repaid over any term between 5 and 25 years, depending on your available income and the amount of equity in the property that is to provide the security for the loan. With competitive rates and a quick decision a home improvement loan could well be just what you need to enable you to finance your dream improvements.
A UK Home Improvement Loan is a low cost, low rate, cheap, low interest loan secured on your UK property. As the home owner, it frees you up to do whatever improvements you want on your property.
With a UK Home Improvement Loan you can borrow from �5,000 to �75,000 with low monthly repayments.
A UK Home Improvement Loan is great if you want to raise a large amount; are having problems getting an unsecured loan; or have a bad credit history � you may be able to get a UK Home Improvement Loan even when you have been turned down for an unsecured loan.
Get the home of your dreams without moving house with a UK Home Improvement Loan.
Moving property is expensive � solicitors, estate agents, stamp duty, new soft furnishings � the list seems to go on and on. And most of this is money down the drain. Why move home when you can get a UK Home Improvement Loan and save money?
With a low cost, low rate, cheap, low interest UK Home Improvement Loan, you can afford the extension, new kitchen or bathroom, conservatory, landscaped garden, redecoration you want right where you are, in your own home. You can add value to your property and save all those moving costs too.
A UK Home Improvement Loan can help you with:
A new kitchen or bathroom
An extension or loft conversion
A conservatory
Landscaping your garden
New furniture
You can even use it on non-house expenditure like a new car or repaying credit card or other debts.
Home Improvement Loan rates are variable, depending on status.
Your monthly repayments will depend on the amount borrowed and term.
You may freely reprint this article provided the author's biography remains intact:
What is a Bad Credit Personal Loan?
A UK Bad Credit Personal Loan is a loan designed for the many people with a bad credit rating. A bad credit rating can make your life a misery.
However created, your past record of CCJ�s (County Court Judgements), mortgage or other loan arrears can live on to deny you access to finance that other people regard as normal.
If you are a UK home owner with equity in your property, a UK Bad Credit Personal Loan can bring that normality back to your life. Secured on your home, a UK Bad Credit Personal Loan can give you the freedom, for example, to do the home improvements or buy the new car you really wanted.
With a UK Bad Credit Personal Loan you can borrow from 5,000 to 75,000 and up to 125% of your property value in some cases. . A UK Bad Credit Personal Loan is a low cost loan secured on your UK home. It frees up the spare capital (or equity) in your home for you to use on whatever you want.
A UK Bad Credit Personal Loan is ideal if you want to raise a large amount and have a poor credit history you may be able to get a UK Bad Credit Personal Loan even when you have been turned down for an unsecured loan. There are loan plans for applicants who have CCJ's and mortgage arrears, it doesn't matter how many months arrears you have or how many CCJ's you have registered against you, if you have the equity in your property the chances are that a loan plan can be tailored to suit your needs. Whether or not you've missed a few payments on your current credit payments, there are loan plans that will allow you to re-establish your credit rating. So if you've been turned down for credit elsewhere don't despair.
More detailed information
County Court Judgement (CCJ)
A county court judgement is a judgement for debt in the county court. If a judgement is settled in full within 30 days of the date of the judgement it will not appear in the credit register. A judgement may be set aside, varied and suspended on application to the court. Judgements are registered publicly with Registry Trust and held for six years. In the event of a payment after that date the judgement will appear in the register but will be shown as being satisfied. However a satisfied judgement will, in most cases, show on your credit history and will treated as adverse credit history. If you have experienced a county court judgement and it has had a negative affect on your credit history you may still be able to obtain a loan via specialist lenders.
Arrears
Arrears are mortgage payments that have not been made by the due date or are not to the correct amount in accordance with the mortgage deed agreed by the policy holder and the lender.
Borrowers with arrears in their credit history may find lenders are less willing to provide them with a loan. Fortunately some high street lenders will consider providing credit impaired borrowers with a loan.
A UK Bad Credit Personal Loan can help you with:
Home improvements such as a new kitchen or bathroom
That once-in-a-lifetime holiday
Your dream car or boat
Repaying credit card or other debts to reduce your monthly outgoings to a more manageable amount
A UK Bad Credit Personal Loan rates are variable, depending on status. Your monthly repayments will depend on the amount borrowed and term.
However created, your past record of CCJ�s (County Court Judgements), mortgage or other loan arrears can live on to deny you access to finance that other people regard as normal.
If you are a UK home owner with equity in your property, a UK Bad Credit Personal Loan can bring that normality back to your life. Secured on your home, a UK Bad Credit Personal Loan can give you the freedom, for example, to do the home improvements or buy the new car you really wanted.
With a UK Bad Credit Personal Loan you can borrow from 5,000 to 75,000 and up to 125% of your property value in some cases. . A UK Bad Credit Personal Loan is a low cost loan secured on your UK home. It frees up the spare capital (or equity) in your home for you to use on whatever you want.
A UK Bad Credit Personal Loan is ideal if you want to raise a large amount and have a poor credit history you may be able to get a UK Bad Credit Personal Loan even when you have been turned down for an unsecured loan. There are loan plans for applicants who have CCJ's and mortgage arrears, it doesn't matter how many months arrears you have or how many CCJ's you have registered against you, if you have the equity in your property the chances are that a loan plan can be tailored to suit your needs. Whether or not you've missed a few payments on your current credit payments, there are loan plans that will allow you to re-establish your credit rating. So if you've been turned down for credit elsewhere don't despair.
More detailed information
County Court Judgement (CCJ)
A county court judgement is a judgement for debt in the county court. If a judgement is settled in full within 30 days of the date of the judgement it will not appear in the credit register. A judgement may be set aside, varied and suspended on application to the court. Judgements are registered publicly with Registry Trust and held for six years. In the event of a payment after that date the judgement will appear in the register but will be shown as being satisfied. However a satisfied judgement will, in most cases, show on your credit history and will treated as adverse credit history. If you have experienced a county court judgement and it has had a negative affect on your credit history you may still be able to obtain a loan via specialist lenders.
Arrears
Arrears are mortgage payments that have not been made by the due date or are not to the correct amount in accordance with the mortgage deed agreed by the policy holder and the lender.
Borrowers with arrears in their credit history may find lenders are less willing to provide them with a loan. Fortunately some high street lenders will consider providing credit impaired borrowers with a loan.
A UK Bad Credit Personal Loan can help you with:
Home improvements such as a new kitchen or bathroom
That once-in-a-lifetime holiday
Your dream car or boat
Repaying credit card or other debts to reduce your monthly outgoings to a more manageable amount
A UK Bad Credit Personal Loan rates are variable, depending on status. Your monthly repayments will depend on the amount borrowed and term.
Secured Loans - UK Overview
Borrowing money has become more and more popular in the UK over recent years, and this is partly due to the fact that it has become far easier to borrow money. The rising popularity of consumer finance has also been aided by the wide variety of deals and the low interest rates available these days. Secured loans have become very popular with those that own property, and this type of finance deal offers affordability and excellent value for money. Secured loans are available from a wide pool of lenders, which means that consumers have plenty of choice when it comes to selecting and applying for secure loans.
The amount available to borrow with secured loans is dependant upon the amount of equity available in your property, which means the amount of the market value minus any loans or mortgage outstanding on it. There are many benefits available with secured loans, and you will find that this type of finance is one of the most cost effective options available. With secured loans you can look forward to far lower interest rates than most standard, unsecured loans, and this is because there is less of a risk to the lender since the loan is secured against an asset.
Secured loans also offer far high borrowing levels than unsecured loans, although the amount available to borrow will depend in your equity. However, you could find yourself eligible to borrow tens of thousands of pounds with secured loans, which could prove invaluable if you are looking to raise a large amount of finance for just about any purpose. The repayment period with secured loans is also far longer than with unsecured loans, which means that your monthly repayments will be far lower.
The other great thing about secured loans is that they are far more easily accessible to those with poor credit than a standard, unsecured loan. This is because the lender has to take less of a risk with secured loans, as they are secured against an asset, and the lender is therefore usually more willing to consider those with bad credit for this type of finance. Bad credit secured loans are available at really reasonable rates, which means that you can enjoy lower repayment terms even if your have a tarnished credit history.
One of the most common reasons for taking out secured loans is to consolidate other loans and credit. Many people pay out a fortune each month on a selection of high credit loans and cards. With secure loans you can wrap up all of that expensive credit in to one convenient loan, and you can then pay just one lot of interest and make just one repayment each month. You can use bad credit secured loans to wrap up your other more costly credit, and even to pay of some debts, and this can go some way toward improving and repairing your credit.
Secure loans are widely available online, and by browsing and booking via the Internet you can quickly ascertain which of these loans best suits you in terms of conditions and interest rates. It is always wise to compare the various deals available on secured loans in order to check that you are getting a competitive deal and rate.
Whatever you are looking to fund or purchase, secured loans make it more affordable and more achievable. If you are using a secure loan in order to consolidate your other loans and credit, you can look forward to far lower repayments each month as well as an overall reduction in the amount of interest you pay. Finding, comparing and applying for secured loans is simple when you harness the power of the Internet, and you can rally speed up the process as well as benefit from total convenience and ease. You are also more likely to find really competitive deals on secured loans when you look online, giving you an even better chance of getting great value on your borrowing.
If you find yourself in need of a fairly large sum of money and you have equity in your property, it makes sense to look into the range of secured loans available. With secured loans you don't have to worry about unmanageable repayments, because the lower interest rates and longer repayment periods on offer mean that your monthly repayments will be far lower than those of an unsecured loan. Most secured loans can be processed quite quickly these days, and when you apply online you can complete your secured loan application from the comfort of your own home.
With such great deals on offer when it comes to secured loans, this is by far the most cost effective option open to property owners. With many people sitting on large sums of money that is tied up in their property, paying extortionate fees on some unsecured loans makes little sense when you could enjoy far better rates with secured loans, which simply enable you to unlock the money that would otherwise be tied up in your property.
The amount available to borrow with secured loans is dependant upon the amount of equity available in your property, which means the amount of the market value minus any loans or mortgage outstanding on it. There are many benefits available with secured loans, and you will find that this type of finance is one of the most cost effective options available. With secured loans you can look forward to far lower interest rates than most standard, unsecured loans, and this is because there is less of a risk to the lender since the loan is secured against an asset.
Secured loans also offer far high borrowing levels than unsecured loans, although the amount available to borrow will depend in your equity. However, you could find yourself eligible to borrow tens of thousands of pounds with secured loans, which could prove invaluable if you are looking to raise a large amount of finance for just about any purpose. The repayment period with secured loans is also far longer than with unsecured loans, which means that your monthly repayments will be far lower.
The other great thing about secured loans is that they are far more easily accessible to those with poor credit than a standard, unsecured loan. This is because the lender has to take less of a risk with secured loans, as they are secured against an asset, and the lender is therefore usually more willing to consider those with bad credit for this type of finance. Bad credit secured loans are available at really reasonable rates, which means that you can enjoy lower repayment terms even if your have a tarnished credit history.
One of the most common reasons for taking out secured loans is to consolidate other loans and credit. Many people pay out a fortune each month on a selection of high credit loans and cards. With secure loans you can wrap up all of that expensive credit in to one convenient loan, and you can then pay just one lot of interest and make just one repayment each month. You can use bad credit secured loans to wrap up your other more costly credit, and even to pay of some debts, and this can go some way toward improving and repairing your credit.
Secure loans are widely available online, and by browsing and booking via the Internet you can quickly ascertain which of these loans best suits you in terms of conditions and interest rates. It is always wise to compare the various deals available on secured loans in order to check that you are getting a competitive deal and rate.
Whatever you are looking to fund or purchase, secured loans make it more affordable and more achievable. If you are using a secure loan in order to consolidate your other loans and credit, you can look forward to far lower repayments each month as well as an overall reduction in the amount of interest you pay. Finding, comparing and applying for secured loans is simple when you harness the power of the Internet, and you can rally speed up the process as well as benefit from total convenience and ease. You are also more likely to find really competitive deals on secured loans when you look online, giving you an even better chance of getting great value on your borrowing.
