The following is a guest post by Eric Lindeen, of Anna Buys Houses.
The second quarter of 2020 marked the highest U.S. mortgage delinquency rate (reported as 60-days past due) since 1979. Amidst the chaos of the pandemic, federal and state governments have made efforts to protect against the financial strain U.S. consumers are enduring—including mortgage payment forbearance of foreclosure.
What Is a Forbearance?
Forbearance is the postponement of mortgage payments, or the lowering of monthly payments for a specified time period; it’s not loan forgiveness. Repayment terms are negotiated between the borrower and lender. Mortgage forbearance is one tool to help protect homeowners from foreclosure due to temporary hardships, such as a job loss, natural disaster, or pandemic. Some homeowners may opt for strategic forbearance, meaning they proactively enter a forbearance agreement just in case they lose their ability to make their mortgage payments.
As of October 25, data from the Mortgage Bankers Association (MBA) reports that approximately 2.9 million U.S. homeowners are currently in forbearance plans. That number represents 5.83% of servicers’ portfolio volume. MBA data also shows that nearly 25% of all homeowners in forbearance plans have continued to make their monthly payment (perhaps an indicator of the use of strategic forbearance).
How Do Forbearance Plans Work?
Mortgage payment forbearance programs have come at a time when many Americans are losing their livelihood and others fear the potential fallout from the health and economic crisis. Not all forbearance plans are created equal. Therefore, it’s critical to understand how different plans are structured to protect your financial health and credit.
The Coronavirus Aid, Relief and Economic Security (CARES) Act is one measure enacted to provide relief to consumers facing hardships due to the impacts of the coronavirus. One provision of the Act allows mortgage payment forbearance and provides other protections for homeowners with federally or Government Sponsored Enterprise (GSE) backed or funded (FHA, VA, USDA, Fannie Mae, Freddie Mac) mortgage loans.
If you have a federally or GSE-backed mortgage, no documentation is required to request forbearance, other than an assertion that you are facing a pandemic-related hardship. Borrowers are entitled to an initial forbearance period of up to 180 days. If necessary, an extension of an additional 180 days may be requested. Federally backed mortgages are protected against foreclosure through December 31, 2020.
Recently, the foreclosure moratorium was extended yet again to at least March 31, 2021 for GSE-backed loans (Fannie Mae and Freddie Mac). Be sure you understand who owns your loan and the terms of your loan as these deadlines approach. Extensions are likely to continue to help borrowers keep their homes and lenders navigate the constant uncertainty that is 2020.
The CARES Act amended the Fair Credit Reporting Act (FCRA) with a provision that when a lender agrees to forbear an account of a consumer impacted by the pandemic, the consumer complies with the terms of the forbearance. Then, the mortgage issuer must report that account as current to credit reporting agencies.
How Your Credit Factors into Forbearance
On paper, knowing that your credit won’t be affected by forbearance seems like a good deal. There’s an important distinction here. Your loan doesn’t need to be current to qualify for forbearance under the CARES Act. However, any delinquencies on your account prior to entering a forbearance plan will impact your credit report. Make sure that your loan is current, and being reported as current to the credit bureaus, before you agree to a forbearance of foreclosure.
What about Private Mortgages?
Around 30% of single-family mortgages are privately owned. Many private banks and loan servicers have voluntarily implemented relief measures that don’t fall under the same protections of the CARES Act. Terms vary by institution and state of residence. And relief plans may not be structured in the same manner as federally-backed and funded loans.
For example, borrowers with private loans may be required to pay back all missed payments in a lump sum as soon as the forbearance period ends. Lump sum payments are not required for GSE-backed loans. Additionally, if modifications are made to a privately funded loan, the new terms could impact your credit score depending upon how the lender reports the status of your loan to the credit bureaus.
The good news is that the three major credit bureaus (i.e., Equifax, Experian, and TransUnion) are providing free weekly online credit reports through April 2021. Be sure to check these reports to ensure that the new terms of your loan are being reported as “paying as agreed” and not reported as late. Credit.com also has resources to help check and manage your credit.
It’s also important to understand the terms of your loan. Some homeowners who recently refinanced were asked to sign a form that was quickly described as “new COVID paperwork.” The fine print stated that their new loan was not eligible for forbearance relief measures.
Get matched with a personal loan that’s right for you today.
Mortgage payment forbearance is one tool that can protect homeowners from defaulting on their loan, damaging their credit, and worst of all, losing their home to foreclosure. Key takeaways include, knowing who owns your loan, who services your loan, and what type of protections are available to provide relief if the current economic crisis is impacting you or you fear that it might.
There are proactive steps to protect against foreclosure and determine the right path for your personal situation.
Retail sales jumped 5.3% in January, as $600-per-person stimulus checks hit pocketbooks early in the month. All major categories of spending rose. The biggest beneficiaries: Department stores, up 23.5%; home furnishings, up 14.7%; electronics, up 12.0%; nonstore (mostly e-commerce), up 11.0%; sporting goods and hobbies, up 8.0%; and restaurants, up 6.9%.
More stimulus is expected: The current Democratic stimulus proposal includes an additional $1,400 per person, though with income restrictions. With COVID-19 infections dropping this month, sales should continue to be strong as restrictions are eased and more people feel comfortable shopping or eating out in-person. The recent winter storms should ding February sales in Texas and certain other states, however.
Restaurants finally caught a break in January, doing better than expected despite a continuing pandemic surge. Falling COVID-19 infection rates in February also bode well for restaurants, though likely not until after the current winter storms subside.
Even though November and December sales showed monthly declines, holiday sales were still above last year’s level. Holiday sales of in-store goods were 4.9% above last year, though only 3.0% higher if building-store sales are excluded. E-commerce sales were roughly 26% higher than last year. Of course, not all stores have done well. Clothing, electronics and department stores have a lot of ground to make up to get back to last year’s sales level.
Bad credit is not something that can be solved overnight. Although you can work to repair your credit, progress usually takes time. Sometimes, you do not have time to wait for your credit score to improve because you need a loan right now.
Life has a habit of throwing unexpected expenses in your path such as an unexpected medical bill or car repair. Whatever has you seeking a personal loan, it is likely something that you need the money for soon. It might be ideal to wait for your credit score to improve but that is not always possible.
Luckily, there are many online lenders that are willing to provide bad credit personal loans for $5,000 or more. Let’s take a look at some of the best lenders who provide personal loans to people with bad credit.
Best Personal Loans for Bad Credit
You can absolutely secure a personal loan with bad credit. However, you should keep in mind that you will likely not receive the best terms. With bad credit, lenders are likely to charge you a higher interest rate for the loan. Make sure you absolutely need a personal loan before moving forward.
CashUSA serves as your one-stop shop to connect with online lenders that offer personal loans with bad credit. With a quick request process, CashUSA will work to connect you to a lender that is willing to work with you.
CashUSA lenders provide personal loans with a loan amount of $500 to $10,000. APR can vary widely based on the individual lender and your credit score, but it can range between 5.99% to 35.99%. The interest rate is variable with terms between 90 days and 72 months. Funds are deposited directly into your bank account.
Full review of CashUSA
As the name suggests, BadCreditLoans.com is a place to find unsecured personal loans if you have bad credit. BadCreditLoans.com is not a direct lender but the site will connect you to lenders that are willing to work with you.
Lenders in the BadCreditLoans.com network offer loan amounts up to $10,000. Although most of the personal loans through these lenders are smaller than $10,000, it is possible to obtain the full $10,000.
