Unsecured Debt Consolidation Loans – Debt Reduction Without Using Collateral

Eliminating debt is not an easy task. For this reason, many people carry high credit card balances for several years. Homeowners may take advantage of home equity loans or refinancing to reduce debts. In addition, persons with a vehicle title or collateral may obtain a secured personal loan to payoff debts. However, there are also options for eliminating debts that do not require collateral.

What are Unsecured Debt Consolidation Loans?

In a nutshell, unsecured debt consolidation loans are personal loan that do not entail collateral. Prior to a lending institution such as a bank or credit union approving a loan request, the applicant must submit some sort of collateral. Typical collateral includes a vehicle title. Hence, if the loan is not paid, the lender may claim the applicant’s property.

Because unsecured debt consolidation loans are not protected, they are harder to qualify for. Each lender has a different criterion. However, most lenders require good credit and a sizeable income.

If you are hoping to become debt free, a debt consolidation loan is the answer. Although unsecured loans carry a higher interest rate, the rate is considerably lower when compared to credit card rates. Moreover, debt consolidation loans have fixed terms.

Other Debt Consolidation Options without Collateral

Again, qualifying for an unsecured debt consolidation loan is tricky. Some lenders do not offer these types of loans. Furthermore, the lenders that do offer unsecured debt consolidation loans have strict lending requirements. Unfortunately, it’s impossible to get approved for an unsecured loan with poor credit. In this case, you may have to explore other alternatives.

If a home equity loan or refinancing is not an option, you may consider transferring your high interest balances to a low rate credit card. This will lower monthly payments and make is possible to reduce debts.

Another option involves consolidating debts through a credit counseling or debt management agency. These agencies negotiate lower interest rates, and consolidate debts without collateral or credit checks.

If using such an agency, you will be placed on a payment plan. Because debts are consolidated, a single payment is submitted to the debt management agency each month. These companies are very effective, and can help you become debt free in five to ten years.

Get Low Interest Bad Credit Personal Loans From Non Profit Organizations

Mainly for debt consolidation purposes, this kind of loans are meant for those who are undergoing a difficult financial situation that makes it impossible for them to obtain finance through the common sources.

Different purposes

Though, as said before, the main purpose of these loans is to help those who need to reduce their debt in order to avoid further worsening of their current financial situation, they are also used for attending to urgent needs that cannot be postponed specially when related to certain accidents or illnesses that imply high medical bills that otherwise couldn’t be covered.

Non profit personal loans can be obtained in different ways, those meant for attending special situations must be seek at non profit organizations specialized in this kind of aid.
Once contacted and providing that you meet the requirements for getting their aid, they will guide you through all the process so you won’t have to worry much about it. They’ll want however that you concentrate on committing to return the money once the situation has improved.
On the other hand, there are many non profit financial institutions providing personal loans for people in financial troubles to help them go through a temporary complex economic situation.
The purpose of these organizations is to make people fully understand the value of finance and help them consolidate their debt and slowly become debt free. The interest rate is subsided in consideration of the non profit nature of the organization. The interest rate is just high enough so as to cover the institution’s expenses.

Different Requirements

There are however, many requirements you’ll need to meet in order to be eligible for this kind of loans. For starters, each institution has its own requirements, some of them only lend to members but others tend to help all those in need. They will all require, though, a commitment on your behalf to make a reduction on your outstanding debt and expenses.
They will even exercise some kind of control over your budget by telling you what to cancel first, what expenses to avoid, etc. Everything, of course, is controlled by experts in debt elimination and financial guidance.

Other Benefits

This kind of loans has another uniqueness that is not found on other loans. The lender, having such knowledge of your financial situation, will be more understandable when an unexpected situation turns the monthly installments into an unbearable burden. In such a case the lender will modify the repayment schedule or even interrupt repayments till your income has improved enough.