If you find yourself in need of a fairly large sum of money and you have equity in your property, it makes sense to look into the range of secured loans available. With secured loans you don't have to worry about unmanageable repayments, because the lower interest rates and longer repayment periods on offer mean that your monthly repayments will be far lower than those of an unsecured loan. Most secured loans can be processed quite quickly these days, and when you apply online you can complete your secured loan application from the comfort of your own home.
With such great deals on offer when it comes to secured loans, this is by far the most cost effective option open to property owners. With many people sitting on large sums of money that is tied up in their property, paying extortionate fees on some unsecured loans makes little sense when you could enjoy far better rates with secured loans, which simply enable you to unlock the money that would otherwise be tied up in your property.
Payday Loans � The Legal Loan Sharking Industry
Laws have been created to protect people against "Loan Shark" practices in which short-term loans are given out at excessive interest rates. There is an industry that has come of age the last couple of years that has circumvented these laws. Enter the Payday loan industry.
Payday loans is a some-what new multi-billion dollar industry in which people borrow money to tithe them over until their next payday. These loans also go by the names cash advance loans and paycheck loans. They prey on the lower class that find themselves short of money before a payday.
The one thing to consider when looking into a payday loan is the APR or Annual Percentage Rate that these loans carry. At first glance, you may think paying $240.00 for a loan of $200.00 for two weeks is ok. The A.P.R of this loan comes to a whopping 520%. That is the amount this loan would cost if played over a years time. Compare this with a high interest credit card of 29%. When you see it compared to these numbers, you can see they are not the bargain you first thought it was.
A representative from a payday loan company has agreed to be interviewed for this article on the condition his identity and that of his company be anonymous.
I asked him, how can they can justify such enormous interest charges. His reply was "Because we can. There are loopholes out there that allow us to do this. This is a high risk loan for most cases so we need to charge enough to cover bad loans and to make a profit."
When asked about if payday loans are ever a good idea, his response was "Sure. For example if you will be late on a credit card payment of $70.00 and will be charged a late fee of $30.00 then the APR of the payday loan justifies getting one. You will save points if you get a payday loan and not pay the higher interest rate of the late fee."
When you should get a payday loan:
There are times when payday loans are justified as discussed above. The primary example when your late fees are more expensive than the late fees paid to your creditors.
Another non-tangible justification is when you can avoid getting reported for a late payment. This can be far more expensive than any payday loan fee in that it could affect the cost you pay for future loans. This is especially true if it�s your mortgage or car payments.
Yet another reason to get a payday loan is that you determine that the cost is worth it to you personally. If you are headed for the long awaited vacation and could use a few extra bucks to enjoy and can afford the fees then you should look into this.
A final thought on when you should get a payday loan is if you need that cash and it�s free. That's right free. There are a many sites out there that charge ZERO interest to all first-time customers. One such site can be found at Low Cost Payday Loans.
What to look for when getting a payday loan:
The first thing to look for is the APR. Federal law has made it so that every lender must disclose the cost of any money borrow through a Truth in Lending Disclosure. This must break down the cost by APR (Annual Percentage Rate). This is the first thing to compare loans by.
Another thing to look for is the length of the term. If two companies charge the same rate for every hundred dollars borrowed but company A has a term of up to four weeks and company B has a term of two weeks, then go for Company A and take advantage of the extra four weeks. The APR of Company A is half of Company B. The reason this differs from the first item is that sometimes they base APR on a fixed amount of time (two-three weeks usually). When you read the fine print that the fee charge is fixed and may allow you to pay it back in a longer term such as four weeks.
Payday loans is a some-what new multi-billion dollar industry in which people borrow money to tithe them over until their next payday. These loans also go by the names cash advance loans and paycheck loans. They prey on the lower class that find themselves short of money before a payday.
The one thing to consider when looking into a payday loan is the APR or Annual Percentage Rate that these loans carry. At first glance, you may think paying $240.00 for a loan of $200.00 for two weeks is ok. The A.P.R of this loan comes to a whopping 520%. That is the amount this loan would cost if played over a years time. Compare this with a high interest credit card of 29%. When you see it compared to these numbers, you can see they are not the bargain you first thought it was.
A representative from a payday loan company has agreed to be interviewed for this article on the condition his identity and that of his company be anonymous.
I asked him, how can they can justify such enormous interest charges. His reply was "Because we can. There are loopholes out there that allow us to do this. This is a high risk loan for most cases so we need to charge enough to cover bad loans and to make a profit."
When asked about if payday loans are ever a good idea, his response was "Sure. For example if you will be late on a credit card payment of $70.00 and will be charged a late fee of $30.00 then the APR of the payday loan justifies getting one. You will save points if you get a payday loan and not pay the higher interest rate of the late fee."
When you should get a payday loan:
There are times when payday loans are justified as discussed above. The primary example when your late fees are more expensive than the late fees paid to your creditors.
Another non-tangible justification is when you can avoid getting reported for a late payment. This can be far more expensive than any payday loan fee in that it could affect the cost you pay for future loans. This is especially true if it�s your mortgage or car payments.
Yet another reason to get a payday loan is that you determine that the cost is worth it to you personally. If you are headed for the long awaited vacation and could use a few extra bucks to enjoy and can afford the fees then you should look into this.
A final thought on when you should get a payday loan is if you need that cash and it�s free. That's right free. There are a many sites out there that charge ZERO interest to all first-time customers. One such site can be found at Low Cost Payday Loans.
What to look for when getting a payday loan:
The first thing to look for is the APR. Federal law has made it so that every lender must disclose the cost of any money borrow through a Truth in Lending Disclosure. This must break down the cost by APR (Annual Percentage Rate). This is the first thing to compare loans by.
Another thing to look for is the length of the term. If two companies charge the same rate for every hundred dollars borrowed but company A has a term of up to four weeks and company B has a term of two weeks, then go for Company A and take advantage of the extra four weeks. The APR of Company A is half of Company B. The reason this differs from the first item is that sometimes they base APR on a fixed amount of time (two-three weeks usually). When you read the fine print that the fee charge is fixed and may allow you to pay it back in a longer term such as four weeks.
Second Mortgage Loans
A second mortgage is a loan that is secured by the equity in your home. When you obtain a second mortgage loan the lender will place a lien on your house. This lien will be recorded in 2nd position after your primary or 1st mortgage lender's lien, hence the term second mortgage.
A second mortgage is also sometimes referred to as a home equity loan. There is no difference between a home equity loan and a second mortgage. These are just two different terms for the same subject.
A second mortgage can either be a fixed-rate loan or an adjustable-rate credit line. Interest rates and loan program terms will vary from lender to lender so it is important to shop around and compare before committing to any one offer.
Loan proceeds from a second mortgage loan can be used for just about anything. Many consumers take out 2nd mortgage loans to consolidate debt, do home improvements or pay for their kids college education. Whatever you decide to do with your loan proceeds it is important to remember that if you default on your payment you can lose your home so you will want to make sure that you are taking the loan out for a worthwhile purpose.
Another plus of a second mortgage loan is that the interest you pay back on the loan may be tax deductible. Consult your tax advisor regarding your personal situation but in most cases the interest is 100% fully deductible as long as the combined loan to value of your 1st and 2nd mortgage do not exceed the value of your home.
A second mortgage is also sometimes referred to as a home equity loan. There is no difference between a home equity loan and a second mortgage. These are just two different terms for the same subject.
A second mortgage can either be a fixed-rate loan or an adjustable-rate credit line. Interest rates and loan program terms will vary from lender to lender so it is important to shop around and compare before committing to any one offer.
Loan proceeds from a second mortgage loan can be used for just about anything. Many consumers take out 2nd mortgage loans to consolidate debt, do home improvements or pay for their kids college education. Whatever you decide to do with your loan proceeds it is important to remember that if you default on your payment you can lose your home so you will want to make sure that you are taking the loan out for a worthwhile purpose.
Another plus of a second mortgage loan is that the interest you pay back on the loan may be tax deductible. Consult your tax advisor regarding your personal situation but in most cases the interest is 100% fully deductible as long as the combined loan to value of your 1st and 2nd mortgage do not exceed the value of your home.
Are Interest Rates Up, Up and Away?
Interest rates have been at their lowest levels in over 40 years. U.S. consumers have been able to purchase previously unaffordable homes, cars and other toys. Many have used cheap home equity loans to remodel, take vacations and pay off credit cards. Students have taken advantage of the rock-bottom student loan rates.
But, interest rates look to be headed up. Recently, Alan Greenspan and the Federal Reserve escalated the Fed funds rate from 1% to 1.25%. So, what does that mean to you and me?
The increase in rates is important if you have variable (not fixed) loans. For example, if you have adjustable rate mortgage or home equity lines of credit, the interest rates will probably go up (as well as the payments) in the next few months. Each time the Fed increases the Fed funds rate, it will roll down onto your adjustable rate loans and your payments will go up. The speed of increase and the amount of the increase will depend on what index your loan is based on � check with your lending institution for more information on that.
If you have high credit card debt, the situation may be even more bleak because credit card rates remained high while other rates have been incredibly low. The Fed increases are a good excuse for your credit card company to hike your rates even higher.
So, what can you do if you�re looking at rates and payments going up, up and away?
* Your payment increases may be fairly gradual. Depending on the economy, the Fed will continue to increase rates although they have signaled that the increases are likely to be very gradual. If the economic or political situation changes, they always have the ability to lower rates again. The Fed's rate-setting committee is scheduled to meet again Sept. 21, Nov. 10 and Dec. 14, and they may skip a rate increase at one of those meetings if inflation is subdued.
* Check with your student loan lenders to see about consolidating and locking in rates. Good news: interest rates on savings are also likely to increase! So, if you have CD�s coming due, check with different financial institutions before automatically rolling them over. If you have money stashed in savings accounts, the rates are probably starting to creep up. I highly recommend ING savings for the highest rates around (www.ingdirect.com). They also give great service, have no fees or hidden costs and are FDIC insured. You can also name your accounts at ING to make it easy to identify what you�re saving for.
* If you�ve been thinking about re-financing, there are still some good deals out there and there�s no sense in procrastinating any longer. Contact me for some excellent resources for re-financing.
* What if a new house isn�t in your plans for a couple of years? When rates go up, it often cools off real estate prices and balances out the higher rates. Continue to save money in the highest interest short-term accounts you can find (no stocks or other long-term investments). Rates will probably not take huge leaps in the short term.
* If you have an adjustable rate (home or home equity or car loans), you will see higher payments so call your lender to find out what the new payment is �likely� to be. They�ll probably put all kinds of disclaimers out about not really knowing, but try to get a worst case scenario and then start pretending you really do have that new payment. Put the extra into a special savings account so you�ll have a �slush� fund to cover if you run short one month. At the same time you are building up a cushion for the future, you�ll have a good idea of whether or not you can handle the new payment. If not, now�s the time to start looking at other alternatives like cutting back, increasing income or even refinancing.
Remember, if you refinance your existing term to a new 30 year term, you�ll have lower payments, but you�ll pay a lot more for your house because of the additional interest.
* Call your credit card companies and see if they are willing to lower your rates (not all are). Look for good, permanent credit card interest rates that you can transfer higher rate balances to. For example, if most of your cards are 18% or higher, find a good 12% card or lower and transfer as much as you can to that. Playing the 0% credit card shuffle is a dangerous game and can hurt your credit score.
* Reduce credit card debt now! Stop using your cards and pay more than the minimums. If you pay off one card, take that payment and put it on another card. If you receive a pay increase, put it on the cards. The sooner the cards are paid off, the more flexibility you�ll have!
All in all, we�re quite likely to enjoy reasonable interest rates for some time to come. However, make preparations now and you�ll be able to handle whatever comes your way.
If you need help, I�m the one to call -- 541-387-2995!