The APR on personal loans can range between 5.99% and 35.99%. Interest rates are variable but generally on the shorter side, starting at just 3 months. You can get the money deposited in your bank account as soon as the next business day.
Full review of BadCreditLoans.com
PersonalLoans.com works to connect borrowers with personal loan offers between $500 and $35,000. If you have bad credit, then you should not expect to be approved for the maximum $35,000 loan. Although not everyone is able to qualify for the maximum amount, every applicant can request the amount they are seeking.
The APR on personal loans ranges from 5.99% to 35.99%. The APR you qualify for will be largely based on your credit score. One big benefit offered by PersonalLoans.com is the flexibility of repayment terms which range from 6 to 72 months. You’ll have the ability to choose the timeframe you’d like to repay the loan.
A final benefit of these personal loans is that there is no prepayment penalty. You’ll be able to repay your debt as quickly as you’d like without any repercussions.
Full review of PersonalLoans.com
Although Avant typically works with borrowers of average to above-average credit, it is still a company worth looking into. You do not need good credit to apply for an Avant personal loan.
The company offers personal loans with loan amounts between $1,000 and $35,000 with APRs that range from 9.95% to 35.99%. Many Avant borrowers are using the personal loan as a way to consolidate their debts. If you are using this strategy to rebuild your credit, the Avant may be the right choice for you.
Full review of Avant
You can obtain a personal loan from OneMain Financial with a loan amount of between $1,500 and $25,000. However, the company has set slightly different limits for each state, so you will need to confirm your state’s limit with your local office.
As an applicant, you’ll have the option to pursue a secured or unsecured personal loan. If you have poor credit scores, then a secured loan may be the better option.
The interest rates will vary greatly based on your credit history but you can expect an APR range from 25.10% to 36%. The maximum loan term we’ve seen in 60 months. Make sure you ask about the origination fee as it varies per state.
One thing to note about these personal loans is that they will need to be executed after communication with a loan officer. That means you’ll need to make an appointment with a loan officer and talk to them in-person or over the phone.
Full review of OneMain Financial
This Chicago-based lender works with borrowers across the country to provide bad credit personal loans. The company offers unsecured personal loans with a loan amount of $1000 up to $10,000.
NetCredit evaluates each loan application on a case-by-case basis. Your loan offer will likely vary greatly based on your credit score and the state you live in.
Since the company works in many states, the APR range is extremely wide, from 36% to 155%. You’ll need to check out NetCredit in your state to better understand what this company can offer you. There may also be an origination fee depending on where you live.
Full review of NetCredit
A personal loan can seem difficult to obtain at a bank or credit union if you have bad credit. However, the lenders above can help you get approved for a loan to fund whatever life throws your way.
While it is possible to obtain a personal loan with a poor credit score, it may not be the best financial move, especially if you want to use it to consolidate credit card debt. It is more than likely that you will be offered unfavorable loan terms and high interest rates, which could cost you thousands over the course of your loan.
You could be using those funds to pay down other debts to improve your credit score. With a higher credit score, you’ll be able to obtain more favorable personal loan terms in the future. With that said, bad credit installment loans are still usually a better option than payday loans. Just make sure you can afford the monthly payments before you move forward with a personal loan.
Before applying for short-term loans, think of other ways that you could fund the immediate emergency. You could sell belongings, pick up a side hustle, or find a way to fix the problem yourself. If you are interested in rebuilding your credit score, then take advantage of our free DIY guide.
Shaq became famous as a basketball player, a very large basketball player! He was 7-1 and was well over 300 pounds when he was playing in the NBA. Not only is he one of the best basketball players of all time but is a real estate investor as well. He has also been a major part of many other businesses like Ring doorbells, Five Guys Franchise, and he was an early investor in Google. After leaving the NBA, he has become even more involved in real estate and been a part of some very large deals! It is hard to find the exact information on what Shaq has done real estate-wise, but he has given hints over the years in interviews on how he started and what he is involved in. From what I could find out he started by flipping houses with a partner in New Jersey. He has also been involved in low-income housing in Denver and done deals in Florida as well. He currently is focusing on large projects in the New Jersey area where he spent time as a kid.
Where did Shaq live growing up?
Shaq was born in New Jersey and his father was a basketball player as well. However, his father had drug problems and was never a part of Shaq’s life. Shaq did have a stepfather who was in the army and Shaq ended up living in Texas and Germany as a kid because of his stepfather’s career. Shaq ended up going to high school in San Antonio and leading his team to a state championship. Shaq was a always big kid. He was 6-6 when he was 13! I was 6-1 when I was 13, but I stopped growing at 13 and Shaw did not.
It is important to know where Shaq grew up because it impacted his real estate investing later on. He was not a real estate investing just to make money. As he said onCNBC Make It:
“I don’t invest in companies just to try and get the big hit,” “I [invest] because I know it’s going to change people’s ideas… change people’s lives.”
How did Shaq blow his first million?
Shaq had an amazing interview with Daymond John (The Shark Tank) about how he spent a million dollars the first day he made it. He spent $150,000 on a Mercedes for himself, then his dad wanted a car so he bought him one, and then he bought his mom a $100,000 car. He bought jewelry, suits, CD changer, went to Vegas, etc. Then his banker called him in to warn him about his spending. Shaq had no idea about taxes and that he had spent the entire million without realizing it!
From that point on, he made sure to take care of his money and learn from those who know about money. He credits Magic Johnson with helping him learn a lot about money and investing it instead of wasting it.
How did Shaq start his real estate investing career?
During Shaquille O’Neal’s long playing career, he earned an estimated $292,198,327! He definitely had a head start as an investor by earning so much money in the NBA. However, he did not start with huge projects although some of the articles you read will have you believe he did. In a 2002 article from the Denver Post about an affordable housing project he said:
“We started buying homes out of foreclosure and paying $10,000 or $12,000 for them, fixing them up, and maybe selling them for $25,000 or $35,000,” Shaq said.”It would be easy for me to develop a housing community around a golf course or buy strip malls, but that’s not how I want my book to go.”
He was talking about Mike Parris, who was his uncle and business manager, and mentioned that he was doing this 4 years ago, which would have been 1998 when he was 26. Shaq started small in his hometown. At the time he would have been playing with the Orlando Magic in Florida.
While he may not have been the one swinging the hammer, he was definitely investing in real estate at a young age.
How did Shaq’s real estate investing evolve?
Shaq started the O’Neal group in 2006 which invests heavily in real estate, but as we know he was involved in investing before that. In the article in the Denver Post from earlier, he was also involved in buying big projects before that as well. In 2002 Shaq said;
“My dream is to own $1 billion a year in affordable housing,”
He started by purchasing a $65 million affordable housing project in the Denver area that eventually cost $100 million after property improvements and other costs were factored in. The project consisted of 1,500 units and the seller would only sell to investors who were willing to keep the affordable housing aspect of the project.
In 2006 his company invested in The Met in Miami which was a highrise with 1,000 units.
He also recently opened an $80 million apartment complex in New Jersey and has plans for another $150 million high rise.
What is a little frustrating is the giant gap you see from 2006 to 2018! it is hard to find much information on the O’Neal group or his real estate investments during that time. There was another project he was involved in Atlantic City, but I could not find out if that project was ever completed. However, he was not just investing in real estate during his career. He has done many things!
What other businesses has Shaq been a part of?
Shaq has said he loves real estate and obviously has been a part of some huge deals but he has done many other things as well! Here are a few of them:
Pre-IPO Google stock: He bought into Google before it even went public.
