Loans

Student Loan … – How does it … loans are a great source of … aid for students who need help paying for their … … students often leave college with

mediaimage
Student Loan Consolidation – How does it Work?
Student loans are a great source of financial aid for students who need help paying for their education. Unfortunately,Student Loan Consolidation – How does it Work? Articles students often leave college with burdensome debt. In addition, they often have multiple loans from different lenders, meaning they are writing more than one loan repayment check each month. The solution to this problem is loan consolidation.

What is loan consolidation?
Loan consolidation means bundling all your student loans into a single loan with one lender and one repayment plan. You can think of loan consolidation as akin to refinancing a home mortgage. When you consolidate your student loans, the balances of your existing student loans are paid off, with the total balance rolling over into one consolidated loan. The end result is that you have only one student loan to pay on.

Both students and their parents can consolidate loans.

Should I consolidate my loans?
Loan consolidation offers many benefits:

-Locks in a fixed, usually lower, interest rate for the term of your loan, potentially saving you thousands of dollars (depending on the interest rates of your original loans)
-Lowers your monthly payment
-Combines your student loan payments into one monthly bill

In addition, consolidated loans have flexible repayment options and no fees, charges, or prepayment penalties. There are also no credit checks or co-signers required.

You should consider consolidating your loans if the consolidation loan would have a lower interest rate than your current loans, particularly if you are having trouble making you monthly payments. However, if you are close to paying off your existing loans, consolidation may not be worth it.

How will the interest rate for the consolidated loan be?
The interest rate for your consolidated loan is calculated by averaging the interest rate of all the loans being consolidated and then rounding up to the next one-eighth of one percent. The maximum interest rate is 8.25 percent.

To figure your interest rate, visit loanconsolidation.ed.gov for an online calculator that will do the math for you.

How much can I save?
How much you save by consolidating loans depends on what interest rate you get and whether you choose to extend your repayment plan. According to Sallie Mae, the leading provider of student loans in the United States, consolidating student loans can reduce monthly payments by up to 54 percent. However, the only way to reduce your payment this much is to extend your repayment plan. You typically have 10 years to repay student loans, but, depending on the amount you’re consolidating, you can extend your repayment plan all the way up to 30 years. Remember that if you choose to extend your repayment term, it will take longer to pay off your overall debt and you’ll pay more in interest. There are no preypayment penalties, so you can always choose to pay off the loan early.

Am I eligible to consolidate my loans?
In order to consolidate your loans, you must meet the following criteria:

– You are in your six-month grace period following graduation or you have started repaying your loans
-You have eligible loans totaling over $7,500
-You have more than one lender
-You have not already consolidated your student loans, or since consolidation you have gone back to school and acquired new student loans

The following types of loans can be consolidated:

-Direct Subsidized and Unsubsidized Loans
-Federal Subsidized and Unsubsidized Federal Stafford Loans
-Direct PLUS Loans and Federal PLUS Loans
-Direct Consolidation Loans and Federal Consolidation Loans
-Guaranteed Student Loans
-Federal Insured Student Loans
-Federal Supplemental Loans for Students
-Auxiliary Loans to Assist Students
-Federal Perkins Loans
-National Direct Student Loans
-National Defense Student Loans
-Health Education Assistance Loans
-Health Professions Student Loans
-Loans for Disadvantaged Students
-Nursing Student Loans

Where can I get a consolidation loan?
You can consolidate your loans through any bank or credit union that participates in the Federal Family Education Loan Program, or directly from the U.S. Department of Education. The loan terms and conditions are generally the same, regardless of where you consolidate. You may want to check first with the lenders that hold your current loans.

If all your loans are with one lender, you must consolidate with that lender.

If you decide to consolidate your student loans, remember that you can only do so once unless you go back to school and take out more loans. Therefore, you will want to make sure you get the best deal the first time. The interest rate will be the same from all lenders, but some lenders may offer future rate discounts for prompt payment and a discount for having monthly payments directly debited from your account.