But, interest rates look to be headed up. Recently, Alan Greenspan and the Federal Reserve escalated the Fed funds rate from 1% to 1.25%. So, what does that mean to you and me?
The increase in rates is important if you have variable (not fixed) loans. For example, if you have adjustable rate mortgage or home equity lines of credit, the interest rates will probably go up (as well as the payments) in the next few months. Each time the Fed increases the Fed funds rate, it will roll down onto your adjustable rate loans and your payments will go up. The speed of increase and the amount of the increase will depend on what index your loan is based on � check with your lending institution for more information on that.
If you have high credit card debt, the situation may be even more bleak because credit card rates remained high while other rates have been incredibly low. The Fed increases are a good excuse for your credit card company to hike your rates even higher.
So, what can you do if you�re looking at rates and payments going up, up and away?
* Your payment increases may be fairly gradual. Depending on the economy, the Fed will continue to increase rates although they have signaled that the increases are likely to be very gradual. If the economic or political situation changes, they always have the ability to lower rates again. The Fed's rate-setting committee is scheduled to meet again Sept. 21, Nov. 10 and Dec. 14, and they may skip a rate increase at one of those meetings if inflation is subdued.
* Check with your student loan lenders to see about consolidating and locking in rates. Good news: interest rates on savings are also likely to increase! So, if you have CD�s coming due, check with different financial institutions before automatically rolling them over. If you have money stashed in savings accounts, the rates are probably starting to creep up. I highly recommend ING savings for the highest rates around (www.ingdirect.com). They also give great service, have no fees or hidden costs and are FDIC insured. You can also name your accounts at ING to make it easy to identify what you�re saving for.
* If you�ve been thinking about re-financing, there are still some good deals out there and there�s no sense in procrastinating any longer. Contact me for some excellent resources for re-financing.
* What if a new house isn�t in your plans for a couple of years? When rates go up, it often cools off real estate prices and balances out the higher rates. Continue to save money in the highest interest short-term accounts you can find (no stocks or other long-term investments). Rates will probably not take huge leaps in the short term.
* If you have an adjustable rate (home or home equity or car loans), you will see higher payments so call your lender to find out what the new payment is �likely� to be. They�ll probably put all kinds of disclaimers out about not really knowing, but try to get a worst case scenario and then start pretending you really do have that new payment. Put the extra into a special savings account so you�ll have a �slush� fund to cover if you run short one month. At the same time you are building up a cushion for the future, you�ll have a good idea of whether or not you can handle the new payment. If not, now�s the time to start looking at other alternatives like cutting back, increasing income or even refinancing.
Remember, if you refinance your existing term to a new 30 year term, you�ll have lower payments, but you�ll pay a lot more for your house because of the additional interest.
* Call your credit card companies and see if they are willing to lower your rates (not all are). Look for good, permanent credit card interest rates that you can transfer higher rate balances to. For example, if most of your cards are 18% or higher, find a good 12% card or lower and transfer as much as you can to that. Playing the 0% credit card shuffle is a dangerous game and can hurt your credit score.
* Reduce credit card debt now! Stop using your cards and pay more than the minimums. If you pay off one card, take that payment and put it on another card. If you receive a pay increase, put it on the cards. The sooner the cards are paid off, the more flexibility you�ll have!
All in all, we�re quite likely to enjoy reasonable interest rates for some time to come. However, make preparations now and you�ll be able to handle whatever comes your way.
If you need help, I�m the one to call -- 541-387-2995!
What Is A Second Mortgage?
A second mortgage is a loan that is secured by the equity in your home. When you obtain a second mortgage loan the lender will place a lien on your house. This lien will be recorded in 2nd position after your primary or 1st mortgage lender's lien, hence the term second mortgage.
A second mortgage is also sometimes referred to as a home equity loan. There is no difference between a home equity loan and a second mortgage. These are just two different terms for the same subject.
A second mortgage can either be a fixed-rate loan or an adjustable-rate credit line. Interest rates and loan program terms will vary from lender to lender so it is important to shop around and compare before committing to any one offer.
Loan proceeds from a second mortgage loan can be used for just about anything. Many consumers take out 2nd mortgage loans to consolidate debt, do home improvements or pay for their kids college education. Whatever you decide to do with your loan proceeds it is important to remember that if you default on your payment you can lose your home so you will want to make sure that you are taking the loan out for a worthwhile purpose.
Another plus of a second mortgage loan is that the interest you pay back on the loan may be tax deductible. Consult your tax advisor regarding your personal situation but in most cases the interest is 100% fully deductible as long as the combined loan to value of your 1st and 2nd mortgage do not exceed the value of your home.
A second mortgage is also sometimes referred to as a home equity loan. There is no difference between a home equity loan and a second mortgage. These are just two different terms for the same subject.
A second mortgage can either be a fixed-rate loan or an adjustable-rate credit line. Interest rates and loan program terms will vary from lender to lender so it is important to shop around and compare before committing to any one offer.
Loan proceeds from a second mortgage loan can be used for just about anything. Many consumers take out 2nd mortgage loans to consolidate debt, do home improvements or pay for their kids college education. Whatever you decide to do with your loan proceeds it is important to remember that if you default on your payment you can lose your home so you will want to make sure that you are taking the loan out for a worthwhile purpose.
Another plus of a second mortgage loan is that the interest you pay back on the loan may be tax deductible. Consult your tax advisor regarding your personal situation but in most cases the interest is 100% fully deductible as long as the combined loan to value of your 1st and 2nd mortgage do not exceed the value of your home.
125% Equity Home Loans
If you are a homeowner in need of a home equity loan but you have not yet built up any equity in your home, don't despair. A 125 percent equity home loan may be the answer.
A 125 percent equity home loan is a second mortgage loan that allows you to borrow up to 25% more than the value of your home. For example, if your home is worth $100,000 and you owe $100,000 on the mortgage, this loan program would allow you to still borrow up to $25,000.
The 125 percent equity home loan is offered by various online lenders. Each lender has their own qualification and loan term guidelines but generally this is a credit score driven loan program. Credit score driven means that you have to have a certain credit score to qualify for the loan. In addition, your credit score usually determines the maximum loan amount you may qualify for and the maximum cash in hand you may receive. Also, some 125 percent equity home loan lenders may require seasoning on the length of time you have lived in your home. Three months is normally the minimum.
When it comes to a property appraisal, most 125 percent home equity loan lenders do not require you to obtain one. They generally will use the purchase price of your home as the value if you have lived in your residence for 12 months or less. If you have lived in your home over 12 months, a recent tax assessment, simple drive-by appraisal, or automated value model (avm) can be used. An avm is a computer generated assessment of your home's value which is based on recent home sales of comparable houses in your neighborhood.
A 125 percent equity home loan is a second mortgage loan that allows you to borrow up to 25% more than the value of your home. For example, if your home is worth $100,000 and you owe $100,000 on the mortgage, this loan program would allow you to still borrow up to $25,000.
The 125 percent equity home loan is offered by various online lenders. Each lender has their own qualification and loan term guidelines but generally this is a credit score driven loan program. Credit score driven means that you have to have a certain credit score to qualify for the loan. In addition, your credit score usually determines the maximum loan amount you may qualify for and the maximum cash in hand you may receive. Also, some 125 percent equity home loan lenders may require seasoning on the length of time you have lived in your home. Three months is normally the minimum.
When it comes to a property appraisal, most 125 percent home equity loan lenders do not require you to obtain one. They generally will use the purchase price of your home as the value if you have lived in your residence for 12 months or less. If you have lived in your home over 12 months, a recent tax assessment, simple drive-by appraisal, or automated value model (avm) can be used. An avm is a computer generated assessment of your home's value which is based on recent home sales of comparable houses in your neighborhood.
No Income Verification Home Equity Loan
A no income verification home equity loan is a second mortgage loan that does not require you to provide income documentation to qualify for the loan. This type of loan is great for homeowners who need a home equity loan but have hard to document income.
The majority of borrowers with hard to document income are either self-employed or commission based employees. Consumers who fall under these categories may have high income but have a lot of business related deductions that they write off on their taxes. This is good on the one hand as it reduces the taxable income and thus the amount of taxes owed, however, when it comes to getting a home loan it can hurt as most lenders use the average of your last 2 years taxable net income (the amount left after all of your deductions) to determine your income figure for qualifying purposes. This may cause you to have a debt to income ratio problem if you have a high debt load and thus keep you from qualifying for the loan. With a no income verification home equity loan, however, your gross income can be used for qualifying purposes as opposed to the net income.
In order to qualify for a no income verification home equity loan you will, in most cases, need good credit and a high credit score. Expect to pay a higher rate for this type of loan as opposed to a traditional loan in which you have to document your income. Also, even though a no income verification loan does not require you to document your income, some lenders may require that you have a certain dollar value of assets on hand which must be verified. Not all lenders have this requirement though - some lenders offer a program called NINA which stands for "no income no assets" meaning you do not have to document either. Loan guidelines and rates vary from lender to lender so it is a good idea to shop around to increase your chances of getting the best deal available to you.
The majority of borrowers with hard to document income are either self-employed or commission based employees. Consumers who fall under these categories may have high income but have a lot of business related deductions that they write off on their taxes. This is good on the one hand as it reduces the taxable income and thus the amount of taxes owed, however, when it comes to getting a home loan it can hurt as most lenders use the average of your last 2 years taxable net income (the amount left after all of your deductions) to determine your income figure for qualifying purposes. This may cause you to have a debt to income ratio problem if you have a high debt load and thus keep you from qualifying for the loan. With a no income verification home equity loan, however, your gross income can be used for qualifying purposes as opposed to the net income.
In order to qualify for a no income verification home equity loan you will, in most cases, need good credit and a high credit score. Expect to pay a higher rate for this type of loan as opposed to a traditional loan in which you have to document your income. Also, even though a no income verification loan does not require you to document your income, some lenders may require that you have a certain dollar value of assets on hand which must be verified. Not all lenders have this requirement though - some lenders offer a program called NINA which stands for "no income no assets" meaning you do not have to document either. Loan guidelines and rates vary from lender to lender so it is a good idea to shop around to increase your chances of getting the best deal available to you.
Friday, July 17, 2009
Business Acquisition Financing
Services we provide:
Analysis of the purchase price. We determine if the purchase price can be supported based upon the cash flow of the acquired entity.
We do an in depth analysis to determine whether the purchase price is within the standards of the industry.
Financing to purchase the company. We do this by leveraging the existing assets of the company to the maximum amount based upon cash flows available, keeping your cash requirements to a minimum.
We can also provide the equity necessary should there be a cash shortfall between the financing and the cash you are putting into the transaction.
Please contact us today for a free evaluation of your financing needs from one of our finance specialists.
Analysis of the purchase price. We determine if the purchase price can be supported based upon the cash flow of the acquired entity.
We do an in depth analysis to determine whether the purchase price is within the standards of the industry.
Financing to purchase the company. We do this by leveraging the existing assets of the company to the maximum amount based upon cash flows available, keeping your cash requirements to a minimum.
We can also provide the equity necessary should there be a cash shortfall between the financing and the cash you are putting into the transaction.
Please contact us today for a free evaluation of your financing needs from one of our finance specialists.
Commercial Bridge Loans
Many times a company is approved for a loan through its bank, or financial institution, but the loan doesn’t close for 4-6 months. During that time we can provide a short-term bridge loan, which will be paid back when the senior loan closes, so your short-term financial needs can be met.
We can also provide other types of short-term collateralized loans and can usually close in 10 days or less.
We can also provide other types of short-term collateralized loans and can usually close in 10 days or less.
Debt Restructuring
Growing companies enter into loan agreements to pay for equipment needed to expand their businesses. Loans have different maturities and in most cases, the companies have built in equity in the equipment. We will pay off all your lenders and refinance all your equipment into one loan.
This can result in reduced payments of 30% or more, so your cash flow and bottom line are greatly improved.
