college loan consolidation: July 2009

7/28/2009

5 Steps For Guaranteed Unsecured Credit Card Approval...

Receiving a guaranteed unsecured credit card isn't difficult, but it will require some work. Here are a couple of tips to get you headed in the right direction.

Step #1 - Credit Score
Before you initiate applying for any credit card, know what your credit score is. Often times people think their credit's better than it very is. You are entitled to a free credit report every year, as well as every time you are denied credit. Take advantage of this. Knowing what is on your credit report will not only arm you with knowledge when you apply for credit, it's just smart too. You may find something on the report that needs to be disputed. The credit card company will be checking this, you need to know what they are seeing.

Step #2 - Debt to Income Ratio
The credit card company will be looking at more than just your credit score when they arrive at a credit approval decision. If you bring house $20,000 a year on paper, they may not think you make enough to cover any additional expenses. This is why the applications will ask questions about not just your income, but your different expenses such as mortgages or rent. Be armed with tax returns, bank statements, and other documents that will provide a more accurate snapshot of your income ratio.

Step #3 - Know Their Requirements
Finding out what criteria the bank adheres to in approving credit can be tricky. Since most unsecured credit cards will have requirements that vary, it may be hard to pin down exactly what you need to do. A quick call to customer service should be able to answer some of your basic questions though. If customer service isn't able to help you, ask to tell their finance department. This won't guarantee that you will get completely the answers, but it will get you on the right path. Some cards require minimum credit scores, minimum income requirements, and other factors that the bank predetermines. Applying for a card that requires a score of 700 when your score is 650 will only ding your credit further.

Step #4 - Current Relationships
You have a much better chance of being approved for an unsecured credit card with a company that you already have a relationship with. This doesn't mean that you must have another credit card through that bank, but if you have a mortgage or car note that is paid on time every month through a bank that offers cards, try these banks first. If you conduct your banking transactions with a credit union, often times you can get a guaranteed unsecured credit card by utilizing this existing relationship.

Step #5 - Features
If your credit history is a little shaky, but not necessarily bad, you may want to start by applying with credit card companies that offer "no frill" credit cards. The more benefits and features the card offers, the higher the requirements generally are. Forego the features such as airline miles or cash back for the time being. Once you've been a great customer of theirs for a time, you can apply or upgrade your card to one that does more for you.

With some research on your end, you should be able to find a guaranteed unsecured credit card with little effort....

Is Using A Personal Loan To Pay Off Credit Cards A Good Idea?...

It might or might not be a great idea to pay off your credit cards by using money from a personal loan, but we're going to take a look at the pros as well as cons, and when you've read them, you should be able to easily decide whether or not it makes sense for you.

Moreover, it needs to be said right up front that the intent of this article is not to suggest that you take out a personal loan in order to pay off your credit cards, but is merely to point out the pros and cons of doing so.

First off, it's probably not worth taking out a personal loan to pay off your credit cards, if you owe less than $15,000 on them.

If you do owe more than $15,000 though, and you're probably to initiate missing payments, then paying off completely your cards might be a good idea, because you'd stay away future penalties, and paying more interest on the interest.

The first thing that you need to do, is to check how much interest you're paying on your cards, because you'll later need to compare this sum with the interest that's being requested by the bank offering the personal loan. The amount of interest that's charged for personal loans varies greatly,'ll depend mostly on your present FICO score.

If your credit rating's not in great shape, then it's likely that the interest on a personal loan will be higher than it is on your credit cards, but if you get behind on your credit card payments then the penalties build up fast, and so does the compounded interest.

The interest on personal loans does not compound, and you able to make arrangements for different repayment schedules when you sign up. What's more, you'll exclusively be making one payment a month, and a paid off personal loan looks a helluva lot better on your credit rating, than skipped credit card payments.

Should you think that a personal loan might be the best option, then before you go hunting for one, the following are what you'll most likely be asked for, if and when you apply for one.

1) At least three months proof of employment.
2) A recent pay slip, that shows your take home pay.
3) Utility receipts, to validate your home address.
4) Checking or deposit account details.

If you get loan approval, which should be inside 24-48 hours, then the money will be almost immediately deposited into your bank account, and your monthly repayment will be deducted from the same account automatically.

You should check out at least three loan companies before finally deciding on one, and then compare the following.

