Posts from the ‘Credit score’ Category

Improve Your Credit Score with Poor Credit Auto Loan

Banks and financial institutions usually look for healthy credit score when an individual approaches them for an auto loan. Credit score is a number representing whether the borrower will pay his or her debts. It is used by banks and financial institutions to evaluate the potential risk involved while lending money to customers. So, if an individual has low credit score, lending companies will be reluctant to provide auto loan to that individual.

But low credit score can be mended with the help of poor credit auto loan. Poor Credit Auto Loan not only helps you get an automobile of your choice but also helps you improve your credit score. So, if you have been denied an auto loan due to your bad credit score, you can go for poor credit auto loan.

Poor credit auto loan doesn’t take the credit score into consideration, as it has been specifically designed to help people with poor credit scores. However, lenders charge high interest rate on these poor credit auto loans which directly corresponds to the risk involved with the borrower. Some people may think paying such high interest as a disadvantage but if pay your loan in time your credit score will be improved. And, once this is done banks will be more confident to provide regular auto loans to you in the future.

Suppose you have already taken an auto loan and finding it difficult to make the monthly payments, you can go for auto loan modification. Auto loan modification specialists help you renegotiate your auto loan with the lending companies and lower monthly payments.

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Emergencies can ruin your planned finances!

How about getting your morning tea at 12:00 hours and your lunch at late evening? This routine would be considered as terrible. So, to avoid such incongruity, everything in life should be planned. It is important that we know where we are investing, what you will do and where you go; so design your life in such a way to avoid any confusion or uncertainty.

When it comes to finances one need to be extra careful in handling money. An account of all; the daily expenses, extra expenses and any scheduled expenses are always necessary. However, how best you plan to keep your finances intact, it’s difficult to entirely secure it. Emergency or external factors may ruin or challenge your plans. A big emergency in form of natural calamity to secondary factors like shares downfall or loss of job etc. can leave you standalone.

To our rescue there are many funds in form of loan but what if you already own one? and are unable to bear its brunt. Would you take another loan to fulfill the requirement? Not a smart move, the move should be to smartly handle the situation and go for a loan modification.

Unlike home loans, obtaining a new car loan may be very challenging after a repossession, which stays on your credit report for a minimum of seven years. So avoid the pitfalls of “post-repo” car shopping by keeping the car you have and protecting your good name.  What would be the best option? The best option will be to go for auto loan modification to make your payments low and rescue from this hassle.

How about getting your morning tea at 12:00 hours and your lunch at late evening? This routine would be considered as terrible. So, to avoid such incongruity, everything in life should be planned. It is important that we know where we are investing, what you will do and where you go; so design your life in such a way to avoid any confusion or uncertainty.

When it comes to finances one need to be extra careful in handling money. An account of all; the daily expenses, extra expenses and any scheduled expenses are always necessary. However, how best you plan to keep your finances intact, it’s difficult to entirely secure it. Emergency or external factors may ruin or challenge your plans. A big emergency in form of natural calamity to secondary factors like shares downfall or loss of job etc. can leave you standalone.

To our rescue there are many funds in form of loan but what if you already own one? and are unable to bear its brunt. Would you take another loan to fulfill the requirement? Not a smart move, the move should be to smartly handle the situation and go for a loan modification.

Unlike home loans

, obtaining a new car loan may be very challenging after a repossession, which stays on your credit report for a minimum of seven years. Anthony Tribunella, the director of Auto relief group says, “Avoid the pitfalls of “post-repo” car shopping by keeping the car you have and protecting your good name.” What would be the best option? The best option will be to go for auto loan modification to make your payments low and rescue from this hassle.

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What’s CARD Act?

“The Credit Card Accountability Responsibility and Disclosure Act of 2009 or Credit CARD Act of 2009 is a federal law passed by the United States Congress and signed by President Barack Obama on May 22, 2009”.                         Source:  Wikipedia

The CARD Act is approved to protect card holders from the unfair practices, sudden hikes in interest rates and changes in terms and conditions usually done by credit card companies. Following is the extract summary of the bill:

  • Credit card holders must be given protection against sudden hike in interest rates. A minimum 45 days notice must be provided to all card holders for any changes in interest rate so that they don’t feel cheated.
  • Regular payers must not be penalized by credit card companies. If a customer is regularly paying all his/ her bills on time for six months continuously, they must be charged their previous interest rate and not the hiked rate.
  • Credit card holders must be informed 21 days before the due date of their bill payments to avoid penalties.
  • Credit card companies usually mention some confusing terms such as ‘fixed rate’ and ‘prime rate’ as it is misleading for credit card holders. It is important that they set proper definitions of those terms.
  • The CARD act also gives the right to card holders to set a credit limit for their card. This will avoid over-spending and thus credit card companies will not be able to charge for non-payment.
  • Fair allotment of payments must be done by the credit card companies. The debts which have a higher interest rate must be cleared off first and then other bills.
  • The act also limits the amount of ‘over-the-limit’ fees that are usually highly charged by credit card companies to gain profit.
  • Vulnerable consumers will be protected from fee-heavy subprime credit cards.
  • Under this act, congress must collect the data on industry profits of credit card industry and present every year.
  • The credit card holders will have the right to get an explanation of the minimum amount he/she has to pay against the debts and interest charges.
  • A credit card cannot be issued to teenagers i.e. below 21 years or if issued they must present a co-signer who can give a guarantee to repay the debts.
  • Banks must provide a reason for participating on college campuses and at university-themed events.

