Archive for the ‘ISA Rates’ Category
Wednesday, March 23rd, 2011
There is a lot of competition in the ISAs market place, driving up the interest rates and providing new opportunity for investors and a pay day for savers. Rates are steadily climbing which means that if you have an old ISA account on a fixed lower rate, you might want to take a look at some of the newer offerings. If you take cash out every year, that money can be transferred to new account with better rates. However, you do have to choose an account that accepts transfers.
Tax Incentives
ISAs have become popular with people trying to shield their savings from the tax man. You can put in cash or shares to the ISA on and interest on the deposits is not taxed. This can make it very attractive to people trying to shield savings from the tax man. There are different limits on how much you can put into an ISA, depending on whether it is cash or shares, and these programs are available only in the UK.
Take Advantage of Inflation
Even with the tax savings, ISAs have gotten more popular over time because savers put their money there can get higher yields than a regular savings account. When you add in the tax savings on the interest, for large deposits made on a yearly basis, it can really add up. Many people are using these accounts to supplement their retirement holdings. With fierce competition by banks to get more money in via investors or savers, the banks are starting to drive up the rates on ISA, leading to better yields for consumers. Since all of it is tax-free, it is bypassing the traditional interest rate on a savings account which is taxed, and becoming the account to have in the UK. These types of accounts may appear elsewhere as banks sort out the rules and regulations.
Tags: Advantage Of Inflation, Banks, Consumers, Individual Savings Accounts, Interest Rate, Interest Rates, Investors, Isa Account, Many People, Money, Offerings, Pay Day, Retirement Holdings, Savings Account, Tax Incentives, Tax Man, Traditional Interest
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Friday, January 14th, 2011
Unwanted interest has come from sources including industry regulator, the Competition Commission (CC), following an Office of Fair Trading (OFT) investigation which was in turn sparked by a super-complaint lodged by the National Consumer Council (NCC).
Doorstep loans offer small short-term loans to people who are on low incomes or without access to bank accounts, with repayments being collected weekly or fortnightly by collectors who directly call at the customer’s homes.
Peter Freeman, chairman of the CC, said, “Customers value home credit because it suits their needs very well but the fact is that they are paying too much for it, because of the lack of competitive pressure in the market.”
The regulator found that the lack of competition in the home credit market has meant that customers had, in their opinion, been overcharged by 500m during the past five years.
Peter Freeman believes, “Price competition between the existing lenders is weak, partly because customers seem insensitive to prices, given the greater value they place on factors such as the convenience of the loan and the difficulty in comparing prices between companies.”
Although there are more transparent alternatives to doorstep lenders through such high street companies as My PayDay Loan (http://www.mypaydayloan.co.uk ), which provide quick access short term loans, the six major door-step lenders still account for about 90% of the market, with the largest, Provident Financial, currently owning 60% of the 2bn per year industry.
Whereas there is ample regulation and there are high levels of competition for traditional unsecured loans, with financial product comparison sites like Moneynet (http://www.moneynet.co.uk ) providing consumers with quick access to comparisons across the standard loan industry, there is little competition and product comparison information is not readily available from doorstep lenders. The CC announced that the lack of adequate competition within the market was allowing lenders to overcharge their most vulnerable customers.
The CC recommended a series of changes to help reduce the problem, including suggestions that the lenders provide better information on their pricing and introducing regular statements in an effort to allow customers to shop around easier. Another suggestion to promote increased competition which was put on the table was for more data sharing with the credit reference agencies by the lenders about their customers’ credit histories. The CC also threatened that if lenders did not follow the recommendations, then in future it might impose a price cap on the maximum interest payable for these types of loan.
The CC’s announcements have provoked a furious reaction from the doorstep lenders who have challenged the calculations and the conclusion that this sector of the loan industry was making excessive profits.
A representative for Provident stated, “Customers are not being overcharged for their home credit loans nor is the home credit sector making excessive profits.”
