Florida's real estate boom, by any measure one of the biggest speculative investment bubbles in history, peaked in October 1925, and banks started failing in the summer of 1926. The bubble burst because of:
Bank fraud and insider abuse, aggravated by unsecured personal loans made to bank regulators, including state Comptroller Ernest Amos, who misled the public about the health of Florida's banks, according to historian Raymond Vickers.
National hostility against the "excesses" of Florida. This was orchestrated by northern bankers who were tired of seeing their deposits flow to Florida banks. To counteract bad publicity in the northern states, Gov. Martin and several developers held a press conference in New York City in early 1926 to tell "the truth about Florida." The press saw this as a sign that the boom was over.
Bad loans.
The public defection of Sen. T. Coleman du Pont from Mizner Development Corp.'s board, when he realized the company's marketing department was making guarantees to buyers that could not be kept. One advertisement for Addison Mizner's dream development, Boca Raton, promised grandeur and said: "Attach this advertisement to your contract for deed. It becomes a part thereof." Fearing personal liability, du Pont quit, and within a week, several other board members followed. This put Boca in a coma and the boom on life support.
Prices that soared beyond anyone's ability to pay. "We just ran out of suckers," said one developer.
A rail strike, in October 1925, which led to a rail embargo that kept needed building supplies out of the state when demand was the highest.
The January 1926 capsizing of the Prinz Valdemar, a four-masted ship that was to be used as a floating hotel, in the mouth of Miami's harbor. That blocked the import of building materials by ship for weeks.
Bad publicity following a hurricane in September 1926 that killed 400 people and left 50,000 homeless in Dade County.
source:http://www.heraldtribune.com/article/20080127/REALESTATE/801270421
Sunday, January 27, 2008
AA Personal Loans: Female car dealers preferred
A new survey by AA Personal Loans suggests that many Britons may prefer to buy a car from a female salesperson.
AA Personal Loans conducted a poll in which they asked people which celebrities they would prefer to have as a car dealer.
Lorraine Kelly and Paula Radcliffe were among the top choices, the figures reveal.
In fact, four out of five of the top selections on the list are women, with Jeremy Paxman as the sole man appearing.
Mark Huggins, head of AA Personal Loans, suggested that some people may associate more trustworthy qualities with women, rather than men.
"With the gender balance in the car market shifting, women being just as likely to buy a second hand car as men, it makes sense that many would prefer to buy a car from a woman," he remarked.
A recent Sheilas' Wheels study suggested that women may not be doing enough to keep their hair under control as they drive, which could be a safety hazard.
source:http://www.moneynews.co.uk/4155/aa-personal-loans-female-car-dealers-preferred/
AA Personal Loans conducted a poll in which they asked people which celebrities they would prefer to have as a car dealer.
Lorraine Kelly and Paula Radcliffe were among the top choices, the figures reveal.
In fact, four out of five of the top selections on the list are women, with Jeremy Paxman as the sole man appearing.
Mark Huggins, head of AA Personal Loans, suggested that some people may associate more trustworthy qualities with women, rather than men.
"With the gender balance in the car market shifting, women being just as likely to buy a second hand car as men, it makes sense that many would prefer to buy a car from a woman," he remarked.
A recent Sheilas' Wheels study suggested that women may not be doing enough to keep their hair under control as they drive, which could be a safety hazard.
source:http://www.moneynews.co.uk/4155/aa-personal-loans-female-car-dealers-preferred/
Thursday, January 24, 2008
Bank said no? Try a personal lender online
When Betty Cabrera needed $5,000 to move into a bigger apartment, the Tacoma woman didn't hit up family or friends for cash.
She posted an ad on asking for a loan to cover first and last month's rent and moving expenses, and uploaded a photo of herself with her husband and two children "to show that I'm a family person."
Soon after her listing went up, complete with her credit rating and debt-to-income ratio, the bids rolled in, eBay-style. Perfect strangers made online offers to lend her money.
"The more days it went, the lower the interest rate was," Cabrera said.