1) Interest rates. 2) The type of repayment schemes available. 3) Semi-hidden fees, and be alert to these. 4) What you'll need to provide to get approval. 5) How long it will take to get approved.

The final and most essential thing to check before signing on a dotted line, is whether your monthly payments will be higher, or lower with a personal loan.

Once you know that, you should easily be able to make an informed decision as to what would be best for you.

Some Parting Words Of Advice.

Don't be glib about personal loans, and only ask one because you believe that it will profit you. You want it to improve your situation and not worsen it.

After you get your loan, please do your best to ensure that your monthly payments get paid on time, even if this means that you'll must cut back on a few perceived luxuries. Remember that missed payments on your personal loan, will very negatively affect your future FICO score.

7/24/2009

debt consolidation loans with bad credit...

Information About Debt Consolidation Loans with Bad Credit

Finding debt consolidation loans with bad credit could be quite a task? after all, a lot of lenders dont want to take a risk on someone who's such an obvious credit risk. Luckily, however, a lot of lenders'll take that risk; its simply a matter of knowing what theyre looking for, as well as how best to approach them for a loan. Asking around to see which banks and lending companies offer debt consolidation loans with bad credit is a great start, and from there its simply a matter of presenting yourself in the best possible light in order to improve your chances of getting the money that you need.

Debt consolidation at a glance

Before applying for debt consolidation loans with bad credit, it helps to cognize exactly what debt consolidation is. Basically, consolidating your debt means that youre getting a loan that will be applied toward your outstanding debts? either paying them off completely, or paying off a portion of the debt to make the rest more manageable. This leaves you with the loan payment as either your exclusively payment to make or at least one of a few payments to make, and producing it easier for you to repay fewer debts than when you had the larger amount. Debt consolidation loans with bad credit are almost always secured loans, meaning that youve got collateral (such as a car or real estate) on the line to ensure that you repay what youve borrowed.

Getting the most from your loan

To get the best value and lowest interest rate when trying to get debt consolidation loans with bad credit, its best to use your most valuable property as your collateral and ask for considerably less than its total value. This insures that the lender will get their money back the only way or another, and usually makes them much more willing to issue debt consolidation loans with bad credit. Paying off as much of your debt as you could before applying is a good idea, too? it shows that youre dangerous about getting out of debt, and are making a legitimate effort. If it looks like you really want to fix your debt and credit problems, then youre more likely to be eligible for lower interest rates and better terms for debt consolidation loans with bad credit.

Shopping around for the best value

Even though youre applying for debt consolidation loans with bad credit, it doesnt mean that you have to accept the first offer that comes your way. Shop around with many lenders and compare their rates, seeing what terms one lender offers and whether other banks or finance companies can offer you something comparable. This will help you to get the most out of your money, and ensure that you have less to repay.

Bad Credit Consolidation Loans Are a Solution...

A bad credit rating able to be the kind of problem that feeds on itself, growing bigger as well as bigger until it becomes impossible to handle. Such a rating makes it nearly impossible to purchase not cheap items, like cars or homes without either a large amount of cash or many kind of equally expensive collateral.

A Bad Credit Remedy
Debt consolidation loans are a solution many are turning toward to solve bad credit issues. This is a loan, which means borrowing more money, so it should exclusively be taken as a last resort, e.g. avoiding bankruptcy. When bad credit is so bad that it is impossible to get a loan anymore, a debt consolidation loan can be the first step to restoring financial stability. The debt consolidation money goes into paying back all other debts, leaving only the consolidation loan itself to be repaid. Through regular monthly installments, the consolidation loan will be paid back to the lender, at a lower interest rate. This lower interest rate allows for quicker repayment and faster restoration of a low credit rating.

How a Secured Consolidation Loan Works
Secured consolidation loans require large assets as collateral, such as a home. This is the easiest way to secure a loan, due to it is less risk to the lender. As the debt is paid off, it will take about six months to a year to restore the borrower's credit rating, allowing him or her to get back to life as normal - hopefully with a better perspective on financial matters.

How an Unsecured Consolidation Loan Works
Applicants without assets to put up as collateral can still apply for an unsecured consolidation loan. This type of loan bears a higher rate of interest and offers less money, but there is no threat of repossession. It will still allow a debtor to pay off other outstanding debts.