Provident commented that the method of calculating the loan profitability was “flawed”, as it did not include the intangible costs of running a network of agents who collected payments door-to-door.
Peter Freeman, chairman of the Competition Commission, said recommendation by the CC might help to encourage some of the more mainstream banks to extend their lending practices into lending to lower-income customers.
Disclaimer:
All information contained in this article, is for general information purposes only and should not be construed as advice under the Financial Services Act 1986.
You are strongly advised to take appropriate professional and legal advice before entering into any binding contracts.
Tags: 500m, Bank Accounts, Comparing Prices, Competition Commission, Consumer Loans, Doorstep, Incomes, Industry Regulator, Lenders, Loan Industry, Moneynet, Mypaydayloan, Payday Loan, Peter Freeman, Price Competition, Product Comparison, Provident Financial, Repayments, Short Term Loans, Unsecured Loans
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Friday, January 7th, 2011
Does the American government see its citizens as its children?
In Americas 230 year history the government seems to have forgotten that there job is to run the government as the people see as best and not the government telling the people what is best for them.
The most recent example is the Internet gambling Ban signed into law last week by President Bush. The bill makes it illegal for banks and credit card companies to transfer money to casinos for the purpose of wagering on sports or games of chance, like roulette, blackjack and poker.
These games are harmlessly enjoyed regularly by millions of Americans everyday, but some people become addicted to these games so the government is telling all of its citizens that no one is allowed to play these games in an online casino.
This is not the first case of the government going against the wishes of the people, in the early 1900s the government decided that the consumption of Alcohol should be banned, because some people were developing health and mental problems related to drinking too much. So rather then educating the people on the ill effects of prolonged Alcohol abuse the American government banned Alcohol.
But instead of reducing the consumption of Alcoholic beverages it increased, and because the government was not allowing the production or importing of Alcohol, organized grime got into the moonshine business, and eventually the Government saw the error of their decision and repealed the law.
Another great example of a failed policy to protect the people is the war on drugs that the government has been aging since the early 1980s Billions of tax dollars a year goes into the war on drugs, but what are the results?
The price of drugs has risen, and to support their habits many drug addicts have had to commit acts of robbery and murder to get their drugs.
The American prisons are packed full of people whose only crime was possession of these illegal drugs.
Instead of being an industry that is regulated and controlled you have people selling these drugs to kids in school playgrounds, and shooting each other to protect their territory.
Had the government decided not to criminalize drugs but make it a heavily controlled industry, they could use the tax money for social programs like schools ad to give Americans universal health care.
Please do not misunderstand me I am not in favor for legalizing hard drugs, but the current system is not working at all, but I am all in favor for legalizing online casino gambling.
If I choose to play some hands of blackjack or poker from the comfort of my home what rights does the government have to tell me not to, and what sense does it make that I can not play in a casino over the internet, but I can drive down the street to the local casino and play there.
To enforce this ban millions if not billions of dollars of software and computer hardware will be needed to monitor all of the banks transactions and that money will come from taxes instead of the government taxing online casinos or even having all the online casinos government controlled then they get all the profits to be used to improve the lives of the American citizens, millions of which are bellow the poverty line if not homeless.
The American government needs to start re-thinking its policy of treating its citizens like small children, or the American people need to demand a new government.
Tags: 1980s, Alcohol Abuse, Alcoholic Beverages, American Government, American Prisons, Billions, Developing Health, Drug Addicts, Early 1900s, Games Of Chance, Grime, Ill Effects, Illegal Drugs, Internet Gambling Ban, President Bush, Robbery, Roulette, Tax Dollars, Wagering On Sports, War On Drugs
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Friday, December 31st, 2010
You’ve found your dream home and are now ready to start shopping for a mortgage. Several lenders have talked about points. You’ve heard that paying points is the only way to get a low interest rate. But is increasing your initial costs worth getting a lower rate?