After a week, her loan, which started at a 13.99 percent interest rate, was bid down to 9.9 percent. A few days later, the money was transferred to her account.
Cabrera, who got a three-year unsecured personal loan, doesn't know who lent her the money or why they did. But she said she'll probably get another loan when it comes time to make some home improvements.
Peer-to-peer lending occupies a tiny fraction of the credit market, but it's gaining in popularity as borrowers and lenders look to bypass banks and credit cards for better deals. Social lending networks are emerging to help borrowers and lenders find each other.
"You cut the middleman out. You're getting a better deal," said Renaud Laplanche, founder and chief executive of Lending Club, which launched as a Facebook application last year before opening to the public in September.
Laplanche said borrowers get an interest rate on an unsecured loan that's 2 percent to 3 percent better than they'd get from banks, and lenders get a return of 10 percent to 12 percent -- better than many investments.
"The sites put the decision-making power in the hands of the individual," said Jean Garascia, an analyst with Javelin Strategy & Research.
Between $300 million and $400 million has been borrowed through peer loans in the U.S., a drop in the bucket of the $880 billion credit market, she said. "It's a relatively small population that's using it right now," she said. "That's not to say it won't change."
Younger consumers and higher-income people are the most likely to use it.
"A lot of it is knowing you have alternative options and not being afraid of the medium," Garascia said.
Ben Gillihan, 31, of Des Moines, likes to read people's "pitch" to find out why they need the money. He tends to lend to people who are trying to consolidate their debt or pay off high-interest credit cards.
"It's fun to read through (the listings) and feel like you're lending to an individual, versus (buying) a CD, which is more impersonal," said Gillihan, who has invested about $6,000 so far in the Lending Club and $1,700 with Prosper. "I can loan to them at 13 or 14 percent. Their credit cards are 20 percent. There's an upside for them, and a rate of return for me, too."
Many borrowers are looking to consolidate their credit card debts and loans, or start a new business. Others want to pay for a wedding, cover medical bills, restore an old sailboat or upgrade their kitchens.
The handful of sites -- Prosper, Lending Club, Zopa, Virgin Money and GlobeFunder -- all offer a slightly different model on peer lending. Virgin cuts out the awkwardness by facilitating loans between friends and relatives. Lending Club sets the interest rates depending on one's credit rating and tries to connect people with shared interests. Zopa, a United Kingdom-based company that debuted last month, allows lenders to buy certificates of deposit from credit unions to help borrowers.
Prosper, the largest in the U.S. with 500,000 members and $100 million in loans, leaves it up to the marketplace to decide who gets funded and at what interest rate.
"It's done by the community itself, so people can get the right prices on both sides," said Chris Larsen, chief executive of Prosper.
Larsen said the arrival of other competitors in recent months validates what Prosper is doing.
"We're all focused on competing with the credit card companies and traditional banks," Larsen said.
People who lend money are looking for something different, he said. They want to do well and get a better return on their investments, but they say, "I also want to feel good about what I'm doing."
David Laub of Mercer Island likes to help people who are trying to get out of high credit card debt because he hates credit cards. As an entrepreneur, he also identifies with those who need money to start their own businesses.
He recently took a pass on a borrower who wanted a loan to pay for breast implants and was skeptical of the retiree who had a $2,000 monthly income but wanted to borrow $25,000.
But he sympathized with a borrower whose car had broken down and who ended up taking out a payday loan to pay for the repairs.
"That person had a job for five or six years, a good credit rating," said Laub, chief financial officer of mobile technology firm Crushorflush.
Laub and Gillihan typically make small loans to many borrowers to spread out their money and reduce the risk of someone not paying.
"There's always the risk of somebody not paying," Gillihan said. But to date, he said, no one has defaulted.
source:http://seattlepi.nwsource.com/money/348102_peerloans21.html?source=mypi
She posted an ad on asking for a loan to cover first and last month's rent and moving expenses, and uploaded a photo of herself with her husband and two children "to show that I'm a family person."
Soon after her listing went up, complete with her credit rating and debt-to-income ratio, the bids rolled in, eBay-style. Perfect strangers made online offers to lend her money.
