Private Loan » Credit Card Debt

Private Lending – The Best Source For Loans

admin — Thu, 22 Apr 2010 19:34:08 +0000

In difficult economic times, private lending may be your easiest source to obtain the loan you need. You can receive money to start a business, for a new car, to pay off a loan, to pay off credit card debt, for college education or for home refinance. In short, if you have a reason – any reason – to borrow money, private lending may be the best avenue for you to take.

Private lending is also known as person to person lending and in small business as small business financing, factoring, receivables financing, commercial loans or hard money. What differentiates true person to person lending is that the transaction is usually a one on one transaction. It is a transaction made by one person who has excess money to someone who has a need for money.

Person to person loans are nothing new. They have been around since the early Babylonians where ancient tablets have been found detailing the interest rates, collateral and repayment schedules of loans made between two individuals. In today’s world, these types of loans are easier to find by simply typing in your search terms on any of the major search engines.

Lenders, like borrowers, come in all shapes and sizes and each has their own set of expectations and requirements. Some lenders require detailed analyses of your proposal while others require almost no documentation. Most lenders will require at least some documentation so you must be prepared with your income statement, net worth, liabilities, monthly expenses, loan amount request, and the purpose of your loan. Most lenders will also require a credit check and they are required by law to request this of you before they can make a credit check on your credit.

The application process in most cases is much easier than dealing with a bank, the SBA or with any other financial institution; the lenders are not interested in lots of paperwork, they just want to be assured you will be able to pay them back. Some lenders require a processing or application fee, many require you to pay points and some may tack on a few other items you will need to pay for. Look these over carefully as many of these add-on expenses are negotiable. Work with your lender to request these additional expenses be removed.

Fee structures, documentation required, collateral, interest rates and repayment schedules will all vary from lender to lender and from time to time as changes in the economy and financial world dictate. Private lending may be harder to locate in difficult economic times, but the major players will all still be active. Contacting them, filling out their application and paying their initial fees may be all you need to get the money you need into your bank account. Even in these difficult economic times, the money is out there, somewhere, all you have to do is find it.

By: Perry Jones

Why Apply For a Private Loan?

admin — Tue, 22 Dec 2009 15:27:38 +0000

There are many different reasons why private loans are preferred over any other kind of loan. The number one reason people apply for a private loan is that traditional lenders simply will not give regular borrowers a chance.

When traditional lenders deny a loan application, many consumers simply turn to private lenders. Unlike traditional lenders, many private lenders of secured loans are willing to approve almost any loan application. Also, if the loan is secured, a private lender will not rely upon a borrower’s credit history when it comes to loan approval.

Another reason why people seek private loans is that most people have big expenses that must be paid right away. Some of these expenses can include paying for weddings, borrowing money for a new or used car, and even paying off credit card debt.

In fact, that brings us to the second most popular reason why a private loan is a good idea: credit card debt. Credit card debt is a fact of life for most people, but it doesn’t have to be. Credit card companies take advantage of the fact that many people can only make minimum payments each month.

Even though minimum payments are made, interest rates keep climbing. Essentially, those people that only make minimum payments wind up paying more than they bargained. They may use one credit card to pay another and a never-ending cycle of paying only interest and little to no principal begins. By consolidating debt with a private secured loan such as a car title loan, the borrower will be able to make one easy monthly payment instead of multiple payments to multiple creditors. Many private lenders have flexible terms and can find a repayment plan to suit your budget.

No matter what your reason might be for acquiring a bit of extra money, applying for a private loan is a great way to relieve some debt, pay for an event, or simply create some extra spending money – wouldn’t that be nice? Private loans can be obtained for anything that you have in mind, from house repairs to new acquisitions.

When you apply for a private secured loan, you will be able to gain the money that you need right away. This is often the biggest incentive for people that need money now. Traditional lenders can take weeks to approve a loan, and sometimes they can take just as long to deny a loan application. Private loans just make sense.

Why Apply For a Private Loan?

admin — Thu, 10 Dec 2009 12:53:36 +0000

Federal Loans Vs. Private Loans

admin — Fri, 20 Nov 2009 10:47:17 +0000

You are ready to go back to college or maybe you are fresh out of high school. If either applies, it is most likely that you have considered how you will pay for your tuition. During your consideration you probably have viewed numerous types of student loans, including both federal loans and private loans.