He started a clothing line
He has owned 17 Auntie Anne’s Pretzels restaurants
He has owned 150 car washes
He has owned 155 Five Guys Burgers and Fries franchises
He has owned 40 24 Hour Fitness gyms
He has been a partner in Las Vegas nightclubs
He has owned a movie theater
He was a partner with Muscle Milk
He was a partner with Vitaminwater
He was a partner with Loyal3
He has released albums with commercial success
He has been in movies and on TV
He is super involved with law enforcement
I am sure I am missing many other things he had done or been a part of! I have no idea how many of these things he has sold or still owns but he has sold many of his investments and business over the years. He is obviously very diversified!
How involved is Shaq in real estate investing?
I have no idea how involved Shaq is or was in real estate. He sounds very passionate about it when he talks about so he could be very involved. However, he has so many other things going on it would not surprise me if he is mostly the money guy and other people find the deals and put together the projects. There is nothing wrong with that as the best investors learn how to make money without doing a ton of work! If Shaq happens to read this and has some more information to add, I would love to hear from you! Mark @ Investfourmore.com
New to peer-to-peer lending? It’s a type of lending that has been around for over 15 years in the U.S. and has continued to grow in that time. It’s a way for borrowers to access competitive rates outside the traditional bank lending model.
It also brings the potential for higher returns to individual investors, often even including those who are non-accredited. P2P lending is a platform meant to cut out the middleman and generally democratize the loan landscape.
On top of that, there are reputable lenders across industries. That means better diversification amongst personal loans, business loans, and even commercial real estate projects.
Let’s jump in and find out how peer-to-peer lending works and who are the best P2P lenders out there today.
How does peer-to-peer lending work?
Peer-to-peer loans take online lending to the next level, directly pairing borrowers with investors in a virtual platform. It’s a unique alternative to traditional banking and often comes with lower interest rates for borrowers and higher yields for investors.
Peer-to-peer lending cuts out a lot of the costs generally associated with taking out loans through a bank. There are no physical branches to support, and staffing is generally a much less substantial expense for P2P lending companies.
How does the peer-to-peer lending process differ from bank lending?
Peer-to-Peer Lending Application Process
From the borrower’s perspective, the application process starts much of the same way as any other loan process. Most P2P lending platforms allow for prequalification that only requires a soft credit pull, giving you an idea of what kind of personal loan you could qualify for and with what terms. At this point, you’re also given a loan grade, which classifies your application as a risk rating.
Next, your funding request is posted on the P2P platform. Investors can review the details of your inquiry, such as what you’ll use your loan funds for, non-identifying aspects of your application, and their anticipated return. If interested, the investor can then commit any amount of funds to your personal loan. Once you reach a certain percentage of committed funding, your loan application moves onto the next level.
You’ll need to submit information to verify your application, like proof of income and any other documentation required by the lender. It then goes to underwriting and you’ll receive an official loan agreement outlining the details of the loan, including rates, terms, and your repayment responsibilities.
After you sign and submit the loan agreement, the loan funds are typically deposited into your bank account within 24 to 48 hours.
Borrowing through P2P Platforms
Because there are extra steps involved in the approval process for a P2P loan, it can take longer to get your funding when compared to other lenders. On the plus side, however, borrowers can often qualify for more competitive rates and terms.
And since there’s upfront transparency to investors regarding each borrower’s credit rating, low credit borrowers may still get the chance to qualify for a loan, even if they’ve been denied by other lenders.
P2P platforms also offer a wide degree of flexibility on loan use. While they’re all different, most generally allow for common funding purposes such as debt consolidation, home improvements, life events, and other major purchases. Your exact need could influence which P2P lender you ultimately choose.
Investing through P2P Platforms
Investors are often drawn to peer-to-peer platforms for the pure fact that returns are often higher than other investment choices. Plus you get to administer as much control as you’d like when managing your portfolio. That’s because you can pick and choose how much you invest at any given moment, in addition to what mix of loan grades you want in your portfolio.
Alternatively, you’re also able to set your investments on autopilot with most of them. You generally can input how you’d like your investments to be distributed. The lender will then automatically disburse your funds to loan requests that meet your criteria.
This frees you up from having to manually review borrower requests, making the process as simple as you want it to be. While P2P lending certainly contains a large degree of risk, some investors may choose to make it a part of their portfolios.
Which is the best peer-to-peer lender?
There are a number of reputable peer-to-peer lenders online today. Here is a breakdown of the best ones to help you choose the right one, whether you’re interested in borrowing or investing.
Prosper is one of the largest P2P lenders, having facilitated $13 billion in loan transactions. That’s a huge amount and they rely heavily on large institutional investors in addition to individuals who back loans for borrowers. Prosper offers loans that can be used for home improvement, vehicles, adoptions, engagement rings, special occasions, and more.
The eligible loan amount is broad, ranging between $2,000 and $40,000 with the choice of either a three or five-year repayment term. Interest rates are competitive and always fixed, meaning you know exactly how much your monthly payment will be for the entire life of the loan.
For investors, Prosper boasts a historical average of 5.5% and the ability to diversify your holdings beyond the typical stocks and bonds. They also pay out monthly returns, so you could potentially earn a steady stream of income. Any returns are deposited straight into your account on a regular basis, so you get quick access to those funds.
Read our full review of Prosper
LendingClub is another major player in the P2P space, helping clients borrow more than $85 billion over the years. The lender advertises a quick funding process with cash available within as few as seven days. Loan options include consolidating debt, paying off credit cards, making home improvements, or covering a major expense. In addition to personal loans, LendingClub also offers auto refinancing and medical debt loans.
The application process is easy for borrowers. You fill out an online form in just a few minutes, including the amount of money you’d like to borrow. If approved, you can review different loan offers that show your potential interest rate, repayment term, and monthly payment amount.
LendingClub works with both individual and institutional investors. For individuals, you can choose between an investment account and a retirement account, with historical returns ranging between 3% and 8%.
You can start with as little as $25 invested in a single loan. You can also automate your investments with pre-selected strategies that correspond to your financial goals, or you can manually select your investments.
Read our full review of LendingClub
Upstart offers a huge variety of loan options, which is probably why it’s experiencing such enormous growth as a lender. As a borrower, you can use an Upstart loan to pay off your credit cards, consolidate debt, refinance student loans, pay for personal expenses, buy a car, or even start a business.
Smaller loan amounts are available and start at $1,000 or you can apply for as much as $50,000. You can repay your loan funds over three or five years.
What makes Upstart stand out to borrowers?
The approval process is much more holistic than many other lenders. Rather than placing a primary focus on your credit score, Upstart uses your education and your job history to help you qualify for lower rates. The thinking is that by factoring in these considerations, you have a financial potential that lessens your risk. Plus, you can get your loan funds in as fast as one day.
Investors have two choices when selecting Upstart. You can customize a plan for automatic investments or you can open a self-directed IRA to help supplement your retirement savings.
Upstart also states that 91% of their loans are either current or paid in full. This can help you determine the risk associated with the lending platform, which seeks to serve quality borrowers who simply have a limited credit history.
Read our full review of Upstart
PeerForm offers loans on a P2P lending platform in amounts ranging from $4,000 to $25,000. All loans are unsecured, so as a borrower, you don’t have to worry about providing any collateral. You can check your rate by filling out a simple online form.
After that, you may receive one or more loan offers with different rates and terms. If one of those offers works for you, your loan is then listed on PeerForm’s lending platform.
Once your loan is funded by investors, you simply need to submit a few pieces of documentation to verify your identity and income. Examples of information you may need to submit include a copy of your ID, bank statements, pay stubs, and/or recent tax statements.
