BAD CREDIT PERSONAL LOANS? WHICH TYPE OF LENDER TO CHOOSE ?

What is a bad credit loan?

Basically, it is a loan with a very low or bad credit score as a result of defaulting on loan payments, showing R9's on your Equifax report, going into collections and ending up in bankruptcy or consumer proposal. These loans are often called "sub-prime" loans and are perceived as high risk and therefore involve higher interest rates.


Can I get a car or personal loan if I have bad credit?

Yes, there are many sub-prime lenders out there who will advance loans for cars, personal loans and mortgages -- but approval will depend on how much you owe and if you are in arrears.

Also, the amount you can loan will depend on your income, job, length of time on job and if you have the collateral of a paid off car or a home with sufficient equity.

The more collateral, the better your chances of getting a loan at better rates.


Is there a difference between bad credit lenders for personal loans?

Yes. Big differences. See below.

Finance companies which offer loans you are required to repay over one year or more (depending on how much you borrow) with fixed monthly payments including both interest and principal. Some allow you to pay off early and therefore pay less interest.

 Some allow you to postpone payments without charge. Some also help repair your credit score by reporting to Equifax. You receive the highest rating if you pay on time. Ask about each company's rates, credit repair services and charges for holding a payment and if you can pay off the loan early.


Pay day loan companies which offer fast, short-term loans from payday to payday which usually must be paid back within two weeks, or occasionally over a month.

These loans are only meant for short term. If you cannot pay back within that time, your interest will quickly grow not only on the principal of the loan but on the unpaid interest.

 Your interest will skyrocket by hundreds and thousands of dollars depending on how long it takes you to repay.
The difficulty of paying off payday loans which go into default often results in taking out a second loan in order to pay off the first.

In the U.S., 76% of payday loans are repeat loans, or loans that are being used to pay off the original.


Credit card cash advances are often used instead of loans. The problem here is that often only the minimum payments are made and while this seems convenient this practice leads to huge interest charges.

 Also, it will take an extraordinary amount of time to repay your loan.You must read your credit card statement carefully to see how long it will take you to pay back what you owe if you only pay back the minimum amount.


For example, if you make only the minimum payment of $40 on a balance or $2000 -- it would take you 30 years and 10 months to pay it all off and you would end up paying $4931 in interest!

The safest bet is to select the right finance company where you are given time to pay off all your interest and principal, open loans you can pay off early, repayment flexibility when there are problems, and an opportunity to improve your credit score.


Since 1984, Prudent Financial Services has offered the best credit repair services and the lowest-cost rates for people with bad credit histories in Toronto and the GTA. We offer fast same day car and personal loans. Also, Prudent Mortage Corp. offers competive mortgage and home equity loans. For more information about PRUDENT FINANCIAL SERVICES, visit our web site: http://www.prudentfinancial.net


Also, visit Prudent Value Cars, our quality pre-owned car dealership where you can get the car you want and the loan you need all on the same day. Visit our showroom inventory at http://www.prudentvaluecars.com.

WILL PAYDAY LOANS HARM YOUR CREDIT SCORE?

Taking a payday loan might seem like a good idea if you’re in a financial bind.  You can get a payday loan regardless of your credit rating since no credit check is required. But that loan can make your bind a whole lot worse, and eventually damage your credit score. 

What’s your credit score?

Your credit score is a rating of your financial health, at a specific moment. It shows how big a risk you are for lenders, compared with other consumers. The credit bureaus Equifax and TransUnion rate you on a scale from 300 to 900. High scores are very good.  Low scores are very bad.  The higher your score is, the lower a risk you are for a lender.

Credit bureaus use a math formula to calculate your credit score. The formula takes into account such factors as:

●How much money do you owe? Have you ever missed a payment on your debts?

●Have you ever had a collection agency pursue you? Have you ever gone bankrupt? Or been in a proposal or credit counselling?

●What is the limit on your credit card? Is your spending always close to your credit limit? Are you only paying the minimum?

Many consumers worry that if they take out a payday loan, it will harm their credit score.   After all, the mere act of applying for a payday loan kind of screams desperation. However, taking out the loan will not hurt your credit score because pay day loan companies do not report to the credit bureaus. But what happens afterwards certainly could!

