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Never Agree To a Pre-Computed Auto Loan
By George McHenry
Wedding loans are also a type of personal loans. Wedding day is the most
important day in everyone's life. A wedding loan can make it very special.
If you are calling all your friends and relatives, then you have to throw a
big party.
Loan market in the UK is swamped with enormous number of loan
options. Different loans have been designed keeping in mind the diverse
needs and expectations of the UK residents. Cash advance loan and no
fax payday loans are some of the classes of instant loans that are
prevalent nowadays.
A business loan can be secured by all types of UK business property,
commercial and residential properties. Business Loans can offer up to 79%
LTV (Loan to Valuation) with variable rates, depending on status and
length of term.
Car loans, student loans, credit card debt and other types of personal
loans can often be included in the consolidation loans. These loans will in
effect pay off your old loans and you will have one, larger loan to pay off.
Before Signing For That Car Loan Make Sure You Understand The Offer
Although 90% of all auto loan offers are simple interest loans, there are
some lenders who are pushing loans that are not. A simple interest loan
means that interest is paid, or computed, only on the original principal of
the loan. You should never agree to an auto loan that is not a simple
interest loan.
The other thing that you want to insist on when securing an auto loan is
that the loan be given with no pre-payment penalties. Simply put, this
means that the lender will not penalize you, by charging a fee, if you pay
the loan off early either through refinancing or other means.
It is important to remember that it is always easiest, and refinancing will
save you the most money, when a simple interest auto loan with no
prepayment penalties is refinanced with another simple interest auto loan
at a lower interest rate.
Never Agree To a Pre-Computed Auto Loan
Some lenders offer auto loans that are not simple interest loans at all;
they are what are known as pre-computed loans. Sub prime lenders will
often target high risk borrowers with pre-computed auto loans, and some
used car dealers might push this type of auto loan financing.
If you sign on the line for this type of auto loan, you are legally committed
to paying back the full principal balance of the loan as well as the total
amount of all interest that would accrue over the life of the loan.
For the purpose of ease in recognition, we will refer to the first case of
instant loans as fast loans and the second class of instant loans as instant
loans itself.
The reason is that personal loans are all purpose loans and impart a
freedom that is unlikely in any other loan type. A secured personal loan
would be a loan taken for any peculiar reason and is secured on your
assets or home.
Consolidation loans have loan terms ranging from 10 - 30 years. A good
consolidation loan would be that which fits beautifully in your financial
situation. Consolidation loans are advantageous to almost anyone because
of the ease with which you can customize them to your financial stability
and your choice. Secured loan helps borrowers in making the best use of
the equity stored in his or her property that helps him in borrowing a
larger amount of loan and that too for a longer loan term.
Take the time to look at several loan companies to find those that offer
you the lowest interest rates and the most for your money. It is
important to insure that you will qualify for the loans as well.
If you agree to a pre-computed auto loan and then wish to pay it off
early, either through refinancing the loan or another means, the lender
will usually use an outdated and expensive formula, known as the rule of
78s to calculate a rebate of finance charges. Through this rebate you will
pay a very hefty fee for paying the loan off early.
This type of loan allows the lender to apply more of the payment to
interest and less to the principal balance of the loan. A pre-computed
auto loan allows the lender to collect the majority of the interest due
during the first half of the loan repayment period.
Hold Out For the Best Offer
If the first lender that you speak to is not offering a simple interest auto
loan with no pre-payment penalties at a reasonable and competitive
interest rate, walk away with a smile. There are plenty of other lenders
eager to compete for your auto loan financing.
Record low interest rates, and the global lenders marketplace created by
the Internet have led to a competitive lending market. In other words,
it¡¯s a buyer¡¯s market! Check with your local bank, the financing that the
automobile dealer is offering, as well as online resources. Remember to
not only compare interest rates, but look for hidden fees and transfer
balances that my not be apparent at first glance. By thoroughly
investigating all of your options, you can¡¯t help but get a loan that is
perfect for you! Many student loans have a deferred repayment option,
allowing the student to put off repaying the loans until after they've
finished school.
A special type of instant loan is payday loan, which are characteristically
fast in approval. Borrowers who have emptied their monthly paycheque
and need money to disburse an occasional or regular expense will use a
payday loan. Usually the loan lender is not bothered about the reason for
which you are taking the loan. Some people even take secured personal
loans for things consolidation of credit card debts. Consolidation of loans
undoubtedly constructive but you must learn to never again get into
credit debts again.
Bridging loans can be used to fill in the cash shortfall existing in a property
transaction and many more. Each loan has different features; you can find
the loan you are looking for from the vast number of loans offered by
lenders.
Learn more ways to reduce debts today. Direct loans are convenient,
flexible and simple. A Direct loan is a loan by a lender to a customer
without the use of a third party. This type of loan enables the lender to
have greater discretion in the distribution of loans.
About the Author
Credit card debts can mount up and get out of control quickly, you can reduce them today!
Article Source: http://www.simplysearch4it.com/article/48701.html
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