"The more days it went, the lower the interest rate was," Cabrera said.
After a week, her loan, which started at a 13.99 percent interest rate, was bid down to 9.9 percent. A few days later, the money was transferred to her account.
Cabrera, who got a three-year unsecured personal loan, doesn't know who lent her the money or why they did. But she said she'll probably get another loan when it comes time to make some home improvements.
Peer-to-peer lending occupies a tiny fraction of the credit market, but it's gaining in popularity as borrowers and lenders look to bypass banks and credit cards for better deals. Social lending networks are emerging to help borrowers and lenders find each other.
"You cut the middleman out. You're getting a better deal," said Renaud Laplanche, founder and chief executive of Lending Club, which launched as a Facebook application last year before opening to the public in September.
Laplanche said borrowers get an interest rate on an unsecured loan that's 2 percent to 3 percent better than they'd get from banks, and lenders get a return of 10 percent to 12 percent -- better than many investments.
"The sites put the decision-making power in the hands of the individual," said Jean Garascia, an analyst with Javelin Strategy & Research.
Between $300 million and $400 million has been borrowed through peer loans in the U.S., a drop in the bucket of the $880 billion credit market, she said. "It's a relatively small population that's using it right now," she said. "That's not to say it won't change."
Younger consumers and higher-income people are the most likely to use it.
"A lot of it is knowing you have alternative options and not being afraid of the medium," Garascia said.
Ben Gillihan, 31, of Des Moines, likes to read people's "pitch" to find out why they need the money. He tends to lend to people who are trying to consolidate their debt or pay off high-interest credit cards.
"It's fun to read through (the listings) and feel like you're lending to an individual, versus (buying) a CD, which is more impersonal," said Gillihan, who has invested about $6,000 so far in the Lending Club and $1,700 with Prosper. "I can loan to them at 13 or 14 percent. Their credit cards are 20 percent. There's an upside for them, and a rate of return for me, too."
Many borrowers are looking to consolidate their credit card debts and loans, or start a new business. Others want to pay for a wedding, cover medical bills, restore an old sailboat or upgrade their kitchens.
The handful of sites -- Prosper, Lending Club, Zopa, Virgin Money and GlobeFunder -- all offer a slightly different model on peer lending. Virgin cuts out the awkwardness by facilitating loans between friends and relatives. Lending Club sets the interest rates depending on one's credit rating and tries to connect people with shared interests. Zopa, a United Kingdom-based company that debuted last month, allows lenders to buy certificates of deposit from credit unions to help borrowers.
Prosper, the largest in the U.S. with 500,000 members and $100 million in loans, leaves it up to the marketplace to decide who gets funded and at what interest rate.
"It's done by the community itself, so people can get the right prices on both sides," said Chris Larsen, chief executive of Prosper.
Larsen said the arrival of other competitors in recent months validates what Prosper is doing.
"We're all focused on competing with the credit card companies and traditional banks," Larsen said.
People who lend money are looking for something different, he said. They want to do well and get a better return on their investments, but they say, "I also want to feel good about what I'm doing."
David Laub of Mercer Island likes to help people who are trying to get out of high credit card debt because he hates credit cards. As an entrepreneur, he also identifies with those who need money to start their own businesses.
He recently took a pass on a borrower who wanted a loan to pay for breast implants and was skeptical of the retiree who had a $2,000 monthly income but wanted to borrow $25,000.
But he sympathized with a borrower whose car had broken down and who ended up taking out a payday loan to pay for the repairs.
"That person had a job for five or six years, a good credit rating," said Laub, chief financial officer of mobile technology firm Crushorflush.
Laub and Gillihan typically make small loans to many borrowers to spread out their money and reduce the risk of someone not paying.
"There's always the risk of somebody not paying," Gillihan said. But to date, he said, no one has defaulted.
source:http://seattlepi.nwsource.com/money/348102_peerloans21.html?source=mypi
Friday, January 18, 2008
Bad Credit - How To Secure Loans With Bad Credit Status
Having bad credit status is like having disease and remaining helpless with no positive answers from lenders. Still there are some lenders who have managed reducing their risks and provide suitable loans to bad credit scorers.
