Money – Templo Do Conhecimento Mon, 29 Aug 2022 16:09:53 +0000 en-US hourly 1 Money – Templo Do Conhecimento 32 32 China’s Bad Debt Managers See Their Profits Collapse on Property Losses Mon, 29 Aug 2022 10:06:59 +0000

(Bloomberg) – China Huarong Asset Management Co. and China Cinda Asset Management Co., the country’s two largest state-owned distressed debt funds, reported falling first-half profits as credit writedowns increased following a worsening real estate crisis.

Bloomberg’s Most Read

Net profit for Cinda’s first six months fell 33% to 4.51 billion yuan ($652 million), after impairments on assets jumped 85%, an exchange filing shows. . Huarong, which is also due to release its report on Monday, expected to post a net loss of 18.88 billion yuan for the same period, compared with a profit of 158 million yuan a year ago.

China’s troubled debt managers have been in turmoil as aggressive lending to beleaguered developers and unchecked expansion in other areas during the sector’s boom years beleaguered funds by $730 billion with heavy credit losses, causing their obligations to plummet. Beijing is currently considering a preliminary plan to restructure the sector that could see state-backed entities take over three of the companies, people familiar with the matter said.

China Great Wall Asset Management on Friday reported a net loss of 8.56 billion yuan for the past year after twice extending the disclosure deadline, citing deteriorating asset quality and losses from changes in the fair value. This compares to 2.1 billion yuan in profit the previous year.

Beijing-based Huarong, Cinda, Great Wall and China Orient Asset Management Co. were formed to buy up bad debts from banks following the Asian financial crisis of the late 1990s, when decades of government loans to state-owned enterprises had left China’s largest. lenders on the brink of insolvency. The so-called AMCs subsequently expanded beyond their original mandate, creating a maze of subsidiaries to engage in other financial activities, including shadow lending.

They have lent money to the majority of the top 50 developers in the country over the years. Real estate represents approximately 44% of Cinda’s acquisition and restructuring activities.

“Real estate businesses pose significant credit risks and some local governments face serious debt risks,” Cinda said in the statement. “Distressed entities and distressed assets will increase. AMCs must play their professional strengths to the full, take the initiative to act and actively participate in the prevention and defusing of major risks.

Over the past year, Chinese authorities have ordered AMCs to reduce non-core activities and shift assets from securities to insurance to reduce risk and return to their original mandate. More recently, they have been seen as potential white knights in the crumbling real estate sector, only to find themselves knee-deep in the troubles themselves.

As part of the overhaul that could take place after the Communist Party Congress this year, one solution being considered is for Great Wall to be acquired by state-owned China Everbright while Orient and Cinda are merged. The long-term goal would be for Cinda and Orient combined to become the only bad debt manager with a national operation to manage troubled assets, people familiar said. Huarong and Great Wall would focus on managing the non-performing loans of their new parents – China Citic Group and Everbright.

Bloomberg Businessweek’s Most Read

©2022 Bloomberg LP

Do you have a low credit score? Tips to increase your score and be ready for credit Fri, 26 Aug 2022 11:17:00 +0000

Most lenders check the CIBIL score or a credit score assigned by other bureaus when evaluating your credit application. If your score is low, they may be hesitant to offer you credit. Indeed, a low credit rating makes you a high-risk borrower. However, some lenders will offer you credit even if your credit score is less than ideal. For example, a good CIBIL score is considered to be 750 and above, but you can also get a personal loan for a CIBIL score of 550. Sometimes called bad credit loans, these loans are exactly what the name suggests – loans you can get with bad credit.

However, you should exercise caution when applying for a loan for bad credit. Relying too much on these can put you further into debt and hurt your creditworthiness for future needs. It can also make repayment difficult, as these loans usually come with a higher interest rate. To avoid having to resort to a bad credit loan, you can improve your credit score and boost your creditworthiness. Soon you will be eligible for a loan with attractive terms that make borrowing easy and affordable!

Here are some of the best tips to help you improve your credit score and creditworthiness.

Repay dues on time

To boost your credit score, make timely repayment a priority. This will help you create a disciplined balance sheet that strengthens your creditworthiness. Automatic payments and alerts can ensure you don’t miss any of your loan or credit card bill payments. If you have a large debt and you do not have the funds to meet this obligation, consolidate all your debts into one. This eases your task of managing different due dates and makes repayment more manageable.

Check your credit score frequently

Checking your CIBIL score or your credit score at regular intervals is one of the easiest and simplest ways to keep tabs on your credit health. This is an overall rating assigned by rating agencies after taking into account certain key factors. The score is based on a credit report that contains a summary of all these factors and can help you change your habits or decisions to improve your score. Plus, checking the CIBIL score and report helps you spot and report inaccuracies. Since unresolved discrepancies can also hurt your credit score, be proactive.