Example of a recent transaction:
A manufacturing company had combined monthly payments of $28,000 per month and showed a modest $10,000 a year in profits. We were able to refinance all their loans and reduce their monthly payments to $16,000 per month. Their bottom line was increased by a whopping $144,000 per year!
Contact us today to see if we can do the same for your company.
This can result in reduced payments of 30% or more, so your cash flow and bottom line are greatly improved.
Example of a recent transaction:
A manufacturing company had combined monthly payments of $28,000 per month and showed a modest $10,000 a year in profits. We were able to refinance all their loans and reduce their monthly payments to $16,000 per month. Their bottom line was increased by a whopping $144,000 per year!
Contact us today to see if we can do the same for your company.
Medical Working Capital Loans
Loans ranging from $15,000 to $250,000
Very Competitive Rates
Up to 84 months to Repay
Credit Approval in 48 Hours from Application Submission
Funding Within 5 Days of Receipt of Signed Documents
Programs for Medical Professionals with Damaged Credit
Types of Medical Professionals We Can Finance:
Board Certified Internists
Dermatologists
Maxillofacialists
OB/GYN’s
Orthopedic Surgeons
Pediatricians
Plastic Surgeons
Cardiovascular Surgeons
General Surgeons
Neurosurgeons
Ophthalmologists
Oral Surgeons
Periodontists
"Ologists" of all types, as well as Dentists, Family Practitioners, General Practitioners, MD’s, Osteopaths, Psychiatrists, Veterinarians.
The proceeds of these loans can be used for almost any purpose.
Personal Needs
Debt Consolidation
Practice Expansion
Just About Anything.
Please contact us today and we will forward you an application or, if you prefer, one of our qualified professionals will contact you with all of the details.
Very Competitive Rates
Up to 84 months to Repay
Credit Approval in 48 Hours from Application Submission
Funding Within 5 Days of Receipt of Signed Documents
Programs for Medical Professionals with Damaged Credit
Types of Medical Professionals We Can Finance:
Board Certified Internists
Dermatologists
Maxillofacialists
OB/GYN’s
Orthopedic Surgeons
Pediatricians
Plastic Surgeons
Cardiovascular Surgeons
General Surgeons
Neurosurgeons
Ophthalmologists
Oral Surgeons
Periodontists
"Ologists" of all types, as well as Dentists, Family Practitioners, General Practitioners, MD’s, Osteopaths, Psychiatrists, Veterinarians.
The proceeds of these loans can be used for almost any purpose.
Personal Needs
Debt Consolidation
Practice Expansion
Just About Anything.
Please contact us today and we will forward you an application or, if you prefer, one of our qualified professionals will contact you with all of the details.
Church Financing
We can finance pews, air-conditioning and heating systems, organs, sound and video equipment, pianos, computers, or just about any type of equipment your church needs.
We offer low rates and up to 60 months to repay.
Our Church Equipment Finance Programs
We offer 3 specific programs so that every church nationwide can qualify to get financing for any equipment their growing church needs. Below is a list and a brief description of each program and what a church would need to qualify for that specific program.
Established Church Program
Church must be established for 7 years or more if the church is part of a major denomination. 15 years or more if the church is non-denominational.
Church must maintain a minimum average bank balance of $7,000 or more. Combined accounts will qualify, example: checking + savings.
Church must be listed with directory assistance.
Newer Church Program
Church must be established for 2-5 years or more.
Church must maintain a minimum average bank balance of $2,500 or more. Combined accounts will qualify, example: checking + savings.
Church must be listed with directory assistance.
Start-Up Church Program
Any church that has been established less than 2 years.
Church must maintain a minimum average bank balance of $2,500 or more. Combined accounts will qualify example: checking + savings.
Church must be listed with directory assistance.
We offer low rates and up to 60 months to repay.
Our Church Equipment Finance Programs
We offer 3 specific programs so that every church nationwide can qualify to get financing for any equipment their growing church needs. Below is a list and a brief description of each program and what a church would need to qualify for that specific program.
Established Church Program
Church must be established for 7 years or more if the church is part of a major denomination. 15 years or more if the church is non-denominational.
Church must maintain a minimum average bank balance of $7,000 or more. Combined accounts will qualify, example: checking + savings.
Church must be listed with directory assistance.
Newer Church Program
Church must be established for 2-5 years or more.
Church must maintain a minimum average bank balance of $2,500 or more. Combined accounts will qualify, example: checking + savings.
Church must be listed with directory assistance.
Start-Up Church Program
Any church that has been established less than 2 years.
Church must maintain a minimum average bank balance of $2,500 or more. Combined accounts will qualify example: checking + savings.
Church must be listed with directory assistance.
Construction Equipment Financing
Working Capital Loans
Need working capital? With an equipment equity loan from Blue Sky Business Capital you can:
put cash in your company's pockets
take on more jobs
acquire new equipment or expand your business
Our equity loans are not based on the profitability of your company but the value of your equipment. Even if your personal credit is badly damaged we can get you the cash you need - Now! Call us today!
Accounts receivable financing
Are you waiting 60, 90 or 120 day to get paid for your work? We can lend you money for working capital or any other reason the same day you bill and we get paid back when you get paid. Call for details.
Here is a partial list of the equipment we can finance:
• Above Ground Fuel Tanks
• Street Sweeper
• Backhoe
• Mechanic’s Truck
• Bulldozer
• Roofing Truck
• Chipper
• Stump Cutter
• Concrete Mixer
• Flat Bed Truck
• Cranes
• Garbage Truck
• Dump Truck
• Tow Truck
• Excavator
• Tractor-Farming
• Trailers
• Sewer & Septic
Need working capital? With an equipment equity loan from Blue Sky Business Capital you can:
put cash in your company's pockets
take on more jobs
acquire new equipment or expand your business
Our equity loans are not based on the profitability of your company but the value of your equipment. Even if your personal credit is badly damaged we can get you the cash you need - Now! Call us today!
Accounts receivable financing
Are you waiting 60, 90 or 120 day to get paid for your work? We can lend you money for working capital or any other reason the same day you bill and we get paid back when you get paid. Call for details.
Here is a partial list of the equipment we can finance:
• Above Ground Fuel Tanks
• Street Sweeper
• Backhoe
• Mechanic’s Truck
• Bulldozer
• Roofing Truck
• Chipper
• Stump Cutter
• Concrete Mixer
• Flat Bed Truck
• Cranes
• Garbage Truck
• Dump Truck
• Tow Truck
• Excavator
• Tractor-Farming
• Trailers
• Sewer & Septic
Accounts Receivable Financing
Blue Sky Business Capital is a premier national lender providing financing to small and medium sized businesses nationwide.
Unlock the Cash Tied Up in Your Receivables.
Accounts receivable financing, or Factoring, is the purchase of accounts receivable invoices at a discount. If you sell your products or services to businesses that pay in 30, 60, 90 days or more, Blue Sky Business Capital has a liquidity solution for you. We can finance companies that are start-ups, losing money, or in bankruptcy because accounts receivable financing is based on your customer’s credit, not yours. This is not a “debt.” You are selling an asset. But it is more than just an asset sale; it is like outsourcing your accounts receivable department. Factors provide valuable services. They check your customers credit for you and notify you of bad risks and they provide detailed monthly statements. Qualifying accounts even get free credit insurance.
Cash in 24 Hours
No Personal Guarantees
We Finance Any Type of Business
No Recourse Even if the Account Does Not Pay
Credit Insurance on Your Clients At No Cost To You
No Arbitrary Loan Board Decisions, No Fixed Payments
As Sales and Receivables Increase, Funding Increases
Focus On Your Business, Not Collections
Use The Money To . . .
Fund Payroll or Other Operating Expenses
Purchase Inventory to Take Advantage of Bulk/Early Payment Discounts
Fund Expansion and Growth
Respond to Seasonal Demands and Opportunities
Take on That Large New Account with Confidence
This Will Be Great For Your Business
Contact us today and one of our financial specialists will give you a no-cost analysis of what we can provide for your company.
Unlock the Cash Tied Up in Your Receivables.
Accounts receivable financing, or Factoring, is the purchase of accounts receivable invoices at a discount. If you sell your products or services to businesses that pay in 30, 60, 90 days or more, Blue Sky Business Capital has a liquidity solution for you. We can finance companies that are start-ups, losing money, or in bankruptcy because accounts receivable financing is based on your customer’s credit, not yours. This is not a “debt.” You are selling an asset. But it is more than just an asset sale; it is like outsourcing your accounts receivable department. Factors provide valuable services. They check your customers credit for you and notify you of bad risks and they provide detailed monthly statements. Qualifying accounts even get free credit insurance.
Cash in 24 Hours
No Personal Guarantees
We Finance Any Type of Business
No Recourse Even if the Account Does Not Pay
Credit Insurance on Your Clients At No Cost To You
No Arbitrary Loan Board Decisions, No Fixed Payments
As Sales and Receivables Increase, Funding Increases
Focus On Your Business, Not Collections
Use The Money To . . .
Fund Payroll or Other Operating Expenses
Purchase Inventory to Take Advantage of Bulk/Early Payment Discounts
Fund Expansion and Growth
Respond to Seasonal Demands and Opportunities
Take on That Large New Account with Confidence
This Will Be Great For Your Business
Contact us today and one of our financial specialists will give you a no-cost analysis of what we can provide for your company.
Equipment Leasing
Types of Leases We Offer
Application only to $250,000. No financial statements necessary.
Middle market financing up to $500,000
Large ticket over $500,000
Approvals for application only in 24 hours. Middle market and large ticket usually take 3-5 days. Up to 84 months to repay with excellent rates. These programs are for companies established for two years or more.
Sale & Lease Back
Many companies need working capital for expansion and do not want to use their bank lines for working capital. We have a program where we can use the equity in your existing equipment to give your company the working capital it needs. We buy your equipment and lease it back to you and when all the payments are made you own the equipment again.
Startup Program
Most financial institutions will not finance companies that are just going into business. If your company has just started in business, or is in business for a short time usually less than two years, we can help you grow by financing the equipment you need to be successful.
B, C and D Credits
In these tough economic times many businesses have suffered financially. Additionally, the owners of these companies have seriously damaged their personal credit. We have developed a “second chance” program to help these companies. We can structure your financial needs to help you rebuild your company.
Government and Municipal Leasing
We can provide lease financing to any government or municipal entity with guaranteed approval. The rate is determined by the rating of the municipality or government agency. A partial list of who we finance is listed below:
Federal Government Agencies
Armed Services
State Agencies
Public Schools
Police Department
Fire Houses
Libraries
The above list is only an example of what we can finance. We can finance any state or federally controlled entity.
Please contact us so one of our finance specialists can discuss your specific needs and how we can arrange the financing your company requires.
Why Lease?
Leasing is the right choice!Leasing is one of the fastest growing ways of acquiring equipment in business today. Recent surveys found that 80% of U.S. businesses, from Fortune 500 to the local family business, lease some portion of their equipment. A growing business often faces the dilemma of limited cash flow and the need to add equipment. Leasing can put the equipment to work for you with real cash flow advantages and without major capital investment. We can lease virtually any type of equipment, including software and installation.
Low monthly paymentsThe monthly lease payment will usually be lower than the payment required by other methods of financing.
No need to tie up capitalKeep your business’ cash for future needs, unexpected expenses or working capital when revenues are low.
You can always lease equipment – you can’t lease money!Most types of financing require down payments of up to 25%, whereas leasing covers 100% of the cost of the equipment. Most leases require only one or two payments in advance. Get immediate use of the equipment with minimal up-front cost.
Preserve existing lines of creditLeasing has no impact on your bank credit lines. Protect your borrowing power for other business needs or opportunities.
Eliminate obsolescenceTechnology is changing at a rapid fire pace. What meets your business’ needs today may be obsolete three years from now. Leasing allows you the flexibility to maintain a competitive edge by giving you today’s best technology then allowing you to upgrade when the equipment has outlived its advantage.
