Whether they are referred to as “school loans“, “student loans” “college loans” or just “money for college“, the phrases all mean the same thing-money that is borrowed so that a person can obtain a higher education.  And, there are almost as many types of education loans as there are names for them.

Many college-bound students use the Free Application for Federal Student Aid (FAFSA) form to apply for Federal Student Aid college loans.  Examples of loans that can be applied for using a FAFSA are Pell Grants, Stafford loans, SMART (Science and Mathematics Access to Retain Talent) Grants and PLUS loans (loans that are taken out by a student’s parents) as well as others.

Some student loans are subsidized-that is, the Federal Government pays the interest for a certain amount of time, while others are unsubsidized-the student (or borrower[s]) is responsible for paying the interest that accrues on the loan.  Some student loans do not require that any repayment be started until a certain time after a student leaves school (hopefully, because the student graduated).  Others, such as the PLUS loan, offer the borrower(s) the option of beginning repayment immediately, or waiting until after the student has finished school.

It is also possible to apply for education loans through different lending institutions such as banks, credit unions, or other loan agencies.  These types of loans are referred to as “private” loans.

How much money a student needs to borrow will, of course, depend on how much it will cost to attend college.  Many colleges quote a “flat” amount per quarter, per semester, or per year, which includes books, tuition, housing, and other college expenses.  When this occurs, the student usually has a fairly good idea of exactly how much he or she will need to borrow, and can decide whether to borrow year to year, or to apply for a lump sum that will cover all of the college years.

Many students know early on which college they would like to attend.  Often, as the time gets closer, the prospective student will begin keeping track of tuition and other costs at the preferred college, and can tell if an increase seems likely.  He or she can then begin to plan accordingly, especially when it comes to knowing how much to apply for in student loans.

Other colleges break down each category, and quote a separate amount for each one.  One advantage of this is that if the student already knows that he or she will not need to worry about a specific expense (for example, he or she has already arranged for off-campus housing), he or she will then know that it is not necessary to apply for housing funds.   For this reason, the student may find that he or she can choose to look into obtaining a personal loan, rather than a Federal loan.

This may allow the student to “shop around” for the best interest rates, repayment terms, and other loan options that might not be available on other loans.  It may also allow the student to borrow more money than he or she may have thought.

No matter how education loans are obtained, the important thing is for a student to realize that there is money out there, and it is available.  It may take a few years to pay the loan back, and much of a student’s earnings the first few years after college may go to that particular debt.  However, the student will have received something that is worth every cent of the money that was borrowed-a college education, with all the benefits and rewards that come with it.

Tags: college loans, education loans, FAFSA, federal loans, Loans, money for college, PLUS loan, private student loans, school loans, Staffford loans, student loans, subsidized loans, unsubsidized loans

A loan is simply an agreement to pay back an amount of money that has been borrowed, along with any interest, and sometimes finance charges or application fees.  Loans can be as simple as someone you work with loaning you $20 and you paying them back $20 on payday, or as complicated as a bank lending you enough to start your own business, and you pay the bank back within a specified length of time.

Usually, when we see the word “loan“, we’re talking about an amount that is most likely over $100 dollars, and is obtained through a lending institution of some sort.  (Banks, credit unions, and independent loan companies are examples of lending institutions).

There are different types of loans; however, most loans fall within one of two categories: (secured and unsecured loans), and personal loans.

Unsecured personal loans are often referred to as “signature” loans.  The lending institution does not require you to “put up” some form of “collateral”, such as a bank or money market account, or some form of personal property (a car, home or other real estate, or something else of value).

Some financial institutions may ask you to have someone co-sign with you on an unsecured loan, however.  In this way, should you be unable to repay the loan, the co-signer would be responsible for the payments.

Secured loans are those that require you to provide some sort of collateral, such as that mentioned in an earlier paragraph.  The most common or familiar type of secured loan is an automobile loan, because the lending institution maintains control of the ownership papers (the title, in other words), until the loan is paid in full.  If the loan is not repaid, or payments become severely delinquent, the lending institution simply takes possession of the vehicle.

Another example of a secured loan is the very common payday loan.  You may think that this type of loan would be considered an unsecured signature loan, because, after all, you’re giving them a post-dated check, which has your signature on it.  However, when you think about it, you are actually securing this loan with funds that will be (or should be) available in your checking account on the due date.  If for some reason the money is not in your checking account when the check is presented to the bank, you will be “dinged” for the original loan amount, plus any interest, plus any insufficient fund fees that the loan company and/or your bank charges.  There are usually better options for obtaining a personal loan than a “payday” loan.

A business loan may be acquired in order to start a business, or in order to expand or support an existing business.  These are usually the most complicated types of loans. For this reason, anyone who takes out a business loan may want to have an attorney to look over the terms and conditions of the loan agreement.  This is for the borrower’s protection as well as the lender’s.

The ability to pay back a business loan is, of course, dependent on the success of the business.  The loan will still have to be repaid, even if the business fails.  This is another reason why an attorney can be an asset.  He or she can advise you on how much to borrow, and which repayment terms will be the best for your business.