Limit new apps

Try not to apply for new loans or credit cards multiple times in a short period, as each application will result in a thorough investigation of your credit score by lenders. Too many inquiries in a short period of time can make you look like a high-risk borrower because it involves credit-hungry behavior. So only apply if you meet the lender’s eligibility criteria, need the funds, and have a repayment plan based on your current debt. Also in this regard, checking the CIBIL score regularly is a good way to go. Your credit report contains information about the number of inquiries on your profile, and by viewing this and your current load, you can decide if it’s a good time to apply for new credit.

Keep an eye on your credit limit and its usage

Having too much debt in a short period and using it to the maximum reduces your creditworthiness. So don’t max out your credit cards every month. Likewise, keep an eye on your credit utilization rate, which refers to the total amount of revolving credit you use each month. Although you should strive to maintain this ratio at 30%, start by reducing it to at least 50% to increase your credit score. Here too, checking your CIBIL score at regular intervals can help you better plan your use of credit.

Keep in mind that if you have a low score, getting new credit can become extremely difficult. Although you can get a personal loan for a CIBIL score of 550 or even lower, its terms and fees may not be in your best interest. By checking your CIBIL score before applying for a loan or a new credit card, you can make informed decisions. It also helps in case you want to see how your new improved credit behavior actually improves your score.

CIBIL score verification is easier and faster with the digital services offered by Bajaj Finserv. Here you can check your CIBIL score for free online using your PAN card information and some other basic information such as your mobile number and your monthly salary. With this simple process, you can not only see your credit score, but also get your credit report in minutes. So get started today and get insights to improve your creditworthiness.

This article is part of the sponsored content program.

]]> What to do if you are refused a loan Mon, 22 Aug 2022 21:01:04 +0000 If you applied for a personal loan and your application was denied, you are not alone. Amid rising inflation and the possibility of a recession, many Americans are struggling financially and are looking for help.

Personal loan debt has increased 24 percent since 2021, but the number of borrowers is lower than in 2019. As personal loans grow in popularity and people accumulate more and more personal loan debt, many people find it difficult to qualify. If you have been refused a personal loan, there are several things you can do to improve your creditworthiness and your chances of getting a loan.

To obtain a personal loan, you must meet certain conditions. When lenders decide if they want to lend you and what terms they are willing to offer, they need to establish your creditworthiness and the likelihood of being able to repay the loan.

Some of the key factors that lenders consider when reviewing personal loan applications include:

Credit score range Average APR Average loan amount
720+ 9.81% $18,812.69
680-719 16.01% $15,214.76
660-679 23.54% $11,727.69
640-659 28.93% $9,470.86
620-639 35.98% $7,350.97
580-619 54.17% $5,746.62
560-579 85.24% $4,250.88
Less than 560 135.83% $2,817.03

As illustrated in the table above, people with higher credit scores are more likely to qualify for a lender’s best APRs and highest loan amounts. Essentially, the better your credit, the better your chances of getting a loan on ideal terms.

Additional documents

When looking for a personal loan, you must have several documents in hand before applying. First, you need to submit a loan application. Each lender has a unique application and specific requirements may vary. You usually need to provide basic personal and financial information, the amount you want to borrow, and the reason for the loan. You will also need proof of your identity, income and address.

There are several reasons why a person may have their loan application rejected:

  • Bad credit history: A bad credit history can tell creditors that you may have trouble repaying what you owe due to past transactions.. Your credit score is generally a good indicator of your credit history, but lenders also look at your financial history to establish your creditworthiness.
  • High debt to income ratio: Your debt-to-income ratio, expressed as a percentage, is the ratio of the income you earn per month to your total monthly debt payments. Lenders use your DTI to determine how likely you are to repay a loan. If you have a DTI of 50% or more, you may have too much debt for a lender to give you a new loan.
  • Incomplete application: Your loan rejection could be as simple as missing documents. If you are rejected for a loan, check that you have fully completed the application and submitted all the appropriate documents.
  • Lack of proof of stable income: Consistency is key, as it helps lenders understand your business landscape going forward. Since jobs can vary by industry, lenders can look at tax returns to get a better overview.
  • The loan does not correspond to the objective: Lenders may have certain restrictions on what you can and cannot do with the loan money. The lender may be able to offer you alternative suggestions to better suit your needs.
  • Unstable Employment History: Lenders like to see a steady stream of income over time. If you’re between jobs or have a history of unstable employment, this could signal to lenders that you may not be a reliable borrower.

If you apply for a personal loan and your application is denied, there are several things you can do to improve your chances of qualifying next time.

First, you need to ask the lender why your application was denied. Under the Equal Credit Opportunity Act, lenders must disclose the reason for your loan application’s denial, provided you find out about it within 60 days of the decision. This is known as notice of adverse actionwhich is the key to taking action and increasing your chances of getting your next loan.

