Read This Before You Hate Short-Term Loans

admin — Sun, 26 Jul 2009 20:41:33 +0000

One of the biggest causes for big banks hating relatively small-sized short-term loan businesses is mostly because the smaller companies are eating away at their ability to have a monopoly on the market — credit cards.

Plus, the big banks are focused on long-term loans, and short-term loans cut into their turf. If people need a little money for short-term purposes, they’d have to go to big finance to get a long-term loan — but only if short-term loans get outlawed or heavily restricted.

There is some legislation afoot in many states, and countrywide, to limit the APR interest rates allowed by short term lenders to about 36%. Currently, they charge from around 456% to as much as thousands of percent in interest, making their short term loans very lucrative.

If they are capped at 36%, or limited by the amount of money they can loan out, they will not be able to stay in business. This creates a problem for consumers, because financial institutions do not make small, short term loans.

And, the reason they do not currently make these payday style loans is because, with their limited interest fees, the work would not be profitable.

Then again, some people suggest that the big lenders actually are behind the smaller lenders, lending money in lump sums rather than to specific people who want a loan, meaning they are making money on the side.

It seems like no matter what happens, big finance will profit from consumers needing short term loans. That could be another reason why big finance hates small payday loan companies, in that they need the business, and must deal with the payday loan companies.

If the small payday loan companies are driven out of business by legislation to limit their profitability, the consumers will need to go elsewhere for their short term loans.

They might be able to try out a way to make money online or sell products, but there will soon be legislation outlawing that as well. This is really going to affect lower-class Americans.

Then again, there might be such an outrageous demand for short-term loans that the big banks might actually end up offering them. The chances of this happening are slim.

Big finance hates watching small payday loan companies grow and thrive. In some places, there are more payday loan stores than McDonalds and Starbucks.

Low Interest Personal Loans

admin — Wed, 24 Sep 2008 17:45:36 +0000

There are many people looking for low interest personal loans to help them through financial difficulties or maybe even to help them pay for something they need or want and don’t have the cash for right now. If you’re one of these people then you should know that low interest personal loans may be available for you, but you should make sure you know exactly what you’re agreeing to before you sign those loan papers. Especially when you’re looking to purchase something personal you want to make sure that you get a low interest personal loan so you don’t end up putting yourself into financial trouble later because you’ve found you can no longer afford the payments.

You should know that if you already have bad credit you won’t be able to get a low interest personal loan. Personal loans typically have higher rates already than other loans like your mortgage and you need a very high credit score if you want to get a personal loan with a really good interest rate. If you have good credit check with your bank or credit union and see what kind of rates they offer on personal loans. Because you already have a relationship with them they will be more likely to offer you a personal loan than some company that hasn’t worked with you financially before. If you have bad credit though don’t despair, you still have options for getting a personal loan.

One option is to go through the online company called Prosper. Prosper matches willing lenders with those that need small personal loans. Once you sign up with their site you’ll be reviewed and assigned a credit rating. At that time you can then post a loan request. The cool thing about Prosper is you get to set up a profile there and you are able to tell your story, why you need the loan, you can even post pictures if you like. After posting the loan request the interested lenders on Prosper will bid on your loan to fund it. It’s really a grassroots effort toward getting personal loans and adds a personal touch as well, since most of the lenders will be more understanding than banks typically are.

Of course you also have the option of getting a payday loan, however these should really only be used in emergencies because of their high interest rate. A payday loan is not the type of loan you want to use for personal purchases. With a payday loan you’re required to pay the loan back very quickly, usually within 30 days and the interest rate is astronomical, so it just doesn’t make sense to use a payday loan unless there is no other way to get money you need for an emergency situation. Payday loans have helped many people when used correctly, but they are certainly not low interest personal loans.

Payday Loans » small personal loans

Read This Before You Hate Short-Term Loans

Low Interest Personal Loans