Fixed payments through the term of the leaseUnlike bank lines of credit that usually have variable rates, lease payments are fixed no matter what happens in the market. By choosing to lease you won’t be a victim of skyrocketing interest rates. Remember the 80’s when rates rose from 9% to over 20% in one year? That can’t happen with leasing.
Significant tax and accounting advantagesLeasing eliminates the need for complicated depreciation schedules since lease payments are generally line item expenses on your P&L statement. And since lease payments can usually be treated as a pre-tax business expense you may even reduce your taxes. Paying cash for equipment automatically adds 30-40% to the cost when you realize that cash = profits and taxes are paid on profits. Leasing is the right choice! It minimizes demands on cash flow, eliminates obsolescence, keeps your bank lines open, saves on taxes and shelters you from the market
Application only to $250,000. No financial statements necessary.
Middle market financing up to $500,000
Large ticket over $500,000
Approvals for application only in 24 hours. Middle market and large ticket usually take 3-5 days. Up to 84 months to repay with excellent rates. These programs are for companies established for two years or more.
Sale & Lease Back
Many companies need working capital for expansion and do not want to use their bank lines for working capital. We have a program where we can use the equity in your existing equipment to give your company the working capital it needs. We buy your equipment and lease it back to you and when all the payments are made you own the equipment again.
Startup Program
Most financial institutions will not finance companies that are just going into business. If your company has just started in business, or is in business for a short time usually less than two years, we can help you grow by financing the equipment you need to be successful.
B, C and D Credits
In these tough economic times many businesses have suffered financially. Additionally, the owners of these companies have seriously damaged their personal credit. We have developed a “second chance” program to help these companies. We can structure your financial needs to help you rebuild your company.
Government and Municipal Leasing
We can provide lease financing to any government or municipal entity with guaranteed approval. The rate is determined by the rating of the municipality or government agency. A partial list of who we finance is listed below:
Federal Government Agencies
Armed Services
State Agencies
Public Schools
Police Department
Fire Houses
Libraries
The above list is only an example of what we can finance. We can finance any state or federally controlled entity.
Please contact us so one of our finance specialists can discuss your specific needs and how we can arrange the financing your company requires.
Why Lease?
Leasing is the right choice!Leasing is one of the fastest growing ways of acquiring equipment in business today. Recent surveys found that 80% of U.S. businesses, from Fortune 500 to the local family business, lease some portion of their equipment. A growing business often faces the dilemma of limited cash flow and the need to add equipment. Leasing can put the equipment to work for you with real cash flow advantages and without major capital investment. We can lease virtually any type of equipment, including software and installation.
Low monthly paymentsThe monthly lease payment will usually be lower than the payment required by other methods of financing.
No need to tie up capitalKeep your business’ cash for future needs, unexpected expenses or working capital when revenues are low.
You can always lease equipment – you can’t lease money!Most types of financing require down payments of up to 25%, whereas leasing covers 100% of the cost of the equipment. Most leases require only one or two payments in advance. Get immediate use of the equipment with minimal up-front cost.
Preserve existing lines of creditLeasing has no impact on your bank credit lines. Protect your borrowing power for other business needs or opportunities.
Eliminate obsolescenceTechnology is changing at a rapid fire pace. What meets your business’ needs today may be obsolete three years from now. Leasing allows you the flexibility to maintain a competitive edge by giving you today’s best technology then allowing you to upgrade when the equipment has outlived its advantage.
Fixed payments through the term of the leaseUnlike bank lines of credit that usually have variable rates, lease payments are fixed no matter what happens in the market. By choosing to lease you won’t be a victim of skyrocketing interest rates. Remember the 80’s when rates rose from 9% to over 20% in one year? That can’t happen with leasing.
Significant tax and accounting advantagesLeasing eliminates the need for complicated depreciation schedules since lease payments are generally line item expenses on your P&L statement. And since lease payments can usually be treated as a pre-tax business expense you may even reduce your taxes. Paying cash for equipment automatically adds 30-40% to the cost when you realize that cash = profits and taxes are paid on profits. Leasing is the right choice! It minimizes demands on cash flow, eliminates obsolescence, keeps your bank lines open, saves on taxes and shelters you from the market
SBA Loan Program
Blue Sky Business Capital is a nationally recognized company helping entrepreneurs achieve their business goals. We have been designated as a Preferred Financial services company by SBA lenders to have loans processed more quickly and efficiently than many others.
There are a number of advantages to an SBA loan, including longer terms, no points and no balloon payments.
Who is Eligible for an SBA Loan?
Most for-profit small businesses are eligible for an SBA guaranteed loan. This includes manufacturers, wholesale, retail and service businesses as well as independent or franchise businesses.
Loan Qualifications
Retail and service businesses with sales (3-year average) not exceeding $6 million to $20 million, depending on the industry
Wholesale businesses with employees up to 100 regardless of sales volume
Manufacturers with employees up to 500 depending on the industry, regardless of sales volume
SBA 7(A) Loan Size $150,000 to $2.0 million
Loan Fees
Loan packaging fee: $750 to $2,000
Fee is based on loan size, it is collected at the time of loan submission; refunded if declined by credit
SBA guaranty fee: 1.70% to 2.60% of the loan amount
Fee can be financed in the loan
Use of Proceeds
Commercial real estate (purchases, construction, or refinance)
Leasehold improvements
Business expansions
Machinery, equipment, furniture or fixtures
Business acquisition
Working capital (offered in conjunction with some of the above)
Start-ups (ALL Franchises, Motels, Restaurants Gas Stations and C-Stores)
Other Credits Considerations
Business must have adequate historic cash flow to cover the proposed debt
Business debt to net worth must meet industry averages
Borrowers must be actively involved in the day-to-day operation of the business
Satisfactory personal credit histories are required for all principles and guarantors
No past bankruptcies or felony arrests
Contact us today about our SBA Loan Programs and other services.
There are a number of advantages to an SBA loan, including longer terms, no points and no balloon payments.
Who is Eligible for an SBA Loan?
Most for-profit small businesses are eligible for an SBA guaranteed loan. This includes manufacturers, wholesale, retail and service businesses as well as independent or franchise businesses.
Loan Qualifications
Retail and service businesses with sales (3-year average) not exceeding $6 million to $20 million, depending on the industry
Wholesale businesses with employees up to 100 regardless of sales volume
Manufacturers with employees up to 500 depending on the industry, regardless of sales volume
SBA 7(A) Loan Size $150,000 to $2.0 million
Loan Fees
Loan packaging fee: $750 to $2,000
Fee is based on loan size, it is collected at the time of loan submission; refunded if declined by credit
SBA guaranty fee: 1.70% to 2.60% of the loan amount
Fee can be financed in the loan
Use of Proceeds
Commercial real estate (purchases, construction, or refinance)
Leasehold improvements
Business expansions
Machinery, equipment, furniture or fixtures
Business acquisition
Working capital (offered in conjunction with some of the above)
Start-ups (ALL Franchises, Motels, Restaurants Gas Stations and C-Stores)
Other Credits Considerations
Business must have adequate historic cash flow to cover the proposed debt
Business debt to net worth must meet industry averages
Borrowers must be actively involved in the day-to-day operation of the business
Satisfactory personal credit histories are required for all principles and guarantors
No past bankruptcies or felony arrests
Contact us today about our SBA Loan Programs and other services.
SBA Loan Program
Blue Sky Business Capital is a nationally recognized company helping entrepreneurs achieve their business goals. We have been designated as a Preferred Financial services company by SBA lenders to have loans processed more quickly and efficiently than many others.
There are a number of advantages to an SBA loan, including longer terms, no points and no balloon payments.
Who is Eligible for an SBA Loan?
Most for-profit small businesses are eligible for an SBA guaranteed loan. This includes manufacturers, wholesale, retail and service businesses as well as independent or franchise businesses.
Loan Qualifications
Retail and service businesses with sales (3-year average) not exceeding $6 million to $20 million, depending on the industry
Wholesale businesses with employees up to 100 regardless of sales volume
Manufacturers with employees up to 500 depending on the industry, regardless of sales volume
SBA 7(A) Loan Size $150,000 to $2.0 million
Loan Fees
Loan packaging fee: $750 to $2,000
Fee is based on loan size, it is collected at the time of loan submission; refunded if declined by credit
SBA guaranty fee: 1.70% to 2.60% of the loan amount
Fee can be financed in the loan
Use of Proceeds
Commercial real estate (purchases, construction, or refinance)
Leasehold improvements
Business expansions
Machinery, equipment, furniture or fixtures
Business acquisition
Working capital (offered in conjunction with some of the above)
Start-ups (ALL Franchises, Motels, Restaurants Gas Stations and C-Stores)
Other Credits Considerations
Business must have adequate historic cash flow to cover the proposed debt
Business debt to net worth must meet industry averages
Borrowers must be actively involved in the day-to-day operation of the business
Satisfactory personal credit histories are required for all principles and guarantors
No past bankruptcies or felony arrests
Contact us today about our SBA Loan Programs and other services.
There are a number of advantages to an SBA loan, including longer terms, no points and no balloon payments.
Who is Eligible for an SBA Loan?
Most for-profit small businesses are eligible for an SBA guaranteed loan. This includes manufacturers, wholesale, retail and service businesses as well as independent or franchise businesses.
Loan Qualifications
Retail and service businesses with sales (3-year average) not exceeding $6 million to $20 million, depending on the industry
Wholesale businesses with employees up to 100 regardless of sales volume
Manufacturers with employees up to 500 depending on the industry, regardless of sales volume
SBA 7(A) Loan Size $150,000 to $2.0 million
Loan Fees
Loan packaging fee: $750 to $2,000
Fee is based on loan size, it is collected at the time of loan submission; refunded if declined by credit
SBA guaranty fee: 1.70% to 2.60% of the loan amount
Fee can be financed in the loan
Use of Proceeds
Commercial real estate (purchases, construction, or refinance)
Leasehold improvements
Business expansions
Machinery, equipment, furniture or fixtures
Business acquisition
Working capital (offered in conjunction with some of the above)
Start-ups (ALL Franchises, Motels, Restaurants Gas Stations and C-Stores)
Other Credits Considerations
Business must have adequate historic cash flow to cover the proposed debt
Business debt to net worth must meet industry averages
Borrowers must be actively involved in the day-to-day operation of the business
Satisfactory personal credit histories are required for all principles and guarantors
No past bankruptcies or felony arrests
Contact us today about our SBA Loan Programs and other services.
PERSONAL LOANS
Get $10,000 to $250,000 at historically low rates
A Personal Loan is a great borrowing decision for many people. To get started, please click PRE-QUALIFY NOW and provide the requested information. From there we will guide you through the entire loan process.
PRODUCT FEATURES: • No collateral required• Minimal documentation• No annual fee in most decision process
SUGGESTED LOAN USES: • Home improvements • Debt consolidation • Dream vacations • instances • Cash available for any use• Funds can be deposited into your account • No pre-payment penalty in most instances
SERVICE FEATURES: • All situations considered• Available in all 50 states• No more shopping around • Complete privacy & security• Expert guidance reduces mistakes• Simple to understand Wedding & special events • Unexpected bills• Anything you desire! TERMS: RATES: • Loan: 6 to 84 months• Line of Credit: Revolving • As low as 6.99% fixed or variable APR
A Personal Loan is a great borrowing decision for many people. To get started, please click PRE-QUALIFY NOW and provide the requested information. From there we will guide you through the entire loan process.