The main reasons personal loan applications are denied are bad credit, lack of credit history, unstable income and high debt to income ratios.

Review and build your credit score

The most important thing you can do to increase your chances of getting a personal loan is to establish your credit score. If you want to see your credit score without a credit check, use a soft credit inquiry, which lets you see your score and credit history without damaging your credit score. When you check your report, make sure there are no errors. Check that your payments are marked as paid on time if you paid them on time and there are no incorrect balances.

Once you know your credit score and have reviewed your credit report, there are several things you can do to boost your credit. Pay off all your debts on time and keep your credit card balances low to avoid accumulating additional debt. You can also become an authorized user on someone else’s account. This can be useful if that person has a better payment history and low usage rate.

Pay off other debts

Lenders generally look for a DTI below 36%, although some allow applicants with DTIs as high as 50%. If a high debt-to-equity ratio is affecting your ability to take out a loan, work on paying off your current debts before applying for more credit.

One way to do this is to tighten your budget and reduce monthly credit card expenses. Talking to a financial advisor about debt consolidation is also a good idea. A debt consolidation loan could help you reduce your monthly payments by consolidating your debts into a single loan. Ideally, the interest rate on this new loan will be lower than what you were paying before the consolidation.

Look for ways to increase your income

A higher income can help lower your DTI and make you more attractive to lenders. Finding ways to supplement your income could improve your chances of getting a loan. Consider asking for a raise at work, finding another job, or finding side work. Add any household income to your full-time job when re-applying for the loan.

Compare personal loans

Different lenders have different requirements, rates, terms and fees. Research lenders and compare rates before going to any particular one. Which lender is right for you depends on your financial situation and your particular needs. Prequalifying with a few lenders is a good idea to see exactly what you’ll be eligible for before applying. You can get a personal loan from online lenders, banks, and credit unions. Each option caters to people with different incomes, credit scores, and personal life schedules.

Prepare your next application and prequalify

Try prequalifying with a few lenders. Although pre-approval is not a guaranteed approval, obtaining pre-approval means that you have met the initial requirements. Many lenders allow you to prequalify without affecting your credit score or committing yourself. However, pre-approval could be denied if something changes, such as your income or credit score.

When you’re ready to reapply, make sure your documentation is up to date to reflect all the hard work and changes you’ve made. If you’re still unsure if you’ll qualify, try finding a co-signer. This option is not only for people who do not meet the requirements, it can also give them an extra boost to get a lower rate. However, a co-signer is responsible for paying any missed payments.

Whenever you apply for a loan or any other type of credit, the credit application appears as a credit application on your credit report, which lowers your credit score. For this reason, it is best to wait a while before applying again. You should wait at least 30 days before applying again, but experts recommend waiting six months to give yourself the best chance of qualifying.

While you wait to reapply, you should work to resolve the reason for your loan denial. Pay off your debts, try to improve your credit score, improve your income if possible, and look for lenders with looser eligibility requirements. If you make payments on other debts during this time, make sure you get the most up-to-date credit reports before submitting another loan application.

The bottom line

Although being turned down for a loan can seem like a big blow, especially if you need the money fast, there are a lot of things you can do to remedy the situation and improve your chances of qualifying the next time you apply.

If you need the money fast and can handle the higher interest rates, there are loans for borrowers with bad credit that tend to have more flexible requirements. However, be aware that you should wait at least a month before reapplying for a loan after being turned down, and that you should only take out a loan if you are sure you can make the monthly payments plus interest and fees. You can also try reapplying for a lower loan amount. The lower the loan amount, the higher your probability of approval.

To improve your chances of getting a personal loan, you can reduce your existing debt and improve your credit score and debt-to-equity ratio.

Suze Orman says you’re ‘asking for so much trouble’ if you do this now Sun, 21 Aug 2022 11:32:46 +0000

Image source: Getty Images

It pays to take it seriously.

Key points

  • While the economy is now stable, things could soon get worse.
  • Making the mistake of going into debt could put you in a difficult financial situation in the short term.

Is the US economy headed for a recession? There’s reason to believe it might be.

But first, we have to go back and talk about inflation. Inflation has been skyrocketing since mid-2021, and this year price increases have really gotten out of control. This left many consumers in a position where they had to loot their savings or rack up credit card debt just to make ends meet.

The Federal Reserve, meanwhile, is eager to slow the pace of inflation. To do this, it has aggressively implemented interest rate hikes, the aim of which is to increase the cost of borrowing for consumers.

Why is it beneficial? The whole reason we’re stuck in this runaway inflation cycle is that the demand for consumer goods has long outstripped the available supply. If borrowing becomes too expensive, consumer spending could decline. This could then reduce the gap between supply and demand and help calm inflation.