When you invest with PeerForm, you can choose between whole loans and fractional loans, the latter of which are geared towards individual accredited investors. PeerForm advertises competitive, risk-adjusted returns. PeerForm assigns each loan applicant a grade, which comes with a corresponding interest rate.
Read our full review of Peerform
Fundrise – Real Estate Platform
Fundrise is another P2P real estate platform that gives individual investors access to multimillion-dollar projects. The investment horizon for each project is usually between three and seven years. While that’s certainly not as liquid as investing in the stock market, the benefit is that Fundrise’s investments are expected to perform better.
Investors can earn an 8% to 11% expected annual return. Most plans are charged an annual 0.85% asset management fee, while clients using investment services pay a 0.15% advisory fee.
How does Fundrise choose its investments?
The goal is to buy properties for less than their replacement cost, then improve them using local industry experts. All aspects of the project are analyzed, including the sponsor, the property itself, the local market, and the overall economy. Fundrise states in a year of reviewing 2,000 proposals, they approved less than 2%.
Fundrise Investment Plans
Fundrise offers three different investment plans:
Supplemental Income creates an ongoing income stream.
Balanced Investing allows you to heighten your diversification.
Long-Term Growth seeks to maximize returns over longer periods of time.
You can even get started with a minimum investment of just $500. Anyone over the age of 18 can invest with Fundrise. Read our full review of Fundrise.
Funding Circle – Small Business Loans
Funding Circle offers a slightly different model, providing P2P small business loans. Approvals can be received in just 24 hours, making it a faster option than traditional banks. Small business owners can borrow between $25,000 and $500,000, with repayment terms lasting anywhere from six months to five years. Plus, you get a dedicated account manager who can help with any questions throughout the process.
Funds can be used for a range of purposes, including increasing cash flow, hiring new employees, buying new equipment, or upgrading your premises. The initial application takes just 10 minutes to complete. Within a day, you may talk to both a loan specialist and underwriter to learn more about your business. Once you’re approved and agree to the loan terms, you can get funding within five days.
Investors can diversify their fixed income portfolios by choosing to invest in secured business term loans through Funding Circle. There is, however, a pretty hefty minimum investment, which starts at $250,000. You can either select notes manually from the marketplace or enroll in automatic investing.
PeerStreet – Real Estate Loans
PeerStreet allows investors to finance short-term real estate loans. According to PeerStreet, their investments could be less volatile than the stock market. Investors select first lien real estate loans that are highly vetted before being offered.
PeerStreet works with private lenders to source these investments, which must meet a variety of requirements using both algorithms and manual processes. Investors can choose their projects one by one or use PeerStreet’s tool to match with investments that meet their chosen criteria. Additionally, you can start with just $1,000 per loan, making it easy to diversify.
What kind of returns can you expect with PeerStreet?
Some investments could potentially bring in double-digit returns, but the company also states that an example yield is 6% to 9% over 12 months. Service fees generally range from 0.25% to 1.0% and are disclosed with each project. Obviously, there’s a risk with any investment, and these real estate loans are no different.
To qualify as an investor with PeerStreet, you must be accredited. That means you must have an annual income of at least $200,000 or $300,000 in joint income with your spouse. Additionally, your net worth must be at least $1 million.
How to Earn Money with P2P Lending
There are no guarantees with how much money you can make investing in P2P lending. It depends on so many variables, including your risk tolerance, the loan types you choose, as well as more general factors like the economy. Some of them advertise the potential for double-digit returns, and most at least say they outperform the stock market while also being less volatile.
P2P lending platforms generally offer investor materials that you can review to get more details on the risk versus return. To help increase your returns, however, you can consider some general advice. First, think about diversification in relation to your broader portfolio and your P2P portfolio.
You probably don’t want to invest solely in high-risk, high-yield loans. Try investing enough money so that you can spread the money over different loan grades.
Is peer-to-peer lending safe?
Just like your returns rely on a number of factors, so does your safety as an investor choosing P2P loans. Your funds aren’t insured, but all P2P platforms must register with the SEC. This keeps them under federal scrutiny to ensure they stay in practice with all the current regulations.
Still, diversity must be a priority in minimizing your risk when investing in these types of loans. If a borrower defaults on a loan you’ve invested in, you’ll lose that money. Be sure to create a healthy balance within your accounts. You can also start off conservatively as you learn the process, then add in higher yield loans to bolster your returns. It’s also important to check out the lender’s vetting process for its borrowers.
Whether you’re interested in borrowing or investing in a P2P loan, there are countless options available today. Personal loans, business loans, and real estate investments have become more accessible to all parties thanks to automated lending platforms connecting individuals on both sides of the equation.
As with any financial decision, the key is to do your own research and compare options. Each P2P lender has its own strengths and weaknesses. Do some digging to figure out which one best meets your needs for either funding or investing. Once you find it, it’s a win-win for everyone.
It happens to the best of us. You might have been totally on top of your budget, and then an unexpected something turns up to throw you off course. Maybe it’s a medical bill, an unforeseen car repair, or a layoff. But regardless of the specifics, you find yourself in need of cash you just don’t have.
If you’re struggling with bad credit the situation is just that much more stressful. Because a poor credit score and history can make it very difficult to get your hands on the unsecured personal loans you need to get through a tough time. And that, in turn, can just drive your credit score even lower if it means you’ll end up defaulting on existing payment commitments.
Unsecured Loans for People with Bad Credit
Fortunately, there are some online lenders who understand that life isn’t always ideal. They’ve created accessible unsecured loans that you aren’t automatically disqualified for just because your credit history has a few blemishes.
Of course, as with any loan, you will be paying interest for the privilege of borrowing the money. And the lower your credit score, the higher your interest rate will be on average. So, it’s important to reserve the use of an unsecured loan for true financial emergencies.
It’s also a good idea to shop around and find the lender that can offer you the best terms for your specific needs and credit standing. So without further ado, here are five of the best places to choose from when you need an unsecured loan even though you have bad credit.
By matching you with a variety of lenders, CashUSA allows you to get an unsecured loan with bad credit.
Plus, their sprawling network of providers can offer sizable unsecured loans of up to $10,000. This can be a godsend if you’re dealing with unexpected medical bills or other major expenses.
Your loan request can be approved within a matter of minutes and funded in as little as one business day, and all credit types are eligible (though interest rates and terms will vary based on your standing).
Loan Amount: $500 – $10,000+
APR: 5.99% – 5.99%
Term: 3 – 72 months
Read our full review of CashUSA
Although it’s not ideal, it’s a fact: most Americans couldn’t come up with even a few hundred dollars to spare in the face of an emergency.
That’s why MoneyMutual offers fast, short-term loans of up to $2,500, even to borrowers with bad credit.
Their services have been trusted by more than two million customers to date, and once approved, you can receive your funds via direct deposit, sometimes in less than 24 hours after approval. There’s no cost to fill out the online application, and it takes just minutes.
Loan Amount: Up to $2,500
Read our full review of MoneyMutual
Whether it’s a quick $500 to cover rent or a serious financial undertaking costing tens of thousands of dollars, PersonalLoans.com can match you with lenders offering the funds you need fast. And there is no minimum credit score.
Better yet, you’ll have up to 72 months (i.e, six years) to repay it in easy monthly installments, making these unsecured loans a great choice for debt consolidation or to pay off a large standing balance at a lower interest rate.