It can be very difficult to pay off these loans, because they are much more expensive than other kinds of credit.  For example, borrowing $100 for two weeks can cost a fee of $21, which is like paying an incredible 546% annually. You would never take out a bank loan that carried a 546% annual interest rate or use a credit card with that kind of interest rate on unpaid balances.

What if you can’t repay on time?   

If you don’t manage to pay on time – within a week or two -- interest begins to accumulate not only on the principal of the loan but on the unpaid interest. Your interest charges will skyrocket by hundreds and thousands of dollars, depending how late you are in paying. 

The difficulty of paying off the payday loan often results in taking out a second loan in order to pay off the first.  In the U.S., 76% of payday loans are repeat loans, or loans that are being used to pay off the original. 

If you debt spirals out of control and you default on your payday loan, you will be in serious trouble. The lender will pass the loan on to a collection agency. If you are unable to pay when the agency tries to collect, it will report your delinquency to the credit bureaus -- which will almost certainly lower your credit score. A damaged credit score will make it even more difficult to get credit in the future.

Here’s another downer: Payday loans, even if they are repaid on time, do not help repair your credit rating, because the payday lenders do not report to the credit bureaus exceptif you go into collections. 

Most finance companies, however, do report your loan payments regularly to the credit bureaus, and you receive the highest credit rating when you pay on time.  So at loan companies, you are re-establishing your financial credibility.
Prudent Financial offers the best credit repair services and the lowest-cost rates for people with bad credit histories in Toronto and the GTA.  For more information about PRUDENT FINANCIAL SERVICES, visit our web site: http://www.prudentfinancial.net

Don’t Pay Only the Monthly Minimum on Your Credit Card-Part Two

Don’t Pay Only the Monthly Minimum on Your Credit Card-Part Two

You may think that when you pay on time the minimum amount due on your credit card at the end of each month, you’re being financially responsible. Think again.

In our first episode we talked about how does the long repayment works.

This episode will go in depth regarding how paying only the minimum monthly payment can cost you a huge and unnecessary amount of interest in addition to repaying the original sum.

Skyrocketing Interest

Say you’ve got an outstanding balance of $2,000 on your card. Your minimum payment would initially be $40 (2% of $2,000).

If you make only the minimum monthly payment of $40, it would take you 30 years and 10 months to pay off your balance and you would end up paying $4,931 in interest!

You would be much better off financially if you could increase your monthly payment to $100. So then, you would need only two years to pay off the balance in full and you would pay only $395 in interest!

That’s a saving of $4,535 !

So, upping your monthly payment by even a small amount can save you a whopping amount of interest.

In our final episode of this series we’ll discuss how the minimum payment is applied.

For more valuable financial advice, please visit us at prudentfinancialservices.net

What Is A Bad Credit Score?

Getting your credit score won't be very helpful if you don't actually understand the meaning of the term. Then, what is a personal credit score? When we mention credit scores we usually mean the figure that is generated by a particular formula on the basis of the data contained in your credit report. The credit score is used by the lenders to determine the risk. The higher your credit score is, the better the risk you are. This means that you are less likely not to repay the loan or to default. Various credit scores are based on different scales, however, the figure typically ranges from 400 to nearly 900. Thus, the credit score of 700-800 means that you are a rather good risk.

What Does Bad Credit Mean?

If your credit score is near 400 points, you are considered a poor risk for the loan lenders. There are actually different ways to decide what a bad credit score is, though in most cases scores in the 500s and low 600s put consumers in the worst risk category considered by the lenders. This means that you may be approved only for loans with no credit check.

Anyway, bad credit score is not the end of the world. It just means that you are not is a good position to apply for a loan. Whether it is a personal loan, credit card, mortgage or a car loan you will face a measured access to the funds and you will be charged excess fees. Lenders need to protect themselves, therefore, if your credit score is bad there is a strong possibility that you won't be paying a debt as agreed. In most cases it will be difficult to get your application approved. However, if the amount you need is rather small, you may turn to no credit check loans payday.

What Can You Do About Bad Credit?

 

In order to improve your credit ratings, change your repayment and borrowing practices. All you need is to prove your creditors that you can build positive credit habits for a long period of time. If you have late payments or defaulted on some loan, it is the right time to make good. In case your credit cards are spent to the maximum, it is a proper time to pay down the balances to less than 30% or "credit utilization. The picture of a credit is individual and differs depending on many factors, thus, it is a good idea to check your credit score at least once a year.