Having bad credit status is like having disease and remaining helpless with no positive answers from lenders. Defective credit score was the main reason behind people's loan requests to be rejected. Even if they manage to get an advanced personal loan, they end up paying excessively high interest monthly installments. This is because lenders do not take account of the previous good credit status of borrowers due to their present imperfect payment records. They forgot people at present tarnished with poor credit history once owned good credit history. So is it then really so difficult for these bad credit scorer to take a bad credit loan, bad credit mortgage or a bad credit car loan? Negative answer to this question brings good news for owners of bad credit status.
How and What Loans Are Available For Bad Credit Status Owners
Recently some lenders started agreeing to the fact that people with good credit status earlier may be trapped into poor credit status. Moreover, now they admit that to expand their own scope of business they must expand range of loans and provide more scopes for this group of consumers. They must come up with different types of loans to suit and correct bad credit history of their consumers.
Whether for buying car, home renovation or holiday plans, bad credit scorers can find suitable bad credit personal loans for them. If the borrower is capable of using his collateral to secure loan, his bad credit status is not an obstacle for loans. With valuable collateral of borrowers involved, lenders feel and know the loan will paid; otherwise borrower will lose his asset. Collateral usually becomes borrowers' home, car and other extremely valuable asset.
With the collateral getting involved into the business of bad credit personal loans, both lenders and borrowers feel secure from their own aspects. Because the main risk would involve a borrower's failure to keep up with the payments, his collateral removes this risk from lenders' end. Therefore, lenders do not hesitate providing loans to poor credit scorers. Moreover, earlier borrowers were imposed extremely high interest rates because of the risks involved. Now with their collateral involved personal loans, lenders now offer reasonable and considerably lower interest rates to people with bad credit. Hence, today borrowers with defective payment records can be entitled to suitable personal loans they need and that too with much lower interest rates.
Source:http://www.americanchronicle.com/articles/49321
Having bad credit status is like having disease and remaining helpless with no positive answers from lenders. Defective credit score was the main reason behind people's loan requests to be rejected. Even if they manage to get an advanced personal loan, they end up paying excessively high interest monthly installments. This is because lenders do not take account of the previous good credit status of borrowers due to their present imperfect payment records. They forgot people at present tarnished with poor credit history once owned good credit history. So is it then really so difficult for these bad credit scorer to take a bad credit loan, bad credit mortgage or a bad credit car loan? Negative answer to this question brings good news for owners of bad credit status.
How and What Loans Are Available For Bad Credit Status Owners
Recently some lenders started agreeing to the fact that people with good credit status earlier may be trapped into poor credit status. Moreover, now they admit that to expand their own scope of business they must expand range of loans and provide more scopes for this group of consumers. They must come up with different types of loans to suit and correct bad credit history of their consumers.
Whether for buying car, home renovation or holiday plans, bad credit scorers can find suitable bad credit personal loans for them. If the borrower is capable of using his collateral to secure loan, his bad credit status is not an obstacle for loans. With valuable collateral of borrowers involved, lenders feel and know the loan will paid; otherwise borrower will lose his asset. Collateral usually becomes borrowers' home, car and other extremely valuable asset.
With the collateral getting involved into the business of bad credit personal loans, both lenders and borrowers feel secure from their own aspects. Because the main risk would involve a borrower's failure to keep up with the payments, his collateral removes this risk from lenders' end. Therefore, lenders do not hesitate providing loans to poor credit scorers. Moreover, earlier borrowers were imposed extremely high interest rates because of the risks involved. Now with their collateral involved personal loans, lenders now offer reasonable and considerably lower interest rates to people with bad credit. Hence, today borrowers with defective payment records can be entitled to suitable personal loans they need and that too with much lower interest rates.
