Tag Archives: credit rating
Secured Loans Are Based On Equity In Your Home
In financial jargon, the word Equity means the difference between the market value of your home and the debts raised against it. In other words, it is the unencumbered value of your home that is known as equity. The concept of equity is important for a homeowner since a loan can be raised against the equity in your home. Many lenders offer a loan to value ratio of eighty per cent only. It means that if your home has a value of £150,000, you can take a loan up to £120,000.
The credit rating that you have at the time of taking loan is very important. A good credit rating implies that your past conduct in the financial transactions was trustworthy and, therefore, lenders are likely to offer you a low rate of interest. By releasing the equity in your home, you can borrow up to £250,000. People usually take loan against equity only when they have large monetary requirements.
How borrowers are advantageously placed when taking secured loans?
In the past few years, the value of an average home in the UK has increased manifold. This reflects in the prevailing home prices; an average home costing more than £200,000 in the UK. The higher the price, the higher will be the equity in your home. Thus, the homeowners who want to borrow money are obviously better situated than those who are living on rent. In normal course, lenders give 80 per cent of equity in your home as a loan but this is not a fixed criterion and you may get more or less depending upon individual financial circumstances.
Bad credit loans and credit reference agencies
Secured loans are also available to those people who are having a bad credit rating. The credit rating is a numerical figure that is attributed to every borrower on the basis of his past conduct in the loan market. There are several credit reference agencies in the UK that gather information from various sources like the electoral roll, county court judgments and financial institutions. On the basis of the information collected, these agencies give a credit rating to every borrower. Lenders check credit rating to their satisfaction before sanctioning any loan to the borrowers.
Bad credit loans are available in two ways by providing a security or without it. However, lenders prefer to give bad credit loans only to those borrowers who can provide a security. This is usually done to cover the risk involved in giving loans to people who have dubious credit record.
Rebuilding Your Life After Bankruptcy; Don't Cave To Holiday Pressures! (Page 1 of 3)
There’s something about shopping during the holidays as I watch consumers being attacked by exuberant cashiers pushing their store’s credit card that gets me concerned for those trying to build a solid life after bankruptcy.
These clerks seem to be unaware of how careful individuals have been all year to build their life after bankruptcy; by watching what they spend, and how easy it is to go over budget. Offering a ¡°credit rebuilder¡± a new card is like offering a recovering chocoholic a gooey double-fudge brownie supreme.
The holidays bring about mixed feelings among my clients: joy, anxiety, fear, sadness¡.not any of it relating to the reason for the season.
Rebuilding your credit and creating the life after bankruptcy that you desire is a difficult tightrope balance between moving forward with your life and not ruining the upward progress of your credit score.
Holidays mean gift-giving gatherings with sometimes hundreds of people, if you total them all up. Pressure rises when the office party committee asks us to pitch in for gifts for management.
Your head starts spinning when you think about how your extended family has grown and how they will all exchange presents Christmas Eve at your house this year. You finally feel the wind knocked out of your sails when the cashier tells you that you can save up to 25% on your purchase if you apply for their wonderful store credit card.
Just remember and keep this thought at the front of your mind…creating the desirable life after bankruptcy is the objective, not the savings of 25% that is surely to be out of our original budget anyway.
As someone who has recently discharged a bankruptcy and is trying to rebuild life after bankruptcy as well as create a high credit rating, should you respond to such a sweet, seductive offer? (Twenty-five percent off purchases, after all, would give you the extra money to buy Aunt Millie that deluxe food steamer!)
But here’s what I teach as a financial counselor from Credit Is Key: though it is much easier said than done, do NOT apply for any credit cards during the holiday crunch.
Every financial move should be the result of planning and preparation for your life after bankruptcy – not suddenly caving in to pacify the salesclerk – or Aunt Millie. If you say ¡°yes,¡± then the store will make an inquiry on your credit.
Did you know that even a couple inquiries will actually hurt your credit?
Rebuilding your life after bankruptcy requires inner strength. A strength you have been nurturing and growing since your discharge. A strength that is given a boost by having a specific goal in mind and a planned strategy in place; building a wonderful credit rating to enjoy your life after bankruptcy. Help yourself! Instead of falling into the ¡°get-a-credit- card-and-reduce-your-spending¡± trap, try these ideas for holiday savings — without inquiries or damaging rejections. Always remember the objective…improve your life after bankruptcy by improving your credit rating!