How to Improve Your Credit Rating?

How long will negative effects of bankruptcy affect your credit rating?
There is not a one-sized fits all solution for this question. However, it is important to know that your credit rating can be restored through the right channels.
When you go through a bankruptcy or other large scale social event, you will be able to recover from it within a certain period of time provided you follow the rules of good credit going forward.
The maximum amount of time you can expect to have negative information about your credit history on your account is seven years, but the actual time can vary depending on the event and where you live.

Improving your credit rating will require you to make certain behavioural changes that will help you get ahead. First, you have probably heard this, but you should heed it and always pay all your bills on time. It is better to go without in other areas of your life if you need to in order to pay your bills on time if improving your credit rating is important to you.
If you can't pay your entire bill on time, at least pay the minimum due to avoid future negative credit ratings that will hurt your credit rating and your chances for financial success.

There is another way to improve your credit rating which is called a secured credit card. If you can put down a big chunk of money, say $1000 or more, then you will be able to get a secured credit card. This will make it obvious that you are able to be responsible with credit and that you have good income coming in. A secured credit card is a great way to quickly improve your credit rating.

All in all, it takes time to recover from incurring bad credit. This is not a situation that occurred over night and it doesn't get fixed over night. It is important to remember not to make too many applications for credit when you are trying to recover your credit because every time you are denied it is another black mark on your credit rating. The best thing to do when you are trying to recover your credit rating is to keep a careful eye on your spending.

Don't spend too much and put as much as you can into your bills and staying out of debt. Start to do that and it will heal your credit rating in the long term. For more valuable information, visit www.prudentcreditrepair.ca

Here's Some Things You Need to Know about Bad Credit Loans

Sometimes, no matter what you do, you still find yourself in a bind with financial difficulties. Often the only to recover is to apply for bad credit loans. There are many offers on the market today that claim to be there to help you out of your troubles, but you have to always be cautious when you are trying to rebuild your credit. One of the first steps to take is to research all of your options to get the very best interest rate with and the longest repayment period. This will allow you to be able to better manage your current income.

You’ve already checked with your bank. They've indicated your current credit score is a problem. Even though many people believe there would be no way a bank would give them bad credit loan, if they are willing to work closely with the people who already know them, it is often possible to get the lowest cost bad credit personal loans right from the bank they are already doing business with. If nothing else, you can take the information you get from your bank and compare it with other offers you may obtain. It does take time to comparison shop, but it is well worth the investment of time.

If you are looking for bad credit loans to get you out of your current financial bind, be sure to look past the headlines in advertisements. Some lenders may seem to be offering incredible rates to all their customers; you have to remember that these may just be teaser rates to get people in their offices. Once you are there the old bait and switch tactics take over, and you may find the rates for loans after a proposal may be a lot higher than you expected. It is always the best idea to shop around, no matter where you are looking for a loan.

There is something else you must know when getting bad credit loans. When you take out a loan with a long term payback period you will be paying extra in interest and any fees that apply. If you can afford to do so, it would be a good idea to make that payback period as short as possible. Remember you are trying to save money no matter what you are doing. However, if you must keep the monthly payments low, more time to pay the loan may be the best option for you. That way you will be able to make the rent, car payment, and put groceries on the table.

For more valuable information, visit www.prudentcreditrepair.ca

Here's Some Things You Need to Know about Bad Credit Loans

Sometimes, no matter what you do, you still find yourself in a bind with financial difficulties. Often the only to recover is to apply for bad credit loans. There are many offers on the market today that claim to be there to help you out of your troubles, but you have to always be cautious when you are trying to rebuild your credit. One of the first steps to take is to research all of your options to get the very best interest rate with and the longest repayment period. This will allow you to be able to better manage your current income.

You’ve already checked with your bank. They’ve indicated your current credit score is a problem. Even though many people believe there would be no way a bank would give them bad credit loan, if they are willing to work closely with the people who already know them, it is often possible to get the lowest cost bad credit personal loans right from the bank they are already doing business with. If nothing else, you can take the information you get from your bank and compare it with other offers you may obtain. It does take time to comparison shop, but it is well worth the investment of time.

If you are looking for bad credit loans to get you out of your current financial bind, be sure to look past the headlines in advertisements. Some lenders may seem to be offering incredible rates to all their customers; you have to remember that these may just be teaser rates to get people in their offices. Once you are there the old bait and switch tactics take over, and you may find the rates for loans after a proposal may be a lot higher than you expected. It is always the best idea to shop around, no matter where you are looking for a loan.