What Can Be Paid Off with a Debt Consolidation Loan?
Anything that might reflect poorly on the borrower's credit rating can be paid off with the debt consolidation loan. This usually includes such things as credit cards and medical bills, but can be car payments or credit lines maxed out from shopping. A consolidation loan will pay these in full, which begins the process of repairing credit. There will be no more phone calls requesting early payment from various creditors, after a bad credit loan is taken out. There will no longer be high interest rates that make entire repayment near impossible. The consolidation company works with the borrower to ensure that the repayment schedule is reasonable and as fast resolved as possible.

A Revived Credit Rating
The moment the old debts are paid off with the loan, restoration begins on the borrower's credit rating. After only six months to a year, there will be a marked improvement upon the credit rating. Every person who takes out debt consolidation will have the loan and the repayment schedule individual tailored to fulfill his or her financial needs.

Is an unsecured consolidation loan right for me?...

* Yes, if you need a reduction in monthly outgoings, to settle an Individual Voluntary Arrangement (IVA), to speed up repayment of several debts with one creditor or if you could substitute lenders for better interest rates, but you have no assets to use as security.
* No, if you have used a consolidation loan unsuccessfully before, to consolidate an old consolidation loan or to free up credit as well as store cards that you intend to continue using as part of your normal monthly budget.

Compared to a secured loan, unsecured loan lenders have to accept a higher risk due to they won't have anything to fall back on if you can't make the repayments. This means that they'll have to carry out creditworthiness checks to evaluate the level of risk, such as credit history, property ownership, income, size of loan and repayments and the number of recent loan applications.

After the checks have been made, the lender will either accept or decline your application. Not completely lenders evaluate the risks the same for each case, and there's fit competition inside the unsecured loan retail place. Some lenders will offer different products depending on the size of the risk they feel they are taking, and there are lenders that purposefully accept higher risk applicants. However, these lenders offset their risks by charging higher interest rates for these loans. The size of unsecured loans obtainable ranges from ?500 to ?25,000, and the repayment schedules could vary from six months to ten years.

Unsecured loans can be taken out either as a fixed interest loan, allowing you to budget for a regular payment each month, or as a variable interest rate loan. Because these vary with the Bank of England base rate, it can be more difficult to budget for these. Choosing which format is the most suitable will be a matter of personal choice, depending on your needs and personal circumstances.

7/23/2009

The Subprime Aftermath: Lessons Learned

June 08 - Though not quite as contemptible as an obscene four-letter word, the term "subprime loan" comes close. Those two words acquired a stigma over the past year as the real estate retail essentially collapsed. It's the rare financial analyst that fails to remind us how subprime lending resulted in nationwide misery. Unfortunately, after uttering that accusation, many counselors are remarkably imprecise as to exactly what constitutes a subprime loan. Does a home bought with no down payment and a loan equal to 100% of the purchase price qualify? You'd certainly think so from the articles I read. And what about loans where little or no principal payments are made during the early years? The suggestion normally conjures up predictions of impending disaster.

At the risk of sounding indifferent to living dangerously, I'm not averse to either of these two borrowing techniques. Actually, the harshly criticized zero-down purchase does not necessarily mean high risk. For over half a century the widely used GI loan, created by the Servicemen's Readjustment Act of 1944, provided military veterans with home loans on a nothing down basis. Countless ex-servicemen profited handsomely from this program.

As for failure to make principal payments during the early years of a loan, this became, in essence, the normal method of home financing following the Great Depression of the 1930s. Consider the typical FHA loan, by which millions of Americans acquired their residences. The standard 30-year fully amortized fixed-rate loan provides that at the completion of the first five years of scheduled payments, about 95% of the original balance remains unpaid. Even after ten years, 85%'s still owed. This is because most of the payments in the early years go toward interest. Technically this might not equate to no payments of principal, but it comes pretty close.

This, then, conjures up the question: Exactly what differentiates current subprime lending abuses from earlier-day practices perceived as creative. As an example of this latter practice, consider a device I used extensively in the high interest rate duration of the 1970s and 1980s, known as an all-inclusive mortgage (also called a "wrap-around"). In this circumstance, a property is sold subject to a seller's carryback mortgage loan, junior to and inclusive inside an existing first mortgage that remains on title. Providing the underlying loan carries no due-on-sale provision, which many at the time did not, it's a permissible technique. This contrivance, though unconventional, provides benefits to both buyer and seller when properly structured.