For most people, paying points doesn’t make sense. Points, also called discount points or origination fees, are each worth one percent of the loan amount. They are paid to the lender at closing.
Paying points basically allows the borrower to buy down the interest rate.
Points became popular in the early 1980s when mortgage rates were in excess of 15%. Most people could not afford the monthly payments that come with such high interest rates. Lenders began offering discounted rates at a certain fee. Sellers often paid the points in order to sell their properties. This gave buyers affordable mortgages and owners were able to sell their homes.
Times are different now. Interest rates are reasonable. There isn’t a large need to pay a lot of money up front in order to get a lower rate.
Let’s look at the numbers. You have contracted to purchase a home for $240,000. You have the 20% down, which leaves you with a mortgage of $192,000.
You find a 30-year fixed rate mortgage at 6.5% with two points. For closing, you will need to pay $3,840 ($192,000 x 2%) for the points.
The lender can also offer you a rate of 7% with no points.
What do you choose? The lower rate or the lower closing?
At 6.5% you will have a monthly principal and interest payment of $1,207. At 7% your payment increases to $1,270 each month. That’s a difference of $63 per month. If you are looking for a monthly payment reduction, it’s not really a significant one.
It will take you 61 months ($3,840 divided by $63) to recoup your points payment in the form of a lower payment. This is your payback period. But if you had the $3,840 still, it could be earning interest in the bank. If it gets 3% interest in the bank, it would earn about $10 per month. If you pay points, this is interest lost, so subtract $10 from your $63 per month savings. Now divide $53 into $3,840, and your payback period increases to 72 months — six years.
So you have to live in your home for at least six years in order to take advantage of the savings that paying points gives you. Most people don’t keep a mortgage for six years. Unless you are absolutely sure you will live in the home for the time period necessary to recoup your points, you should probably invest your money instead of putting towards points.
If you are looking at paying points in order to reduce your monthly housing payment, you may want to look at a less expensive property. Sixty dollars worth of savings isn’t a lot if you have a tight budget. Chances are that if you have a tight budget to start with, finding extra money for closing would be difficult. And don’t forget, taking out a side loan to get the money to pay points with is defeating the purpose.
Tags: 192, 1980s, 30 Year Fixed Rate, 30 Year Fixed Rate Mortgage, Dream Home, Fixed Mortgage, Fixed Rate Mortgage, High Interest Rates, Initial Costs, Interest Payment, Interest Rate, Mortgage Lenders, Mortgage Rates, Mortgages, Origination Fees, Payback Period, Payment Increases, Principal And Interest, Shopping, Year Fixed Rate Mortgage
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Sunday, December 26th, 2010
The research from KBD has also revealed the full extent of the north-south financial divide.
Taking the UK as a whole, the typical household has some 40,000 of disposable wealth, but this figure oscillates wildly depending on where you look and indeed where you live.
An average London family will possess 81,732 in readily-accessible cash, while the Midlands sees this figure reduced to 31,939 and Scots find themselves cut somewhat adrift with a typical 29,724 waiting to be spent.
The gap, however, is closing the Scottish figure was in fact a 35 per cent increase on that of 12 months ago while north-westerners and the Welsh, with 32 per cent and 31 per cent rises respectively, also saw notable and much-welcomed rises.
London may top the charts, but its disposable income figure has only escalated by two per cent, while usually-affluent south-westerners only saw a seven per cent appreciation.
Matt Boot, chief analyst at KDB, commented on some of the factors behind these fresh figures.
He said: “Early signs in 2006 show an upturn in housing values along with continued stock market growth, and this has swelled the amount that households can really lay their hands on.
“Although absolute disposable wealth levels per household still show a marked north-south divide, the gap is closing, and the smart money for growth is in the Midlands and above.”
This is heartening news for many Brits but also indicative of how volatile and changeable such figures can be, with many variables lying behind them. In turn, this shows how carefully-laid spending and saving plans can change due to a variety of factors, be they economic or personal.
