loans Archives - Our Debt Free Family

How to Choose the Best Loan for Your Needs

May 14, 2020 | Leave a Comment

Starting a new business means a lot of expenses. Rent, employees, stocks, just to name a few of the expenses that every new business faces on a daily basis. Sometimes, it’s hard to make ends meet. That’s why loans are there to help you cover those extra expenses that would otherwise be impossible to afford every month. They help you address specific needs and find ways how to support financially your business. After all, there’s isn’t a business that doesn’t need a little extra money.

There are different loans according to the sum of money and the conditions. It’s very important to estimate the capacity of your business company to deliver reimbursement on time and pay the whole amount of money in the given period of time. Banks and other financial institutions offer a variety of loans under different financial conditions. Check out the regulation before you decide on which loan suits your business the best. Here is a list of loans most popular among business companies nowadays.

Personal Loans

Personal loans are the most convenient method to receive the funds that you need. The money that you borrow from a lender you need to return them back, and you pay an interest rate for a given period of time as mentioned in the bank contract. You can use the money from a personal loan for whatever your needs are. For example, you can pay off credit card debt with personal loan.

The benefits of personal loans are numerous, especially when want to pay off the debt for a longer period of time. To qualify for a personal loan, borrowers need to fulfill several criteria, like credit report, credit score, and debt-to-income ratio. You need to take all of these things into consideration and discuss them with your bank to find out whether your current financial situation allows you to receive a persona loan. To receive the lowest rates for credit, you need to have an excellent credit score, among other things as well.

Term Loans

Term loans, also known as long-term loans, are the most common loans nowadays. Business owners looking for high funding shouldn’t look elsewhere. They aren’t very appropriate for recently opened business companies because lenders want to make sure that you have a clear track record. Applying for a term loan takes a longer time than for other loans. Once the application is accepted, borrowers need to pay a principal amount. Afterward, what follows is the regular monthly payment of the principal amount plus the interest rate according to the contract’s conditions.

Short-term Loans

When you’re in a hurry for fast cash, a short term loan is the solution to your problem. Unlike the term loans, they don’t need a track history to be eligible to apply for a short-term loan. They don’t include loads of paperwork and long processing procedures. In fact, you neither need to have a great credit score, nor there is a need to wait a long time to receive your payment. Whether you want to expand your business or recover from the financial crisis, short-term loans are the answer to your problem.

However, paying a short-term loan must be made for a short amount of time. Unlike the term loans, you need to repay the whole amount of money for the time specified in the contract. Payment schedules may be weekly or monthly, while usually repaying the loan amount is no longer than two years. You need to look elsewhere for financing when the loan amount is not enough for financing your business.

For more of our great articles, read these:

Yes, You Can Use Charts To Get Out Of Debt

How Often Should You Review Your Budget?

How Much Income Do You Need To Afford A Million Dollar House?

Image source: Creditdebitpro.com

Self Lender Reviews: Building Credit With a Loan

March 19, 2019 | 1 Comment

Self-lending via credit builder loans has typically been something that small community banks and credit unions handle. However, with the increasing use of the internet to lend and borrow, Fintech startups such as Texas-based Self Lender are increasingly moving into the credit building loan market. So, what are Self Lender reviews saying? And is this the right option for you?

About Self Lender, Inc.

Self Lender, Inc. is a new venture capital funded startup that focuses on helping individuals build credit while saving instead of racking up debt. They’ve been able to leverage modern FinTech to come up with a solution to every debt-free family’s conundrum: pay off debt or build credit.

Incidentally, you may be thinking you don’t need a loan, and you’d be right, but there are still plenty of instances in which you’ll need a good credit score. For example, some jobs require good credit scores. Bad credit can make borrowing a lot more expensive. Credit builder loans are a bit unusual, but they work.

How Does Self Lender Work?

You’re probably thinking, “I’ve never heard of a credit building account before.” However, credit building loans have been available through traditional banks and financial institutions for years. They’re often called “CD-secured loans” or “savings-secured loans,” since they’re secured by a Certificate of Deposit (CD)

By opening a Credit Building Account with Self Lender, you are committing to putting a certain amount of money into the account each month. Think of it as a savings account.

