Cheap Loans: How Much Do They Really Cost?

2007-03-08 10:33:40

( Financial )



Cheap loans are not always cheap. While some people may get their cheap loans at the advertised annual percentage rate (APR), others may not. Loan providers priced their cheap loans using a system called risk-based pricing. This means that they first assess your creditworthiness based on your circumstances and credit history. Based on this assessment, they now decide the APR that will be given to you.

Those with perceived high risk rating will not get the advertised APRs or even the cheap loans. If you’re not eligible for the cheap loans, why not consider a loan consolidator?

Most often, people with damaged credit history are not extended the cheap loans. The best thing that you can do when you really need the loan is to get a loan consolidator. Many loan providers do offer loan consolidators to help you manage your finances.

A loan consolidator is a single loan which you can use to pay off all your other debts, including credit card bills. This is a secured loan since loan providers would require you to put up your property as collateral for the loan as a guarantee of payment.

Because it is a secured loan, companies can give you a low APR for your loan consolidator. This will now enable you to consolidate all your loans and credit card bills into one loan, reduce your high monthly payments, avoid high penalty charges and relieve you of financial pressures.

You can then put your finances in order and rebuild your credit rating. Loan consolidator is also easier to keep track of because you are now only managing one loan.

At times, you just have to take a proactive stance on your nerve-wrecking debts. More and more people are now open to the idea of taking on a loan consolidator to address their financial dilemma. You have to take prompt actions now instead of waiting for the situation to further worsen.


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