For many, this is the last option to avoid bankruptcy. If this is your situation don’t hesitate, do a search on the internet for non profit lenders and contact them for information on their programs.
If you think you can manage your debt yourself, and you don’t need this kind of aid, you can always look for other sources of finance. There are regular bad credit loans available provided by many online lenders.

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Have your read your credit card contract through completely? Do you know when it is okay for your creditor to raise your interest rates? If you are not sure about how and when your rates can be affected over the life of your contract you should take a few minutes to read your contract thoroughly from beginning to end.

Creditors must have clauses in their contracts that give them the right to change your interest rates. And if your rates have gone up you can be pretty sure that they are there, you may have missed them on your first read through but they are there buried in the contract.

If even after reading your contract again you still cannot figure out just how your credit card issuer can do this to you ask yourself the following questions.

Have you been late paying your monthly credit card payment recently? If you have, your interest rate going up is most likely due to this factor. Whenever you are late making a payment the credit card company has the right to raise your interest rates.
Have you been late on any other debt payments? Any late payments can cause your interest rates to rise, even ones that are not associated with your credit card. Your creditors have access to your credit report and all payments that you make are on there, if they see you made a late payment to someone else it can get them concerned that you will do the same to them in the future. That is why it is so important to always make your payments on time every single month.

Has your credit card company merged with another company? Mergers can affect your contract. The acquiring company has the right to change the rules on you as long as they let you know what is going on and why.

It is amazing what credit card companies can get away with legally. All you can do is make sure that you understand the ins and out of your contract, that way you will not be stunned when you get hit with extra fees.

Credit cards are a big financial responsibility, before you sign for one decide if it is really the right thing for you financially.

When you sign your credit card contract you probably assume that the interest rate quoted in this contract is the rate that you will always be paying. This is not the case. Credit card companies have the right to up your interest rate. Knowing how and why can save you a lot of stress in the long run.

Good Reasons To Use Bad Credit Credit Cards

It won’t be long until the United States at long last progresses to a cashless system of purchases. Every year online buying and new payment methods are becoming a part of the American way of life. Even now it is possible to pay almost any bill online or even set up automatic payments where the account holder need not even raise a finger. While obviously this isn’t yet foolproof, the convenience often outweighs any dangers that are present. The question becomes, how can a person with bad credit be apart of these new systems?

Credit cards with low APR are for the most part unavailable to consumers that have bad credit. With the nation as a whole moving into an area of poor credit however, more financial institutions are making products available for this growing market. Credit cards for bad credit are becoming more common, and the availability is quickly spreading.

These bad credit credit cards can be a decisive advantage to consumers with a poor credit history, but if managed badly can do more harm than good. While some people have bad credit as a result of unemployment or illness, most consumers simply manage their finances badly. Bad credit cards handled poorly will keep a credit rating low, or make it worse.

Bad credit cards can be used in the following ways to increase a consumer’s credit rating:

Monthly Use – Make at least one purchase each month on the credit card, and pay the balance off entirely. This offers a consistent flow of credit reporting on your account. This consistency is what creditors are looking for in a good customer.

Keep a small balance – Although any financial expert worth talking too will say to pay off your credit card balances as fast as possible, there can be a benefit from carrying one. Credit companies like customers to carry a balance for obvious reasons, so they may increase your balance because of this. DO NOT carry a balance that will cause you to get behind in payments due to high APR.

Charge less than half your available credit – The more debt incurred on credit cards, the less credit worthy you are. A safe point is less than half of your available credit limit across all open credit accounts.

It has become common for creditors to sell customer accounts to other credit companies as credit worthiness changes. This may have already happened to you and you were simply unaware of why. In 2005 Providian sold off much of it’s customer base to Washington Mutual. As a customer becomes more credit worthy, they become more valuable to many creditors. To make a profit, some bad credit credit companies will help customers build their credit up, and then sell them to another company. This can be a good thing for the consumer as well, as their new account will probably have better APR.