But the Fed’s actions could also have negative consequences. On the one hand, they could trigger a recession, a recession that would lead to widespread unemployment. Second, even if we avoid a recession, higher borrowing rates could put those with credit card debt in a very precarious position.

That’s why Suze Orman insists that people with credit card debt should do their best to pay it off as soon as possible. Those who continue to carry this debt, she says, “are asking for so much pain.”

The Danger of Credit Card Debt Right Now

Credit card debt is usually bad news. This can mean racking up interest points and damaging your credit score. But right now, it’s especially important to try and pay off any credit card debt you have, says Orman.

With the Fed increasing rates, your credit card balances may soon become more expensive to pay off. This is because interest on credit cards is usually variable, so the interest rate you are paying on your balances now may not be the rate you will be charged next month or the following month.

Plus, says Orman, if a recession hits and you lose your job, then you could struggle to pay off your debt. And if you are only able to make your minimum payments in this situation, the amount of interest you accrue on your debt will only increase.

Plus, if you find yourself out of work, the last thing you want are monthly credit card minimums hanging over your head. And that’s why, she says, it’s time to pay off that debt once and for all.

How to quickly pay off credit card debt

If you’re sitting on a credit card balance, paying it off quickly is key. But how to get out?

One option is to make a balance transfer and transfer your balances to a single credit card with a lower interest rate – or maybe an introductory rate of 0%. This could make your debt less expensive as you reduce it.

Another option is to subscribe to a Personal loan and use its proceeds to pay off your credit cards. You’ll then have to pay that loan back, but at least personal loans come with fixed interest rates, so the rate you sign up for initially is guaranteed until you’re all paid.

Of course, both of these options simply involve moving your debt or swapping one type of debt for another. Ultimately, to get rid of debt, you’ll need to make an effort to spend less so you can spend more of your income on the amount you owe. Another option is to earn more money by getting a side hustle.

You may not be able to pay off your credit card debt in a few weeks, especially if you have a lot of it. But if you’re able to pay it back by the end of the year, you could dramatically improve your financial outlook and avoid the trouble Orman warns you about.

The best credit card waives interest until 2023

If you have credit card debt, transfer it to this top balance transfer card guarantees you an introductory APR of 0% in 2023! Plus, you won’t pay any annual fees. These are just a few of the reasons why our experts consider this card a top choice to help you control your debt. Read our full review for free and apply in just 2 minutes.

Retired CUBG CEO looks back on 20 years Fri, 19 Aug 2022 19:34:27 +0000
Larry Middleman speaks at a CUBG conference in 2019. (Photo: CUBG)

Larry Middleman wrote the original business plan for Portland, Oregon-based commercial services business group CUSO CU by hand on a piece of paper, front and back, while stuck in an airport during five o’clock in 2001. Now he’s preparing to retire from his role as CUSO President/CEO – which is still practicing some of the original business model concepts he noted during that long layover – but not before d enjoyed CUBG’s first in-person conferences since 2019.

In 20 years, Middleman has grown CUBG from that hand-written business plan to the industry’s largest business service, CUSO. Now owned by six credit unions, CUBG employs 75 people, manages more than $2.5 billion in commercial loans, hosts numerous educational events, and recently expanded into SBA lending through the acquisition of fellow CUSO. . He will retire at the end of September, just after CUSO completes its first post-pandemic in-person conferences in Portland and Memphis, Tennessee, and will be replaced by Justin Conrey, who has spent the past five years as CUBG. executive.

Middleman got his start in the financial services industry while attending college, when he took a job as a part-time cashier at a savings bank in Portland. Finding he performed well in the role, he took it on full-time while earning his degree in accounting, then went into public accounting for about five years.

While working as a CPA, Middleman said he began working with banks on audits and advisory projects, as well as with some credit unions. “It became very clear to me that I was much more attracted to credit unions, given my style and people skills, as well as the types of interactions I was looking for. It was just a different feeling,” he said.

He then served as SVP – CFO for Northwest Corporate Federal Credit Union in Portland before launching CUBG in 2002 as a 100% corporate-owned CUSO (in 2007 Northwest Corporate merged with Southwest Corporate Federal Credit Union of Plano, Texas, which was then liquidated in 2010).

For this Q&A session, CU Times caught up with Middleman just as CUBG’s Portland conference kicked off on August 8. Responses have been edited for length and clarity.

CPU Hours: Why retire now?

Intermediate: CUBG has just celebrated 20 years in business to date, and after 20 years of being in this industry, the growth of the business and all the work, travel and demands associated with it, there has come a time when I felt that time was my most precious Resource.

Another reason for my timing was that about a year and a half ago we acquired CUSO Member Business Lending, and I wanted to make sure it was well integrated. I also wanted to get back to in-person conferences, and I feel like now my job is done here to some extent and it’s time to have people [leading CUBG] who are young, energetic, perhaps more up to date with the latest technology and willing to travel.