Can my spouse and I consolidate our loans together?
You can consolidate your loans together, but it is not a good idea for a couple reasons:

-Both of you will always be responsible to repay the loan, even if you later separate or divorce
-If you need to defer payment on the loan, both of you will have to meet the deferment criteria

When should I consolidate my loans?
You can consolidate your loans any time during your six-month grace period or after you have started repaying your loans. If you consolidate during your grace period, you may be able to get a lower interest rate. However, since you will lose the rest of the grace period, it is a good idea to wait until the fifth month of the grace period before consolidating. The consolidation process usually takes 30-45 days.

This article is distributed by NextStudent. At NextStudent, we believe that getting an education is the best investment you can make, and we’re dedicated to helping you pursue your education dreams by making college funding as easy as possible. We invite you to learn more about how to get Student Loan

When in a financial emergency, would you choose a loan that’s less likely to be approved? Here’s why No Credit Check loans thrive despite a higher cost.

mediaimage
There’s no doubt that No Credit Check loans are among the higher cost loans out there. What makes them still so prominent and widespread? Isn’t the cost of the loan what makes them unattractive to people? Clearly,No Credit Check Loans A Help for Troublesome Times Articles the market is proving since years that that’s not the case. While loans that people use to fulfil wants and aspirations (like car loans and home loans) are to a huge extent affected in demand by their cost, the same does not seem to stand so true for loans that serve people in urgent needs of funds for various reasons.

When in such a situation, options can be limited for a lot of people. Quick loans and borrowing from friends/family seem to be the available solution but not many wish to choose the latter and especially not after having done it once or twice before. Hence, quick loans are increasingly being the most preferred choice and as you read ahead, you shall see that a lot of people do not tend to have a strong credit history, making No Credit Check the only available quick loan option that can to an extent be relied upon.

Why do so many Individuals have Poor Credit Scores?

Roughly half of the millennials in the US do not have a healthy credit score. People outside of that group are a little better off but not by a huge number. What leads to this? Let’s take a look at the top reasons:

Poor understanding of the credit system: Not knowing how to prioritize payments and not knowing when shutting down a credit account (eg. Credit card) can actually be harmful for the credit scores, is an easy way to lose out on your credit score.
Using one credit card for everything: If you have and use just a single credit card for everything, use it to a high percentage of its limit and don’t repay it fully each month, there’s a significant hit that you’re causing to your credit score.
Not checking and acting upon errors: The credit system is complex. Once a year, you can check your credit report free of cost and repercussions. It is important to do so and apply to correct any issues and errors you find. Errors are common and corrections are also often done when requests are legitimate.
Not knowing what all gets featured on a credit report: Many do not know that even applying for a loan that gets rejected, hits the credit score. That’s just an example of many other things that make up the credit score.
Are No Credit Check Loans Faster?

Credit check is just like any step of the loan approval process – it takes time. When one step is skipped, time is saved. However, there are other things that need to compensate for what the credit check does. Being a short term loan, these are typically steps that do not take much time, hence No Credit Check loans still tend to be faster.

The other thing that makes these loans faster in general, is that they’re non-bank direct lender loans. Their processes seem to be simpler and quicker in general but this of course varies from lender to lender, and so does the speed and consistency of loans disbursement.

We have a few suggestions that can help you get loans quicker, if that’s what you need:

Keep all the documents and details ready while applying
Provide complete information and try to ensure it’s all easy to verify
Provide good quality scans of documents when applying online
Ready reviews about your lender to understand if they’re fast at processing loans
Apply for only as much as you know you can really repay and it’s likely that the lender would make similar assessments and process you loan so you don’t have to reapply elsewhere and waste time that way.
How Much Costlier are these Loans?

Loans and their mathematics are not designed to be very easy to understand. It’s hard to compare the usual bank and credit card loans with the non-bank direct lender loans which come with APR disclosures and simple interest while the former typically charge compounded interest.

In the simplest of terms, what I can say is that in less than a year’s term a significantly higher APR loan shall have a significantly higher cost irrespective of the type of interest being charged. Beware of loans that charge interest monthly – these shall have a many times higher APR (which is Annual).

