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What is a bad credit?

August 21, 2006

Bad credit is a sign of danger for loan borrowers. Bad credit arises when as you are incompetent in meeting your debt repayments on time. There are many reasons for which you get the tag of a bad credit holder such as unpaid credit card bills, late payments, CCJ’s and IVA’s taken, bankruptcy faced etc. All such incidents are reported to credit rating agencies namely Experian, Equifax and Transunion and accordingly these agencies assign you a credit score. If your score is below the mark of 500, you will be considered as a bad credit holder and lenders will hesitate to serve you with their money.

Bad credit history loans - the definition

Bad credit history loans are loans for providing cash support to the people in need for satisfying their needs. These needs could be related to traveling and holidaying or consolidating debts or buying a new home for you. Also you can use the loan amount to start your new business venture for earning better money and making life more comfortable. You can buy commercial properties or fund the wedding or education of your children.

The interest rates and the repayment terms

Banks and other financial institutions will not consider you loan request due to bad credit. So, a recommended option is to go for private lenders to apply for a bad credit history loans. The interest rates on these loans are much lesser than what you get from banks and financial institutions for standard loans. These private lenders offers you flexible repayment terms and conditions and are ready to talk if the borrower is facing any difficulty in making the repayments.

The amount and the period of loans

Bad credit history loans are offered mostly against certain collateral against the loan amount. But these days lender are also ready to offer you amounts from £1000 to £25000 for a period of 6 months to 10 years in absence of the collateral. It is called an unsecured bad credit history loans. On the other hand you can borrow larger amount up to £75000 for a period up to 25 years where the collateral is present.

The application

The option of online application form serves the borrowers with the fastest possible support with reduced paperwork and formalities and quick communication between the lender and the borrowers. The online application form is completely secured avoiding misuse of your personal information. You are required to fill your personal details along with the loan amount required, employment and collateral details (if going for secured option). So, you are done…the lender will review your application and contact you for further assistance.

by Anton Gabriel

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Property Development Loan

August 21, 2006

The group of words “Property Development Loan” is self-explanatory-A loan which is borrowed to develop properties. There are lenders who offer property development loans on the basis of profitability of the property project.

A property development loan is a type of loan offered by a lender, usually bank, to an entrepreneur or for that matter any organization, for development of a property. In this case, like any other category of loan, the lender lends the money for certain duration of time at a certain rate of interest, which becomes the profit for lender. On its part, the borrower agrees to pay within the decided time period in the mutually decided number pf installments. Almost all property development loans are construction linked, which means instead of disbursing full payment at one time, certain percentage of loan amount is given in the beginning and then rest amount is given in phases, a certain percent of the total amount at a time, depending upon the percentage of work done.

One of the most important factors in property development loan is that few lenders ask the borrower to invest his portion of money in project development before they disburse the first installment of loan. Subsequently, lenders pay in the ratio of project completed.

Property development loans In case of property development loans, loan amount depends upon the profitability, viability and risks associated with the property development project. Similarly, rate of interest charged by lenders depend upon the profitability and risks associated with the project.

If the project seems risky or viability is not guaranteed, lenders charge higher interest than a project which is sure to be profitable. This higher interest rate is charged by lenders to compensate against the increased risk associated with the property project. Some of the key features of property development loans are:

Loan amount (criteria varies from lender to lender; some of the common are give below)  Loan amount depends upon project profile  However, usually it is up to 100% of the cost of the project  amount varies between £30,000 and £30 million  Up to 70% of the land cost and 70% of the building costs

Repayment period: Up to 12 months Interest Rates: Variable rates, generally between 2% and 3% above the Bank of England’s base rate. Repayments: On project completion

Therefore, if you want to develop a property, you can borrow loan from lenders who offer property development loans. Money in case of property development loan is disbursed in the ratio of actual construction done and loan is repaid at the end of the project by selling the property or by refinancing the property.

by Steve Clark

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