CPU Hours: What’s it like meeting up with all of your colleagues in person knowing that these are also your last conferences as CEO of CUBG?

Intermediate: He feels good. We just had our members only lunch [for CUBG member credit unions], which is what we traditionally do to start the conference, and I was going to say a few words at the beginning of lunch. The noise level was so high in the hall that it took me a few tries to get people to stop talking and listen, which I think speaks to the success of our conference. It means people are engaged, talking to colleagues and sharing information. So it’s a great way for me to have a last hurray here and see people I’ve developed many close relationships with over 20+ years.

CPU Hours: What were some of the early challenges in starting CUBG?

Intermediate: Like any new business, you need to attract customers, generate revenue, and deliver a product that people want. I had the benefit of being the CFO of Northwest Corporate, and through the board and corporate committees I had an audience of about 20 Northwest executives who not only wondered if they should invest in the business, but were interested in it themselves. . So I had about 10-20 customers sitting right in front of me before it even opened, and that gave us a nice head start. The business model caught on pretty well in terms of other credit unions from other states showing interest, so the challenge quickly became how to handle all the demand for our services, hire the right people and put all policies, processes and systems in place. place while we were building it.

CPU Hours: What accomplishments are you most proud of over the past 20 years as CEO of CUBG?

Intermediate: Taking that original business plan and literally going from nothing to what we have today is a great achievement – building it, growing it, being able to handle that growth, continuing to deliver quality service and quality analysis commercial underwriting agreements, and be consistent with it over the years.

Another thing is that being a solid and stable influence for the industry has been very rewarding. And it’s so rewarding to have provided the economy and the environment for our employees to have gainful employment, buy cars and homes, raise families and advance in their careers.

CPU Hours: What has been the toughest economic time in the past 20 years for the credit unions that CUBG serves, and how has CUBG stepped up to help them weather it?

Intermediate: The most difficult period was the Great Recession from 2008 to 2012, as the credit union industry at the time did not have the depth of experience [that they have now with commercial lending]. Everyone was focused on origination deals, but when the loans started to deteriorate, the credit unions needed a particular level of expertise. We saw a lot of downturn because the credit unions curtailed their programs, and it was a turbulent economic time for everyone. But we’ve done very well, helping credit unions with loan restructuring strategies, changing our focus, and providing a lot of education. And from CUBG’s perspective, we’ve been able to stay profitable during that time, which I think is a testament to our flexibility.

CPU Hours: How would you describe your leadership style and what have you learned about being a better leader?

Intermediate: I was told early on when I was in management training programs that I had a calm confidence and a pleasant demeanor, so I embraced that and it served well. I try not to sweat the small stuff. I think one of the most important things I’ve learned and continue to perfect over time is just to listen. Sometimes when you get into a leadership position, you may think you’re the best, and you may ask for feedback but not really listen. I value other people’s opinions and encourage them to tell me what they really think, even if they strongly disagree. So not just hearing the words, but letting them sink in and determining if I should use this information to change course.

CPU Hours: Credit unions have seen strong growth in commercial lending over the past two years. Do you see this slowing growth or other challenges emerging for credit unions engaged in commercial lending in this uncertain economic environment?

Intermediate: There was definitely some slowing down, I would call it a loosening of the accelerator pedal.

But people who own businesses or invest in commercial real estate still see real value in real estate. The cost has increased because interest rates have risen, but that hasn’t derailed the plans. Unfortunately, it’s kind of a classic inflation situation – if my cost of borrowing goes up, I have to increase the cost to the tenants of my building.

There are certainly things to be done with caution rather than full speed right now. In the first half of this year, however, we set records for underwriting volumes and new deals coming in – not deal refinances, but brand new deals because rates were going up.

And especially with the shortage of personnel that prevails, [some credit unions have said], you know, we’re struggling to keep staff and hire people, so let’s slow down a bit. And I don’t see that as a bad thing, because we haven’t seen the losses that we anticipated with the pandemic. You have to go at different speeds at different times in the business cycle.

Payday loans versus installment loans: which is better? Wed, 17 Aug 2022 17:50:55 +0000

If you need money quickly, you can turn to loans. You can get a variety of loans: personal, payday, installment or same day loans. These loans can be used for large purchases and unforeseen circumstances, such as funerals, medical emergencies, or home repairs.

What are the differences between these loans? In particular, we will be looking at payday loans versus installment loans in this article. Let’s start.

Payday loans versus installment loans

Installment loans are a broad category that includes mortgages, auto loans, and other personal loans. They are usually longer and subject to credit checks. Payday loans are usually paid in a lump sum within two weeks or the next payday and have higher interest rates. To avoid the stigma associated with payday loans, the industry has adopted the term “short-term installment loan”.

What is a payday loan?