There is something else you must know when getting bad credit loans. When you take out a loan with a long term payback period you will be paying extra in interest and any fees that apply. If you can afford to do so, it would be a good idea to make that payback period as short as possible. Remember you are trying to save money no matter what you are doing. However, if you must keep the monthly payments low, more time to pay the loan may be the best option for you. That way you will be able to make the rent, car payment, and put groceries on the table.

For more valuable information, visit www.prudentcreditrepair.ca

Start Up Loans for People with Bad Credit

Constantly being declined as a result of your bad credit can be extremely frustrating. A personal loan is one of the most effective means for re-building credit. So what steps should you take to restart your path to financial success?

Getting a loan with bad credit may seem hard to accomplish but it’s extremely common nowadays. There are many lenders who specialize in bad credit loans. The catch is that the interest is fairly higher than if you had a great credit score. With that said, this is a great way to get your start up to a healthy credit history.

If you’re approved to get a bad credit loan, you will get the chance to build your credit history. Building a good credit history is important because it not only makes you fit for all sorts of loans but it also helps you get the best rates available. For every loan you take out and make consistent on time payments, you will increase your credit score by proving payment responsibility.

There are two types of bad credit loans, secured and unsecured. A secured bad credit loan is a loan which is given to someone with bad credit and is secured by an asset owned by the borrower such as a car. This type of loan generally has a lower interest rate the risk to the lender is lower as they can collect on the collateral should you default on your payments. An unsecured bad credit loan is tougher to get because there is no collateral. The lender basically relies on your promise to pay the loan back and because of this, you present a greater risk to the lender and therefore interest rates are higher.

Rebuilding your credit is a process. Financial institutions like banks want to see how well you can manage repayment on a loan over a period of time. Some of the major reasons for bad credit issues is paying only the minimum on your credit cards or taking out a short term loan when you require a longer term to pay it back.

Prudent Financial Services doesn’t just provide loans to people with bad credit histories but go several steps further than the competition to help you repair your credit by regularly reporting to Equifax. Prudent encourages customers to talk about anything that will affect your loan payments and Prudent will work with you when bad things happen.

For more information, visit www.prudentcreditrepair.ca

The Cost of Bad Credit

A good credit score is an important thing to have but it’s difficult to maintain. Living without credit or bad credit is becoming more common and most wonder what the big deal is if I have a low credit score?

Credit card payments and the level of debt have the most impact on your credit score. The information contained in your credit report is also used by many financial calculations. This means that a lender will not only view your credit score but will combine your monthly minimum payments reported by your creditors and compare it to your monthly gross income. This is known as a debt to income ratio and is as important as your credit score.

If you’re deep in debt, living paycheque to paycheque or are constantly charging things on your credit card, this will make your life extremely difficult from getting a job, your children following in the same footsteps to getting a place to live.

Here are some of the costs of living with bad credit:

1. A big consequence with having bad credit is the denial for a loan. Being denied for a credit card or being denied for a home mortgage when you need it will not only cause you to get denied but it will also be embarrassing for you and affect you emotionally.

2. Creditors and lenders will view you as a higher risk and because of this you will be paying for that through higher interest rates. Over time you’re paying a lot more than if you would have should you have had better credit.

3. When you want to rent a home or apartment, you may be refused as most landlords will check your credit prior to offering you the lease. If you have poor credit, the landlords will think you’re less likely to pay them and will refuse you.

4. If you have a history of living without credit that is good, you will require to pay a large security deposit for things such as utilities and cell phones.

5. The decisions you make will affect your children. They watch what parents do and financially and there is a great chance that they will follow suit.

6. Another big consequence that will directly impact you and your family is worry and anxiety. This kind of stress can lead to all sorts of health issues for you and even cause problems in your family life.

Poor financial decisions can ruin your credit fast so if you want to maintain an impressive credit score or you want to improve it, make your payments on time and include a little extra each month to help pay down your debt. Keep all your accounts open as an open account without a balance is more beneficial than a closed one and also don’t open any new accounts.

For more valuable tips and information, visit www.prudentcreditrepair.ca

Bad Credit Loan Approval In Toronto? Does That Even Exist?