It is possible to have credit that is so bad that even companies that specialize in bad credit credit cards won’t issue you a card. Once this point is reached, possibly through bankruptcy, debit cards and prepaid credit cards become the only options left. Debit cards work the same as credit cards when making a purchase for the most part, and they can’t get you into any further credit problems. Prepaid cards work exactly like a credit card, however money must be deposited into the prepaid credit card account before they can be used.

With all of these options open to consumers, there something out there that will allow everyone to take part in the modern economy. With careful effort over time, even the worst credit history can be repaired.

How to Find a Quality 0% APR Balance Transfer Credit Card

Getting into credit cards debt is a lot easier as compared to getting out of it. The problem with credit cards is that they charge you so much interest that most of the consumers get into debt very soon and they don’t even know about it. Selecting a high quality 0% balance transfer credit card can keep you out of such debts by offering minimum interest rates.

Many of us are aware of the benefits of a 0% balance transfer credit card but if you are not totally clear on what they are and what are the stipulations attached, we will explain it to you in detail to help you make a well informed decision.

When you get an ordinary credit card the reason you get into debt so easily is that they charge you huge amounts of money as interest. Most of the money that you give the companies as repayment of debt is used to cover the interest. In result, your debt keeps on mounting and no matter how hard you try to get out of it you keep on getting in deeper.

If you get a good quality 0 % APR balance transfer credit card, it will help you pay of the debt easily as the interest is low and you do not have to put a strain on your earnings. The trick is to find the perfect 0% balance transfer credit card which suits your needs. Choosing which credit card is the best option can be difficult as there are a large number of such credit cards available in the market.

Using the Internet as a search medium, you can find the 0 % APR balance card to suit your financial needs. However there are a few basic things which you need to know before beginning the search for a good quality 0 % APR balance card. First of all, many of us are unaware of the fact that majority of such credit cards are just introductory offer for a limited time and after the end of that specific time period the interest rate can be increased considerably.

When you look for a 0% balance transfer card make sure that you know the time period after which the introductory offer expires. Choose the company which offer the longest introductory offer so that you can avail maximum benefits. You should also find what the interest rates are once the introductory offer expires as there are some companies who offer high interest rates which can get you into deeper debt.

You will also need to find out if the credit card company requires you to pay an annual fee, if so what will be the amount to be paid. There is also a balance transfer fee associated with a credit card that either has to be paid at the time of the purchase or can be paid of at a later time within the specified time limit.

A 0 % balance transfer credit card can help you a lot in dealing with your financial troubles effectively and efficiently. Once you find the card that suits all your requirements, you can forget about mounting debts and rising interest rates.

Many people suffering from deep debt obligations often look towards debt consolidation as the answer to their problems. Sometimes the debt is so painful, they don’t always look at both the pros and cons of this debt solution though, so we’ll take a brief look here.

First though, what is debt consolidation? Simply put, it’s the process of combining all your debts into one. If you have ten debts of $10,000 each, then you have a total debt of $100,000. Some of those debts however, might be generating an additional 10% interest, while others are generating 15%-20% interest. In other words: Some of your debt is more expensive than others.

This is where debt consolidation comes into play. In theory, you’d take out a loan for $100,000 at a reasonable – or hopefully low – interest rate. Then you’d use those funds to pay off all ten of the smaller debts. This leaves you with just one payment to make each month, and one interest rate to manage.

Consolidating debt can be done with debt consolidation loans, by transferring your debt to zero or low interest credit cards, and by taking out a home equity loan.

Using the equity of your home to pay off debts can be risky, because if you default on the new loan, you could lose your home.

Likewise, using zero interest credit cards could also be problematic in the future, because these offers are usually designed to lure you in. The zero interest doesn’t last.

Debt consolidation loans might be helpful, but be aware that when you have debt problems to begin with, you might not qualify for low enough interest rates. So if you choose to go this route, be sure to do all the math: Figure out whether the consolidation loan actually will reduce your overall payments – including the total interest you’ll be paying for the life of your loan.