Payday loans are much smaller, usually under $1,000, and must be paid off on your next payday (hence the name). When applying for the loan, you may need to write a post-dated check or provide your bank details.

The downside of payday loans is that they can be difficult to repay. However, lenders allow you to roll over the loan and pay the additional interest on the next payday. Typically, they will also include late fees.

You can read some of the benefits of payday loans below.

Benefits of Payday Loans

They are easily accessible.

For many borrowers, the ease with which payday loans can be obtained is the most important advantage. Unlike traditional loan products, you can apply online in minutes and have the funds transferred to your bank account usually the same day.

They are less stringent than other types of loans.

Payday loans appeal to many borrowers because the acceptance criteria are often less stringent than other types of loans. As a result, lenders frequently approve borrowers with poor credit histories and low incomes, even if they do not meet the essential eligibility criteria of banks and other top-tier institutions.

You can be approved even if you have bad credit.

As stated earlier, you don’t need a perfect credit history to be approved for a payday loan. Even borrowers with bad credit can still apply and may even be approved.

It is an unsecured loan.

Following this, you do not necessarily need collateral for a personal loan. They have high interest rates for this reason – to offset the costs if borrowers default.

Now let’s look at installment loans.

What is an installment loan?

An installment loan can include mortgages, car loans, boat loans, etc. Installment loans similar to payday loans are generally referred to as “personal loans”.

As with any installment loan, you benefit from a lump sum of money in the front. You will then make a fixed monthly payment for the duration of the loan. For example, a car loan can last for three years, while a mortgage loan can last for thirty years. Personal installment loans generally last 12 months.

Here are some advantages of installment loans:

The benefits of installment loans

They have high loan limits.

Installment loans allow you to borrow up to $50,000 or more if you meet all of the lender’s requirements.

They can help you build your credit.

If you have a below average credit score, you can get an installment loan to help you rebuild it, as long as you make timely payments. You can even get better rates if you have good credit.

The reimbursement is fixed.

Installment loans have a fixed amount and repayment schedule for their entire term. Lenders can’t change your monthly payment unless you want a loan restructuring.

Early repayment is an option.

If you can afford to pay off your loan early, you can do so with installment loans without incurring additional costs. However, consult your lender before making any prepayments.

Conclusion—Which is better?

If you qualify for an installment loan, it may be preferable to a payday loan. Payday loans have higher interest rates, and since you can defer them to the next payday, you could potentially continue to defer payment and find yourself in a cycle of debt.

However, payday loans might be more beneficial if you have bad credit, need money urgently, or can repay the loan on time. In the end, it depends on your situation and your financial capacity.

An alternative option to consider: cash advance applications

These look like payday loans and are sometimes called “payday advance apps”, but there are a few key differences. There is no physical storefront and no interest is charged. Instead, they ask for a “tip”. They make small loans that are paid off with your next paycheck.

Authors biography :

Harrison has been a freelance financial journalist for 6 years. He knows the major trends in the financial world. Jones’ experience and helpful tips help people manage their budgets wisely.

Student loan refinance interest rates drop for 10-year fixed rate loans Mon, 15 Aug 2022 19:03:22 +0000

Our goal at Credible Operations, Inc., NMLS Number 1681276, hereafter referred to as “Credible”, is to give you the tools and confidence you need to improve your finances. Although we promote the products of our partner lenders who pay us for our services, all opinions are our own.

The latest student loan refinance interest rate trends on the Credible Marketplace, updated weekly. (iStock)

Pricing for Qualified Borrowers using the Credible Marketplace for refinance student loans fell this week for 10-year fixed rate loans and rose for 5-year floating rate loans.

For borrowers with credit scores of 720 or higher who used the Credible Marketplace to select a lender during the week of August 8, 2022:

  • Rates on 10-year fixed-rate refinance loans averaged 5.46%, down from 5.75% the week before and 3.46% a year ago. Rates for this term hit their lowest point in 2022 so far during the week of January 10, when they were at 3.44%.
  • Rates on 5-year variable rate refinance loans averaged 3.99%, down from 2.79% the previous week and 2.59% a year ago. Rates for this term hit their lowest point in 2022 so far during the week of July 4, when they were at 2.51%.

Weekly Trends in Student Loan Refinance Rates

If you’re curious about what kind of student loan refinance rates you might qualify for, you can use an online tool like Credible to compare the options of different private lenders. Checking your rates will not affect your credit score.

Current Student Loan Refinance Rates by FICO Score

To ease the economic impacts of the COVID-19 pandemic, interest and payments on federal student loans have been suspended until at least August 31, 2022. As long as this relief is in place, there is little incentive to refinance federal student loans. But many borrowers with private student loans are taking advantage of low interest rates to refinance their student debt at lower rates.

If you qualify to refinance your student loans, the interest rate you may be offered may depend on factors such as your FICO score, the type of loan you are seeking (fixed or variable rate), and the repayment term. of the loan.

