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When seeking car loan approval, understanding credit score requirements is essential. A good credit score can significantly influence the terms of your loan. Lenders often use credit scores to assess the risk of lending money. A higher score typically leads to lower interest rates and better loan conditions. Lenders categorize credit scores into different ranges. […]

When seeking car loan approval, understanding credit score requirements is essential. A good credit score can significantly influence the terms of your loan. Lenders often use credit scores to assess the risk of lending money. A higher score typically leads to lower interest rates and better loan conditions. Lenders categorize credit scores into different ranges. […]

WHY A $500.00 LIMIT CREDIT CARD HAS A BIGGER IMPACT ON YOUR CREDIT SCORE THAN HAVING A CAR LOAN: Having both an auto loan and a credit card in your name will impact your credit score, but the revolving credit account (your credit card) will play a bigger factor in your score’s calculation. Here’s why: REASON 1: Revolving credit is highly influential when calculating your credit utilization rate or the percentage of your total credit that you’re using. Your credit utilization is the second biggest factor (after payment history) that makes up your credit score. As you keep paying off your revolving balance on your credit card, your credit score will go up and you’ll free up more of your available credit. Whereas with an installment loan, the amount you owe each month on the loan is the same, and the total balance isn’t calculated into your credit utilization. REASON 2: Revolving credit has more of an impact on your credit score because it also offers more “financial clues” into your behavior than installment credit does, Droske says. With a $20,000 auto loan, the borrower can only behave in so many ways: Either they make the monthly payment on time over the term of the loan, or they don’t. On the other hand, borrowers can make lots of decisions when using a credit card — charge a little and pay the minimum, max it out and pay it off entirely, don’t use it at all. How you manage your variable debt tells lenders a lot about how you’ll manage the future debt you don’t have yet.

WHY A $500.00 LIMIT CREDIT CARD HAS A BIGGER IMPACT ON YOUR CREDIT SCORE THAN HAVING A CAR LOAN: Having both an auto loan and a credit card in your name will impact your credit score, but the revolving credit account (your credit card) will play a bigger factor in your score’s calculation. Here’s why: REASON 1: Revolving credit is highly influential when calculating your credit utilization rate or the percentage of your total credit that you’re using. Your credit utilization is the second biggest factor (after payment history) that makes up your credit score. As you keep paying off your revolving balance on your credit card, your credit score will go up and you’ll free up more of your available credit. Whereas with an installment loan, the amount you owe each month on the loan is the same, and the total balance isn’t calculated into your credit utilization. REASON 2: Revolving credit has more of an impact on your credit score because it also offers more “financial clues” into your behavior than installment credit does, Droske says. With a $20,000 auto loan, the borrower can only behave in so many ways: Either they make the monthly payment on time over the term of the loan, or they don’t. On the other hand, borrowers can make lots of decisions when using a credit card — charge a little and pay the minimum, max it out and pay it off entirely, don’t use it at all. How you manage your variable debt tells lenders a lot about how you’ll manage the future debt you don’t have yet.

For individuals with poor credit, securing car loans can be challenging. Fortunately, specialized lenders offer solutions. Borrowers with bad credit history, typically those with FICO scores below 600, face obstacles when seeking traditional loans. However, auto loans tailored for bad credit applicants provide competitive rates and flexible repayment terms. These loans are available from online […]

For individuals with poor credit, securing car loans can be challenging. Fortunately, specialized lenders offer solutions. Borrowers with bad credit history, typically those with FICO scores below 600, face obstacles when seeking traditional loans. However, auto loans tailored for bad credit applicants provide competitive rates and flexible repayment terms. These loans are available from online […]

