Category: Loans

How to Identify a Good Lending Company

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calculator, loan forms , pen

A lending company offers loans for personal uses and businesses. It is essential to find a lending company that is professional and profitable. The best thing about lending companies is the fact that they are fast and they do not care about a credit score.

In case you have been turned down by banks due to a poor credit score, a good lending company will still offer you the loan that you need. It is all about looking at the terms of the lending company. Here are some ways to identify the right lender:

Interest Rates

Before you take a loan from any company, make sure that you check the interest rates. For many lending companies, the interest rate might be quite high because they are short-term loans. However, it is all about striving to get the best deal from the lender.

Do not make a mistake and take the lowest interest rates. Consider taking a loan from a company that offers reasonable rates. Companies that offer the lowest interest rates might have a lot of added fees.

exchanging money

Repayment Terms

When signing the contract, you will be provided with repayment terms. It is essential to read the fine print and understand what the lender expects from you. A right lender should offer you friendly payment terms.

The lender should give a good repayment schedule so that you can be able to repay the loan comfortably. Some lenders will even offer a grace period after the repayment period deadline to give you ample time to plan.

Added Fees

It is essential to check out for added fees when taking a loan. There are lending companies that will offer low interest rates to entice customers. Apart from the low interest rates, they will offer added fees that will make the overall amount very high. Make sure that you watch out for the added fees and stay away from lenders that have fees that cannot be explained.

loan terms for contract

Reputation and Professionalism

The reputation of the lending company is also something to check. You need to take a loan from a company that has proved to have a good reputation. Some companies have already earned an excellent reputation as good and honest lenders.

Taking a loan from a good and reputable company will guarantee you professional services. A reputable company will always offer you professional services.…

Types of Loans You Should Know

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money

Many if not all the events of your life could use a little more money to see them through, right? Some though have bigger budgets than you could facilitate and could use some more cash. A friend may chip in but mostly taking a loan to meet the need is mostly the suitable option. But before getting a loan for your wedding party, vacation, home renovation, holiday or some other need, it would be good to understand the type of loans which exist so that you can make a better decision. Here is the list:

Closed-ended and Open-ended Types

Open-ended loans are the kind you can take again and again after repaying the formerly taken amount. For instance, this system is used with credit cards, where after repaying the credit, you can use your card to make purchases again. Credit is always available as far as you borrow and pay under the agreed terms.

money tree

Closed loans, on the other hand, cannot be renewed once you have paid the amount you had borrowed. You have to reapply for another loan if you need the money or if the credit limit available is not enough to sort your need.

Unsecured and Secured Types

Unsecured loans are loans given based on your credit history and income. You don’t require collateral to get one. In case of default, the lenders ensure they have exhausted collecting options and then use debt collectors after which they file a lawsuit against you.

Secured loans demand the use of collateral, for instance, title deeds. The collateral is usually at a higher market price than the loan. With such loans, defaulting places the lender in a position to sell the collateral and repay the loan.

Conventional Types

Call them mortgage loans. This loans are granted by mortgage lenders and do not conform to government agencies or housing administrations. They can either be conforming or non-conforming. These loans are typically higher than government-backed mortgages. They also conform to the dollar limit set in the housing finance agencies.

In this case, they cannot exceed some amounts such that they may not suit some big loans like the non-conforming jumbo loans. These loans do not conform to the criteria for issuing loans due to their huge value. Real estate and commercial loans tend to fall into this categories as they are bigger and address more than required in bank lending criteria.

Conforming and Non-conforming

Conforming loans are such which are issued based on the Finnie Mae or the Freddie Mac guidelines. They conform to such guidelines like giving a loan amount based on the location of the house you stay in, loan versus value, your credit history, dollar limits and your income to debt ratios.

Non-conforming loans do not follow such guidelines. They are bigger loans compared to the conforming loans. For instance, a jumbo loan

Loans are good to facilitate the events of our lives. Similarly, care should be taken to avoid bad loans as they can bring down what we want to grow.…