Tag Archives: interest rate
Where to Borrow Cash Fast?
Where do you usually borrow money? It is no wonder that a lot of people prefer turning to their friends and relatives in times of financial emergencies. It is great if they can give you some required cash. But has it even come to you that by doing that you may ruin your good and trustworthy relationships with lets say the closest friends. Just keep in mind that it is better not to combine things like money and friends/family. Once something goes wrong it is going to be extremely difficult to rebuild relationships. Here is one tip: consider borrowing with payday loans.
Lets discuss the advantages of such a deal.
First of all, you will not be embarrassed. They genuinely would like to help you. Second off all, this service is the fastest way of borrowing money. You can do this either online or by going to the local cash advance store. Third of all, everything is hassle-free, meaning no paperwork is required, if you choose to submit an application online, you can skip waiting in a long queue. Fourth off all, there are a lot of payday lending companies that is why you have a chance to compare interest rates and regulations. And finally fifth off all, a potential customer only needs to meet a very few requirements. They are: be employed, be 18+, have the US citizenship (it is alright if you are a Permanent Resident). As for the credit history, most of payday lenders are very understanding and they may approve you for a loan despite the credit score being less than perfect. But be aware of one fact: the better your credit, the smaller the interest rate is going to be for you. So make sure to take a good care of your credit.
This online tool also has minuses. You will need to pay the interest rate, but dont we always overpay for fast services? Sure we do. Another thing that has to be kept in mind is that in case a client has a zero balance on a card he/she chose to pay back with, penalties are going to be extremely big. Advice: do not apply for payday loans online unless you are absolutely sure that you can pay back in full on a set date.
This is about it. Ask for referrals from your friends so that you could choose a reliable company to borrow with. Good luck with your personal finances and stay away from the debt!
Funding Circle for Business Loans
Peer-to-peer lending sites are still a growing phenomenon in the UK. Their publicity efforts tend to centre on their benefits for investors, mainly the relatively high interest rates they offer to savers. The success of the sites depends on winning over lenders looking for a home for their savings: there is less material out there about their advantages from the point of view of borrowers.
Its assumed that potential borrowers, particularly business borrowers, will find their own way to the sites with minimal encouragement, given the tight credit market of recent years.
If you run a company thats in need of investment, the financial climate isnt easy. Its hard to get backing from the banks, even for small loans. What are your options? Of the top three UK peer-to-peer sites, the biggest one for business borrowing is Funding Circle (FC).
Who can borrow through Funding Circle?
A business is eligible to apply for a loan of between £5,000 and £1,000,000, if it
* Has a turnover (not profit) of over £100,000 per annum
* Has filed accounts at Companies House for at least two years
* Is a limited company or LLP, not a business run by an individual or a partnership
The loans are repayable over a period between six months and five years. A personal guarantee for the loan is expected in all cases, and for larger loans over £100,000, the site requires security to be given, either on a specific asset to be bought with the loan proceeds, or generally over company assets.
How does it work for borrowers?
A business needing to borrow must initially complete an online application. Funding Circle estimates that should take about 20 minutes. They aim to process the information, complete routine checks, and revert to the borrower with a decision within two days.
FC will do a credit check with Experian, and will also check with CIFAS as to whether any fraud has been recorded in connection with a company director.
The borrowers proposal may be accepted or rejected outright, or Funding Circle may request modifications in the terms or the security required. In some cases, the company may be restricted to borrowing a smaller sum that they had intended. Depending on FCs assessment of the borrowing companys financial strength, and the degree of risk in lending to them, the loan request, once accepted, will be assigned a risk band which determines the range of interest rates allowed for the loan. The rates range between 7.2% and 11.5%, as at November 2013.
Once agreement has been reached on terms, the loan proposal will appear on the FC website, with information about the companys credit rating, accounts, and the purpose of the loan, together with details of any guarantee and/or security.
Within the assigned risk band, lenders can offer to lend money at their chosen rate, which is driven down in a reverse auction as successive lenders place their bids. The more popular the lending proposition, the quicker the interest rate will go down. It usually reaches the minimum for its particular risk band, but may not do so if the proposal doesnt appeal to the lender members of the site.
Appealing to lenders
To ensure the best chance of your proposal attracting the lowest interest rate for its band, make your proposal full and convincing. Describe your company mission and values, and explain why you need the money as precisely as possible.
Make sure that any issues with your credit score have been resolved with Experian as far as possible, as the company credit rating is very important to lenders. Above all, answer their questions as promptly and fully as you can, even when, as is sometimes the case, they are phrased less than diplomatically. Far fewer people will lend on a proposal with unanswered questions outstanding, or with questions they think arent answered fully.
After the auction
When the loan is fully funded, usually at the minimum rate for the band, the borrower must decide whether to accept the proposal or not.
If its accepted, the loan, consisting of 10s or 100s of small slices coming from individual investors, will be administered by FC who will distribute the repayments between the investors and chase up late payments. They will be responsible for collecting the debt through the courts if necessary, and will enforce any guarantee or security, should the loan go bad.
If you are thinking about borrowing through Funding Circle, its a good idea to get familiar with the website and watch a few auctions first. You can get an idea of the process and also the sort of questioning you may face from potential investors.