Source:http://www.americanchronicle.com/articles/49321
Monday, January 14, 2008
Cheap Secured Personal Loans With Minimum Rates
Secured personal loans provide one of the most interesting and inexpensive sources of funds. Whether you have good credit, fair credit or poor credit, you can always get finance through secured personal loans because the risk is always compensated by the guarantee that collateral provides and thus, your credit score will not define whether you are approved or not.
Instead, credit assessment will determine the interest rate you will have to pay for the money borrowed.
And since an asset is guaranteeing the loan repayment, cheap secured personal loans offer inexpensive financing even for those with a poor credit score. If you really want to obtain a cheap rate, by following some easy steps and advice you can ensure obtaining competitive secured personal loan terms and minimum interests.
First Step: Collateral Assessment
Use your most valuable asset to secure a loan. If you have a property that is worth a lot more than the amount you need to borrow, that asset constitutes excellent collateral as it provides a greater security for the lender knowing that if interests accumulate or the prices of properties drop, the asset will still be enough to cover the debt.
Second Step: Loan Conditions
It is important that you foresee the loan conditions that you will probably need to cope with and the limitations that you may have. This will let you ponder correctly the amount of money that you should borrow and the term of the repayment program. If you cannot commit to high monthly payments you will need to either sacrifice a portion of your desired loan amount (postponing home improvements for some months for instance) or choose a longer repayment program that will let you reduce the amount of your monthly payments.
Third Step: Lender Comparison
To obtain cheap secured personal loans you must shop around for a lender. There are many secured personal loan lenders out there but if you want to obtain a cheap loan you have to compare different quotes. The best way to do this is to take advantage of the tools that internet sites provide.
There are many online financial sites running comparisons which are modified periodically to reflect market variations that can help you make your decision. But if you are not comfortable confiding in these online sites, you can do your own research by searching the net for cheap secured personal loans and requesting loan quotes from different lenders.
Additional Tip: Credit Assessment
It is a common mistake to believe that when it comes to secured loans, the applicant’s credit score is not important. This is absolutely false. Though secured personal loans can be easily approved even with bad credit, this does not mean that bad credit will not impact on the loan conditions. You may obtain approval but your secured personal loan will not be cheap at all if your credit is far from perfect. Therefore, it is a good idea to try improving your credit score a bit prior to applying for your loan in order to get a cheap secured personal loan with advantageous terms.
Source:http://www.americanchronicle.com/articles/viewArticle.asp?articleID=48810
Instead, credit assessment will determine the interest rate you will have to pay for the money borrowed.
And since an asset is guaranteeing the loan repayment, cheap secured personal loans offer inexpensive financing even for those with a poor credit score. If you really want to obtain a cheap rate, by following some easy steps and advice you can ensure obtaining competitive secured personal loan terms and minimum interests.
First Step: Collateral Assessment
Use your most valuable asset to secure a loan. If you have a property that is worth a lot more than the amount you need to borrow, that asset constitutes excellent collateral as it provides a greater security for the lender knowing that if interests accumulate or the prices of properties drop, the asset will still be enough to cover the debt.
Second Step: Loan Conditions
It is important that you foresee the loan conditions that you will probably need to cope with and the limitations that you may have. This will let you ponder correctly the amount of money that you should borrow and the term of the repayment program. If you cannot commit to high monthly payments you will need to either sacrifice a portion of your desired loan amount (postponing home improvements for some months for instance) or choose a longer repayment program that will let you reduce the amount of your monthly payments.
Third Step: Lender Comparison
To obtain cheap secured personal loans you must shop around for a lender. There are many secured personal loan lenders out there but if you want to obtain a cheap loan you have to compare different quotes. The best way to do this is to take advantage of the tools that internet sites provide.
There are many online financial sites running comparisons which are modified periodically to reflect market variations that can help you make your decision. But if you are not comfortable confiding in these online sites, you can do your own research by searching the net for cheap secured personal loans and requesting loan quotes from different lenders.