The chart above shows that good credit can help you get a lower rate, and rates tend to be higher on loans with fixed interest rates and longer repayment terms. Since each lender has their own method of evaluating borrowers, it’s a good idea to ask for rates from multiple lenders so you can compare your options. A student loan refinance calculator can help you estimate how much you could save.

If you want refinance with bad credit, you may need to apply with a co-signer. Or, you can work on improving your credit before applying. Many lenders will allow children to refinance parent PLUS loans in their own name after graduation.

You can use Credible to compare rates from several private lenders at once without affecting your credit score.

How Student Loan Refinance Rates Are Determined

The rates charged by private lenders to refinance student loans depend partly on the economic environment and interest rates, but also on the duration of the loan, the type of loan (fixed or variable rate), creditworthiness the borrower and the lender’s operating costs and profit margin. .

About Credible

Credible is a multi-lender marketplace that allows consumers to discover the financial products best suited to their particular situation. Credible’s integrations with major lenders and credit bureaus allow consumers to quickly compare accurate and personalized loan options without putting their personal information at risk or affecting their credit score. The Credible Marketplace delivers an unparalleled customer experience, as evidenced by over Over 5,000 positive reviews on Trustpilot and a TrustScore of 4.7/5.

Letter: Bad Credit Risk Bank Loans Are Truly Unintentional Charity | Letters Mon, 08 Aug 2022 23:30:00 +0000

Bad credit risk bank loans are an involuntary charity

“Giving all Americans a chance to achieve their dreams” [Aug. 4] aims to promote a program designed primarily to provide money to minorities who cannot afford to acquire homes for themselves.

If the editorialist substituted the word give for the concept used, which is lendat least some readers could correctly deduce what it actually means.

The concept pushed here is really involuntary charity disguised as bank loans.

The article mentions a federal law called “The Community Reinvestment Act”.

What it actually does is force banks to lend money to people who have bad credit risks. The law is a product of the Carter administration that was resurrected by the Obama, now Biden administration.

People also read…

The tools previously used before were the ultimate lenders known as Fannie Mae, Ginnie Mae and Freddie Mac, all quasi-governmental organizations designed to look like US-guaranteed lenders. when they are not.

In the early 2000s, many savvy traders used this same situation during an economic downturn (once known as the Depression) to snatch perhaps a trillion dollars from the American taxpayer.

The Federal Reserve along with the US Treasury got Congress to turn on the money taps to bail out the banks (US and foreign) with money from the printing press, the responsibility for which the American people became responsible.

For more, please see TJ Woods Jr.’s little book, “Meltdown,” which will.

Dave Ramsey says that taking on this type of debt is “like trying to save yourself from a sinking boat with a bucket full of holes”. Is he right ? Sun, 07 Aug 2022 13:32:43 +0000

Image source: Getty Images

Is the finance guru irrelevant on this issue?

Key points

  • Dave Ramsey is not a fan of most types of debt.
  • He doesn’t believe you should take out a personal loan.
  • The reality is that borrowing through a personal loan can sometimes be a smart move for several reasons, such as consolidating credit card debt.

If you know financial expert Dave Ramsey, you probably already know that he doesn’t like to borrow. In fact, he suggests avoiding most types of financing. And, there’s a particular kind of debt he said not to take on because it’s “like trying to get out of a sinking boat with a bucket full of holes.”

What debt is he talking about — and is he right to recommend avoiding it?

Dave Ramsey is against personal loans

On his blog, Ramsey explained common reasons people get personal loans: debt consolidation at a lower interest rate; building credit; and buy things you can’t afford to pay for outright. And he said none of those reasons are valid for borrowing.

“We know it can seem like taking out a loan will help you get ahead or even just relieve you in the middle of a crisis,” Ramsey said. “But trust us, the loans only leave you a few steps back from where you started.”

Ramsey warned that taking out a personal loan can be “a lot of work”, to “achieve absolutely nothing”. And he warned that “the burden of personal loans (plus the interest that is automatically added) prevents you from making real progress with your money”. He also suggested that if you take out a personal loan, you could find yourself stuck in debt for life, so you should just say no.

Is Ramsey right?

Ramsey is on the verge that certain types of debt, like store credit cards and installment loans, are bad news. But when it comes to personal loans, it falls far short of the basics.

First, personal loans won’t lock you into debt because unlike credit cards, which let you keep charging them as you pay down your balance, personal loans don’t work that way. You borrow a fixed amount of money and you have a limited time to repay it. This is a huge advantage of using a personal loan to pay off credit card debt because you can stick to a set schedule and know exactly when you are going to be debt free.