You choose from the options available and then make the agreed-upon payments each month. Then commit to a term. Self Lender deposits the amount of the loan into a CD for you. Then you make payments for a specific amount of time. After the term is over, you can cash out the CD and either spend it or transfer it to a different type of savings account.

There is no hard credit pull to get started, so signing up won’t impact your credit score at all. And, you don’t have to have credit to get started either. You simply sign up, choose your payment plan and go.

Where payment plans are concerned, Self Lender works with your budget and reports your payments to all three credit bureaus. So, for every on-time payment, you make toward the account, the more your credit will improve.

Getting Started

Signing up for Self Lender is easy. Go to www.selflender.com and choose “sign up.” From there, you’ll be prompted to enter your name and email. The site will then guide you through the account setup. You’ll need the following information handy:

• Home address
• Social security number
• Birthdate

To get started, you’ll have to pay a non-refundable admin fee between a $9 to $15 depending on the payment terms you choose. Then, you will choose a payment plan that works for you. The site offers plans with monthly payments starting at $25 and up to $150.*** Then you select a term length of 12 to 24 months. At the end of the term, you’ll get the cash you put in. For instance, a $25 contribution for 24 months will result in a $525 payout at a 14.92% APR. Or, you can put in $89 for 12 months at a 14.62% APR and receive $1,000 in savings at the end of your term.

The loans aren’t free. Self Lender charges a processing fee, and, of course, the payment structure includes interest. That said, Self Lender doesn’t charge more than 16%, which is better than alternatives like prepaid or secured credit cards, which might charge as much as 30% interest.

As a side bonus, Self Lender lets you check your credit at no cost.

While there are no guaranteed results, Self Lender reviews have shown the services are effective.

Ready to start building your credit? Apply at Self Lender today!

Self Lender Reviews

Self Lender reviews are generally favorable. On average, users have seen an increase of 45 points during the term agreement with Self Lender. Here are some other Self Lender reviews to give you an idea of how it has worked for other consumers.

“Love love love this program and this app! In eight months my credit went up a hundred and nine points. Super happy and can’t wait to renew once the first year is up.” – Debbie G.
“I recently moved to the states and had no established credit. Using this service along with two prepaid credit cards, my score went from 4 – 710 in 9 months. I took a 12 month term with only $50 payment per month but I’m already thinking about applying for a larger Self Lender loan as soon as this completes to further build my score and save at the same time.” – Neil M.
“Self Lender has been a fabulous service for me, as I have started building my credit history. I jumped 30 points over the period of my account, and I just got my savings I built deposited into my bank account! I’ve already signed up for second account, because it’s guaranteed saving that boosts your credit score! Thank you for making it easier for millennials without established history to become more creditworthy!” – Evan M.
“This really works…and pretty quick, too!! Score jumped 118 points in 4 months.
I’m using Self Lender to build credit and save money.” – Cynthia C.

So, now there is only one question left to answer: is Self Lender the right option for you?

Is Self Lender the Answer to Your Credit Troubles?

Self Lender reviews also suggest the product isn’t necessarily a silver bullet. The product has the potential to improve your credit substantially, but everyone’s credit is different. The figures published by Self Lender just show average improvement in one’s credit. Some people have seen a lot of improvement in their credit; some show more modest gains. It is also not exactly clear when the credit improvements kick in. In some cases, the benefits are immediate. In other cases, it takes more time to see the gains.

So, on average Self Lender reviews do show the product works, but it’s not clear if it works equally well for everyone and when its benefits kick in.

Also, one important requirement is that for Self Lender credit builder loans to effectively improve your credit you need to have a stable income, and you need to have a long-term planning mentality. So, if you’re not able to secure steady employment or aren’t ready to think in a one or two-year time frame, Self Lender is probably not the answer.

Other important factors to consider are frankly, your personality. Some people do better with an enforced way to improve their credit. If you treat your savings plan like a credit card payment, you may be able to save more money than you think. However, if you prefer a more independent and flexible approach to your personal finances, their credit builder loans might not be the optimal option for you.

If you are interested in learning more about Self Lender, apply here.