Additional Tip: Credit Assessment
It is a common mistake to believe that when it comes to secured loans, the applicant’s credit score is not important. This is absolutely false. Though secured personal loans can be easily approved even with bad credit, this does not mean that bad credit will not impact on the loan conditions. You may obtain approval but your secured personal loan will not be cheap at all if your credit is far from perfect. Therefore, it is a good idea to try improving your credit score a bit prior to applying for your loan in order to get a cheap secured personal loan with advantageous terms.
Source:http://www.americanchronicle.com/articles/viewArticle.asp?articleID=48810
Sunday, January 13, 2008
Secured loans are based on Equity in your home
In financial jargon, the word Equity means the difference between the market value of your home and the debts raised against it. In other words, it is the unencumbered value of your home that is known as equity. The concept of equity is important for a homeowner since a loan can be raised against the equity in your home. Many lenders offer a loan to value ratio of eighty per cent only. It means that if your home has a value of £150,000, you can take a loan upto £120,000.
The credit rating that you have at the time of taking loan is very important. A good credit rating implies that your past conduct in the financial transactions was trustworthy and, therefore, lenders are likely to offer you a low rate of interest. By releasing the equity in your home, you can borrow upto £250,000. People usually take loan against equity only when they have large monetary requirements.
How borrowers are advantageously placed when taking secured loans?
In the past few years, the value of an average home in the UK has increased manifold. This reflects in the prevailing home prices; an average home costing more than £200,000 in the UK. The higher the price, the higher will be the equity in your home. Thus, the homeowners who want to borrow money are obviously better situated than those who are living on rent. In normal course, lenders give 80 per cent of equity in your home as a loan but this is not a fixed criterion and you may get more or less depending upon individual financial circumstances.
Bad credit loans and credit reference agencies
Secured loans are also available to those people who are having a bad credit rating. The credit rating is a numerical figure that is attributed to every borrower on the basis of his past conduct in the loan market. There are several credit reference agencies in the UK that gather information from various sources like the electoral roll, county court judgements and financial institutions. On the basis of the information collected, these agencies give a credit rating to every borrower. Lenders check credit rating to their satisfaction before sanctioning any loan to the borrowers.
Bad credit loans are available in two ways – by providing a security or without it. However, lenders prefer to give bad credit loans only to those borrowers who can provide a security. This is usually done to cover the risk involved in giving loans to people who have dubious credit record.
Source:http://www.bestsyndication.com/?q=011108_compare_home_equity_loan_rates.htm
The credit rating that you have at the time of taking loan is very important. A good credit rating implies that your past conduct in the financial transactions was trustworthy and, therefore, lenders are likely to offer you a low rate of interest. By releasing the equity in your home, you can borrow upto £250,000. People usually take loan against equity only when they have large monetary requirements.
How borrowers are advantageously placed when taking secured loans?
In the past few years, the value of an average home in the UK has increased manifold. This reflects in the prevailing home prices; an average home costing more than £200,000 in the UK. The higher the price, the higher will be the equity in your home. Thus, the homeowners who want to borrow money are obviously better situated than those who are living on rent. In normal course, lenders give 80 per cent of equity in your home as a loan but this is not a fixed criterion and you may get more or less depending upon individual financial circumstances.
Bad credit loans and credit reference agencies
Secured loans are also available to those people who are having a bad credit rating. The credit rating is a numerical figure that is attributed to every borrower on the basis of his past conduct in the loan market. There are several credit reference agencies in the UK that gather information from various sources like the electoral roll, county court judgements and financial institutions. On the basis of the information collected, these agencies give a credit rating to every borrower. Lenders check credit rating to their satisfaction before sanctioning any loan to the borrowers.
Bad credit loans are available in two ways – by providing a security or without it. However, lenders prefer to give bad credit loans only to those borrowers who can provide a security. This is usually done to cover the risk involved in giving loans to people who have dubious credit record.
Source:http://www.bestsyndication.com/?q=011108_compare_home_equity_loan_rates.htm
Personal Loan – An External Monetary Help
Many a times planning go awry. This may happen in your personal life as well as professional life. You may lose your job or suffer a big setback in the business. It is not as if people do not foresee these circumstances and fail to make provisions. The problem arises when the situation becomes too bad and your savings and reserves fail to bail you out. To counter these circumstances, a financial help from some external source becomes necessary.