Therefore the role of a payday loan (http://www.mypaydayloan.co.uk/fact_fiction.html ) becomes clear. If at some point you find that you do not have quite as much available cash as you had budgeted for perhaps if some inconvenient extra expenses have come your way or if a special occasion has arisen which urgently needs catering for then some short-term cash might be invaluable to offset any problems this may cause.
A sum of between 80 and 1,000 can help you foot the bill for that one-off event or occasion, or can buy you time to readjust to changing circumstances. The short term loan is repayable at a convenient time your next payday and harbours no extra charges (http://www.mypaydayloan.co.uk/charges.html ) or caveats save for the explicitly-stated repayment rate of 25 for every 100 borrowed.
My Payday Loan is a leading provider of this service and a reputable one customers are assured that the additions to their disposable income that they require will typically be in their bank accounts within 24 hours.
Tags: 12 Months, Brits, Chief Analyst, Disposable Income, Fact Fiction, Gap, Heartening News, Households, Kbd, London Family, Mypaydayloan, Payday Loan, Scots, Smart Money, Special Occasion, Stock Market Growth, Typical Household, Upturn, Welsh, Westerners
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Tuesday, December 21st, 2010
Discover What to do When Your Credit Worth is Damaged
The good thing about bad credit is that you can fix it. If you start now, over time, your bad credit can turn into good credit, and you could qualify for the loans you want at the rates you want. The most important aspect of rebuilding your credit after it has been damaged is showing lenders and creditors that you are serious about repaying your debt and that you can be a reliable borrower over a significant period of time.
Negative account histories remain on your credit report for up to 7 to 10 years, depending on the type of action. Bankruptcy can stay on your report for up to 10 years, and collections drop off after 7 years.
Advice varies widely as to the best methods to rebuild your credit. Some points most experts agree on include:
Starting small – Don’t be intimidated by large debt amounts. Even small payments, made on a regular basis, will improve your payment history and, eventually, your credit score.
Spending less than you earn – Borrowing money to finance a lifestyle that is beyond your means will only land you deeper in debt.
Paying your bills on time – Building credibility as a borrower involves meeting your commitments to pay, early if possible.
Keeping your balances low – When using your healthier or newer accounts, keep the balance that you owe between 25% and 50% of your line of credit. An average of 30% is suggested.
If your credit is damaged and you need more information about the three major credit bureaus, go to www.apscreen.com
Other tips might not seem related to your credit score. Staying at least two years on the same job demonstrates steady employment, and you appear more stable to lenders. You can also open an emergency savings account. Contribute to the account a little at a time on a regular basis. This will not only appear as positive activity to lenders, but also will serve as reserve money to keep you from charging unexpected expenses. Finally, stop borrowing for a while. Certainly avoid borrowing more money from home equity or other lines of credit to pay off credit card debt. Shuffling the debt does not make it disappear.
When establishing new credit, it may be necessary at some point to open a new account once you have paid down your existing ones. Credit unions usually offer the best deals to people with damaged credit. If you are unable to qualify for a credit card, try a smaller company, such as a department store or gas station that might offer you a line of credit.
You may want to look into getting a secured credit card. Offered by several banks and credit unions, secured credit cards are a positive way to show lenders that you can pay bills on time and be trusted with credit. To use a secured credit card, you will deposit a sum of money into a savings account and pay a small yearly fee to the institution offering the card. If you deposit $500, you will have a line of credit up to $500. Using your card on a regular basis and paying it off monthly in full could lead to a traditional line of credit. Once the bank or credit union sees that you are capable of maintaining your secured account, they may extend an offer to you with a fair interest rate.
Another option is to have a friend or relative co-sign for a line of credit with you. This step is risky because you are not only gambling with your loved one’s good credit, but also with their good faith.
After a few months of good behavior, order copies of your credit report from all three credit agencies and check for improvements or errors. Be sure that negative information that you have remedied has been removed. File any complaints in writing and check your report again in a few months to ensure that the changes have been made.