To give you an idea of the difference between the loans, lets look at what a private loan looks like.

Private Education Loans, also known as Alternative Education Loans, can be used to help bridge the gap between the actual cost of your education and the amount the government allows you to borrow in.

Private loans are offered by private lenders, which means you don’t have to complete federal forms and eligibility often depends on your credit score.

Some turn to private education loans when the federal loans don’t provide enough money or when they need more flexible repayment options. For example, a parent might want to defer repayment until the student graduates, an option that is not available from the government parent loan program. (Many PLUS loan providers are starting to allow parents to defer payments on the PLUS loan while the student is in school using an administrative forbearance. Interest continues to accrue, however.)

Private education loans tend to cost more than the education loans offered by the federal government, but are less expensive than credit card debt. The federal education loans offer fixed interest rates that are lower than the variable rates offered by most private student loans. Federal education loans also offer better repayment and forgiveness options. Since federal education loans are less expensive than and offer better terms than private student loans, you should exhaust your eligibility for federal student loans before resorting to private student loans.

Private student loans typically have variable interest rates, with the interest rate pegged to an index, such as LIBOR or PRIME, plus a margin.

The interest rates and fees you pay on a private student loan are based on your credit score and the credit score of your cosigner, if any. Generally, if your credit score is less than 650 (FICO), you are unlikely to be approved for a private student loan. An increase of just 30 to 50 points in your credit score is often enough to get you better terms on your loan.

If you know somebody who can cosign your private loan, you could possibly get a lower interest rate, as such loans are not as risky for the lender. Moreover, the interest rates and fees are usually based on the higher of the two credit scores. So if your cosigner has a much better credit score than you, it could result in a much lower interest rate.

Private student loans may be used to pay for the family’s portion of college costs. While some lenders may offer private student loans in excess of the cost of attendance, any amount exceeding the difference between cost of attendance and financial aid is considered a resource. Like an outside scholarship, this will reduce need-based aid. (Some lenders offer non-school-certified private student loans to bypass this limitation by not informing the college about the loan. If the college becomes aware of the loan, federal regulations require the college to reduce need-based aid. Pending federal legislation would require lenders to tell colleges about all private student loans, eliminating this loophole.)

This cost-of-attendance limitation only applies to education loans, which are loans that make enrollment in college a condition of the loan. It does not matter where the loan proceeds are sent (e.g., direct to the borrower vs to the school) or how the loans are marketed. On the other hand, mixed-use loans, such as home equity loans and credit cards, are not considered education loans and as such are not limited by cost-of-attendance.

The pros of private loans is high, but with a little research you can find out what specifically meets your needs.

By: Kara Lilly

Why Apply For a Private Loan?

admin — Sun, 15 Nov 2009 16:23:49 +0000

e considering a private loan, rest assured that you are not alone. Thousands of people across the country apply for private loans every day, and every single one of those people have excellent reasons for seeking financial help.

By: Gen Wright

Understanding Private Loans for Education

admin — Sat, 14 Nov 2009 21:34:25 +0000

Private loans – students hear about them but sometimes do not quite understand exactly what they are, what they are for, or what they entail. Basically, private loans for education can make up the difference between the amount a student receives from federal financial aid and the actual cost of his or her college education. If a student’s financial aid package does not quite meet their needs and he or she has gotten all the grants and scholarships he or she possibly can, private loans can be a saving grace.

Unlike with federal financial aid, a student’s eligibility for private loans for education depends on his or her credit score – or the credit score of his or her parents. Private loans offer more flexible repayment options than some federal loans, especially when it comes to parent loans. In general, private loans are more expensive than federal loans, but they cost less than credit card debt. Federal loans also offer lower interest rates, so students are always encouraged to get as many federal loans as they can before looking into private loans for education.

Private loans do have their merits, however. As mentioned, they are sometimes the saving grace when a student has exhausted the federal amount he or she is allowed but still has need of financial aid. Parents are often better off with borrowing private loans as well, namely because they can defer payments until their child graduates (for instance, if their child has promised to pay off his or her own school debts, but needs help with getting a loan in the first place) – however, the interest does build up over this time. Looking at it one way, this is really no different than what can happen with unsubsidized federal loans.