Loan Amount: $500 – $35,000
APR: 5.99% – 35.99%
Term: 3 – 72 months
Read our full review of PersonalLoans.com
Bad Credit Loans
It’s right there in the name: this personal loan company is all about matching you with the lenders who will fulfill your needs, even if you have bad credit.
Loan amounts range from a quick $500 to a more substantial $10,000. Interest rates start as low as 5.99%. Bad Credit Loans is a great first stop on your unsecured loan shopping trip — especially since it’s totally free (and easy!) to submit an application.
Loan Amount: $500 – $10,000
APR: 5.99% – 35.99%
Term: 3 – 36 months
Read our full review of Bad Credit Loans
If you just need a small amount of cash and can pay it off quickly, CashAdvance is a great place to get a personal loan, regardless of your credit score.
Although their lenders tend to max out loan agreements at $1,000 and carry fairly high interest rates, you can get the money delivered directly to your bank account quickly and easily.
Loan Amount: $100 – $1,000
APR: 200% – 2000%
Read our full review of CashAdvance
How to Improve Your Credit Score to Get Better Loans Later On
These lenders offer a much-needed service to borrowers with imperfect credit scores. However, it’s in your best interest to work to improve your credit score over time. That way, you’ll be able to get better loan terms later on down the line. And that includes when you want to take on major financial commitments like homeownership.
If your credit history is dotted with blemishes, it can feel overwhelming, or even impossible, to get back on track. But that’s not the case! By implementing sustainable changes and habits and being persistent, you can rebuild your credit score and create the financial freedom you deserve.
Budgeting and Paying Off Debt
Start by looking at your budget and seeing if you can make any cuts. This will save you money that you can then funnel directly toward your standing debt totals. Some people start with the highest-interest account first, known as the “avalanche” approach.
This approach will save you more money over time. Others prefer the “snowball” method, which means starting by paying off the account with the lowest total and using that success as motivation to tackle your bigger debt projects.
No matter which way you go about it, you can achieve the debt-free lifestyle of your dreams! And sometimes, a personal loan is exactly what you need to start moving in the right direction.
Dreaming of long days spent fishing, sunbathing, and generally enjoying the magic of the wide-open water?
Boat ownership could be the key to unlocking your seafaring dreams. But for most of us, slapping down tens, or possibly hundreds of thousands of dollars on the vessel of our dreams is simply not in the cards.
Fortunately, financing a boat can help you get your hands on the boat of your dreams without having to wait until you can afford it outright. But how do you get a boat loan, and who offers them? What kind of boat loan requirements and credit approval can you expect? And what do you do if you don’t have excellent credit?
Read on to learn everything you need to know to get sailing as soon as possible — without spending a fortune.
Different Types of Boat Loans
First things first: what kind of loan can you use to finance a new or used boat in the first place? Though auto loans are available far and wide, not quite as many lenders advertise boat financing options.
But there are several different options available to those looking to finance their boat purchase. Here are some of the most common.
A collateral loan is similar to the one you might have on your car. You may be available to get one through the boat dealership. Just as with a traditional auto loan (and as the name suggests), the boat acts as collateral with this loan. So, if you default on your payments, the lender has the right to repossess it.
Home Equity Loan
A home equity loan is a loan that uses the equity of your home to take out a loan or line of credit. It can be used for buying a boat and may be a very good financial option, given that these loans are often tax-deductible. Home equity loans also offer a lower interest rate than credit cards and other types of unsecured debt, according to U.S. News.
You can take out an unsecured personal loan for pretty much any purpose, given you have a high enough credit score. However, because these loans don’t have any kind of collateral involved, they generally come at higher interest rates than other options.
A credit card with a high enough limit to allow you to make a substantial down payment and regular monthly payments is another option, but we don’t recommend this approach. Revolving credit card debt comes at a high cost, with interest rates frequently reaching over 20% APR. That means you’ll be paying a whole lot more for your boat than the figure you see on the price tag!
Where to Get a Boat Loan
Now that we’ve gone over which types of loans can be used for purchasing a boat, let’s talk about where to get a boat loan.
Boat dealers may directly offer boat loans, just as you’d expect to find in-house auto loans available at certain car dealerships. These are generally collateral loans and may come with additional incentives, such as manufacturer deals and warranties. For example, Yamaha boat financing currently offers $0 down and 0 payments for 90 days. The APR is 2.99%. It’s wise to shop around and compare boat financing rates before you make a final decision.
Banks, credit unions, and other financial institutions may offer boat-specific loans, personal (unsecured) loans, and lines of home equity credit. They may have a better interest rate than the ones you’d find at the dealership. This could save you money even after you factor in those special “deals” the boat seller has on offer.
Peer-to-peer lenders, like Prosper and Lending Club, can help you secure a personal loan directly from a private individual. This might help you find a better deal than you would at a traditional financial institution.
Credit Requirements for a Boat Loan
As with any financing, when you’re shopping for boat loans, you should know that your credit score can have a serious impact on your overall loan terms. It will also impact how much you’ll end up paying for your new boat altogether.
While many marine lenders will extend boat loans to those with poor or nonexistent credit history, these loans may come with high interest rates. That will likely serve only to further complicate your financial situation.
Have a Down Payment
You should also know that just about any boat loan will require a substantial down payment. So, you’ll need to come up with about 10-25% of the boat’s total cost out of pocket to initiate the sale.
You don’t want to drain your entire savings account on what ultimately amounts to a frivolous purchase, no matter how tempting it may be. It’s smart to look closely at your budget to determine how much boat you can actually afford and save up your down payment well ahead of time.
Make Sure Your Credit Is in Good Shape
If you’re already in debt or struggling with a low credit score, your best option might be to repair your credit before you go shopping for a new boat. Fortunately, we’ve got tons of tips and tricks to help you get out of debt as quickly as possible and improve your credit score. These tips can help you get a boat loan with a much better loan term. Here are a few simple steps to take to get you started on the road to better credit.
Pay each of your credit accounts on time, and contribute at least the minimum monthly payment amount. If you can afford to pay more than the minimum, always pay toward the principal loan amount if your lender gives you the option. This will decrease the total amount of interest you pay over the course of the loan.
Avoid closing any existing lines of credit, but don’t try to open a host of new ones at the same time, either. The total length of your credit history plays an important part in how FICO calculates your score. Keeping old accounts open can be helpful even if you’re no longer using them.
Having a diversity of credit types can also be a helpful factor. But at the same time, there’s no need to open several new accounts at once. This can create multiple hard credit inquiries that can read as a red flag to bureaus. So, don’t go crazy trying to establish a bunch of new accounts at once.
Pay off your debts before taking out any new loans. Regardless of your credit score, revolving debt is costly and acts as a weighty financial anchor. You’ll enjoy your new purchase much more once you’re able to afford it without worrying about how to make ends meet!
Getting a boat loan is similar to financing a car (or any other object or project). It can be an effective way to get a boat today, even if you don’t have the money to pay for it in full immediately. However, shopping around to secure the best rates and repayment terms is an important step toward ensuring that your new toy doesn’t put you into a financial tailspin.
For more information on shopping for personal loans, check out our series of loan reviews, including the best personal online loans and the best personal loans for bad credit.
Over 24 million Americans will take out an unsecured personal loan this year, and that number is expected to rise in the years to come. So what exactly can you do with a personal loan?
Debt consolidation is one of the most popular uses because many consumers with credit card debt can find a better interest rate with a personal loan.
Many people use personal loans for other expenses as well. They’re usually reserved for expensive items that are difficult, if not impossible, to pay for all at once even if you have a beefed-up savings account.