Repairing damaged credit is time-consuming but well worth it, both to your peace of mind and to your pocketbook. For more information about credit reports, you can visit
Tags: 10 Years, Account Histories, Bad Credit, Bankruptcy, Borrowing Money, Commitments, Credibility, Credit Report, Credit Score, Creditors, Earn Money, Lenders, Little At A Time, Major Credit Bureaus, Payment History, Rebuilding Your Credit, Reserve Money, Steady Employment, Three Major Credit Bureaus, Unexpected Expenses
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Thursday, December 16th, 2010
You hear people griping about the cost of consumer products these days. The socialist-student-worker-miser believes capitalism is inherently wicked. Someone is out to screw him. The truth is ‘yes’, someone is out to screw you, and will, but only if you let them. They’re not obliged to get you the best deal, and you’re not obliged to take the first deal they offer. Don’t let your greed for a mortgage override your good sense. If a deal seems too good to be true, it probably is.
Start with banks and well known credit unions. When you begin to research, it’s best to start with your current bank, or with large credit unions. These have solid reputations. You may not get the best rate with a large bank, but the security can be worth it.
If you’re in the UK, see if the company is a member of the Finance Industry Standards Association (FISA) and registered under the Data Protection Act (DPA).
A mortgage is an agreement between a borrower and a lender. Determine first what type you’re looking for: fixed rate, variable rate, capped, buy-to-let, bad credit, self-certification, and proceed from there. This will cut down your research time.
There’s no need to apply all over the shop. Try for one from a high street bank, a high street building society, a credit union, an independent loan company and an internet-based one. The trick is to weed out the high interest rates and fees at one end, and the cubicle farm operations at the other. The latter won’t give two straws if you get into financial difficulties. If your application to a good ‘un gets rejected, shrug it off and move onto the next best option.
Ensure that you think about your budget. No matter how cheap your deal may be, pay it off as quickly as you can to avoid interest piling up.
However, it’s important not to overstretch yourself. Save a portion of your regular monthly income as cover for emergencies and unexpected bills.
In order to give you their best mortgage quote, the intermediary you apply to will need at least your:
- Name;
- Address (with post code);
- Time at that address;
- Amount you want to borrow;
- Employment (how long in your current job);
- If you have a bank account (and how long you’ve had it).
You may have to get used to the idea of getting cold calls from other lenders for weeks or months afterwards. Try to halt this by telling the initial broker “Please do not sell or pass my personal data on to other companies. Thank you.”
Independent mortgage information is hard to come by. Everyone is looking to make a few quid, especially when it comes to financial products. It’s a big business; lots of money to be made from needy people.
Many sites which seem to be independent are tied in with established lenders. They can’t give unbiased information. If it’s a financial product, chances are most sites that come up in a search engines’ first and second pages are tied to one of the larger large lending companies.
Tags: Best Mortgage, Capitalism, Credit Unions, Data Protection Act, Farm Operations, Finance Industry, Financial Difficulties, Fisa, Good Sense, Greed, High Interest Rates, Independent Loan, Loan Company, Miser, Reputations, Research Time, Self Certification, Straws, Unexpected Bills, Variable Rate
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Friday, December 10th, 2010
If you have decided to take or loan or mortgage then the facilities available are immense. There are wide variety of banking institutions, banks and brokers who are available to provide loan. It is only when an individual shops and finds the various lenders available and the schemes that they offer that he will be able to get the right loan at a good rate.
In case of a banking institution, the borrower is in contact with one person who is an employer of an organization and gives the various loan facilities offered by his institution. He is only an employee who gives the various facilities available by his employer. He helps borrower on the various facilities and choose what might be the best suitable for him. Once his personal credit information is approved, the employee processes the forms and helps the borrower and gets him credit.