1 Credit Builder Account — proceeds are held in a deposit account until maturity
All Credit Builder Accounts made by Lead Bank, Member FDIC, Equal Housing Lender, Sunrise Banks, N.A. Member FDIC, Equal Housing Lender or Atlantic Capital Bank, N.A. Member FDIC, Equal Housing Lender.
*Subject to ID Verification.
**Individual borrowers must be a U.S. Citizen or permanent resident and at least 18 years old. Valid bank account and Social Security Number are required.
***Sample products are $25 monthly loan payment at a $525 loan amount with a $9 administration fee, 24 month term and 14.92% Annual Percentage Rate; $48 monthly loan payment at a $545 loan amount with a $15 administration fee, 12 month term and 15.65% Annual Percentage Rate.
All loans are subject to consumer report review and approval. Results are not guaranteed. Improvement in your credit score is dependent on your specific situation and financial behavior. Failure to make monthly minimum payments by the payment due date each month may result in delinquent payment reporting to credit bureaus which may negatively impact your credit score. This product will not remove negative credit history from your credit report.
All loans subject to approval. All Certificates of Deposit (CD) are deposited in Lead Banks, Member FDIC, Sunrise Banks, N.A., Member FDIC or Atlantic Capital Bank, N.A., Member FDIC.

We are an affiliate of Self Lender. Although this posting contains affiliate links, the review and opinions expressed below are my own.

What Kind of Interest Will You Have on a $60000 Loan?

July 19, 2017 | 3 Comments

Although the overall goal is to be debt free, sometimes you need to take out a loan or buy something on credit, especially when it comes to large purchases like a car or home. When looking at items that cost tens and hundreds of thousands of dollars pulling out a loan is often necessary.

A common loan amount for such purchases is $60000. With a substantial down payment you can pull out a $60000 loan to cover the rest of your mortgage or your could buy a fantastically beautiful sports car (though they seriously depreciate in value so I wouldn’t). But what are the details and the information you need to know about getting a $60000 loan?

What Kind of Credit Do You Need for a $60000 Loan?

Applying and getting approved for a $60000 loan is no small feat. Many people apply and get denied the first time they go to get a mortgage loan or loan this size. So, what kind of credit do you need for a $60000 loan and what other factors come into play?

Well, your credit does have to be decent to get a $60000 loan and not being paying tremendous interest rates. Your credit score will need to be marked in at least the “good” range to get approved for a loan this size. (Check out the credit score ranges.) In addition to having decent credit there are a number of other factors to take into consideration as well:

How much money do you make?
What type of bank are you applying with?
What is your payment history?
Have you ever taken out a large loan in the past?
What are you using the loan for?

Interest Rates on a $60000 Loan

After you get approved for a $60000 loan you will want to review what kind of interest rate you’ll be paying before you accept the loan. Remember, just because you got approved doesn’t mean you have to accept the money. In fact, if you are given a better interest rate at one bank you can use it for leverage with another. Before making any decision though you should know what the average interest rate on a $60000 loan looks like.

Of course, people with a better credit score will get better interest rates. Your interest rate will also depend on what you are using your loan for. According to Bank Rate, the average interest rate on a 30-year fixed mortgage is 4.13 percent (3.33 percent on a 15-year fixed mortgage). If you’re looking for a business loan (a $60000 installment loan) you’ll likely be paying 5 to 9 percent interest. And if you’re pulling out a $60000 loan for a car you’ll pay 4.36 to 4.92 percent interest (based on your payment arrangement).

Monthly Payments on a $60000 Loan

So, given the average interest rates on a $60000 loan, what would your monthly payments be? Here’s what I found:

Using this mortgage calculator and the interest rates above your monthly payments on a $60000 mortgage loan would be between $290.96 (30-year fixed) and $423.94 (15-year fixed).

Bank Rate’s auto loan calculator helped me figure out the average monthly payments on a $60000 auto loan would be between $1078 (60 month) and $1745 (36 month).

If you’re looking to get a business loan you’ll pay $1132.27 a month at 5 percent annual interest (for five years). At 9 percent interest, you’ll pay $1245.50 a month on a $60000 business loan.

You may also find the following articles helpful:

No matter what your reason for getting a $60000 loan is you should always be sure that you have done research regarding interest rates. You should also have a plan to pay off the loan as quickly as possible.

Incidentially, if you’re wondering whether you can even pay of a loan like this, the answer is: yes. Check out how runthemoney.com dumped his student loan debt.

Photo: Tax Credits