When researching your student loan consolidation information options you want to look into how credit history affects student loans.

A range of general student loan products are not credit-based, Stafford and Perkins are based solely on need and do not even perform credit checks, but not all students will qualify and these services will in many instances cover a reduce amount of less than 100% of the amount needed, especially given the high cost of education today, most students and his or her families may therefore need to supplement these with credit-based student loans, when they do being able to show a good credit report to evaluators will result in the best access to funds, with the better interest rates, as with any credit-based loans a prior history of bad credit does not make acquiring funds impossible, nevertheless it is often much harder and in many instances carries a higher interest rate, avoiding a bad credit history will hence be the difference between getting a loan or if you do obtain one, repaying much more than you would have with a good credit rating.

However what is good or bad credit?

The first issue any loan officer will examine is the FICO score, the FICO is a total score calculated by the main credit agencies based on a secret proprietary formula, though the exact equation is not public, multiple criteria are well known and even obvious. Read More

During the last few decades, we moved many times from place to place, buying and selling houses and other property. To my knowledge, not even the most respectable bank that carried our mortgage ever had anything to do with any FICO score. I first heard “FICO score” mentioned, about six or seven years ago, when one of my children worked for a mortgage company, and I found out from him that FICO score has been around since the 1950s, after Fair, Isaac and Co. (therefore the acronym FICO) developed a certain method to determine the credit risks of borrowers.

FICO scores range from 300 to 850, the higher the better. The majority of scores are in the levels of 600-700. The desirable ones are 720 and higher. FICO scores are designed to measure the risk of delinquency by considering several past and present issues, such as the length of credit history, punctuality of payment, current debt including tax liens and money owed as a result of a court judgment, recent searches by the consumer to obtain credit, and the amount of credit received up to date. The exact formula for obtaining the FICO scores, however, is held secret and–it beats me, but–this conduct is accepted by the Federal Trade Commission.

Three nationwide companies, Experian, Equifax, and TransUnion, use the FICO scores for credit reporting. All three of these companies are required by law to provide the consumer—you—with a free credit report every twelve months. Read More

In the present era, a home is not just a place where you live together with your family. It has become more of a status symbol that reflects your lifestyle. Every one competes to make his home look better than others. However, lack of funds must be pulling you back in this race. Unsecured home improvement loan gives you the much-needed push to help you win this race and have a home that is the envy of others.

Unsecured home improvement loan forms one of the simplest method to finance home improvements. An unsecured home improvement loan is a personal loan, which is not secured against the property of the borrower.

The advantage of taking an unsecured home improvement loan is that it does not put borrower’s property at risk. The loan provider cannot repossess borrower’s property in case of default on loan. The loan is best suited for people who do not own property and living as tenants. Property owners too can apply for the loan.

Home improvements imply any improvement desired by borrower in his home or apartment. Home improvements that one intends to make may vary from person to person. Remodeling kitchen, adding a new conservatory, furnishing children room with bunk bed, can all be sufficient reasons for drawing unsecured home improvement loans. Read More

These days it’s all too easy to have your credit slip down a few notches. If you are looking to refinance, that’s not where you want to be, but it’s not the end of the world either. Let your FICO score dip below 680 and you could be a candidate for bad credit mortgage refinancing. It depends on the individual lender. Let it get down around 650 or worse and you’ll be a bad credit refinance candidate for sure. With the recent shakeup in the sub-prime lending market, many lenders are being more selective about who they’ll extend refinance loans to. They’ll be looking seriously at your recent credit history. Several sub-prime lenders have ceased operations or declared bankruptcy, so there are fewer options available to borrowers in the sub-prime category.

Even so, you can still refinance, bad credit or not. There are options available to you, so you can take advantage of better interest rates. This can be especially important if you purchased your home using an adjustable rate mortgage, and the 3 or 5 year initial period is about to expire. When it does, your mortgage will adjust upward. This can cost you an extra $200 - $600 per month in higher mortgage payments. Many people don’t have the financial wherewithal to absorb such an increase in their mortgage payment. Even if you do, there’s little reason to do so when you can refinance and avoid the payment increase. Read More

Those of you who recently filed bankruptcy (and those bad credit scores) may be tempted, like I was, to ask a friend, parent or relative to co-sign on a loan with you.

Don’t do it.

It weakens your position with lenders. Once a lender sees a co-signer on one of your loans—the lender will question your stability and move into “cover their butt” mode. And the way lenders cover their butts, is by forcing you to get a co-signer on your next loan…and the loan after that…and the loan after that.

Bottom line: When you have an existing co-signed loan—the chance of a lender requiring a co-signer on your next loan increases significantly.

There are right ways to recover from bankruptcy (or just rebuild bad credit) properly and quickly. But having a co-signer only delays your recovery and sets you up for complications along the way.

If you are unable to qualify for the credit you need…take it as a sign that it is not meant to be…until you can qualify on your own.

What if you are asked to become a co-signer?

I have a core belief…and it goes something like this, “Lend people money only if you can afford not to get it back and you won’t hold a grudge if you don’t—but never ever lend people your credit.” Read More

Most of us are aware of the credit score - a numerical quantity widely used to assess your credit worthiness. But there’s another scoring tool that can debar you from getting credit. It’s the Bankruptcy Risk Score - a supplementary score that most creditors and lenders scrutinize prior to offering credit.