Yes, even those with bad credit can be approved for loans in Toronto. A history of having had bad credit is much less important than not having dealt with the past debt that they made late payments on.

Once you have dealt with bad debt, you can finally begin to recover from it. So how do you deal with bad debt? Well there are a number of ways.

If the amount of the debt would be surmountable, if your creditor were to reduce it, you could propose a settlement to your creditor.

If the amount of the debt is in surmountable you could also consider speaking to a trustee in bankruptcy about viable proposal and bankruptcy options.

You could also speak with friends and family to see if you can raise the money privately to deal with the debt.

If you have bad credit, good income and job stability but the debt is less than $5,000, there are finance companies in Toronto that may help you with a small consolidation loan.

Once you have dealt with your past bad debt you can begin to rebuild your credit. You present less of a threat to potential creditors having demonstrated that you didn’t just default on your debts, but in fact you resolved them.

It is true that since the recession in Toronto there are much less options for a consumer who has had problems with credit. It is also true that the recession has shown the financial industry that individuals who have had credit problems during this period, didn’t simple “choose” to go into default and that the economy was a large factor.

For more information on how to deal with your debt and qualify for a bad credit loan visit www.prudentcreditrepair.ca

Need A Loan But Have Bad Credit?

There are thousands of Canadians with bad credit. Are you one of the many Canadians who have made some financial mistakes causing your credit rating to suffer? If so, don’t get discouraged. There was a time where one who had a bad credit score would have no options but currently there is a huge market for bad credit loans. Most banks and financial institutions will not loan money if you have a poor credit score, however, today there are other alternative lenders who will lend money to people with bad credit.

First and most important thing to remember is to be cautious of which lender you will borrow from. Once your credit rating is damaged, you’re considered a high risk and lenders will charge you a higher interest rate in return for them taking a chance on lending money to someone who could possibly not pay back the loan. This does not mean that you should borrow money without researching your best option though.

You may think the only way to borrow money is through a payday loan center. Payday loans give out fast and convenient loans but this comes with a great cost. You will be charged an extremely high interest rate as well as other charges and fees which could ultimately cause you bigger financial hardship. It’s extremely easy to get caught up in a payday loan spiral.

When you’re looking for a loan due to being a previous bankrupt and are having a hard time finding a decent interest rate, just need to rebuild your credit or need quick emergency funds, you’ll need a good plan of attack for borrowing. It’s strongly recommended that you choose a lender that can and will offer you a good interest rate and also help you rebuild your credit.

Cleaning up your credit rating is crucial. It represents your financial health and the risk you are to lenders. It can save you lots of money when purchasing a car, getting a mortgage, renting etc...so choose a lender that doesn’t just provide loans to people with bad credit histories but will go steps further and help you repair your credit by regularly reporting payments to Equifax.

For more information on loans, rebuilding your credit and more valuable information, visit www.prudentcreditrepair.ca

Getting sucked into the Payday loan spiral

You hear and see the payday loan advertisements everywhere. At every corner and all over the internet you will see” Borrow $500 in 15 minutes, no credit check required!” Sounds convenient and easy right? In reality, it really is that easy HOWEVER it’s easier to get sucked into the payday loan spiral.

The Problem

The problem with a payday loan is that you’ll become trapped in a web that’s impossible to escape. With a payday loan you are borrowing against a future pay. The interest rate is extremely high so when 2 weeks roll around and you can only afford to pay off the interest, you carry the loan forward and then the next pay turns into the next pay and before you know it, you’re not paying off the loan and wasting ALOT of money on interest.

What To Remember

You must remember that a payday loan company is disguised as a beneficial route for you but they are happiest when you’re paying them a good chunk of money on interest rather than paying off your loan. This is how they survive. You must also keep in mind that if and when you default in payments, it will be reported to the credit bureau and your credit score will be tarnished.

What Are My Options

You should avoid taking out any more payday loans, seek other alternative lenders that offer a better interest rate. More traditional lenders will even help rebuild your credit by reporting all payments to the credit bureau.

Since 1984, Prudent Financial Services has been specializing in repairing credit with open, affordable, same day loans to discharged and undischarged bankrupts, people whose proposal is almost paid off, or people with paid off debt who still have bad credit scores.

Save your money, your credit rating and your financial health. For more valuable tips and information, visit our facebook page at www.facebook.com/prudentfinancial

Think smart. Think Prudent.