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an online personal loan application or obtain news and tips about unsecured
loans.
If
you have no credit or a very bad credit history, you may qualify only for a
short term personal loan with a low limit. The good thing about this type of
loan is that there is no credit check and offers easy approval.
If
you have fair or better credit, you may qualify for a long term personal
loan with a high limit. These loans may; however, require some form of
security collateral such as being a homeowner.
Since
many people only need cash to cover an immediate need, the short term unsecured
personal loan may be the better option.
Predatory Lending Practices: Refund Anticipation Loans Refund anticipation loans are commonly offered by tax preparation services. With this type of loan, you can get your hands on your tax refund before it is processed with the government. Although this might seem convenient, there are several disadvantages to using a refund anticipation loan. Here are a few things to consider before agreeing to a refund anticipation loan. Interest Rates Perhaps the biggest problem that most people have with refund anticipation loans is the interest rates that are charged for them. Since you are only borrowing the money for a short period of time, it may not...
Predatory Lending Practices: Overdraft Protection Lines of Credit Overdraft protection is a financial service offered by American banks to customers who overdraft on their credit accounts. Overdraft protection line of credit is a voluntary form of overdraft protection - unlike Ad-noc coverage, this is something that you have to sign up for. When you overdraft, the bank uses it's funds to help you make payments, but only up to a certain point. Furthermore, they don't do it for free - you are charged a fee and interest on the outstanding balance. Like many other predatory lending practices, it sounds good and beneficial on the surface, but in...
Military Payday Loans and Standard Payday Loans Compared As a result of many cases of predatory lending, military payday loans are now capped at a 36 percent annual percentage rate, or APR, as dictated by Federal law and a ruling by the Department of Defense. While this may still seem like a high interest rate to pay, some standard payday rates can be well over 500 percent APR. Because of these abuses, payday loans are now banned in fifteen states, as well as in the District of Columbia. Military Payday Loans Because of their deployment obligations or other service-related duties, military members have often been targeted by...
The Lending Criteria for Unsecured Personal Loans Understanding the lending criteria for unsecured personal loans can help you when you apply for a loan. Getting approved for this type of loan works differently from if you were to apply for a secured loan. Here are the basics of lending criteria for unsecured personal loans. Credit Score The most important factor in getting approved for an unsecured personal loan is your credit score. The lender will ask for your permission to pull your credit file, and they will examine it closely. Although credit scores are important with any type of loan, they are critical with an unsecured...
The Dangers of Defaulting on an Unsecured Personal Loan An unsecured personal loan is issued without collateral. These loans are considered high risk to lenders because there is no guarantee against default. As a result, the borrower on an unsecured loan will typically see higher interest rates. However, many borrowers prefer this option despite the expense because it is technically lower risk to the borrower. Just because the lender will not collect an asset in the case of default, though, does not mean there is no danger in defaulting. Credit Penalties The first thing that occurs when a borrower approaches default on a personal loan is a significant...