Personal bankruptcy seems to be a major consumer credit problem for lenders and credit providers. Since creditors cannot recover losses due to bankruptcy without litigation, so consumers filing bankruptcy are more costly for them. The year 2005 has experienced record number of bankruptcy filings - at least 31.6% higher than 2004 prior to the new law coming into effect.

But the new law has hardly helped debtors. Reports suggest that only 3.3% of the debtors could get rid off debts using debt management plans. The mandatory credit counseling sessions under the new law proved useful to only a maximum of 5% and minimum of 1%-2% of the filers. Here lies the need for Bankruptcy Risk Score to make debtors more aware of how much credit they can deal with. On the other hand, creditors and lenders get the extra edge over traditional scores, as they are better informed of the consumers’ credit status. This helps them in making credit decisions accordingly.

Creditors assess the score when you apply for a mortgage, a credit card or any other bank card. Before extending credit, banks may also review the score while checking your accounts. Banks need to maintain a standard capital-to-risk ratio, and Bankruptcy score enables them to evaluate the risk within their portfolio. A combination of your credit score and spending habits (how you use credit card, shopping card, etc) helps in the evaluation. Read More

OK, you’ve filed bankruptcy. Your credit isn’t great, but you need to buy a car.

So you go to the local car dealership and believe the salesman when he says…

“Buy this car today at this high interest rate and we’ll refinance you in 12 months at the lowest interest rate possible.”

Recovering from bankruptcy is easier than you thought! Time to celebrate, right?

WRONG!

Don’t Believe Everything a Car Salesman Tells You

Every day car dealers repeat the “refinance in 12 months” lie to bankrupt people to push them to purchase cars at extremely high interest rates. You may have financed a car through a high-interest lender knowing that it’s not the best choice. But you probably thought it was your only option at the time and you justified it by thinking you could refinance to a lower interest rate later.

But, when you try to refinance the car months later, you find out the car dealer lied to you.

Best Way to Refinance a Car After Bankruptcy Read More

Credit runs into our lives and has effect on almost every decision we make. Bad credit runs in our credit application and has effects on every loan we borrow. A recent survey has shown that one fifth of the adult population cannot qualify for regular loans. For such a huge loan borrowing population there are specific loan programmes called bad credit loans.

With bad credit loans you can borrow loan amounts of the likes of $5000-$75,000. Repayment term will vary from 5-25 years. Both secured and unsecured options are available for bad credit loans. Unsecured bad credit loans will require no collateral and will suit if you want to borrow smaller amounts. For larger amounts secured bad credit loans are appropriate and would require collateral like home, real estate or car etc.

Start with your credit report and credit score - that will give you a clear idea about how ‘bad’ your bad credit is. Credit score has statistical information which can be used by loan lenders to assess the risk accompanied while lending you money. Different credit score structures are used by loan lenders – however the most common is fico credit score. Fico score ranges from 300-900. Anything below 620 will mean you have bad credit score and will qualify for such loans only.

Bankruptcy, arrears, late payments, CCJs, defaults, foreclosure and any court case are seen as bad credit cases. None of these things on your credit report can prevent you from having bad credit loans, unless you have pretty bad credit condition like multiple bankruptcies. In worst case scenario there will fewer lender ready to take this sort of risk. Read More

She was beautiful.

One look and that’s all she wrote.

I wanted her and nothing was going to stop me.

I was determined.

Her body glistened in the sun. Her looks could kill.

She was every young man’s dream…

Of course I’m referring to the used, red, Mazda Miata I tried so desperately to finance shortly after my bankruptcy.

She captured my heart…and that was the problem. Common sense went out the window and I began making choices based on wants rather than needs.

It didn’t matter who financed that car for me or at what interest rate—I just wanted it.

That’s the same type of thinking that led me to file bankruptcy.

MISTAKE #1: Allowing emotions to influence your decision-making

People tell me all the time that they filed bankruptcy to save their homes. Homes that they…

…have three mortgages on

…have no equity in

…owe more on than the appraised value

(this is called negative equity)

…are too emotionally invested in

What the @#?! Geez Louise.

Allowing emotions to creep into your credit or financial decisions is dangerous at best.

When my wife and I and I bought our first home after bankruptcy it wasn’t our dream home. We looked at it as an investment. Before every spending decision we made with that home we asked the question: “Will this increase the resale value of the home?”

Same thing when we purchased our first commercial building. Every decision was based on whether it would increase the value of the building.

It’s easy to get caught up in the emotion of the moment and start doing things to (and spending money on) a house or car to make it special just for you. Read More

Many people with a poor credit history or a low credit score tend to assume that they will not be able to obtain a loan. These people assume that they will not be able to obtain a loan for a car let alone a home.

In point of fact, in the 21st century there are a significant number of loan options available to a person who has a poor credit history and a low credit score. If you are a person in such a position who desires to obtain a loan, there are some points and tips that you should bear in mind as you go about searching for a loan. By following these tips, you will improve your chances of obtaining a loan even if you do have a bad credit history and low overall credit score.

1. The first tip to keep in mind as you go about trying to find a loan (if you have a low credit score and a poor credit history) is to obtain a copy of your credit report from each of the three major credit reporting agencies. (Indeed, even if you have a solid credit history and a decent credit score, you should still consider obtaining a copy of your credit report from each of the three major agencies in advance of applying for a major loan.) Read More