The private lender is helpful when the individuals personal credit rating is bad and when the various banks and financial institutions refuse to give him any credit. The private lender asks for a security and charges high price. A mortgage broker on the other hand is only a middleman and gets credit to the individual from various sources that would be able to finance the individuals need. The rate involved might be high but a broker is the best solution for anyone with bad credit and who is unable to access any institution or banks for his credits. The broker or lender can sometimes give best deal to an individual when more business is promised. The individual can negotiate with a broker and get good credit facilities than when he goes online or approaches a bank.
One disadvantage with a private lender or broker is that the credit facilities are some time got from other places or outside the boundary of the individual and in this case the credit terms and conditions may not match that of the borrower and may not be to his satisfaction. Whereas a bank is a local institution and the employee can help get loans, which suits the need of the individual of the locality, and the credit facilities are tailor made to suit the individuals need.
Whatever is the difference between the bank and private lenders the borrower must shop around and know his limitations and the various facilities available from either of the sources and then approach that source which is most convenient to him.
Tags: Bad Credit, Bank One, Banking Institution, Banking Institutions, Banks, Best Solution, Credit Information, Credit Rating, Financial Institutions, Loan Facilities, Local Institution, Middleman, Mortgage Broker, Organization, Personal Credit, Private Banking, Private Lender, Private Lenders, Satisfaction, Variety
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Saturday, December 4th, 2010
Debt Settlement & Income Taxes What You Need To Know
Debt settlement has become a popular approach to resolving problem debts without having to file bankruptcy. With this approach, creditors agree to accept a portion of what you owe (usually around 50% or less) to settle the account, and the remaining balance is forgiven. This technique will certainly continue to grow in popularity now that the new bankruptcy law makes it tougher to fully discharge debts in a Chapter 7 bankruptcy.
As with anything, there is no free lunch, and creditors are required to report canceled debts to the IRS on Form 1099 (when the canceled balance is $600 or greater). Therefore, the possibility exists that you may owe taxes on the forgiven portion of the debt. For this reason, many financial writers and debt counselors are strongly critical of debt settlement, to the point where they actually recommend against it just because you might end up owing taxes. But the tax consequences of settling your debts are greatly over-emphasized, and this is a really just a minor issue at best.
First, even if you end up owing taxes on the canceled balances, that’s because you saved a bunch of money off your original debts. The total of what you paid the creditor, plus the taxes, will still be much less than what you owed to begin with. There is still a net savings. So it’s hard to understand why this is viewed as a problem in the first place!
Second, the great majority of people who settle their debts are not required to pay taxes on the forgiven part of the balance. That’s because of the “insolvency” rule, described in IRS Publication 908, “Bankruptcy Tax Guide.” Don’t let the title fool you. You don’t need to have filed a formal declaration of bankruptcy to take advantage of the insolvency rule.
Basically, “insolvent” means that you have a negative net worth — that is, you “owe” more than you “own.” As a consequence, most debtors do not have a tax liability on the canceled debts, simply because most debtors are insolvent! It usually comes down to home equity. If you have enough equity in a home (or other property) to outweigh the total of your liabilities (debts), then you have a positive net worth, and will likely have to pay taxes on the forgiven debt amounts. However, the majority of people in serious debt trouble have a negative net worth, and are therefore insolvent. The way it works is that you can offset the canceled debt up to the amount by which you were insolvent at the time you did the settlement.
Come tax time, be sure to get professional tax advice specific to your situation. Also, be sure to read the section in IRS Publication 908 on “reduction of tax attributes,” which requires people using the insolvency rule to reduce their basis in such things as rental property, loss carryovers, etc. Most of that probably won’t apply to you, but again, get specific advice before winging it.
So, the message is, relax about paying taxes on canceled debt balances. That should be the least of your concerns if you’re upside down financially. Don’t let the misguided criticisms of financial writers (who haven’t done their homework) discourage you from looking into one of the most popular and flexible options for achieving debt-freedom.