PRODUCT FEATURES: • No collateral required• Minimal documentation• No annual fee in most decision process
SUGGESTED LOAN USES: • Home improvements • Debt consolidation • Dream vacations • instances • Cash available for any use• Funds can be deposited into your account • No pre-payment penalty in most instances
SERVICE FEATURES: • All situations considered• Available in all 50 states• No more shopping around • Complete privacy & security• Expert guidance reduces mistakes• Simple to understand Wedding & special events • Unexpected bills• Anything you desire! TERMS: RATES: • Loan: 6 to 84 months• Line of Credit: Revolving • As low as 6.99% fixed or variable APR
Start-Up Business Loans
Loan Product Information
Loan amounts from $500 - $30,000
Loan terms up to 60 months
Installment and balloon types offered
Money in your hands (or loans disbursed) in10 business days upon receipt of your completed application and all supporting documents
Interest Rates and Fees
Competitive fixed annual interest rates from 8% -15%
Closing costs of 3%-5% will be financed into the loan amount (includes application and servicing fees)
Start-up Loan Qualifications
Must be 18 years of age or older
Must be the business owner or co-owner
Loan must be for business purposes only
No recent bankruptcies (in the past 12 months)
You must be up to date on all rent and mortgage payments (no missed payments in the past 12 months), as well as on all bills. Applicants with a mortgage that adjusts during the life of the loan will not be considered.
You must be able to prove a stable source of income
You must have no more than $3,000 in past due debt; generally acquired under extraordinary circumstances (Eg. layoff or illness)
You must provide a cosigner on the loan
You must be able to match 50 percent of the loan amount with previous personal investment in the business, or savings
It is strongly recommended to provide a completed business plan
Your business must be operational and have all required licenses (In some cases, non-operational businesses may be considered)
Please note that these funds may not be used for down payments on residential or commercial real estate or to pay closing costs or other expenses related to real estate purchases.
Loan amounts from $500 - $30,000
Loan terms up to 60 months
Installment and balloon types offered
Money in your hands (or loans disbursed) in10 business days upon receipt of your completed application and all supporting documents
Interest Rates and Fees
Competitive fixed annual interest rates from 8% -15%
Closing costs of 3%-5% will be financed into the loan amount (includes application and servicing fees)
Start-up Loan Qualifications
Must be 18 years of age or older
Must be the business owner or co-owner
Loan must be for business purposes only
No recent bankruptcies (in the past 12 months)
You must be up to date on all rent and mortgage payments (no missed payments in the past 12 months), as well as on all bills. Applicants with a mortgage that adjusts during the life of the loan will not be considered.
You must be able to prove a stable source of income
You must have no more than $3,000 in past due debt; generally acquired under extraordinary circumstances (Eg. layoff or illness)
You must provide a cosigner on the loan
You must be able to match 50 percent of the loan amount with previous personal investment in the business, or savings
It is strongly recommended to provide a completed business plan
Your business must be operational and have all required licenses (In some cases, non-operational businesses may be considered)
Please note that these funds may not be used for down payments on residential or commercial real estate or to pay closing costs or other expenses related to real estate purchases.
USA Small Business Loans
Loan Product Information
Loan amounts from $500 - $50,000
Loan terms up to 60 months
Installment and balloon types offered
Money in your hands(or loans disbursed)in10 business days upon receipt of your completed application and all supporting documents
Loan purpose range from inventory and equipment purchase to business marketing, payment of licensing fees, and other expenses associated with building a business
Interest Rates and Fees
Competitive fixed annual interest rates from 8% -15%
Closing costs of 3%-5% will be financed into the loan amount (includes application and servicing fees)
Basic Qualifications
Must be 18 years of age or older
Must be the business owner or co-owner
Loan must be for business purposes only
No recent bankruptcies (in the past 12 months)
You must be up to date on all rent and mortgage payments (no late payments in the past 12 months), as well as on all bills. Applicants with a mortgage that adjusts during the life of the loan will not be considered.
You must be able to prove a stable source of income
You must have no more than $3,000 in past due debt; generally acquired under extraordinary circumstances (Such as layoff or illness)
Loan amounts from $500 - $50,000
Loan terms up to 60 months
Installment and balloon types offered
Money in your hands(or loans disbursed)in10 business days upon receipt of your completed application and all supporting documents
Loan purpose range from inventory and equipment purchase to business marketing, payment of licensing fees, and other expenses associated with building a business
Interest Rates and Fees
Competitive fixed annual interest rates from 8% -15%
Closing costs of 3%-5% will be financed into the loan amount (includes application and servicing fees)
Basic Qualifications
Must be 18 years of age or older
Must be the business owner or co-owner
Loan must be for business purposes only
No recent bankruptcies (in the past 12 months)
You must be up to date on all rent and mortgage payments (no late payments in the past 12 months), as well as on all bills. Applicants with a mortgage that adjusts during the life of the loan will not be considered.
You must be able to prove a stable source of income
You must have no more than $3,000 in past due debt; generally acquired under extraordinary circumstances (Such as layoff or illness)
Delinquencies on U.S. Home-Equity Loans Reach Record
July 7 (Bloomberg) -- Late payments on home-equity loans rose to a record in the first quarter as 18 straight months of job losses and a slumping economy left more borrowers unable to pay their debts, the American Bankers Association reported.
Delinquencies on home-equity loans climbed to 3.52 percent of all accounts from 3.03 percent in the fourth quarter, and late payments on home-equity lines of credit climbed to a record 1.89 percent, the group reported today. An index of eight types of loans rose for a fourth straight quarter, to 3.23 percent from 3.22 percent in October through December, the group said.
“The number one driver of delinquencies is job losses, which we’ve seen build and build,” James Chessen, the group’s chief economist, said in a telephone interview. “Delinquencies won’t come down without a dramatic improvement in the economy and businesses will have to start hiring again.”
The U.S. economy lost an average 691,000 jobs a month in the quarter, and more than 6.5 million positions have been shed since the recession began in December 2007. The economy this year will shrink the most since 1946, according to a Bloomberg survey of 61 economists last month. President Barack Obama predicted last month unemployment will reach 10 percent this year. The rate was at a 26-year high of 9.5 percent in June.
Delinquent bank-card accounts jumped to a record 6.60 percent of outstanding card debt in the first quarter from 5.52 percent in the previous period, a signal unemployed borrowers are relying on cards as falling prices erode the equity in their homes. More borrowers are using cards to meet daily expenses after losing their jobs, the ABA said.
Fewer New Cards
U.S. banks issued 9.8 million credit cards from January through April, a 38 percent decline from the year-earlier period, according to data compiled by Equifax Inc., a credit bureau, quoted today in USA Today. The average limit on a new card fell 3 percent to $4,594, Equifax reported.
“There is less equity to draw on and certainly financial institutions have been scaling back the available lines of credit,” Chessen said. Banks boosted reserves for losses on delinquent loans and have adopted more cautious underwriting policies, he said.
The ABA’s survey tracks data from 300 banks, monitoring late payments on eight types of closed-end loans that are used as a benchmark for typical consumer delinquencies. The composite index rose to the highest level since the group began collecting data in October 1974. Loans are considered delinquent when a late payment is 30 days or more overdue.
Of the closed-end accounts, delinquencies rose on five: home-equity loans, direct auto loans, recreational vehicle, mobile home and personal loans, the group said. Auto loans are 45 percent of all consumer closed-end loans, the ABA said.
Rates for indirect auto loans, made through third parties such as a dealer, fell to 3.42 percent from 3.53 percent in the fourth quarter. Property improvement and marine loan rates also declined.
Delinquencies on home-equity loans climbed to 3.52 percent of all accounts from 3.03 percent in the fourth quarter, and late payments on home-equity lines of credit climbed to a record 1.89 percent, the group reported today. An index of eight types of loans rose for a fourth straight quarter, to 3.23 percent from 3.22 percent in October through December, the group said.
“The number one driver of delinquencies is job losses, which we’ve seen build and build,” James Chessen, the group’s chief economist, said in a telephone interview. “Delinquencies won’t come down without a dramatic improvement in the economy and businesses will have to start hiring again.”
The U.S. economy lost an average 691,000 jobs a month in the quarter, and more than 6.5 million positions have been shed since the recession began in December 2007. The economy this year will shrink the most since 1946, according to a Bloomberg survey of 61 economists last month. President Barack Obama predicted last month unemployment will reach 10 percent this year. The rate was at a 26-year high of 9.5 percent in June.
Delinquent bank-card accounts jumped to a record 6.60 percent of outstanding card debt in the first quarter from 5.52 percent in the previous period, a signal unemployed borrowers are relying on cards as falling prices erode the equity in their homes. More borrowers are using cards to meet daily expenses after losing their jobs, the ABA said.
Fewer New Cards
U.S. banks issued 9.8 million credit cards from January through April, a 38 percent decline from the year-earlier period, according to data compiled by Equifax Inc., a credit bureau, quoted today in USA Today. The average limit on a new card fell 3 percent to $4,594, Equifax reported.
“There is less equity to draw on and certainly financial institutions have been scaling back the available lines of credit,” Chessen said. Banks boosted reserves for losses on delinquent loans and have adopted more cautious underwriting policies, he said.
The ABA’s survey tracks data from 300 banks, monitoring late payments on eight types of closed-end loans that are used as a benchmark for typical consumer delinquencies. The composite index rose to the highest level since the group began collecting data in October 1974. Loans are considered delinquent when a late payment is 30 days or more overdue.
Of the closed-end accounts, delinquencies rose on five: home-equity loans, direct auto loans, recreational vehicle, mobile home and personal loans, the group said. Auto loans are 45 percent of all consumer closed-end loans, the ABA said.
Rates for indirect auto loans, made through third parties such as a dealer, fell to 3.42 percent from 3.53 percent in the fourth quarter. Property improvement and marine loan rates also declined.
State College Consolidation (The Co-Borrower)
When you are considering a state college consolidation loan you need to understand all aspects of the program. You can choose to take out a federal or private loan for consolidation, and each has its own benefits. When you have both private and federal student loans you will want to consolidate them separately because you can lose benefits from your federal loans when you combine them with your private loans in state college consolidation.
Federal Loan Consolidation Program
State college consolidation loans can be handled by the federal loan consolidation program. There are no fees for federal state college consolidation loans. There is also no credit check required which means no co-signer or co-borrower. You benefit from various repayment types as well as deferment and forbearance. The loans are backed by the government and you can rest assured they will be paid one way or another. Should you default; the government can easily garnish your wages or seize your income taxes for repayment.
Private State College Consolidation Loans
Private state college consolidation loans are highly competitive but still relatively easy to have approved. It is necessary to go through a credit check for this type of consolidation and, in some instances, have a cosigner or co-borrower to guarantee that your loan will be repaid. In many cases, the co-borrower is relieved from repayment after a period of consecutive, on time loan payments. The cosigner’s credit will have to be checked and approved before the loan is given. Having a cosigner gives you the benefit of being able to avail considerably lower interest rates due to their established, good credit rating.
The requirements for being a co-borrower include:
US citizenship with a valid Social Security Number and US mailing address
Permanent residency with USCIS documentation
Be of legal age (18-21 typically is the range)
Have a good credit history that includes some time period of borrowing and repaying
Have no bankruptcies in the past seven years
Have no student loan default in their history
Have no excessive delinquencies on loans, no liens, no charge-offs, no judgments
Be willing and able to sign the loan documentation (if they are unable or unwilling to do so you will need to star a new application with a new cosigner)
Federal Loan Consolidation Program
State college consolidation loans can be handled by the federal loan consolidation program. There are no fees for federal state college consolidation loans. There is also no credit check required which means no co-signer or co-borrower. You benefit from various repayment types as well as deferment and forbearance. The loans are backed by the government and you can rest assured they will be paid one way or another. Should you default; the government can easily garnish your wages or seize your income taxes for repayment.
Private State College Consolidation Loans
Private state college consolidation loans are highly competitive but still relatively easy to have approved. It is necessary to go through a credit check for this type of consolidation and, in some instances, have a cosigner or co-borrower to guarantee that your loan will be repaid. In many cases, the co-borrower is relieved from repayment after a period of consecutive, on time loan payments. The cosigner’s credit will have to be checked and approved before the loan is given. Having a cosigner gives you the benefit of being able to avail considerably lower interest rates due to their established, good credit rating.