Tags: automobile loans, loan, Loans, payday loans, personal loans, small business loans

Bad credit loans are loans given to people who for some reason or another have a poor credit rating.  A person’s credit rating is considered poor when the credit score falls below 580. People who have filed for bankruptcy are also considered poor credit risks, and may be unable to obtain a conventional loan.  The only loan they may be able to get would be a “bad credit loan”.

Bad credit loans are available; however, there will be some differences between them and “regular” loans.  You can almost certainly expect to have a higher interest rate than you would if your credit was in good shape, and you may not be able to borrow as much as you need.

Some financial institutions, such as banks, do not even offer bad credit loans.  A credit union may offer this type of loan; however, that organization may require you to have someone co-sign with you on the loan, and may also have you to put up some type of collateral (such as personal property or a car) in order to secure the loan.

If you do find a bank or credit union that will give you a bad credit loan, the difference in the interest rate on that particular loan and any other loan the financial institution makes may not be that much higher; however, it will not be the lowest interest rate offered.

Independent loan companies do offer bad credit loans.  Some advertise that you will get a loan regardless of your credit score or history; others may obtain your credit history, but will still approve the loan.  You can definitely expect to be “dinged” with a high interest rate at one of these places, however.

Some people do not realize or think of it in this sense, but a title loan is a type of bad credit loan.  When you do stop to analyze the situation, you immediately see that a title loan is truly a bad credit loan.  Think about it:  most title loan agencies do not require a credit check; they only require a “clean, clear” title to your motor vehicle.  Basically, what you are doing is “putting your car up as collateral” for a loan.

Unless your credit rating is such that you know there is no possibility of you being able to obtain a loan through any other means, a title loan should be your last resort.  The interest rates are exorbitant, and there is too much of a risk involved.  Miss or be late on one payment, and there goes your car, because you have given the business the ownership papers to the car.

If your credit rating is poor, but you find yourself needing a loan, don’t hesitate to go to another lending agency BEFORE you even consider going to a title loan company.  Most agencies are willing to work with you, and will try to accommodate if there is any possible way.

No matter where you go to get a bad credit loan, only borrow the minimum amount you need.  This is not the time to make an impulse buy or an extravagant purchase. Once you have gotten the loan, make the payments on time each month.  Depending on the repayment period, you may be able to negotiate for a lower interest rate after you have made a series of regular payments.

Tags: bad credit loans, high interest, loan, Loans, poor credit, title loans

Personal loans are loans that are applied for by and (hopefully) given to individuals. In other words, a person, rather than a business, corporation, or organization, wants to borrow money. Personal loans can be either secured or unsecured. Unsecured personal loans usually only require a person’s signature. The individual does not have to “secure” the loan with any type of collateral, such as a car, boat, or other personal property.

Sometimes, a financial organization may require a co-signer on an unsecured loan. In this way, if the original borrower cannot (or does not) repay the loan; the co-signer is responsible for the payments. The co-signer, however, does not have to put up any personal property either (unless that person wishes to do so).

Unsecured loans are usually fairly small. Some financial institutions will only lend up to a certain amount on an unsecured loan before they require that the loan become “secured“. While many lending agencies may offer unsecured loans, frequently, this type of loan is most often offered through a credit union or other similar organization. This does not mean that a bank, independent finance company, or other financial institution will not offer unsecured loans. One needs only to inquire at the place where he or she wishes to complete the loan application to find out if unsecured loans are offered.

An unsecured loan may very well be the first loan a young person applies for and receives. This is because the loan amount is usually fairly low, and the process itself is generally easier than that required for a secured loan. Unsecured bad credit loans will likely have a fairly low interest rate, and the monthly payment is usually very moderate. This makes an unsecured loan even more attractive, especially to a person who is just beginning to build his or her own personal financial history.

Obtaining an unsecured loan, making the payments on time, and paying the loan back within the specified time (if not a little early) are a very good way of starting a sound credit history. When and if the time comes that an individual is in need of another loan (whether unsecured or secured), creditors will have something to look at. If a lender likes what he (or she) sees, then there should be no problem when a person applies for a loan in a larger amount.

Once an unsecured loan has been repaid in full, a borrower may be able to make another unsecured loan, after a sufficient amount of time has passed. As long as each loan is paid off on time, with no late payments, the borrower can continue to obtain unsecured loans whenever it is necessary.

Personal loans are usually made with a repayment period of one to three years. The longer the repayment period, the less the monthly payments will be. A “first-timer” may wish to opt for more time in which to pay back the loan, as this will give the borrower a chance to practice and hone budgeting and payment responsibility skills.

IF a problem arises with repayment, an unsecured loan can usually be “extended”. This simply means that the remaining balance is re-financed, and the borrower is given more time to pay off the loan. If the borrower sees that this situation may be imminent, he or she should immediately contact the creditor and explain the circumstances. The lender is more apt to work with the individual if other arrangements are made before payments become delinquent.

