5 Worst Mistakes of Online Borrowing

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Getting a personal loan online has grown into a multi-billion-dollar industry, with lenders ranging from individuals in peer-to-peer programs to big banks. Although countless Americans have been helped by the ability to borrow money without leaving home, others have hurt themselves by being ill prepared for the process.

“Because the loans are being evaluated remotely, the chances of making a mistake are increased,” warns Todd Nelson, Business Development Officer of LightStream.com, which offers personal loans from $5,000 to $100,000. In an exclusive MoneyTips interview, Nelson reveals the 5 worst mistakes you can make when borrowing money online.

  1. Ignoring inaccuracies on a credit report
    Credit bureaus constantly receive information about your credit use and history, contributing to a profile that lenders …

Refund Advance Loans And Refund Anticipation Checks 101

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Are you counting on your tax refund to pay off bills? You may need the cash before your refund arrives.

The IRS website states that typical refunds take less than 21 calendar days if you e-filed your return. However, if you are claiming the Earned Income Tax Credit (EITC) or the Additional Child Tax Credit (ACTC) your refund may be delayed further.

Tax preparers may offer a solution in the form of refund advance loans (RALs) and refund anticipation checks (RACs). What’s the difference between the two, and is either one right for you?

Refund advance loans are just what they sound like – a loan issued by a lender for the amount of your anticipated tax refund. You are loaned the money up front and your refund is used against the loan balance.

Predatory, older-style RALs were basically eliminated by rule changes in 2010 and 2012 due to high interest rates and other charge…

Video: The Dangers Of Co-Signing A Loan

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They say, “No
good deed goes unpunished,” and that certainly applies to kind-hearted
people who co-sign for a loan. In our exclusive video above, Nav Head of Market
Education Gerri Detweiler explains what you’re risking when you co-sign a loan.

If you are interested in a personal loan, visit our curated list of top lenders.

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More Than Half Of Us Have Seen Friendships End Over A Loan

MoneyTips

What’s one of the easiest ways to end a friendship? Loan your friend a significant amount of money. According to a recent survey from Bank of America, money was the fourth greatest cause of stress in a friendship, behind jealousy, gossip, and disagreements. We would rather talk to our friends about family drama, weight, or even love lives than discuss money matters.

Other survey results make it clear why money concerns end friendships. More than half of survey respondents (53%) have seen a friendship end due to money owed, and one-third of respondents are personally fearful of losing a friendship because of a debt.

Those respondents are wise to be fearful, because 43% of Americans are willing to end a friendship over not paying back a debt. Within that group, 74% have their breaking point on debt of $500 or less – and 38% would end the friendship for an unpaid debt of $100 or less.

By more than a 6:1 margin, respondents belie…

More Protection for the Military

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If you are one of the brave men and women serving our country in uniform, you face enough dangers. You do not need anyone attempting to take financial advantage of you by capitalizing on the unique challenges of military life.

Unfortunately, you can find many payday loan lenders and other purveyors of short-term, high-interest loans near any military base. Bases are full of young service members with a regular and reliable paycheck — fertile ground for lending groups. According to The Wall Street Journal, payday loan organizations target families with service members at twice the rate at which they target civilian families.

The Military Lending Act of 2006 was designed to prevent lenders from taking advantage of military families by capping the effective interest rate at 36%. However, only three credit products were covered: closed-end

6 Situations Where A Personal Loan May Be Better Than A Credit Card

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When you have a relatively large expense that you can’t cover with cash on hand, you generally have two choices to consider: revolving debt such as a credit card, or installment debt such as a personal loan. Which option works best for you?

Consider the difference between the two types of debt. Revolving debt has no finite payment — you can pay as much or as little as you want, but realize that you are paying interest for the privilege of carrying that debt. Installment debt allows you to set up a regular repayment plan over time, and the terms of repayment (the interest rate and length of repayment period) will dictate how much you repay per installment and over the total course of the loan. You can budget your interest costs with certainty, assuming that you make regular payments.

Typically, credit cards come with higher interest rates than personal loans. Introductory offer…

Lenders Pulling Back on New Subprime Loans

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It’s tough living on the lower end of the credit score scale. If you have a credit score below 640 or so, you are generally given “subprime” lending offers for any form of credit that you request. From credit cards to auto loans and mortgages, you will be hit with higher interest rates and potentially other restrictions and fees.

According to credit bureau TransUnion’s Q2 2017 Industry Insights Report, you now have another problem to deal with – difficulty in getting credit at all.

TransUnion found that overall originations for subprime consumer credit have dropped sharply over the past four quarters. Total subprime originations dropped from a post-crisis peak of just under 6 million consumers in Q2 2016 to just under 4.6 million in Q1 2017. The last two quarters represent the first consecutive year-over-year decreases in overall subprime ori…

Personal Loans For People With Fair Credit

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If your credit score is in the low- to mid-600s, you have what is usually considered to be fair credit — not in the range where you have trouble getting personal loans at all, but in the range where finding a good interest rate and reasonable terms can be challenging. Whether you are experiencing a temporary fall in otherwise good credit or you have built your credit up from poor to fair status, it takes effort to find a loan that meets your needs.

Banks and credit unions are less likely to offer you a loan with fair credit unless you take the path of a secured loan that is backed by some form of collateral, such as your car, the contents of your bank account, or the equity in your home. With a secured loan, you are likely to receive a much better interest rate than you could receive otherwise, but there are two drawbacks: you put your collateral at risk, and your loan amount is limited by the amount of collateral that you supply.

Depending on your reason for the…

Personal Loans For People With Poor Credit

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You may need a personal loan for a number of reasons — perhaps to deal with unexpected medical expenses, to consolidate high-interest credit card debt, or even to take that well-deserved vacation. Unfortunately, if you have borderline or bad credit, personal loans may be difficult to get at your local bank or credit union. You can resort to payday lenders that loan money for short periods of time at very high interest rates, or you can investigate the growing number of online lenders that focus on loans for people with bad credit.

Bad credit personal loans represent an underserved market, mainly because most banks and credit unions have plenty of available business without dipping into that particular higher-risk pool. Many personal loans through traditional banks are unsecured, meaning that the bank accepts that you are a low risk to default on the loan and is willing to loan you money without collateral. Unless you are willing to accept a secured loan backed by some form…