The good news is that if a student – or his or her parents – has a decent credit score, it can significantly affect the interest rates for a particular private loan for education. In general, the better the credit score, the lower the interested rate. As such, it is better to apply for a private loan with a cosigner. After all, a student may have a bad – or nonexistent – credit score, while his or her parents have an excellent one. The parents can cosign, defer the payments until their child graduates, and not be responsible for the payments themselves. This is an excellent way to help a child keep their educational debt down, if only for a small amount.

Private loans for education are unquestionable helpful when federal aid simply does not grant enough money to a student. However, they should really be considered a last resort, as federal loans do offer better interest rates. Conversely, private loans often offer better, much more flexible repayment plans, so it all truly depends on an individual student’s needs, means, and financial status. Parents should only consider cosigning a private loan for their child if they are first certain that, should anything happen to make the child unable to pay for the loan, they can afford to, and secondly, if they know they can trust their child to begin paying back the loan after he or she graduates.

By: Gary Marjani

Private Student Loan Consolidation

admin — Thu, 08 Oct 2009 11:40:04 +0000

Like any form of consolidation a private student loan consolidation is when a borrower is allowed to combine multiple private loans under one single private lender at a new interest rate. This allows debtors to find payment relief by spreading the repayment over longer time duration and making the installments for the loan easier. Often it is possible for lenders to consolidate education related credit card debt into the loan but the debtor should have a good credit history or a reliable cosigner.

• The advantages of a private loan consolidation are:
• Lowers fixed rates and longer deferment time periods
• Single easy monthly payments rather than multiple payments
• Collateral not needed loan given against previous history
• No penalties on pre-payment

The advantages of loan consolidation cumulatively are more since multiple loans are easily consolidated into a single loan. A fixed interest rate then helps lower the monthly payments compared to a variable rate loan. Homeowners are allowed to retain the equity on their homes without taking out additional mortgages to repay previous debts.

A student who wants to opt for this must have completed at least 30 days of graduation and begin the loan application process in a expedient manner. The consolidator must be a US citizen and be 18 years of age. The must be fully disbursed within the time limit and their will be no penalties imposed. Private student loan consolidation allows the main burden of debt to be lifted from the students and/or parents shoulder and allow them to work and repay the single loan taken in a proactive manner.

By: Sara Sentor

Why Apply For a Private Loan?

admin — Wed, 19 Aug 2009 02:36:38 +0000

If you are considering a private loan, rest assured that you are not alone. Thousands of people across the country apply for private loans every day, and every single one of those people have excellent reasons for seeking financial help.

There are many different reasons why private loans are preferred over any other kind of loan. The number one reason people apply for a private loan is that traditional lenders simply will not give regular borrowers a chance.

When traditional lenders deny a loan application, many consumers simply turn to private lenders. Unlike traditional lenders, many private lenders of secured loans are willing to approve almost any loan application. Also, if the loan is secured, a private lender will not rely upon a borrower’s credit history when it comes to loan approval.

Another reason why people seek private loans is that most people have big expenses that must be paid right away. Some of these expenses can include paying for weddings, borrowing money for a new or used car, and even paying off credit card debt.

In fact, that brings us to the second most popular reason why a private loan is a good idea: credit card debt. Credit card debt is a fact of life for most people, but it doesn’t have to be. Credit card companies take advantage of the fact that many people can only make minimum payments each month.

Even though minimum payments are made, interest rates keep climbing. Essentially, those people that only make minimum payments wind up paying more than they bargained. They may use one credit card to pay another and a never-ending cycle of paying only interest and little to no principal begins. By consolidating debt with a private secured loan such as a car title loan, the borrower will be able to make one easy monthly payment instead of multiple payments to multiple creditors. Many private lenders have flexible terms and can find a repayment plan to suit your budget.

No matter what your reason might be for acquiring a bit of extra money, applying for a private loan is a great way to relieve some debt, pay for an event, or simply create some extra spending money – wouldn’t that be nice? Private loans can be obtained for anything that you have in mind, from house repairs to new acquisitions.

When you apply for a private secured loan, you will be able to gain the money that you need right away. This is often the biggest incentive for people that need money now. Traditional lenders can take weeks to approve a loan, and sometimes they can take just as long to deny a loan application. Private loans just make sense.

By: Molly Wider