Why Credit Rating is more important for Loan borrower & lender Credit ratings play a crucial role for both borrowers and lenders in the loan process, and their importance can be understood from several angles: For Borrowers: 1. Loan Approval: A good credit rating increases the likelihood of getting approved for a loan. Lenders use credit scores to assess the risk of lending money. A higher score suggests a lower risk, which can improve your chances of securing a loan. 2. Interest Rates: Your credit rating directly impacts the interest rate you’re offered. Higher credit scores generally lead to lower interest rates because lenders view you as a less risky borrower. This can result in significant savings over the life of the loan. 3.Loan Terms: A higher credit rating might not only get you a loan but can also help you secure better terms, such as larger loan amounts or longer repayment periods. 4.Insurance Premiums and Deposits: Sometimes, a good credit rating can influence other financial aspects, such as lower insurance premiums or reduced security deposits for rentals. For Lenders: 1.Risk Assessment: Credit ratings provide a quick and standardized way to assess the risk of lending to an individual. They give lenders an idea of how likely a borrower is to repay the loan based on their past credit behavior. 2.Pricing and Terms: Lenders use credit ratings to determine the appropriate interest rate and terms for the loan. Higher credit scores generally justify lower rates because the borrower is considered less risky. 3.Credit Policies and Limits: Credit ratings help lenders set policies and limits for various types of credit. For example, they might set credit limits or approve loan amounts based on the borrower’s credit history. 4.Operational Efficiency: Credit ratings streamline the decision-making process. Instead of manually reviewing every borrower’s credit history, lenders use credit scores as a benchmark, which speeds up approvals and reduces administrative costs. In summary, credit ratings serve as a critical tool in the lending process, affecting everything from the approval and terms of loans to the risk management strategies of lenders. For borrowers, maintaining a good credit rating is key to securing favorable loan conditions and reducing the overall cost of borrowing.

There are several reasons why people use loan brokers for their borrowing needs: 1. Access to multiple lenders: Loan brokers have access to a network of lenders, which means they can offer a wider range of loan options compared to going directly to a single lender. This increases the chances of finding a loan that fits your specific needs and financial situation. 2. Time-saving: Instead of researching and contacting multiple lenders individually, a loan broker can do the legwork for you. They will gather your information, analyze your needs, and search for suitable loan options on your behalf. This can save you time and effort in the loan application process. 3. Expertise and guidance: Loan brokers are knowledgeable about the lending industry and can provide guidance throughout the loan application process. They can explain loan terms, help you understand your options, and assist in selecting the most suitable loan for your circumstances. 4. Negotiation power: Loan brokers have relationships with lenders and may have the ability to negotiate better loan terms on your behalf. They can use their expertise and industry connections to potentially secure lower interest rates or more favorable loan conditions. 5. Convenience: Working with a loan broker can provide convenience, as they can handle the paperwork, follow up with lenders, and provide updates on your loan application. This can streamline the borrowing process and reduce the hassle for you. It's important to note that loan brokers may charge a fee or receive a commission from lenders for their services. It's essential to discuss and understand any fees or costs associated with working with a loan broker before proceeding. Needcashplus.com

“2024 loan modifications, led by CRE CLO are on track to surpass a record setting 2023.” 🍀 CRED iQ® “Loan modifications have surged as borrowers worked with lenders to achieve loan extensions and other alterations to their loan covenants.” “Approximately $22 billion in loans have been modified in the past 12 months ending May 31, 2024.” “Over $9 billion in loans have already been modified this year through May, placing 2024 squarely on a path to a record setting year of loan modifications.” “This compares to a total of $16.8 billion that was modified in 2023.” “As of May 31, 2024, the average volume of loan modifications averaged $1.8 billion. April was the busiest month which saw over $3 billion in CRE loan modifications.” “Nearly half of the modification types (46.2%) compiled from CRED iQ loan data fell into the Maturity Date Extension category.” “CRE CLO loans continued to dominate the loan modifications by deal type with YTD cumulative balances of $4 billion, representing 44% of all modifications in 2024.” “The SBLL deal type notched a second-place finish at $3.3 billion (36.4%) YTD through May, followed by conduit loans with YTD totals of $1.6 billion (17.4%).” “The number of modifications in 2023 more than doubled compared to 2022.” “So far in 2024 the CRE CLO category is on track to easily outpace its 2023 print while all other categories run rates are tracking closer to the 2023 benchmarks.” “According to CRED iQ’s 2024 CRE Maturity Outlook, 2024 will see $210 billion in securitized maturities—likely fueling the demand for loan modifications in the second half of 2024.” Link to the full CRED iQ® article here: 👉 https://lnkd.in/g3GFx5h7 🍀🍀🍀

Traditional fully documented home loans are not your only option as a self-employed borrower. Find out about simplified self-employed loans and alternative document loans in our latest blog post. https://lnkd.in/gUJ5sj5V