For example, you might need a new roof or want to update your kitchen before you sell your house. Or perhaps your wedding plans cost more than your current cash flow or you need money to help pay for an adoption.
Personal loans make it easy to finance big-ticket items without draining your savings all at once. And while banks and credit unions have historically been the place to go for personal loans, online lenders now offer easy access to financing, often with lower interest rates.
Compare the Best Personal Loan Lenders and Apply Online
Compare offers from multiple lenders to make sure you’re getting the best personal loan rates. Look at the interest rate and origination fees (plus any other applicable fees) because that will tell you how much your total loan will cost.
Each lender’s annual percentage rate (APR) helps you compare these numbers as a single percentage. Also, make sure you can afford the monthly payments and that you’re comfortable with the length of the repayment period.
Without further adieu, we present the nine best personal loans. Because we included lenders focusing on different types of borrowers, we encourage you to read through the list to find the best fit for you.
If you’re looking to compare multiple, personalized offers for personal loans, Credible is your best bet.
Simply complete Credible’s short pre-qualification form and you can instantly receive real offers from as many as 8 different lenders. The entire process takes less than two minutes and will not affect your credit. It’s also completely free!
Lastly, and importantly, your personal information will not be shared with lenders. Comparing offers on Credible will ensure you do not receive any follow-up or outreach from the lenders in their marketplace.
Check your interest rate from the industry’s best personal loan lenders today!
Read our full review of Credible
If you’re interested in a peer-to-peer loan, check out Prosper. Rather than submitting a loan application and getting an answer right away, your personal loan needs to get funded by investors.
Prosper will review key components of your request along with a snapshot of your credit profile. While the process is a bit slower because of this extra step, it opens the door for a wider range of borrowers.
The minimum credit score is 640 but the company says that the average borrower boasts a 710. There’s no exact minimum for income requirements, but again the average for a Prosper borrower is over $88,000 per year.
How much can you borrow with a Prosper loan?
Amounts start at $2,000 and are capped at $40,000. Since more credit types are accepted, there’s a broader range of APRs, moving anywhere between 6.95% and 35.99%.
You can also choose between loan terms, which last either three years or five years. You’re likely to save money on interest with the shorter term, but you can potentially lower your monthly payment amount if you spread it out over the longer period.
Expect to pay an origination fee with your Prosper loan, which can cost anywhere between 2.4% and 5% of your loan amount. The fee comes directly out of your personal loan before it’s deposited into your bank account.
Read our full review of Prosper
FreedomPlus offers personal loans to borrowers with good credit. While their main focus is primarily on debt consolidation loans, you can use the money for a number of purposes, such as home improvement or a wedding. The minimum amount you can borrow is $10,000 while the maximum is set at $35,000.
What kind of APR can you expect from FreedomPlus?
Depending on your credit, interest rates can start as low as 4.99% or go all the way up to 29.99%. You’ll also need to earn at least $30,000 a year through verifiable income.
With FreedomPlus, you can get a same-day personal loan assuming that you’ve provided a completed application with all required supporting documentation early enough on a day that their offices are open. Otherwise, funds can be deposited into your bank account within 48 hours.
An interesting benefit that comes with FreedomPlus is the potential to receive discount points. You can get your APR lowered by using a co-signer, taking advantage of debt consolidation direct pay, or by having at least $40,000 in your retirement account.
Overall, FreedomPlus is a transparent lender with generally favorable loan terms and some extra perks for those who qualify.
Read our full review of FreedomPlus
Payoff allows you to consolidate credit card debt and instead manage a single installment loan with what could very well be a lower interest rate.
Many Payoff borrowers also experience an increase in their credit score, averaging at least 40 points when paying off $5,000 or more in credit card debt.
Loans start off at $5,000 and go up to $35,000 depending on your needs. APRs range from 8% to 25%, which includes an origination fee of 2% to 5%. Loan terms are also flexible, lasting between two and five years.
The minimum credit score is 660. Your debt-to-income ratio must be 50% or less, and you should also have at least three years of good credit.
You also can’t have any current delinquencies and any from the last 12 months should be for 90 days or less. If you meet these requirements, a Payoff personal loan may be a good fit for you.
Once you’re approved, Payoff will give you your free FICO score each month. This helps you track your progress in improving your credit as you pay down your debt.
You’ll also get job loss support in case you lose your job, and check-in calls throughout the year with the member experience team.
Read our full review of Payoff
Upstart offers personal loans particularly for younger individuals who may not have an extensive credit history. Most borrowers are actually in their early 20s to mid-30s, and many of whom have recently graduated from college.
Rather than focusing solely on credit, they consider other factors as well when considering each loan application.
Upstart’s interest rates start at 7.46% and go up to 29.99% — quite a competitive range. You can borrow anywhere between $1,000 and $50,000 for up to five years, but you’ll need a credit score of at least 620 (with the average coming in at 692). If you hit financial troubles, they also offer flexible repayment terms.
If you have a solid work or education history that shows you’re a reliable person, you could find the online personal loan you need with Upstart. Each underwriting process is tailored specifically to the individual giving you the best chance for success.
Read our full review of Upstart
For borrowers with good credit seeking competitive interest rates, Best Egg is a strong option to consider. They’ve funded more than $2 billion since their opening in 2014 and have assisted over 200,000 clients.
For those with the strongest credit scores and an annual income of at least $100,000, APRs are as low as 5.99%. Otherwise, they range up to 29.99%.
Loan amounts are as low as $2,000 and as high as $50,000 if you meet special qualifications. Origination fees range between 0.99% and 5.99% and are taken out of your funds.
Once you’ve had a personal loan for at least six months, you can actually apply for a second loan if necessary. Your combined balances can’t exceed $50,000. However, it gives you more flexibility in your financing, where many lenders prohibit more than one outstanding loan.
Most of their borrowers use their funds to consolidate debt, but you can use the money for just about anything. Whether it’s for medical expenses, a new kitchen, or your upcoming wedding, they allow for a large variety of loan purposes.
If you have strong credit and are in a relatively high-income bracket, you can take advantage of some of their competitive rates and terms. It’s quick and easy to get an offer and won’t hurt your credit. In fact, you won’t have any hard pull at all until you’re ready to sign your loan agreement.
Read our full review of Best Egg
SoFi is an online lender that works with a variety of borrowers to provide personal loans. The lender offers a variety of loans, but personal loans are one of its specialties.
The best part about SoFi is its transparency. The company offers its borrowers a quick and easy process that is clear the whole way. The personal loans offered through SoFi have no origination fees or pre-payment penalties, so you can more easily understand the loan terms.
SoFi offers unemployment protection. If you lost your job, then you would be able to put your loans into a temporary forbearance with little to no hassle.
Borrowers with a solid credit history and high income will have attractive rate offers made through a transparent lending process. Many of SoFi’s borrowers have high incomes and credit scores. The minimum credit score allowable is 680. The median income of borrowers is $106,000.
Fixed-rate loans through SoFi have a range between 5.99% APR and 16.740% APR. If you sign up for autopay, you may be able to save money through a 0.25% discount on your interest rate. The company offers personal loans with a minimum of $5,000 and a maximum of $100,000. However, it is possible to receive a higher loan amount with a strong application.
If you have a high income and good credit score, then SoFi is a great place to find your personal loan.
Read our full review of SoFi
Avant has served close to half a million borrowers since opening its doors online in 2012. It’s a great middle-of-the-road option because most Avant borrowers have either average or above-average credit. The average score range is actually between 600 and 700.