The requirements for being a co-borrower include:
US citizenship with a valid Social Security Number and US mailing address
Permanent residency with USCIS documentation
Be of legal age (18-21 typically is the range)
Have a good credit history that includes some time period of borrowing and repaying
Have no bankruptcies in the past seven years
Have no student loan default in their history
Have no excessive delinquencies on loans, no liens, no charge-offs, no judgments
Be willing and able to sign the loan documentation (if they are unable or unwilling to do so you will need to star a new application with a new cosigner)
Funding College
When you have been accepted into a college or university it is a joyous time filled with hope and many questions. One of the biggest questions, once you have been accepted into a program, is how you will pay for the studies.
College tuition rates go higher each year and there is no end in sight to the levels it may go. There are several types of higher education funding available and it is necessary that students understand all aspects of the funding for their college education.
You Need Financial Aid
Financial aid handles the many expenses for higher education. These expenses include tuition, residence, books, food, transportation, and many unseen necessities. You need to get an idea of how much your college education will cost prior to beginning your financial aid calculations.
You need to consider how much your family will be able to contribute as well as the amount you will need in the form of loans after you have gotten any federal or scholarship aid. Even if you think you may not need the aid you should apply, there are many expenses for college and every little bit helps. Not all financial aid is need based, most of it is, so you should apply to see what you are eligible for even if your need is not great.
Financial Aid Types
There are three major types of financial aid available to all students:
Award Money – grants and scholarships offered by the government and private organizations are money that you do not have to repay and is basically given to you based upon your financial need or personal performance/achievement
Repayable Money – loans are available to students and their parents and must be repaid following the end of the education program. The interest rates are generally lower than most private loans, when you apply through the government, and they are considerably easier to have approved.
Earned Money – most colleges and universities have work-study programs available. The jobs offered are usually part time jobs on the campus, often having something to do with your major program. Part of the money goes to your education and part of it into your pocket for personal use. It is a great way to earn money, pay for college and gain experience that can give you aboost in the working world.
College tuition rates go higher each year and there is no end in sight to the levels it may go. There are several types of higher education funding available and it is necessary that students understand all aspects of the funding for their college education.
You Need Financial Aid
Financial aid handles the many expenses for higher education. These expenses include tuition, residence, books, food, transportation, and many unseen necessities. You need to get an idea of how much your college education will cost prior to beginning your financial aid calculations.
You need to consider how much your family will be able to contribute as well as the amount you will need in the form of loans after you have gotten any federal or scholarship aid. Even if you think you may not need the aid you should apply, there are many expenses for college and every little bit helps. Not all financial aid is need based, most of it is, so you should apply to see what you are eligible for even if your need is not great.
Financial Aid Types
There are three major types of financial aid available to all students:
Award Money – grants and scholarships offered by the government and private organizations are money that you do not have to repay and is basically given to you based upon your financial need or personal performance/achievement
Repayable Money – loans are available to students and their parents and must be repaid following the end of the education program. The interest rates are generally lower than most private loans, when you apply through the government, and they are considerably easier to have approved.
Earned Money – most colleges and universities have work-study programs available. The jobs offered are usually part time jobs on the campus, often having something to do with your major program. Part of the money goes to your education and part of it into your pocket for personal use. It is a great way to earn money, pay for college and gain experience that can give you aboost in the working world.
District College Consolidation (Democratic Consolidation)
Consolidation is not only a concern for the actual loan borrowers, it can be a tool used to gain attention and votes for political parties. The two major political parties often spar over education issues, student loan issues are no exception. District college consolidation loans as well as all other forms of student consolidation loans are of great importance to the Democratic party. There are many politicians who actively advocate for student district loan consolidation and laws that favor the borrowers rather than the lenders.
housands of Dollars going into District College Consolidation
Student loan consolidation can be a way to ease the debt burden from higher education. Students who are unable to repay their college loans can be approved easily for district college consolidation.
Democrats aim to make it easier to have loans approved and write law proposals to improve the contracts and rates on these loans. Lender advertisements state that you can save thousands of dollars by consolidating with one company or another. The Democrat party tries to see to it that you are actually able to repay you loans with district college consolidation and actually save money.
US Department of Education on District College Consolidation
The US Department of Education adjust interest rates yearly on July 1st, so you will find Democrats advertising their proposals for loan law amendments around this date. They often urge borrowers to consolidate their outstanding loans as a way to reduce their student loan debt. You should be aware that loan interest rates tend to rise each year, sometimes by a hundredth of a percentage point but usually a bit more. Democrats are quite right when they say you can save thousands; half of a percentage point difference on a consolidated loan can save you over $3,000.
Advice for Students opting for District College Consolidation
When you are looking at district college consolidation, you will want to have all your research done and questions answered before the beginning of June. It is important that you shop around for the best loan and take a look at the consolidation loan laws in your state as well as at the federal level. You can get much of the information online or with a couple phone calls.
The amount of loans that students need to take out increases with each year which means the laws written for loan completion are needed to benefit the borrowers. Whether you support the Democratic party or not, the laws that are written by Democrats favor the student and should be supported.
housands of Dollars going into District College Consolidation
Student loan consolidation can be a way to ease the debt burden from higher education. Students who are unable to repay their college loans can be approved easily for district college consolidation.
Democrats aim to make it easier to have loans approved and write law proposals to improve the contracts and rates on these loans. Lender advertisements state that you can save thousands of dollars by consolidating with one company or another. The Democrat party tries to see to it that you are actually able to repay you loans with district college consolidation and actually save money.
US Department of Education on District College Consolidation
The US Department of Education adjust interest rates yearly on July 1st, so you will find Democrats advertising their proposals for loan law amendments around this date. They often urge borrowers to consolidate their outstanding loans as a way to reduce their student loan debt. You should be aware that loan interest rates tend to rise each year, sometimes by a hundredth of a percentage point but usually a bit more. Democrats are quite right when they say you can save thousands; half of a percentage point difference on a consolidated loan can save you over $3,000.
Advice for Students opting for District College Consolidation
When you are looking at district college consolidation, you will want to have all your research done and questions answered before the beginning of June. It is important that you shop around for the best loan and take a look at the consolidation loan laws in your state as well as at the federal level. You can get much of the information online or with a couple phone calls.
The amount of loans that students need to take out increases with each year which means the laws written for loan completion are needed to benefit the borrowers. Whether you support the Democratic party or not, the laws that are written by Democrats favor the student and should be supported.
Private College Loan Consolidation (Consolidating your Private College Loans)
It does not seem to matter which type of college or university you have attended, nor does it matter just how much financial aid you were able to muster; it was necessary to take out private loans.
Now that you have finished your education you should be looking to the future but those private loans are holding you back. If you are looking for a way to get out from under your debt without filing for bankruptcy (and completely ruing your credit) you may want to consider consolidating your private college loans. Rather than fighting your way through education debts, you could be sailing smoothly to a debt free future.
Eligibility for Private College Loan Consolidation
Private college loan consolidation has few eligibility requirements and can be relatively easy to obtain. Some basic requirements include:
Having a certain amount (usually $5,000-7,500 minimum) of private student loans
The loans should be in repayment or in the grace period
The loans should not be in default but can be deferred or in forbearance
In most cases you need to be a US citizen or permanent resident. Some lenders offer consolidation to temporary residents but have a lower range for the outstanding loans and a higher interest rate for repayment.
Borrowing on Private College Loans
Depending on the lender and your credit history, you can borrow up to and sometimes over the total amount of your outstanding private college loans. Most lenders will cap their loans somewhere between $125,000 and 250,000 for undergraduate loans; for graduate, dental, medical or law school the maximum amount may be higher.
The interest rate for private college loan consolidation is typically fairly low and is also dependent on the amount of your loans and credit history. There are usually fees for origination, processing and sometimes completion.
The term for private college consolidation loans is anywhere from 5 to 30 years and varies according to your monthly installments and the total amount of the loan.
Deferment of College Loans
Should you choose to restart your education for a higher degree, you often have the option of deferring your principle payments for the loan. This means you will be required to pay the interest on your loans but not make payments toward the cost of the loan itself. You will need to prove to the lender that you are at studying at least half-time to have your loan deferred.
Some private loan consolidators will also offer forbearance in times of financial hardship. This is not a common aspect of private loans but can be a big help if it is written into the contract.
Now that you have finished your education you should be looking to the future but those private loans are holding you back. If you are looking for a way to get out from under your debt without filing for bankruptcy (and completely ruing your credit) you may want to consider consolidating your private college loans. Rather than fighting your way through education debts, you could be sailing smoothly to a debt free future.
Eligibility for Private College Loan Consolidation
Private college loan consolidation has few eligibility requirements and can be relatively easy to obtain. Some basic requirements include:
Having a certain amount (usually $5,000-7,500 minimum) of private student loans
The loans should be in repayment or in the grace period
The loans should not be in default but can be deferred or in forbearance
In most cases you need to be a US citizen or permanent resident. Some lenders offer consolidation to temporary residents but have a lower range for the outstanding loans and a higher interest rate for repayment.
Borrowing on Private College Loans
Depending on the lender and your credit history, you can borrow up to and sometimes over the total amount of your outstanding private college loans. Most lenders will cap their loans somewhere between $125,000 and 250,000 for undergraduate loans; for graduate, dental, medical or law school the maximum amount may be higher.
The interest rate for private college loan consolidation is typically fairly low and is also dependent on the amount of your loans and credit history. There are usually fees for origination, processing and sometimes completion.
The term for private college consolidation loans is anywhere from 5 to 30 years and varies according to your monthly installments and the total amount of the loan.
Deferment of College Loans
Should you choose to restart your education for a higher degree, you often have the option of deferring your principle payments for the loan. This means you will be required to pay the interest on your loans but not make payments toward the cost of the loan itself. You will need to prove to the lender that you are at studying at least half-time to have your loan deferred.
Some private loan consolidators will also offer forbearance in times of financial hardship. This is not a common aspect of private loans but can be a big help if it is written into the contract.
College Loan Consolidation
Plus Consolidation (All About PLUS Consolidation)
PLUS loans are taken out by parents of higher education students to supplement the financial aid package offered and cover all aspects of education. PLUS loans can be used for tuition, books, residence, meal plans, etc and are a great way to insure against unexpected education expenses.
PLUS loans can be repaid immediately upon disbursement and can be consolidated whenever you wish. There are aspects of federal PLUS loans that are similar to and different from the other types of federal loans.
Similarities
They are secured by the US government
The are available under the Direct Student loan program
They are available through private lenders
They can be consolidated through various federal consolidation loan programs
Differences
They are taken out by the parent, rather than the student
They have higher interest rates
They require a credit check for the parent
They offer a few repayment options
They are immediately due for repayment
PLUS Consolidation
PLUS loans can be consolidated immediately upon disbursement and benefit from a fixed rate loan structure. The rate increases slightly each year on July 1st, similar to the other federal loans. You can consolidate PLUS loans for both undergraduate and graduate studies, even though they were originally designed for parents of undergraduates. Changes to this style occurred July 1, 2006 and is referred to as the Grad PLUS program.
The PLUS consolidation programs, as federal programs, give you the added benefit of deferment and forbearance when you want to continue your education further or if you have periods of unemployment or other financial hardship.
PLUS loans are taken out by parents of higher education students to supplement the financial aid package offered and cover all aspects of education. PLUS loans can be used for tuition, books, residence, meal plans, etc and are a great way to insure against unexpected education expenses.
PLUS loans can be repaid immediately upon disbursement and can be consolidated whenever you wish. There are aspects of federal PLUS loans that are similar to and different from the other types of federal loans.
Similarities
They are secured by the US government
The are available under the Direct Student loan program
They are available through private lenders
They can be consolidated through various federal consolidation loan programs
Differences
They are taken out by the parent, rather than the student
They have higher interest rates
They require a credit check for the parent
They offer a few repayment options
They are immediately due for repayment
PLUS Consolidation
PLUS loans can be consolidated immediately upon disbursement and benefit from a fixed rate loan structure. The rate increases slightly each year on July 1st, similar to the other federal loans. You can consolidate PLUS loans for both undergraduate and graduate studies, even though they were originally designed for parents of undergraduates. Changes to this style occurred July 1, 2006 and is referred to as the Grad PLUS program.
