Taking Personal Loan for Debt Consolidation?
If you're one of the many struggling to keep up with credit card debt, car loans, or other consumer debt, it may be best to consider the help of a debt consolidation company. Online debt consolidation companies have made the process even easier than before, and can help individuals secure simpler monthly payments along with lower interest rates on their debt. If you are under debt and want to find some relief, there are a number of options that may be available to you. See your options.
Personal loans can be a godsend when you face a huge tax bill, an unexpected car repair bill, or another large expense. But you might be wondering if a personal loan is even possible if you've had the misfortune of having bad credit.
Given that your poor credit score might be caused due to something accidental and unexpected, like misreported bank finance charge, your first logical step should be to review your credit report and fix whatever is possible as this can really help in broadening your options for personal loans in the future.. There are agencies which can help in repairing your credit score quite successfully and you should consider these as your first option when thinking of a personal loan with having bad credit.
First of all, it's important to understand the nature of a personal loan. Unlike a home loan or a car loan, a personal loan is unsecured, meaning that you are offering no collateral to secure the loan. That makes the loan inherently risky for a bank or other lending institution.
In order to determine whether you can qualify for bad credit loans, it's first necessary to fill out an application. A typical personal loan application requests your full name, Social Security number, income, and other pertinent financial information. A loan officer must determine your credit worthiness, even in the face of your bad credit history.
With a personal loan, you may not have to undergo a credit check. The money may be deposited within 24 hours into your checking account. You can use the cash for virtually anything—but especially for emergency situations. However, the amount you can borrow may be limited to no more than $1,500.
A loan officer may assist you in making your application more appealing by encouraging you to borrow a smaller amount of money or make payments over a longer span of time. In this way, your monthly payments can be lowered, increasing your chances of getting a loan.
The loan officer must also determine whether you have a steady income. If you have held the same job for a number of years, for instance, you're more likely to obtain the loan. However, if you've changed jobs several times over the past few years, you may be less likely to get the loan you want.
The application process for a personal loan is usually relatively quick. Another advantage is that it does not require a formal closing. The application process consists of a written application, a promissory note, and a payment schedule. As a result, there is less paperwork and hassle involved in obtaining a personal loan than in obtaining a secured loan.
At times, it may be possible to obtain a personal loan from a professional organization to which you belong. The main advantage to such a loan is that the annual percentage rate, or APR, may be much lower than the rate you would get at a traditional finance company. For instance, you may be able to get an APR for as low as 7.99 percent, which would be considered a real bargain for a personal loan. You also may be able to borrow a great deal more money from a professional organization than you would be able to borrow otherwise—the amount you can borrow may be as much as $25,000.
With such a loan, you may be able to defer payments for a period of a few months. You also may face no penalty for early repayment. The terms of the loan may also be quite generous, allowing you to make payments over a period as long as 84 months. You can use such a loan to consolidate debt, pay education expenses, or pay home improvement costs.
The answer to judiciously managing a bad credit personal loan is to work out the numbers and determine how soon you will be able to repay the borrowed amount. You should plan to borrow only the lowest amount you need in your situation and plan to make monthly payments that are higher than the minimum monthly payment required. The idea finally is to the sooner you are able to pay back your bad credit personal loan, the better it is for your financial future.
Rebuild.org brings you the latest news headlines related to Personal Loans:
- Should you use a debt relief firm if you can’t repay a loan?
In most cases you are better off contacting your loan company directly than turning to a debt relief firm for help.
[August 23rd, 2011]
- Using loans and credit cards for big purchases
It's important to know when it makes sense to use a loan or a credit card to make a large purchase.
[August 19th, 2011]
- Should you get a personal loan to pay off credit cards?
A personal loan could help to consolidate credit cards, but make sure this is the right strategy to pay off debt.
[August 12th, 2011]
- Consumer credit rose 7.7 percent in June
Consumer borrowing jumped 7.7 percent in June as many people, feeling squeezed by the economy, relied on loans and other types of credit.
[August 5th, 2011]
- Study: Bank payday loans keep borrowers trapped in cycle of debt
Borrowers who use bank payday loans tend to become trapped in a long-term cycle of debt, according to a recent study from the Center for Responsible Lending.
[July 29th, 2011]
Recent articles related to Personal Loans:
- 5 questions to ask when shopping for a personal loan
The most important questions to ask when evaluating personal loan deals.
[March 18th, 2011]
- Auto loans news roundup
Auto loans have been in the news a lot over the last couple of weeks or so. Here's a roundup of some of the headlines and stories you might have missed.
[February 16th, 2011]
- Auto loans cheapest ever, study says
New data confirms that the APRs paid on auto loans in December were the lowest on record. And that seems to be driving a revival in vehicle sales. In fact, things are so good for carmakers that they are again going to be major advertisers during Sunday's Super Bowl.
[January 31st, 2011]
- Cheap auto loans–more reasons to think they may not last
By historical standards, auto loans remain incredibly cheap. But some think that happy situation may not last long.
[January 17th, 2011]
- Cheap auto loans to get dearer in 2011?
Auto loans (in fact most sorts of consumer credit) are generally cheaper now than they have been for years. But will that last? Some experts are predicting that borrowing will become more expensive in 2011.
[January 3rd, 2011]