Some credit and debt counselors feel debt consolidation of any kind is a bad move to make though. In fact, it’s estimated that 70% of americans who take out some sort of loan to consolidate their debt end up with the same or worse debt problems within two years.

A better, more long-term solution might be to consider using a debt counselor. Professional counselors negotiate with your creditors to lower your payments or interest rates, while at the same time coaching you to manage debt more effectively. The unfortunate side effect of using counselors though? Your credit report will take a hit because you’re not technically paying your bills as originally agreed.

So there you have a general overview of debt consolidation, the common solutions and options, along with pros and cons of each. Be sure to research all your options completely before making a decision of course, because you don’t want to make your debt problems worse in the long run.

How To Calculate Credit Card Interest

I am going to explain what you need to do followed by my own example. Lets get started. First thing you need to do is figure out your daily interest rate. Take whatever your APR is and divide it by 365. My APR for this example is 9.99%. My balance at the 9.99% is $550.00.

EXAMPLE- 9.99/365 = 0.02737

Now that you have your daily interest rate take that number and multiply it by the balance given for that rate.

EXAMPLE- 0.02737 X 550.00 = 15.0535

Now take the total of the 15.0535 and multiply it by the number of days that are in the cycle. The number of days in a cycle should be found on the credit card statement somewhere. The days in the cycle will usually change. It will almost never be exactly 30. It can typically range from 28 to 33 days. If you are estimating interest 30 days is a good number to go with. I am going to use 30 since I am just using an example.
EXAMPLE- 15.0535 X 30 = 451.605

This last step is important, you want to move your decimal over twice. So take the 451.605 and move your decimal over.

EXAMPLE- 451.605 = 4.51605

Now you have your answer. Take that amount and get rid of the thousandths position. This will give you a dollar amount. Remember to round your number out and you will see that my example ends up being $4.52.

EXAMPLE- 4.51605 = 4.52

So with the example I gave if you have a balance of $550.00 at an APR of 9.99% over a span of 30 days you will be paying $4.52 in interest. If you have different balances at different rates because of cash advances or balance transfers just do each bucket separately and add the totals. I hope this helped, the math is really easy once you know the formula.

Cash advances and Balance Transfers accrue interest daily. Even if you pay these off in full you will still get charged interest. The interest is calculated the same, but you have no grace period to pay these off like you would a regular purchase.

Beware cash advances. Usually the APR involved with these are much higher than purchase rate. Cash is much more riskier for the bank than purchases so they charge you higher interest. Always check with you financial institution about your cash rate before pulling any advances. With my interest calculation you can determine about how much you will be paying in interest with your next advance, balance transfer or purchase.

Capitol One Since 1995

Capitol One Credit Card Company began in 1995, in the past ten years it has become one of the top credit card companies; they offer services in the United Kingdom and Canada, in addition to the United States.

Capitol One credit cards are varied enough to suit anyone’s credit history and credit needs; their premium credit offerings, for people with excellent credit offer some of the most usable rewards in the credit card business.

Premium Credit Cards

Capitol One credit cards are for people with excellent credit; excellent credit means a person has had credit (in the form of a loan or credit card) for at least 5 years and that the credit card has a limit of at least 10,000 dollars. Also this credit holder will have needed to always make on time payments.

These Capitol One credit cards are available from both Visa and Master Card, so each customer can choose their credit company plus their benefits package; some of the benefits include travel reward miles, cash back rewards, and special annual percentage rates.

For People With A Good Start

Capitol One credit cards are designed with all people in mind, as such they have special cards for people with good credit that is perhaps not quite excellent yet; these cards have great rewards programs and are available from Visa or Master Card.

These cards are platinum cards, this means they will have a credit limit over 5,000 dollars and offer low annual percentage rates plus no annual fees in most cases. The platinum cards are ideal for people who already have a credit card with a limit over 5,000 dollars, plus they have held good credit for at least 5 years; these cards are a little more forgiving and allow their holders to have made a late payment or two in their credit history, so long as it wasn’t over two months late.