On personal level, financial assistance can be taken from relatives, friends or parents. However, this is not always possible to do so. Many people intentionally avoid this type of lending and borrowing fearing that their relations may get strained due to inter-personal monetary transactions. On professional level, there are many lenders who may oblige your loan request.
There is a big loan market in the UK with almost all the banks, building societies and other financial institutions providing loans to the consumers. The loans can again be divided into commercial and personal loans. A personal loan is basically an unsecured loan wherein you do not require any security. However, lenders prefer that borrower has a good credit record, a decent monthly income and a debt to income ratio of less than forty per cent.
When you apply for a personal loan, the debt to income ratio assumes importance. A debt to income ratio reveals the repayment capability of borrower. If you have an income of £5,000 every month and you are paying £750 every month to the creditors, it means that debt to income ratio is 15 per cent. Anything upto 20 per cent is considered very good, reflecting that you have an excellent repayment capability. Lenders normally do not refuse credit if you have less than 40 per cent debt to income ratio.
Take another case where you have 40 per cent debt to income ratio coupled with a bad credit history. Now, this scenario becomes grim as far as availability of loan is concerned. Lenders provide bad credit personal loans with utmost caution. If you have bad credit as well as a debt to income ratio of 40 per cent or more, there will be difficulty in getting borrowing money. You will have to contact sub-prime lenders who provide bad credit personal loans. These loans are high risk loans as far as lenders are concerned and, therefore, the lenders charge high interest rate. The only good thing is that you may be able to get money for fulfilling your requirement
Source:http://www.bestsyndication.com/?q=011108_best_personal_loan.htm
On personal level, financial assistance can be taken from relatives, friends or parents. However, this is not always possible to do so. Many people intentionally avoid this type of lending and borrowing fearing that their relations may get strained due to inter-personal monetary transactions. On professional level, there are many lenders who may oblige your loan request.
There is a big loan market in the UK with almost all the banks, building societies and other financial institutions providing loans to the consumers. The loans can again be divided into commercial and personal loans. A personal loan is basically an unsecured loan wherein you do not require any security. However, lenders prefer that borrower has a good credit record, a decent monthly income and a debt to income ratio of less than forty per cent.
When you apply for a personal loan, the debt to income ratio assumes importance. A debt to income ratio reveals the repayment capability of borrower. If you have an income of £5,000 every month and you are paying £750 every month to the creditors, it means that debt to income ratio is 15 per cent. Anything upto 20 per cent is considered very good, reflecting that you have an excellent repayment capability. Lenders normally do not refuse credit if you have less than 40 per cent debt to income ratio.
Take another case where you have 40 per cent debt to income ratio coupled with a bad credit history. Now, this scenario becomes grim as far as availability of loan is concerned. Lenders provide bad credit personal loans with utmost caution. If you have bad credit as well as a debt to income ratio of 40 per cent or more, there will be difficulty in getting borrowing money. You will have to contact sub-prime lenders who provide bad credit personal loans. These loans are high risk loans as far as lenders are concerned and, therefore, the lenders charge high interest rate. The only good thing is that you may be able to get money for fulfilling your requirement
Source:http://www.bestsyndication.com/?q=011108_best_personal_loan.htm
Thursday, January 10, 2008
Personal Loans – The Reasons And Effects
More and more people are deciding to borrow. The statistics show that the level of personal debt is rising at among the highest rates in the world. This is occurring as more and more people are asking themselves, why wait for the things you want when you can have them now and pay for them later. Not only is this fuelling economic growth, but also giving people more options. It is also a matter of concern to some who fear that consumers will not be able to afford the huge amounts of debt that are being racked up and this is one of the major reasons why the government is worried about the state of the economy, we just keep on living beyond our means and continue to borrow.
What Makes Us Borrow?
