Growth in Secured Loan Lending Market

During the month of July, the secured loan lending pulled off a three-year high after going beyond the £30 million mark for the first time ever since December of the year 2009.

Loans Warehouse is the first in United Kingdom to make public a secured loans index in July. It released its first ever results and revealed to the public that secured loan lending increased by 22 percent in the month of June to achieve £32.3 million.

This latest growth in secured loan lending activity is the largest monthly increase ever since November of the previous year, with lending for borrowers with poor credit increasing by 18 percent on the same month.

According to Matt Tristram, joint managing director of Loans Warehouse, Shawbrook Bank improved its secured loan product offering to borrowers with poor credit as the bank declared that they were opening its products initially intended for those with poor credit to a bigger number of consumers.

Moreover, this proves that lenders are exerting a lot of effort to loosen their requirements or standards and the results for August represent the effect of these lenders ever since they joined the lending market.

In addition to Tristram’s statement, David Johnson, managing director of Shawbrook Bank said that it is please to witness that the secured loan market is finally getting bigger and they are delighted to take part in that development. Johnson further said that as consumers gain more hope in entering the lending the market, they discover that mortgage lenders constantly refuse to consider refinances so secured loan products are becoming more attractive to consumers.

Also, it is anticipated that the secured loan market will further grow especially with the expansion of loan product offerings and an increasing acknowledgement from brokers that secured loan products are a practical alternative to the conventional mortgage products.

How to Get a Payday Loan

In general, a payday loan is a short-term loan that offers a small amount of money, usually less than $500, and has a term of roughly 14 days.

One of the reasons that a person might need to get a payday loan is due to any kind of financial emergency. Moreover, some persons use it to cover an expensive month in particular.

In order to get a payday loan, you need to a go to a payday lender, answer an application with data concerning yourself, your employer, your next pay date and some important bank account information. In other words, you must have a job to be eligible for a payday loan.

After getting a payday loan, you can either pay it back or renew it, although some states do not allow this. In fact, the payday lending industry seems to be shifting towards requiring a principal paydown.

If you cannot pay it back nor renew it, then you can inquire about a payment plan. The majority of lenders would be glad to do this since they still want their money back. Their last options in order to get their money back are to send you to collections, sell your account to a collection agency, or worst is going to court.

Midwestern businesspeople were some of the first to realize that a payday loan is a much better way for borrowers to cover their short-term cash needs. In addition, payday loans requires only a single charge, not like other products that involve collateral, origination and administration fees, prepayment penalties, charges for credit life insurance, interest payments and other charges.

The advantages of getting a payday loan are it is easy, fast and a confidential way to cover short-term cash needs between paydays at the same time as avoiding the possible more expensive costs and bad credit consequences of other products.

Constant Fluctuations in the Mortgage Market

There are continuous fluctuations in the mortgage market this summer following an 8 percent increase in the lending between the months of June and July.

Based on the data from the Council of Mortgage Lenders (CML), the loans for home buyers and remortgages increase to £12.7 billion in July, which is it’s a record high since September and is up by 2 percent in the same period of the previous year.

The overall market was generally invariable, although the lending figures fluctuated due to distortions brought about by one-off events, like the Olympics and the Diamond Jubilee.

Meanwhile, according to CML, they still cannot confirm whether or not the recently released £80 billion Funding for Lending plan has motivated banks to lend more to hopeful homeowners.

Caroline Purdey, CML market and data analyst, said that they are looking forward to September figures because the effects of the Olympics and Diamond Jubilee are already insignificant.

However, Mark Harris, the chief executive of SPF Private Clients, cautioned that any constant recovery in the housing market is still a long way to go. Moreover, Harris said that the ongoing eurozone crisis, the focus on Olympics, and the low consumer confidence might lead to a slight decrease in transactions over the next two months.

In the past few weeks, there have been several inexpensive five-year fixed-rate deals released. This has been considered as an answer to the Treasury and Bank of England’s lending scheme. Its objective is to improve the economy by allowing credit to flow to home owners and businesses.

Earlier, a lot of homeowners had been glad to remain on their lender’s standard variable rates after mortgage deals expire. However, remortgaging is currently anticipated to increase. Moreover, the deals have been mostly intended at borrowers who can pay huge down payments and there are doubts that the scheme will not succeed in improving lending to first-time buyers.

Five Tips Before Considering a Reverse Mortgage

Reverse mortgages are known for allowing senior homeowners aged 62 or older stay in their homes. However, this comes together with excessive fees and limitations. Before considering whether or not to get a reverse mortgage, the following are five tips recommended by experts.

First, delay the timing of the loan because by doing this, you can borrow more against your equity and save more in terms of interest. Another way that you can save on interest is when you begin receiving payments. Moreover, there is more accumulation of interest if the loan period is longer.

Second, be aware of the different types of reverse mortgages. In general, there are three categories: Home Equity Conversion Mortgages (HECMs), which are backed by the federal government; proprietary reverse mortgages, which are basically private loans; and single-purpose reverse mortgages, which come together with limitations in terms of what you can spend the money on.

Third, assess the fees and rates. Reverse mortgages charge a lot of fees, for instance, origination fees, costs for closing and servicing the loan, premium for insurance, and interest rates.

Fourth, avoid lump sum payout. Taking as much money at once results to a situation where homeowners have to handle the money properly, and at the same time still paying for property taxes, insurance, and other costs. If the homeowner fails to pay, the home can be lost to foreclosure. Moreover, the homeowner can end up paying fees that are 5 percent more than those who don’t take the money.

Fifth, look for alternatives. One option is to sell the home because you can draw all the equity you have built up, unlike in reverse mortgage, where you only receive a portion of the equity since you have to pay for fees and interest. Another option is to sell the home to relatives and then renting it back so that it stays within the family.

The Perks of Credit Inquiries

Credit inquiries are part of the statement that determines your FICO score and car shoppers need to be aware of the benefits of inquiries to their scores.

If your credit is not very good or spotless then it is wise to know the impact of credit inquiries on your score. Buyers of cars try to inquire about their credit however what they do not know is that if they are not careful, this could do more harm in their FICO score than good.

FICO employees have been blogging about the effects of inquiries to FICO scores when customers inquire for credit.

According to recent news about car loan inquiries: asking for your credit status in a 30 day interval before the scoring will have no significant effect in improving your FICO score, furthermore all inquiries made within a 45 day period are only counted as one but they must be all for auto loan.

According to FICO you should have only short reasonable periods for shopping and it would also be smart to research about the different companies and their auto deals first. If you have bad credit then you should be responsible enough to get a copy of your credit report from the three reporting agencies and your bill for payment in one of your credit.

Here are some inquiries that have no effect in your credit scores:

a) Inquiries for consumer disclosure – this is when a costumer asks for their credit report copy.

b) Inquiries for promotional purposes – this is when lenders would ask for review in credit offers that were previously approved.

c) Inquiries for account review – this is when lenders would ask for review for the accounts that they currently are handling.

d) Inquiries for employment – this is when potential employers requests for employment.

e) Inquiries for insurance – these are requests from insurance companies regarding a client.