Under the CARD act people will get a chance to improve/ raise their credit score. The rules under this act automatically helps card holders to pay timely as they will be more aware of their limits, interest rates, etc and they can avoid paying penalties resulting in improvement in credit score. A high credit score in itself has many benefits for availing loans. Thus, you can get a loan at a lower interest rate as you would have paid off all your debts on time.

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Various vehicle expenses delay auto loan payments

Owning a car involves a lot of expenses which we do not realize while purchasing one. Fuel prices are increasing day-by-day and maintenance charges are unavoidable. The recent economic slowdown has badly affected the pockets of Americans. It was highly challenging for them to cope up with all expenditures on their vehicles plus their auto loan payments. Compromising on their fuel and maintenance expenditures is practically not possible; hence, they delayed their monthly loan payments and entered into a situation where banks gave orders for repossession.

Repossession lowers an individual’s credit score which remains there for at least 7 years which further creates problems if you want to apply for loan in future. In this case, you will have to go for a bad credit loan with a higher interest rate. So, what is the solution to all these problems? Uncontrollable and unavoidable expenses have to be borne by you in any situation, however try to contact a loan modification service provider that can help you reduce your loan payments.

Loan modifiers are experts in negotiating loan amounts with banks and financial institutions to help their clients give a comfortable time and price spread over time, to avoid delay as well as non-payment of auto loan payments.

While there are no universal rules, our experience shows that the earlier you start the process the better your chances of negotiating a successful transaction. Lenders hate wasting more time and money on “bad” deals and prefer to get constructive proposals that make sense.

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How Bankruptcy is related to Auto Credit?

Filing a Bankruptcy for individuals can be of two types, Chapter 7 and Chapter 13. The effect of Bankruptcy can stay on your credit score card for up to 10 years. There are certain things which need to be considered while planning to file for a bankruptcy.

If you are considering repossession for your vehicle, then this won’t be the right time. If repossession occurs before filing for bankruptcy, then it is implied that you are using bankruptcy to avoid paying your debts and after filing will indicate that you have not learnt your lesson. And if repossession occurs outside of repossession then you will find it very difficult to get an auto credit from anyone, including the subprime lenders, for many years.

If you have filed your bankruptcy under Chapter 13, you will need an order from the trustee to obtain addition loans. Without this order you are not allowed to apply for any kind of loans during bankruptcy.

The lender has the right to repossess your vehicle if you fail to make payments and you are filed under Chapter 7. You may also not be given approval for another vehicle loan from your lender after filing for bankruptcy.

If your case has been filed under Chapter 7, and you vehicle has been repossessed but the case has been discharged, you have a chance to obtain an auto loan from a subprime lender. However, a low interest rate is not guaranteed. This type of loan is called as a bad credit auto loan.

Repossession is of two types, i.e. voluntary and involuntary. In an involuntary repossession, your vehicle is taken away by a repossession service whereas a voluntary repossession happens when the vehicle is brought to a place decided by the lender and then surrendered. Though there is not much difference in both types, it is still named differently.

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Is Bad Credit, The End Of Owning A Car?

In this economic slowdown, credit score, bad credit, bankruptcy became a common word for Americans. Now people are more aware of their credit scores than ever before. However, the increased awareness increased more fear! .

“In the recent past many customers who are thinking of buying a new car inquired us about purchasing a new car, but have a bad credit & low credit score. They informed that they have not a pleasant experience with the dealers. For people who encountered the same situation, we can bet that you might have experienced these kinds of situations. Few dealers would have informed that you are eligible for auto loan only if you have got a credit history for auto loan. Auto loan can be approved but you have to pay high interest rate. Since the score is low, obviously the person’s self esteem will be low and this favors the retailers. They can easily play with your psychology and will turn the negotiation (!) one sided, that is in their side.

The customers might have did their homework before meeting the dealer but dealer would inform that their score is much lesser than what it really is. Some dealers would inform to sign in for extended warranty, insurance etc., but they actually may be a way of extracting more money from the already financially troubled customer. There could be some situation where the customer is asked to co-sign the loan.

“Beware, when you do a trade-in, it could be easy, to degrade the value of your old car. If these are a situation you have experienced, it is always better to consult an expert. There are many auto loan modification companies like Auto Relief Group. The customers are advised to consult them while they think of entering such a step.

By paying a few dollars to the consultant, if saves few thousands, it seems there is nothing wrong in trying it.

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What is the best solution to credit score problems?

The shock of the current economic recession has stimulated some very interesting new attitudes and behaviors in the financial marketplace. An economic downturn & bankruptcy is by no means the end of your financial existence, but instead is the beginning of a new one and should be treated as such. It gives you the platform to start over and rebuild your credit history to a respectable level and repay back your auto credit.

With a record number of repossessions in USA that have already taken place in 2010, auto lenders don’t have any more alternatives for more repossession. The best solution for this problem is Auto Loan Modification. A loan modification service provider is a mediator between you and your bank/ auto dealer to come to a friendly decision with lowered payments for the vehicle owner.

A loan modification service provider will guide you in your credit score report. A credit score is a reckoning of an individual’s creditworthiness based on an analysis of the data reflected in his or her credit report. Your credit score helps determine the interest rate you will pay on your loan.

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