Weak World Economy Has No Silver Lining
By admin | April 23, 2009
The global economy is "…in the deepest post-World War Two recession by far" (Reuters). In a recent report, the International Monetary Fund (IMF) stated that the global economy is expected to get a lot worse before it shows signs of improvement. This news is no news at all to those that are struggling to pay debts, find work, and gain necessary loans.
As banks drop rates and markets fluctuate, far too many people are left in the lurch. Hundreds have turned to credit cards for financial support. More still have turned to traditional lenders only to be turned back out on the street once more. Future economic projects remain optimistic, though these projects are consistently adjusted in light of the ongoing global economic state.
It is entirely possible that an end to this worldwide recession might not be anywhere in sight. This is not good news to anyone left scrambling for funds. Previously, a poor economic state meant that the average person was impacted the most. This time around, the state of the current global economy has touched upon all people, businesses, and even banks. Mark Carney (Bank of Canada Governor) recently stated that "the global recession has intensified and become more synchronous since the bank’s January monetary policy report update, with weaker than expected activity in all major economies" (Globe and Mail).
Traditional lenders are no longer approving numerous loans based upon the sheer fact that they are no longer confident that these loans will be paid back. This means that even those people will outstanding credit could be turned away for a loan. In response to this bank crisis, more and more people are beginning to look towards alternative loans. Since alternative lenders don’t rely upon past credit histories, these lenders can afford to take a chance on borrowers from all walks of life.
Alternative lending companies base their loan applications upon criteria such as a present full time job and some form of collateral. Regardless of bad credit marks, these companies are still willing to give out loans. This is comforting news to those consumers that are desperately seeking a loan. While there is no end to the present state of the global economy in sight, consumers in need of loans are not without hope. Traditional lenders aren’t willing to gamble on consumers at the moment, but alternative lenders are providing a bit of hope within this bleak economy by approving bad credit loans.
Posted in Fixing Bad Credit, Reducing Debt
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The Problem with Credit Card Debt
By admin | April 8, 2009
According to Equifax Canada, the number of consumers that cannot pay their outstanding credit card bills is rapidly increasing (CBC News). With banks constantly slamming doors in consumer faces, many people find that credit cards seem to be the answer to money problems. Canadian consumers are consistently turning to credit cards to pay for car repairs, home repairs, and even everyday items. The problem with credit card debt is that this type of debt is a lot like quicksand for many consumers.
In the past, most Canadians hardly had any type of credit card debt, but this is all changing due to the current state of the economy. While banks are slashing rates, this hardly ever trickles down to the average consumer that is desperate for a helping hand in the form of a loan. In fact, during this year alone "…there was a 7.3 per cent increase in the national consumer delinquency rate… (CBC News)." This statistic has left a lot of Canadians with a massive amount of debt that seems to have no end.
While some consumers are desperately trying to dig themselves out of credit card debt, other consumers are beginning to realize that there are some alternatives to high interest rate credit card usage. Those that need loans are starting to look towards alternative lending options such as private lenders. Various private lenders are still offering great rates to most consumers - even those that do not have an ideal credit history. In almost every case, this is a far better option than "maxing out" any credit card.
In addition to providing great rates to consumers, these lenders also provide an easy repayment plan. Unlike constant credit card use, a onetime private loan can be repaid simply. Most private lenders work with consumers to come up with repayment terms that both parties can agree upon. After a loan has been paid in its entirety, a borrower is then free from any further payments.
Canadian consumer debt is higher than it ever has been before. While most consumers don’t wish to use their credit cards as a form of loan, this often seems like the only available option. As traditional lenders continuously deny loan applications, many consumers have begun to turn towards private lenders. While the Canadian economy is still struggling to get back on its feet, private lenders are as solid as they ever were. This is great news to consumers that want to gain a loan, but don’t want to rely upon high interest credit cards to survive.
Posted in Fixing Bad Credit, Reducing Debt
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Are Bank Loans Really Your Best Bet?
By admin | April 2, 2009
"Canada is on track to post one of the worst economic performances in its history…pushing the central bank to go beyond interest rate cuts…" (Reuters). This is good news for consumers looking to apply for a bank loan. However, this doesn’t necessarily mean that banks are willing to give out those loans. In fact, fewer loans are being doled out to consumers with great credit, let alone those that do not have perfect credit. This leaves a lot of people in a sort of lurch. On the one hand, banks are slashing interest rates left and right. On the other hand, those same banks aren’t exactly handing out loans.
Where does this place the consumer that’s hoping to obtain a loan? Perhaps the best hope for loans in this economy is to look at alternatives to traditional lenders. Private lenders are still giving out loans to those that need them, and most of these lenders don’t rely upon past credit histories to determine an approved loan application. In fact, many private lenders are opening up their doors to those that have been rejected by the banks. As more and more consumers are discovering, seeking a private loan through an alternative lender is one of the few ways to secure a loan in today’s economy.
While banks are continuously fluctuating between approving loans and denying them, private lenders have managed to remain stable. Some consumers may choose to wait out this recession in the hopes that banks will soon start approving loan applications once again, though this wait could be a long one. Millan Mulraine (economics strategist at TD Securities) recently stated that "there is no getting away from the fact that the Canadian economy is in the depths of a rather profound economic recession…it clearly appears that the economy may have taken a dramatic turn for the worse" (Reuters).
With no end to the current recession in sight, banks aren’t likely to start approving loan applications any time soon. Borrowers that need money right now aren’t likely to wait for banks to begin doling out loans once again. Instead, well-informed consumers are looking to private lenders to gain the funds that they need. This push towards private lenders is backed by the fact that these alternative loans don’t require massive amounts of paperwork and excessive credit checks. It’s safe to say that those weathering the traditional loan storm should begin looking to alternative sources, or be swept away by the continuously tumultuous economy.
Posted in Car-Title Loans, Lending
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