If you have strong credit, you can get an APR as low as 9.95%. The loan amount ranges from $1,000 to $35,000. With such a low minimum, you can get a low-rate personal loan for a short-term need, whereas many other lenders require a minimum of $5,000.
Many Avant borrowers use their personal loan for debt consolidation. Avant states that six months into the loan, those borrowers see an average 12 point increase in their credit scores.
Funds can be directly deposited into your account as soon as the next business day. You also get to track your VantageScore for free each month.
Another unique feature offered is their late fee forgiveness program. If you’re late making your payment, you’ll be charged a late fee. If, however, you pay your next three consecutive bills on time, your fee will be refunded in full.
You can access your loan dashboard online or through a smartphone app, making this lender user-friendly and competitive.
Read our full review of Avant
One of the country’s oldest peer-to-peer lenders, LendingClub offers unsecured personal loans to a wide range of borrowers. While most borrowers have excellent credit, it’s still possible to get your personal loan funded with a lower credit score.
The maximum loan is higher than most lenders at $40,000. The minimum loan amount is just $1,000. Your fixed interest rate can range anywhere between 5.32% and 30.99%.
On top of your monthly payments, you’ll be charged an origination loan when you get your cash. Again depending on your credit, you’ll pay anywhere between 1% and 6% of your loan amount.
For the maximum $40,000 loan, that can cost as low as $400 or as much as $2,400. You don’t need the money upfront; the fee will be taken out of your personal loan before receiving it.
Wondering about LendingClub’s credit requirements?
At a minimum, you’ll need a 600, but most successful applicants are closer to a 700 score. There isn’t a salary requirement but the average is just shy of $80,000.
Once you apply, you can choose from various loan terms to best suit your budget and desired repayment term. As a P2P lender, investors will need to fund your personal loan request. During that process, you’ll need to start submitting financial documentation to support your application.
Read our full review of LendingClub
Having bad credit doesn’t mean you can’t work with an established lender like OneMain. APRs are above average, ranging from 25.10% to 36% but the minimum credit score is only 550.
While most of their personal loans are secured with collateral such as a vehicle, you might qualify for an unsecured loan if you pay a higher APR. You can potentially borrow as little as $1,500 or as much as $25,000, depending on what you qualify for.
They certainly have a strong track record, serving over 10 million customers in total. With over 1,700 physical branches across the country, it’s easy to get in-person support whenever you need it.
You can apply online, but if there’s a branch nearby, you’ll need to go in for a meeting to verify your information before finalizing your loan agreement. This final step can be performed over the phone if you don’t live near a physical location.
Once you’ve received a personal loan from OneMain, you get to choose from several flexible payment options. You can pay online or through the lender’s smartphone app.
There are also traditional payment options, such as at a branch or through the mail. Finally, you can even stop at a Walmart to pay there. It’s a straightforward and transparent process, particularly if you need access to bad credit financing.
Read our full review of OneMain
How We Picked the Best Personal Loans
We reviewed countless lenders to come up with the best places to get a personal loan online.
To make it to our list, each lender had to meet the following five criteria:
Diversity in loan options
Wide borrower approval rate
Dependability & Customer Service (or strong reputation and reviews from borrowers)
Competitive loan rates — because regardless of what you’re using the personal loan for, you want it to cost as little as possible
Special features, since many online lenders provide convenient benefits and services for borrowers.
Note: Geographic availability was also an important factor we considered.
Because each state has different regulations, many lenders only focus on a few select locations when they first open. Then, as they gain traction, they move into more and more states. We know our readers live all over the country, so we focused on lenders with a large geographic footprint.
Financial emergencies happen to the best of us, which is why it’s always a good idea to set aside an emergency fund. But if you don’t have an emergency fund, it’s also possible to take out a cash advance loan to cover the expense.
However, this can be challenging for individuals with bad credit. You may have a hard time getting approved for a personal loan, and if you are approved, you may get stuck with terrible interest rates. This is why many people turn to cash advance loans.
A cash advance loan is a short-term loan that is meant to provide temporary relief from financial problems. This includes things like payday loans or cash advances from a credit card. This article will go over some of the best options available to you.
5 Short-Term Cash Advance Loans to Consider
Short-term loans are given in smaller amounts, and the loan term won’t be longer than a few months. These loans are easy to apply and qualify for, even if you have bad credit.
You’ll apply either online or in-person, and the application process is usually pretty quick. Once you’re approved, the lender will give you the cash, minus any fees. The fees for short-term loans are based on the amount you’re borrowing.
If you’re in a true emergency, need access to cash, and don’t want to take out a payday loan, it could make sense to get a cash advance loan. But you’ll want to make sure you compare lenders and understand the terms and conditions.
Short-term lenders tend to charge incredibly high fees that can trap you in a cycle of debt. There being said, if you need to take out a short-term loan, here are five options you can consider.
MoneyMutual is an online lending marketplace that connects borrowers with lenders across the country. You can apply for a cash advance loan of up to $2,500 and receive the funds within 24 hours. The online application process is quick and easy to complete.
The rates vary depending on a borrower’s credit score, but consumers with bad credit are welcome to apply. However, you will need a monthly income of at least $800, and MoneyMutual is not available to borrowers in New York.
Read our full review of MoneyMutual
CashUSA is another online lending marketplace that helps consumers with bad credit access cash advance loans from $500 to $10,000. APRs range from 5.99% to 35.99%, with repayment terms up to 72 months.
If you use CashUSA, the application process is easy, and you’ll receive a decision within minutes. The funds will be deposited in your bank account, and you can get your money in as little as one business day.
Read our full review of CashUSA
CashAdvance is a one-stop-shop for short-term cash advance loans. The company will connect you with its network of lenders and offers loans up to $1,000 or more. You can apply online. It’s very quick and easy.
To qualify for a loan through CashAdvance, you have to be at least 18-years-old and earn at least $1,000 per month after taxes. Your repayments will be automatically deducted from your checking account every month.
Read our full review of CashAdvance
Bad Credit Loans
Bad Credit Loans has been connecting borrowers to its network of lenders since 1998. You can apply for a loan between $500 and $5,000 and receive the funds as soon as the next business day. The interest rate ranges from 5.99% to 35.99%, depending on your creditworthiness.
It’s easy to apply for a loan and you have a good chance of being approved, even if you have bad credit.
Read our full review of BadCreditLoans.com
PersonalLoans.com is another lending network but unlike some marketplaces, it is available everywhere in the U.S. You can apply for a loan between $500 and $35,000, so this is a good option if you need a more substantial loan amount.
The interest rates range from 5.99% to 35.99%, based on creditworthiness. The application and approval processes are quick and you can receive the funds as soon as the next business day. However, if you’re looking to borrow a large sum of money, the approval process may take longer.
Read our full review of PersonalLoans.com
3 Credit Card Cash Advances to Consider
The installment loans above may require a credit check. If that doesn’t seem like the best option, you can also consider a credit card cash advance.
If you have the funds available on your credit card, this could be an easy option for you. However, not all credit cards allow cash advances, and those that do tend to charge very high fees. And once you’ve taken out the money, interest will start accruing immediately.
To receive the money, you can visit your local branch. If you’d rather make a cash withdrawal from an ATM, you’ll need to call the bank and set up a PIN. Listed below are three credit cards that may be good for cash advances.
PenFed Promise Visa Card
PenFed Credit Union issues this card. Borrowers with a fair credit score can qualify for this card and the APR range is 11.24% to 17.99%.
PenFed doesn’t charge cash advance fees on any of its cards, which is pretty uncommon. Most credit cards charge cash advance fees between 3% and 5%. It will charge interest on the amount you withdraw, though.