Second, personal loans can have much lower interest rates than most other types of debt, such as credit cards and payday loans. Therefore, using them to consolidate and pay off debts can make paying off what you owe much easier and more affordable. If you can pay off several other debts with a personal loan at a lower rate, there is absolutely no reason not to as long as you can count on yourself not to charge your credit cards once you refinanced them into the personal loan. .

There are also circumstances where you really have no choice but to borrow. While Ramsey says you can avoid doing this by saving for what you want and sticking to your budget, it does take time. If you don’t yet have an emergency fund saved up and an essential purchase you can’t afford, a personal loan might be one of the cheapest ways to borrow to pay for it.

Ultimately, taking out a personal loan is not about using a faulty bucket to try to save yourself. It is a very good tool to use in certain circumstances and not at all to hesitate.

The Ascent’s Best Personal Loans for 2022

Our team of independent experts have pored over the fine print to find the select personal loans that offer competitive rates and low fees. Start by reviewing The Ascent’s best personal loans for 2022.

How to get a loan with bad credit Fri, 05 Aug 2022 17:53:15 +0000

Our goal at Credible Operations, Inc., NMLS Number 1681276, hereafter referred to as “Credible”, is to give you the tools and confidence you need to improve your finances. Although we promote the products of our partner lenders who pay us for our services, all opinions are our own.

If you have a low credit score, it is still possible to qualify for a personal loan. Keep reading to learn more about loans for bad credit. (Shutterstock)

Having a good credit score can be very useful if you need to borrow money. When you have bad credit, it can be difficult to get a personal loan, especially with low interest rates and no fees. But some lenders cater to borrowers with bad credit scores.

Here’s how to get a loan with bad credit and what you need to know about this specific type of credit product.

If you need a personal loan, visit Credible for see your prequalified rates from various lenders, all in one place.

1. Check your credit report and background

Before applying for loan for bad creditIt’s a good idea to check both your credit report and your credit history to see where you stand. Knowing your credit score can help you determine the types of loans you can qualify for, which lenders to apply to, and which ones to skip if you’re unlikely to meet their requirements.

Reviewing your credit report gives you the opportunity to spot any errors or potential fraud and report them to the credit bureau. If certain items on your credit report are found to be in error, the credit bureau may remove them from your report. This can usually improve your credit score, with little effort on your part. You can also review your report to see areas you can improve to qualify for better loan products in the future.

The reason lenders like to see high credit scores is that a low credit score is usually the result of negative marks on your credit report, such as late payments or debts in collection. A low credit score tells a lender that you are more likely to miss paying your debts or default on the loan, which can be very costly for the lender.


2. Pre-qualify for a personal loan

When you apply for a Personal loan, you trigger a serious investigation into your credit report, which temporarily lowers your credit score. This is unavoidable if you want to get a personal loan, but you can avoid having an unnecessary credit check on your file.

Before officially applying for a personal loan, prequalify with lender to get an estimated loan offer. When you prequalify, the lender only performs a simple investigation of your credit file. So if the lender tells you that they probably won’t approve your loan application or presents you with terms that you know you won’t want to accept, you can ignore the official request to that lender.

Credible, it’s easy to compare personal loan rates from various lenders, and it will not affect your credit.

3. Compare bad credit loans

Before you prequalify, research which lenders accept your credit score so you don’t waste time and energy with lenders who won’t work with you.

Several lenders offer personal loans to borrowers with lower credit scores. These lenders often consider other information when reviewing your application, such as your employment and Income. While most lenders tend to require a score of at least 580, some lenders don’t even require a credit check.

It is important to compare prequalification offers from at least three to five different lenders. This way, you can find a loan that best suits your financial situation.

4. Find a co-signer

You don’t have to apply for a loan meant for borrowers with bad credit. One way to increase your chances of qualifying for a Personal loan – and get a lower interest rate – is to apply with a co-signer who has a higher credit score than you. It can be a trusted friend or family member.

However, the co-signer must be careful. They will be responsible for making loan repayments if you are unable to do so. If you and your co-signer fail to make your payments, or if you make your payments late, your credit ratings may suffer.


What to consider when looking for a loan for bad credit

Not sure if taking out a personal loan when you have bad credit is the right decision for you? Here are some factors to consider:

  • Shop around for the best deal. Just because your credit rating is low doesn’t mean you have to accept the first personal loan offer that comes your way. Compare personal loan offers from a few different lenders to see which one has the lowest interest rates and fees, as well as a loan amount and repayment term that suits your needs.
  • Bad loans come with higher fees. To offset their risk, lenders often charge higher fees when lending to consumers with bad credit, such as application or origination fees for processing the loan.
  • Interest rates are higher. Lenders also tend to charge much higher interest rates when you have bad credit. It may be worth waiting until you have improved your credit score to apply for a loan, as a higher interest rate will cost you significantly more over the life of the loan.

If you’re ready to apply for a personal loan, head over to Credible for a quick and easy compare personal loan rates to find the one that best suits your needs.