The factors that are allowing people to borrow more and more are generally identified as the increase in house values, and expected increases in income. Many people are confident enough to continue borrowing because they know that all this debt is backed up by the increasing value of their home. This is also what they secure the loans against. This kind of debt is very safe from the point of view of lenders, who have their loans fully secured and also borrowers, who can get very attractive conditions and low interest rates on their credit because it is so secure.
What Happens If My Home Loses Value?
However, as most debt is secured against homes this also makes a fragile financial environment for our debt. However unlikely that events may come to pass, house prices could fall leaving many home owners that have secured their loan against their property in a financial mess. The bank or lending institutions would be less likely to negotiate with non payment of loans, panic and then call in debts against those who miss payments more quickly than if the economy was still as vibrant.
Borrowing For The Future
The other factors that are allowing consumers to continue to borrow is their age, optimism and future prospects. The population has a young and well educated work force many of whom have good future prospects. Banks are very willing to lend to university and young professionals on an unsecured basis due to the faith they all place in the future earnings of these borrowers. The logic is that because of their rising income, these borrowers can afford more debt.
On another note, It is also good banking policy to keep these ‘educated’ customers happy and a lifetime of banking may ensue, earning the financial institutions not only profit with the original loan but also the customer’s banking loyalty for life.
The Effects and Benefits of a Personal Loan
These loans therefore seem to be benefiting both lenders and borrowers. The lenders are happy because they have a good supply of borrowers who have good prospects of repaying the loans. From the borrowers point of view, the loans allow them to make investments now, in the things that they will be able to afford later. This allows them to take advantage of the higher earnings and higher house values that they are experiencing. With evidence showing that much of this borrowing is going towards funding home improvements, further education, and business start ups, it would appear that much of what is being borrowed is wisely being invested. It makes sense therefore, in many instances, to take advantage of cheaper credit that is available now and use it to invest in the future, but the overriding factor is be careful!
source:http://www.freearticlesarchive.com/article/Personal_Loans_%E2%80%93_The_Reasons_And_Effects/15680/0/
What Makes Us Borrow?
The factors that are allowing people to borrow more and more are generally identified as the increase in house values, and expected increases in income. Many people are confident enough to continue borrowing because they know that all this debt is backed up by the increasing value of their home. This is also what they secure the loans against. This kind of debt is very safe from the point of view of lenders, who have their loans fully secured and also borrowers, who can get very attractive conditions and low interest rates on their credit because it is so secure.
What Happens If My Home Loses Value?
However, as most debt is secured against homes this also makes a fragile financial environment for our debt. However unlikely that events may come to pass, house prices could fall leaving many home owners that have secured their loan against their property in a financial mess. The bank or lending institutions would be less likely to negotiate with non payment of loans, panic and then call in debts against those who miss payments more quickly than if the economy was still as vibrant.
Borrowing For The Future
The other factors that are allowing consumers to continue to borrow is their age, optimism and future prospects. The population has a young and well educated work force many of whom have good future prospects. Banks are very willing to lend to university and young professionals on an unsecured basis due to the faith they all place in the future earnings of these borrowers. The logic is that because of their rising income, these borrowers can afford more debt.
On another note, It is also good banking policy to keep these ‘educated’ customers happy and a lifetime of banking may ensue, earning the financial institutions not only profit with the original loan but also the customer’s banking loyalty for life.
The Effects and Benefits of a Personal Loan
These loans therefore seem to be benefiting both lenders and borrowers. The lenders are happy because they have a good supply of borrowers who have good prospects of repaying the loans. From the borrowers point of view, the loans allow them to make investments now, in the things that they will be able to afford later. This allows them to take advantage of the higher earnings and higher house values that they are experiencing. With evidence showing that much of this borrowing is going towards funding home improvements, further education, and business start ups, it would appear that much of what is being borrowed is wisely being invested. It makes sense therefore, in many instances, to take advantage of cheaper credit that is available now and use it to invest in the future, but the overriding factor is be careful!
source:http://www.freearticlesarchive.com/article/Personal_Loans_%E2%80%93_The_Reasons_And_Effects/15680/0/
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