Tags: bad credit loans, creditors, lender, loan, Loans, personal loans, secured personal loans, unsecured personal loans

Some consumers were already “feeling the pinch” before the current economic situation (high gas prices, businesses failing, increases in home foreclosures, etc.) ever occurred. Many people were already facing problems that came from having “less than perfect” credit, and the number is, unfortunately, growing.

For this reason, there has been an influx of businesses that offer “bad credit loans”. A credit check is not required in order to obtain money; rather, a “payday”, “title”, or other similar loan can be obtained.

At first glance, these types of loans for people with bad credit would seem to be “the light at the end of the tunnel”. However, a lot of people do not realize that these loans typically have an extremely high interest rate, and terms and limitations that would make a CPA feel as though he had not opened the first college textbook if he were to have to try explaining them.

Those who do have bad credit need to realize that quicker isn’t always better, and just because there is a business offering bad credit loans on practically every corner in those states that allow them to operate does not mean this is the best option. There are financial institutions that are more reputable, and operate within higher ethical standards, than those mentioned above.

These institutions are willing to extend loans for people with bad credit. Granted, the interest rate may be higher for those with lower credit scores than it is for people who have better credit ratings. But, these places will try their best to approve a loan if other criteria can be met.

Some institutions are lending money to those with bad credit, with the stipulation that the borrower(s) attend money management classes. The business itself may offer the classes, or may be in partnership or alliance with those who offer these classes. They may even consider participation in these classes as a reason to adjust the interest rate upon successful completion and a number of on-time payments.

Other reliable loan companies may not necessarily provide a “new” loan, but may allow for an adjustment of terms, refinancing, or the extension of an existing loan. This will allow the borrower to make lower payments, albeit over a longer period of time, but with the opportunity to improve one’s current “not so good” credit rating.

Those loan companies who do make loans in which one’s car title is the security, or a personal check is “held” until the next payday, or similar loans can have their place. If a true emergency arises, such as a major car breakdown, a severe medical emergency, or other similar situation that occurred with no forewarning whatsoever, then one may have no choice but to avail him or herself of such a service.

However, if this is the case, the borrower should take care not to allow him or herself to be swept up in the heady rush of just being able to walk in, lay down a check or a car title, and walk out with cash. The borrower should remember that this is a legitimate emergency situation that will not likely happen again, at least for a very long time, and that this is the only time that this type of service will be used.

Most of the time, however, there are other options. Bad credit loans are available from places that have been in business for many years, and will likely be in business for many more years, and the people who run these places are willing to work with those who have poor credit but need financial assistance.

Tags: bad credit, cash, credit, financial assistance, foreclosures, gas prices, interest rate, Loans, money, money management, payday

As the economy worsens and more and more people are getting foreclosed on, I’ve noticed several more places advertising payday loans and cash advances cropping up. There aren’t many statistics or figures out there to tell us how many people are getting payday loans or if the number is growing. The most current figures are from 2005, when the industry issued more than 28 billion dollars in loans, but financial experts are sure that these numbers may double or more as the housing crisis worsens.

If you’re not familiar with payday loans, the idea is fairly simple. If you need a short term loan of just a few hundred dollars payday loans sometimes called cash advances may be the only option you have. These payday loan companies don’t check the borrower’s credit and they don’t deny loans to anyone, as long as they can show some type of income or government subsidy. The loans typically need to be repaid in just one or two weeks.

Sounds great, doesn’t it? Everyone has unexpected and urgent expenses crop up from time to time. However, there is a downside to these cash advances. They often have high hidden fees. More importantly, the interest rates on payday loans can easily range from between 400-1200%. Some estimates have shown that the average person who takes out a payday loan will end up paying $793 over the course of two weeks for a loan of just $325.

There are many horror stories out there from people who have gotten a cash advance and gotten in over their heads. It is much rarer to hear a story from someone who took out a pay day loan and had a good experience. There are several reasons for this. Payday loans used to be more or less unregulated by the government. There were many large scale unscrupulous cash advance lenders out there that took advantage of this. There are many decent payday loan companies out there, the trick is to ask around and compare rates to find one.

And, as much as some companies have helped earn the bad reputation payday loan companies have, a small part of the blame can be placed on those who take out the cash advance in the first place. Many lenders do not take the time to make an informed decision about their payday loans. They may not read through their entire contract before signing it. Then they feel cheated or scammed when hot with fees and interest they weren’t clear about. The single largest mistakes people make when it comes to payday loans is taking out a lot of them. The system is not made to benefit those who rely on cash advances frequently.

Payday loans are not meant to be long term loans or something you use regularly. If you have a short term, infrequent cash flow problem payday loans can be an ideal way to solve that problem. To keep from getting burned, it’s important to do your research before deciding on a payday loan company, to read everything and be clear about everything before you sign any paperwork and to pay off the loan in the time allocated. Most people who get in over their heads do so because they are continually rolling their loans over. This may buy you more time to pay them back, but really it will cost you so much in fees and interest and all you’re doing is digging a hole you probably won’t be able to climb back out of.

Tags: advance, cash, lenders, Loans, payday