For Customers Who Need Help Building Credit

Capitol One credit cards have cards with smaller spending limits and credit requirements which are easier for people newer to credit or who have had problems managing their credit in the past; these cards will often have credit limits under 5,000 dollars.

Because of their limited history these cards will charge an annual membership fee, however the customer will still be able to take advantage of rewards programs and build their credit with by making on time payments and gradually getting their credit limit raised as they show their credit worthiness.

Credit Source Comparison Chart

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As a member of CreditSources.org you will gain instant access to more than 110 little-known bad credit resources. Divorce, bankruptcy, slow pays, repossessions, and other credit blemishes are not a problem because our lending partners and resources specialize in “high-risk” financing. Even if you have been turned down in the past we can help you find loans and credit cards up to $25,000 and get you approved today!

Special finance programs are available.

No credit check, no collateral, and no proof of income are just a few examples of the financing options we can present to our members. Plus, our members are often able to enjoy some of the best interest rates currently available. We also have many government resources within the members area to help you get the funding you need. Finally, you can get the money you need with payments and terms you can afford!

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It’s all about convenience.

If you thought finding loans for bad credit has to be difficult then think again. Our mission is to help you find loans and financing even if you have past credit problems. We offer the best online resources available, friendly customer support, and we strive to make your experience as pleasant as possible. If you’re ready for a loan then join now — Our support staff and lending partners are waiting to assist you today.

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It’s easy. When you become a member you will receive a username and password to access the members only area. Simply login, browse through our extensive list of bad credit lenders & bad credit resources, and apply online for your loan. You could be approved instantly and it is even possible to receive funds in your bank account within 24 hours!

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Many people think credit cards with high credit limits can not be obtained if you have bad credit but that is not necessarily true. Though your credit score is an important variable when it comes to assessing your credit limits, there are other variables that are just as important or even more important. Thus, by correctly monitoring these variables and preparing yourself for the credit card application you can boost your chances of getting a higher credit limit.

Variables That Determine Your Credit Limit

When assessing your credit limit, the credit card company takes into account many different variables. And as explained in the introduction, though the credit score is an important factor it is not the only one or even the main one. Since credit limits are a matter of amounts, it is your income that will determine your credit limit at first. Also, your history with the credit card company will be an important factor too. Most commonly, you can get higher credit limits with a company that you already have an account with.

Other variables are external and though you can not control them, you can take advantage of them if you know how they work. For instance, knowing that the credit card market is highly competitive, you can benefit from that fact by contacting credit card companies and letting them know what kind of limit the other companies have offered you. I assure you that they will do an effort to improve all previous offers. Also, if you are willing to pay a higher interest rate, by searching for credit card offers on the internet you will find several promotions offering high credit limits in exchange for slightly higher interest rates.

Lines of Credit and Available Income

All lines of credit (and credit cards are lines of credit) base their limits on the applicant’s ability to repay their debt. Thus, the client’s income is an essential variable when it comes to determining the amount of money you can borrow on a credit card line of credit. So, if you want to obtain a high limit credit card whether you can show proof of a suitable income or not is essential. For those who are employed there is no much to do but those who are self-employed can make sure that their tax presentations show the true income they obtain in order to get a higher credit limit when applying for a credit card.

Also, there are credit cards, lines of credit and different loan products that allow you to apply with stated income. This means that they will take into consideration the amount of money that you declare on your application instead of requesting paycheck copies or tax presentations. This is particularly useful for those that cannot prove what their income is or for those that have a basic wage plus commissions that vary from one month to another.

This is the most important factor on credit card applications but if you really want to boost your chances of getting a higher credit limit on your new credit cards, you need to shop around and compare what the different financial companies have to offer. Request different quotes and compare the rates and the credit limits. We always suggest finding a balance. High interest rate cards offer higher credit limits but you should try to get a moderate rate with the highest credit limit possible.