The PLUS consolidation programs, as federal programs, give you the added benefit of deferment and forbearance when you want to continue your education further or if you have periods of unemployment or other financial hardship.
Getting your College Consolidation Straight
Getting your College Consolidation Straight
When it is time for the consolidation of your college loans, you need to have all your facts straight. It is important that you have all the information that you need to choose the best consolidation college loan for your situation.
Many people jump into consolidation of college loans with both feet, often landing themselves in a pile of mess. You can do a bit of research and shop around before consolidating your college loans to get the best rate and save yourself thousands of dollars.
How it Works: College Consolidation Loan
Consolidation of college loans works by reducing the amount of your monthly installment while increasing the amount of time you have to pay. It also combines most, sometimes all, of your college loans into a single monthly payment. For the federal loan program you can typically combine all of your federal loans into a consolidation college loan along with some private loans.
The length of the consolidation college loan term depends on the amount due for all the loans consolidated. There is the standard 10 year term for $7,500 or less; 12 to 15 years for $10,000 to $20,000; 20 years for up to $40,000 and 30 years for above $60,000. The interest on the loan is also determined by the loan balance and term. Some higher value loans have lower interest rates because you wind up paying more interest overall on long term loans.
Alternatives to your Consolidation Loans
You can choose to consolidate your loans because it is simple and easy. You will definitely be paying a higher amount on the loans overall because of the interest rate and term of the loan. You do have the option of contacting your lenders to make payment arrangements for the loans individually.
There are some plans that are based on your income that can be adjusted to better meet your financial standing. You can also extend the term of your basic student loans without consolidating by contacting the lenders. You will pay more by extending the term but it will still be less than your overall output if you consolidate.
College Loan Consolidation
Changing Rules for College Loan Consolidation
College loans consolidation is by no means stagnant. The rules and understandings surrounding student loan consolidation are in flux and sometimes change yearly. It sometimes seems that the lenders are conducting an experiment to see what types of rules will be generally acceptable and which simply will not work.
Whether the loans are federal or private does not seem to matter, things change and lenders just have to get used to it. Some rules that the government and private agencies started out with seemed to be fine and working for years, but some accounting wiz will come up with a way to change the rules to benefit the lender. On some occasions the rule change benefits the borrower but these are few and far between.
Changes to College Loan LawsFederal loan changes make the news more often than private because they affect a greater number of borrowers overall. Private lenders can make and change their own rules anytime they like. Changes that have been made to college loans consolidation rules include:
In-school Status Consolidation – borrowers can only consolidate loans that are already in grace, repayment, forbearance, deferment, delinquent or default status. This means that any loans you currently have accumulating that are paying for your present education cannot be consolidated. Effective July 1, 2006
Reconsolidation – existing consolidation loans can be reconsolidated (into a Direct loan) if they include an FFEL or Direct loan or are an FFEL consolidation loan that is attempting to avert default. In plain English, if you have one of our loans we can help. Effective July 1, 2006
Joint Consolidation with Spouse – married couples cannot join their consolidation loans together as a single federal loan. Effective July 1, 2006
Freedom of Choice – the US Department of Education declared that up to 40% of students with federal loans will be unable to choose their college loans consolidation lender. This is dependent upon loan type and local consolidation options. Effective March 31, 2006
Options for College Loans You can choose to take up the government and various private lenders on their consolidation offers and risk getting caught in the tide of changes to the rules. You can also choose not to consolidate at all and repay your loans one by one. This will require your being in contact with the original lenders and hammering out agreements on loan repayment alternatives.
Many issues are negotiable depending on the lender and it only takes a moment to ask. Whichever road you take, make sure it is only after having researched all possibilities and answered all questions.
College loans consolidation is by no means stagnant. The rules and understandings surrounding student loan consolidation are in flux and sometimes change yearly. It sometimes seems that the lenders are conducting an experiment to see what types of rules will be generally acceptable and which simply will not work.
Whether the loans are federal or private does not seem to matter, things change and lenders just have to get used to it. Some rules that the government and private agencies started out with seemed to be fine and working for years, but some accounting wiz will come up with a way to change the rules to benefit the lender. On some occasions the rule change benefits the borrower but these are few and far between.
Changes to College Loan LawsFederal loan changes make the news more often than private because they affect a greater number of borrowers overall. Private lenders can make and change their own rules anytime they like. Changes that have been made to college loans consolidation rules include:
In-school Status Consolidation – borrowers can only consolidate loans that are already in grace, repayment, forbearance, deferment, delinquent or default status. This means that any loans you currently have accumulating that are paying for your present education cannot be consolidated. Effective July 1, 2006
Reconsolidation – existing consolidation loans can be reconsolidated (into a Direct loan) if they include an FFEL or Direct loan or are an FFEL consolidation loan that is attempting to avert default. In plain English, if you have one of our loans we can help. Effective July 1, 2006
Joint Consolidation with Spouse – married couples cannot join their consolidation loans together as a single federal loan. Effective July 1, 2006
Freedom of Choice – the US Department of Education declared that up to 40% of students with federal loans will be unable to choose their college loans consolidation lender. This is dependent upon loan type and local consolidation options. Effective March 31, 2006
Options for College Loans You can choose to take up the government and various private lenders on their consolidation offers and risk getting caught in the tide of changes to the rules. You can also choose not to consolidate at all and repay your loans one by one. This will require your being in contact with the original lenders and hammering out agreements on loan repayment alternatives.
Many issues are negotiable depending on the lender and it only takes a moment to ask. Whichever road you take, make sure it is only after having researched all possibilities and answered all questions.
Choosing a College Loan Consolidation
Choosing a College Loan Consolidation
There are a few ways to handle college loan repayment, a primary one is through college loan consolidation. Once you have decided that the best way to handle your outstanding college loans is through consolidation, you have to figure out how to go about doing so.
Education can be expensive and most of the time grants and scholarships cannot cover the cost of tuition, books, residence and other expenses. Many students have to take out various loans to cover the total amount.
Only upon graduating does the full cost of that education become realized by the graduate. All of those loans become due at once and paying them off can seem pretty daunting.
Searching for the right college loanThe first part of consolidating your college loans deals with selecting the lender with whom you will file. It is easiest to check back with your school to determine what lenders work with the type of loans you have and through the institution.
Since lenders are competitive, you stand to save in the thousands with their low interest rates and borrower benefits packages. If you are still within the loan’s grace period you can get the best rates possible, but even if you are not you can still get a great deal. Federal loans sometimes have yearly deadlines for consolidation but private loan consolidation can be done any time.
Choose the lender that offers the best deal for your financial situation and be sure to read all fine print, you do not want to face extra charges that you signed up for without knowing.
Paperwork for the college loan consolidation application When you apply for college loan consolidation you will need to have all your paperwork handy. You will have to provide information on the loan types, balances and holders. Of course they will need information regarding the school and the time period in which you were in studies. The lender will also ask you about your current financial and employment situation. You will need to provide contact information for employers as well as some references (usually professional).
There are a few ways to handle college loan repayment, a primary one is through college loan consolidation. Once you have decided that the best way to handle your outstanding college loans is through consolidation, you have to figure out how to go about doing so.
Education can be expensive and most of the time grants and scholarships cannot cover the cost of tuition, books, residence and other expenses. Many students have to take out various loans to cover the total amount.
Only upon graduating does the full cost of that education become realized by the graduate. All of those loans become due at once and paying them off can seem pretty daunting.
Searching for the right college loanThe first part of consolidating your college loans deals with selecting the lender with whom you will file. It is easiest to check back with your school to determine what lenders work with the type of loans you have and through the institution.
Since lenders are competitive, you stand to save in the thousands with their low interest rates and borrower benefits packages. If you are still within the loan’s grace period you can get the best rates possible, but even if you are not you can still get a great deal. Federal loans sometimes have yearly deadlines for consolidation but private loan consolidation can be done any time.
Choose the lender that offers the best deal for your financial situation and be sure to read all fine print, you do not want to face extra charges that you signed up for without knowing.
Paperwork for the college loan consolidation application When you apply for college loan consolidation you will need to have all your paperwork handy. You will have to provide information on the loan types, balances and holders. Of course they will need information regarding the school and the time period in which you were in studies. The lender will also ask you about your current financial and employment situation. You will need to provide contact information for employers as well as some references (usually professional).
ACS Consolidation
When You Cannot Repay Many people need to take out federal and private loans to finance their education. One requirement of taking out a student loan is to repay the balance after you have left your program. For one reason or another, some students find themselves in a situation where they are unable to repay their loans.
It may be that they have too many small loans to pay at the same time. It could be that their monthly expenses exceed their ability to repay the loans. It could be that they are not gainfully employed and cannot afford the repayment installments. Whatever the reason these borrowers risk defaulting on their loans. One way to avoid defaulting on you loans is to take out a consolidation loan from a government or private institution. ACS is a company that offers consolidation loans for former students.
ACS consolidation is offered to students who are in good standing on their loans. You can be in the grace period or repayment period on the loan term to consolidate with ACS. In some cases you are able to avail ACS consolidation if you are enrolled in a program or even if you are delinquent on your loans. If you are at risk of defaulting on your loans you will have to check with ACS to see if your loans are eligible for consolidation.
Defaulting on the ACS LoanDefaulting on a loan means that you have gone past the stage of being delinquent (missing payments), to the point that the lender declares that you are unable to or are unwilling to repay the loan. If you have the option of deferring the loan or there is the possibility of forbearance, it is important that you take advantage of the option before you default on the loan. Many lenders are flexible with such issues and will work with you to ensure that the loan is repaid. ACS consolidation allows for deferment for financial hardship and unemployment as well as returning to education.
Even with consolidation loans you may find some time where you cannot repay the loans. The amount that you will have to pay will increase astronomically if you default and have to pay collection fees on top of the loan. The lenders will always find a way to get their money back. It may be by garnishing your wages or taking your tax return money. Additional problems of defaulting on an ACS consolidation or any other type of loan include:
Low credit rating
Ineligibility for federal aid
Lawsuits
Loss of deferment options
The inability to obtain some licenses
It may be that they have too many small loans to pay at the same time. It could be that their monthly expenses exceed their ability to repay the loans. It could be that they are not gainfully employed and cannot afford the repayment installments. Whatever the reason these borrowers risk defaulting on their loans. One way to avoid defaulting on you loans is to take out a consolidation loan from a government or private institution. ACS is a company that offers consolidation loans for former students.
ACS consolidation is offered to students who are in good standing on their loans. You can be in the grace period or repayment period on the loan term to consolidate with ACS. In some cases you are able to avail ACS consolidation if you are enrolled in a program or even if you are delinquent on your loans. If you are at risk of defaulting on your loans you will have to check with ACS to see if your loans are eligible for consolidation.
Defaulting on the ACS LoanDefaulting on a loan means that you have gone past the stage of being delinquent (missing payments), to the point that the lender declares that you are unable to or are unwilling to repay the loan. If you have the option of deferring the loan or there is the possibility of forbearance, it is important that you take advantage of the option before you default on the loan. Many lenders are flexible with such issues and will work with you to ensure that the loan is repaid. ACS consolidation allows for deferment for financial hardship and unemployment as well as returning to education.
Even with consolidation loans you may find some time where you cannot repay the loans. The amount that you will have to pay will increase astronomically if you default and have to pay collection fees on top of the loan. The lenders will always find a way to get their money back. It may be by garnishing your wages or taking your tax return money. Additional problems of defaulting on an ACS consolidation or any other type of loan include:
Low credit rating
Ineligibility for federal aid
Lawsuits
Loss of deferment options
The inability to obtain some licenses
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