Being very short term loans, No Credit Check loans have a high rate of interest but if your loan term is short enough, the final amount you end up paying quite a small amount at times. The only real way to know how costly a loan really is, is to find out the final cost.

One piece of advice here is to stay totally away from loans that you may fail to repay on time. Loans get very expensive if you cross the stipulated repayment schedules.

When should one avoid No Credit Check Loans?

No Credit Check loans are higher cost loans which are intended for emergencies and other sudden needs. These are also essentially short term loans which are not intended to be designed as a replacement for bank loans or other conventional loans like home loans, car loans, etc. They have their benefits but used wrongly, they can be very expensive and damaging too.

While it is virtually impossible to make an exhaustive list of every situation in which such loans should be avoided, here are a few which should help understand the idea well:

When you’re in a long term need: It’s simple – do not take a high interest rate loan for a long period of time. It will be more expensive than is reasonable. These loans are intended to be short term loans and even the idea of repeatedly renewing them to use them for a long term could be disastrous.
When bank loans are available and can serve you: If you’re not in too much of a hurry and bank loans are available to you, it should not be a problem to choose that option – they would tend to be less expensive. However, if what you specifically need is a very short term loan, you may have to do the mathematics to understand what’s less expensive.
When your credit history is great and there are other quick enough options available: There are other quick loan options out there. Some banks offer pre-approved loans to their long term customers, which are fairly quick. If credit history is not a problem in your case, you must first consider those options which may come at a lower cost.
When you find a lender whose offer seems illegitimate: Some lenders can be hard to verify for legitimacy. Sometimes the offer and their missing online presence should be a giveaway and it’s good to look for safer, genuine lenders while taking a non-bank direct lender loan. I share links of a trusted lender at the end of this article.
When you’re nearing bankruptcy: Since the loans are intended to be quick and with minimal checks and verifications, you’re the one who needs to know that bankruptcy isn’t near when you take this loan. Unlike loans with collaterals and bank loans, bankruptcy cannot be used to close these loans and the penalty of non-repayment will just keep piling up if you hit bankruptcy with such a loan still outstanding.
When you’re already in a lot of debt and didn’t think your decision through: Many borrows stuck in a debt cycle resort to No Credit Check loans. There are ways to use such loans to escape the debt cycle but these are not easy to calculate and it’s definitely not great if things go south from there. Employing a debt consultant for help at such a time may be helpful, if you are not sure you’re getting the mathematics of it right.
Is the “Guaranteed Approval” Real?

Many No Credit Check loans claim to offer a “Guaranteed Approval” on the loan. While this claim seems too good to be true, there’s more to it than meets the eye in the first glance.

I have read into the finer lines of many such loan offers and also spoken to some past borrowers and here I shall share what it truly means – which can vary a little from lender to lender but at a broader sense, remain fairly standard.

The first thing to keep in mind, is that lenders of the No Credit Check loans being non-bank entities, are able to offer a very flexible sum of amount. Some lenders can choose to offer loans for as little as $100. Maybe even lower but I didn’t find any such mention.

The second thing is that the marketing and terminology is worded in a way that it assumes qualification for the loan. If you do not qualify for their loan i.e., if you do not meet their eligibility criteria, there’s anyways no question of an approval. This also encompasses what amount you shall be eligible for borrowing.

Given these facts, it is fair to state that provided you apply for your loans of an amount that their eligibility criteria can accommodate and provided that you meet the rest of the eligibility requirements, your loans shall be approved with certainty. The catch here is that it’s hard to know for sure, what amount can be approved. Some lenders tend to make counter-offers to borrowers when they deem the borrower ineligible for the amount that’s being applied for.

Conclusion

Loans are available in so many ways and forms with so many labels today, that it gets confusing these days for the borrowers. No Credit Check loans also come under multiple labels and are typically offered by non-bank direct lenders. Being riskier for the lender, they tend to be a higher expense loan but the government regulations ensure transparency by mandating APRs to be disclosed and by eliminating compounded interest which tends to make lower interest rates far more expensive over time. The other advantage can be the very short term – which can be useful to many borrowers.

One of the reputed and experienced direct lenders offering suc