This gets us down to the crux of matter, which is abuse in home financing. It's a subject that easily fills volumes. However, at its heart is a basic discord: home acquisition beyond a purchaser's ability. It is this that made subprime lending an insidious perversion. The entire loan industry joined together, incorporating various devices in its quest to finance houses. Certain practices now under scrutiny by legislators and regulatory agencies included minimal initial interest rates scheduled to adjust upward at a later date, buyer qualification based upon unrealistic low initial monthly payments, and loan approval of buyers whose credit history indicated unreliability. Although these factors completely contributed to the final calamity, they were not the cause, but merely the effect.

Fundamental to it all is creation of loans by entities whose funds are not at risk. When loan authorization is granted to processors who profit on creation, but who are unaffected by later payment failure, unsafe lending is guaranteed. It is not by accident that loan approval rested largely with mortgage lending firms that merely complied with established institutional criteria, often nonsensical. All participants profited handsomely by the fees generated through loan creation, despite easily predictable default at many later date. In reality, sound practices are attainable with no special prohibitions or regulatory oversight. Though I'm actively engaged in mortgage lending, I've yet to experience a single foreclosure so far this century. The reason is fundamental. I do not loan other people's money---I risk my own. My personal self-interest insures that loans go only to borrowers who I feel confident will honor their obligations or, that if unexpected misfortune strikes, the loans are amply backed by the securing properties. That's what the secured loan business is all about. What must exist are circumstances by which the maker of the loan only profits from good loans, not bad ones. Enacting a mass of rules to thwart bad intentions is not the answer, for no law will ever obstruct the human capacity for connivance.

I'll briefly summarize with my admonition to the typical homebuyer. I advocate that you not commit to obligations that strain your limits. It's more sensible to restrict yourself to less than you able to handle. Simply put: Choose a cheaper home than you could afford. And while we're on the subject, you might apply that same formula to other aspects of your life. You're far better off if your vehicle, your home furnishings, and your vacations are well within your means. More specifically, these three products should be obtained with no borrowing of any sort. Maintaining a standard of living that requires you to stretch regularly to meet payments is not really much fun. Cash on the barrelhead may seem old-fashioned, but it makes for a more enjoyable way to live.

The Loan Officer's Practical Guide to Residential Finance (Perfect Paperback)

This's the 2009 Edition of the first book in the "Practical Guide" series for the mortgage industry.

Published since 1992, as well as updated annually, this 198 page textbook was written as an answer to the "sink-or-swim" training methods of numerous mortgage firms. The format is designed to give the newly initiated loan officer/agent, lender, processor, or other initiate the practical information they need to do the loan officer's job.

The reader learns how to understand rate and point quotes, how to use a financial calculator, how to make basic computations customers require, how to understand loan programs and compare product features. The student progresses through understanding loan specifications - Conventional Conforming, Jumbo, FHA/VA and Sub-Prime program guidelines - to a practical understanding of ratios, income, assets and closing costs, debts and credit history. This is then placed in the context of the loan application - how to collect all the required documents and disclosures and supervise a loan from application to closing. Beyond the basics, students learn how to finance various property types; condos, PUDs, new construction and investment property. A detailed chapter on refinancing addresses the issues which most often confront the loan officer in a period of heavy refinancing - 10 reasons to refinance.

Finally, understanding how loans are made in the secondary market and the basics of interest rate quoting and behavior are covered.

This product is submitted for approval for use in continuing education in all states which have, or are adopting, a requirement. Many companies use this product as a handout to prospective new loan officers. Many loan officers give this product to their referral sources to help educate them to the requirements of the industry.
Thomas Morgan's The Loan Officer's Practical Guide to Residential Finance is THE most comprehensive loan officer training book in print today. Chock full of every single aspect of the mortgage origination process, I truly recommend this book to every amateur as well as novice loan officer I know!
I wish I had found this book the day I passed my state exam. It would have saved me much frustration as well as my confidence could have been boosted a lot sooner, which is key to succeeding in this business. This book is putting me equal to, if not ahead of many individuals who have been in the business for years. I'm shocked at how little people cognize and I'm pleased at how much I've learned from this book. Absolutely the best money I've spent on my early career!

college loan consolidation