Tags: Bankruptcy Tax, Chapter 7 Bankruptcy, Creditor, Creditors, Debt Counselors, Debt Settlement, Debtors, File Bankruptcy, Financial Writers, Form 1099, Formal Declaration, Income Taxes, Insolvency, Irs Publication, Net Worth, New Bankruptcy Law, Problem Debts, Tax Consequences, Tax Liability, There Is No Free Lunch
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Tuesday, November 30th, 2010
Consumer debt is at an all-time high. What’s more, a record number of consumers, more than 1.5 million in 2004, are filing for bankruptcy. Whether your debt dilemma is the result of an illness, unemployment, or overspending, it can seem overwhelming. In your effort to get solvent, be on the alert for advertisements that offer seemingly quick fixes. And read between the lines when faced with ads in newspapers, magazines, or even telephone directories that say:
“Consolidate your bills into one monthly payment without borrowing”
“STOP credit harassment, foreclosures, repossessions, tax levies and garnishments”
“Keep Your Property”
“Wipe out your debts! Consolidate your bills! How?
By using the protection and assistance provided by federal law. For once, let the law work for you!”
While the ads pitch the promise of debt relief, they rarely say relief may be spelled b-a-n-k-r-u-p-t-c-y. And although bankruptcy is one option to deal with financial problems, it’s generally considered the option of last resort. The reason: it has a long-term negative impact on your creditworthiness. A bankruptcy stays on your credit report for 10 years, and can hinder your ability to get credit, a job, insurance, or even a place to live. What’s more, it can cost you attorneys’ fees.
Advance-Fee Loan Scams
These scams often target consumers with bad credit problems or those with no credit. In exchange for an up-front fee, these companies “guarantee” that applicants will get the credit they want usually a credit card or a personal loan.
The up-front fee may be as high as several hundred dollars. Resist the temptation to follow up on advance-fee loan guarantees. They may be illegal. Many legitimate creditors offer extensions of credit, such as credit cards, loans, and mortgages through telemarketing, and require an application fee or appraisal fee in advance. But legitimate creditors never guarantee in advance that you’ll get the loan. Under the federal Telemarketing Sales Rule, a seller or telemarketer who guarantees or represents a high likelihood of your getting a loan or some other extension of credit may not ask for or receive payment until you’ve received the loan.
Recognizing an Advance-Fee Loan Scam
Ads for advance-fee loans often appear in the classified ad section of local and national newspapers and magazines. They also may appear in mailings, radio spots, and on local cable stations. Often, these ads feature “900″ numbers, which result in charges on your phone bill. In addition, these companies often use delivery systems other than the U.S. Postal Service, such as overnight or courier services, to avoid detection and prosecution by postal authorities.
It’s not hard to confuse a legitimate credit offer with an advance-fee loan scam. An offer for credit from a bank, savings and loan, or mortgage broker generally requires your verbal or written acceptance of the loan or credit offer. The offer usually is subject to a check of your credit report after you apply to make sure you meet their credit standards. Usually, you are not required to pay a fee to get the credit.
Hang up on anyone who calls you on the phone and says they can guarantee you will get a loan if you pay in advance. It’s against the law.
Protect Yourself
Here are some tips to keep in mind before you respond to ads that promise easy credit, regardless of your credit history:
* Most legitimate lenders will not “guarantee” that you will get a loan or a credit card before you apply, especially if you have bad credit, or a bankruptcy.
* It is an accepted and common practice for reputable lenders to require payment for a credit report or appraisal. You also may have to pay a processing or application fee.
* Never give your credit card account number, bank account information, or Social Security number out over the telephone unless you are familiar with the company and know why the information is necessary.
Tags: Advance Fee, Application Fee, Appraisal Fee, Consumer Debt, Creditors, Creditworthiness, Debt Relief, Fee Loan, Filing Bankruptcy, Filing For Bankruptcy, Last Resort, Loan Guarantees, Loan Scams, Negative Impact, Personal Loan, Quick Fixes, Solvent, Tax Levies, Telemarket, Telephone Directories
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