Capital One Platinum Credit Card
This card is easy to apply for and available to borrowers with less-than-ideal credit. The regular APR is 26.96%, which is on the high side, and it doesn’t offer an introductory APR.
But you will have access to cash advances, and the company charges a 3% cash advance fee. This isn’t as good as what PenFed offers, but it’s lower than some.
First Access Solid Black Visa Credit Card
The First Access Solid Black Visa card isn’t going to be your best option, but it is available to borrowers with a poor credit history. The APR is 34.99%, which is much higher than what other credit cards charge. But if you need to take out a cash advance, there are no cash advance fees other than the interest.
Things to Keep in Mind
Sometimes, financial emergencies are unavoidable and you’ll need to find a way to get through them. A short-term loan or cash advance can be a way to close the temporary gap in funds.
Just make sure you repay the loan and begin working on building up your savings. This will help you avoid getting into this situation again in the future. And here are a few things you should consider before borrowing money from anyone:
Have a plan for how you’ll repay the money
See how the Better Business Bureau rates the company you’re considering
Read the terms and conditions before agreeing to anything
Make sure you know exactly what fees you’ll end up paying on a cash advance
Attending college or university is a dream for a ton of people. Yet higher education can be expensive, seemingly putting that dream out of reach for many students and families.
Tuition at American schools has steadily increased for decades, so it can be hard for your average student to afford it. But it’s not only tuition costs that you need to consider: fees, room and board, off-campus living, meal plans, textbooks, living essentials and other supplies all cost money.
Fortunately, there are many different types of financial aid available to help you meet the total costs of attending school.
Grants, scholarships and government programs can all be used to aid your pursuit of higher education. Student loans, including private and federal loans, are also commonly used to fund college. But taking on debt requires more financial planning than other types of aid.
If you’re ready to find the right loan for you and your unique financial situation, we’ve got you covered. We’ll go over everything and anything we think you need to know about subsidized student loans—the basics, how they’re different from unsubsidized loans and much more.
Student Loans and Rising Education Costs
Having a plan for how you’ll pay for college is pretty important. That’s mostly because the tuition continues rise:
According to The College Board, tuition and fees for a public four-year institution in the academic year of 1989–90 were $3,510, in 2019 dollars.
For the academic year 2019–2020, those costs exceeded $10,000. In the same time span, tuition and fees for a private four-year institution rose from $17,860 to nearly $37,000.
In the last 10 years alone, tuition and fees for four-year public schools have increased $2,020, while costs for four-year private schools have grown $6,210.
But as we mentioned, total costs include a lot more than tuition, and these other cost items have shown the same upward trend:
Data from the U.S. Bureau of Labor Statistics (BLS) shows college textbooks costs increased 88% from 2006 to 2016.
Average dorm costs at all postsecondary institutions were $6,106 in 2017, per data from the National Center for Education Statistics (NCES). Boarding costs, including meal plans, were $4,765. A decade earlier those costs, respectively, were $4,777 and $4,009.
Costs rose 24% for students living off-campus at public four-year universities between 2000 and 2017, according to The Hechinger Report.
The growth in college costs has occurred rapidly, outpacing wagegrowth. This has made a degree unaffordable for many. That’s where student loans come in.
The biggest source of these loans is the federal government. According to Sallie Mae, more than 90% of student loan debt today is tied to federal student loans. While the government offers several loan types, often based on financial need, private lenders such as banks and credit unions also make student loans available.
What is a Subsidized Loan?
To better understand your loan options, let’s explore the specifics of one of the government’s most popular offers: the subsidized student loan.
Officially, a subsidized loan is a type of federal loan offered through the U.S. Department of Education’s Direct Loan Program and referred to as a Direct Subsidized Loan. They are made exclusively to undergraduate students who demonstrate financial need and can be used to pay for college, university or a career school.
Subsidized loans work like most other student loans. They allow college goers to borrow money as they learn, paying the principal and interest back later. Most loans don’t require repayment while you attend school, and provide a grace period of six months after graduation for you to find a job.
The most notable feature of subsidized loans is that the government pays the interest while you attend school at least part time. This is a quality that’s pretty much unique to federal subsidized loans.
The government will also pay the interest during the grace period and during periods of loan deferment. You eventually assume responsibility for paying the interest, and principal, once you enter the repayment plan.
The bottom line for subsidized loans is they carry a lower lifetime cost, because the government pays interest while you’re at school.
Who’s Eligible to Take Out a Subsidized Loan?
Subsidized loans aren’t available to everyone, however. In addition to meeting basic requirements for getting a loan from the federal Direct Loan Program, applicants for subsidized loans must:
Demonstrate financial need.
Be an undergraduate student.
Be enrolled at least half time.
Anyone considering a subsidized loan must fill out and submit the Free Application for Federal Student Aid (FAFSA) form. This is how the government will establish whether you demonstrate financial need that is sufficient for taking out a subsidized loan.
What Else Should You Know?
There are two other main points to discuss about subsidized loans—loan limits and time limits. Ultimately, your school will decide how much you can borrow. But there are annual limits to what you can borrow through subsidized loans, as well as a maximum for the entirety of your college career.
In your first undergrad year you can borrow up to $5,500 through federal loan, no more than $3,500 of that amount can be through subsidized loans.
In your second year you can borrow up to $6,500, no more than $4,500 through subsidized loans.
In your third year you can borrow up to $7,500, no more than $5,500 through subsidized loans.
The limits for your third year apply to your fourth year, and any year after that for which you are eligible to borrow through federal subsidized loans.
Factors influencing what you can borrow include what year you are in school and whether you are a dependent or independent student.
Importantly, you can only receive subsidized loans for 150% of the published time of your degree program. That means if you attend a four-year bachelor’s program, you can only receive a subsidized loan for six years.
What’s the Difference Between Subsidized and Unsubsidized Loans?
Unsubsidized loans are the other type of loan the government offers. While unsubsidized loans and subsidized have some similarities, unsubsidized loans have some major differences.
Interest rates for both subsidized and unsubsidized loans are controlled and set by Congress. This makes the interest rates for government student loans among the lowest you will be able to find.
While the federal government pays interest on subsidized loans, you’ll be solely responsible for paying interest on unsubsidized loans. You’ll have to pay interest while you’re in school and during the grace/deferment period. Here are some other key differences:
Unsubsidized loans are available to undergraduate students, as well as graduate and professional students.
Students don’t need to demonstrate financial need to apply for an unsubsidized loan.
There is no maximum time limit for how long you can receive unsubsidized loans (compared to the 150% rule for subsidized loans).
Annual and aggregate loan limits are generally higher for unsubsidized loans.
Private Loans vs. Federal Student Loans
Interested in how private loans stack up to government loans? In a nutshell:
Private loans can have variable interest rates, which may make them lower in some cases than even fixed interest rates on government loans.
Annual loan limits don’t apply to private loans, as you and your lender will work out a package that is best for you.
Being approved for a private loan means submitting to a credit check, or having a parent as a consigner.
Often, private loans require payment while you attend school, and may not have the allowance for forbearance and forgiveness as government loans do.
Taking the Next Steps Toward Taking Out a Student Loan
If you or your child is nearing college age, it’s time to start thinking about how you’ll pay for higher education. It’s a good idea to look into a few options, including student loans, scholarships, grants and other sources.
If you want to get started on applying for a subsidized loan, get started on your FAFSA form. And if you’re taking a closer look at private student loans, you can find help here.