If you are seeking a loan, make sure your credit history is in good standing before seeking a lender. This way you will be assured to receive the most options and favorable terms for your loan. Once you have confirmed your own financial profile is strong, it will be time to conduct some due diligence about your potential lender.

Here are five questions to ask your lender before committing to a loan. There may be additional questions you have pertaining to your specific situation but these questions will get you started in the right direction:

What Is the Loan Requirements/Process?

Before you start completing paperwork, it is important to contact a few lenders to see your options before committing to a loan. You should inquire about the lending requirements they have set including minimum credit score and income amounts. You should also ask about the loan process so you’ll have sufficient expectations for getting your money.

How Is the Interest Payment Calculated?

When you secure a loan, it is vital to understand the interest rate you will be paying back. If you aren’t careful, you can end up paying more in interest than you do on the actual loan. This is especially true with mortgages. Your interest rate will be determined mostly based on your credit history but you need to be sure you ask the lender how the interest will be calculated. Not all lenders use the same calculation and what you don now can hurt you financially

How Does the Repayment Play Out?

When you take out a loan, be assured it must be paid back. How you pay it back is an important consideration. You’ll need to confirm how much is due each month and how long the term of the loan stands. Some lenders will require a direct payment from your bank account while others will allow checks or online payments. Be sure you know your due date, the length of grace periods before a payment is considered late, and if you are allowed to repay your loan early. Some lenders impose penalties for early payoffs because they lose out on interest.

Is Activity Reported to the Credit Bureaus?

Not all lenders will report back to the credit bureaus with your repayment activity so it is in your best interest to ask first. When a lender reports prompt payment information to the credit reporting bureaus, it keeps your credit record up to date and can improve your credit score provided you keep up the prompt payments.

What Happens if I Skip a Payment?

While no one expects financial hardships to come, they often do happen from time to time. If you are having trouble making your loan payment during a month or for a longer stretch of time, you’ll need to know what happens if you go delinquent on your account. You’ll need to understand the consequences as well as the fees associated with late or missed payments.

5 Pieces of Information You’ll Want from Your Lender was created by and is property of American Consumer News.

Secured Loans
A secured loan is a loan that is secured by items of value that can be seized by the lender in the event of a default on the loan. Also called collateral, the items that are used to secure the loan are often examined by the lender before they approve the loan to make sure that the value of the item is as much as the borrower is claiming it to be. It is believed that holding the ability to seize these assets will reduce the chance of the person defaulting on the loan and if the person does default on the loan, the lender has a chance to reduce their losses by selling the assets used as collateral for the loan.

Secured loans are generally made to people that have a blemished credit history or a lower credit score than the lender is comfortable with. These loans have higher interest rates associated with the loan and the amount of money that is loaned under a secured loan is often less than what could be obtained with an unsecured loans. The lender would rather have the loan repaid under the terms of the agreement, but being able to seize the collateral that has been attached to the loan will mean that the losses suffered by the lender under a default will not be as great.

Unsecured Loans
Unsecured loans, such as Payday loans and Cash advances, are typically viewed as the most desirable type of loan available to people today. These loans are typically made to people that have an excellent credit history, a very good credit rating, and have a high enough salary to easily repay the loan without creating a financial hardship. No collateral is required for an unsecured loan because the person has demonstrated that they will be able to repay the loan and the interest with no problems. For people that have a good history with the lender that they are using to obtain their loan, obtaining an unsecured loan can be accomplished in a short period of time.

The type of cash loans which are offered to the person will depend on many different factors. The lender will look at the credit history of the person to determine whether the person has ever had a problem with paying their obligations on time as well as the value of the items put up as collateral for a secured loan. If the lender determines that the person may be a credit risk, the person will be offered a secured loan but if the lender determines that the risk of default is minimal, then the person will be offered an agreement for an unsecured loan.

Unsecured and Secured Loans: How They’re Different was created by and is property of American Consumer News.

The move is set to help create a stronger economy and more jobs. JPMorgan’s head of business banking spoke to small business owners during the announcement and assured the group there would be ‘no hoops to jump through’ in order to get the interest rate reduction. Small businesses applying for new lines of credit of up to $250,000 are eligible for the program. Also, any existing customers who increase their lines of credit by $10,000 or more will be eligible for the discounted rate.

Small business lending has been a hot topic as of late. There has been more pressure on banks to lend to small business. Creating such loans would help decrease the unemployment rate but bankers have stated they are not finding enough borrowers who are creditworthy for a loan. Some banks, including Bank of America (NYSE: BAC), have suffered sever losses from small business defaults.

After meeting with many small business owners, JPMorgan Chase has found that the morale among small business owners has been improving and many of them are planning to hire with in the next year. Also, it is reported that several banks have started to lend more to small businesses. JPMorgan’s loans have risen 31% since last year for a total of $2.1 billion. Bank of America’s loans also increase 18% from a year ago.

Other banks are considering upping their lending to small businesses including US Bancorp, PNC Financial Services, and Capital One Financial Group. US Bancorp has stated that it began to train 3,000 branch managers in the last two years to handle small business lending. “We really weren’t paying enough attention as we should ” to small-business loans, said Kent Stone, head of consumer support services at U.S. Bancorp

JPMorgan Chase (NYSE: JPM) Offering Hiring Incentive to Small Business was created by and is property of American Consumer News.

On Monday, the Senate passed an amendment that may aid consumers who wish to monitor their credit score without having to pay to do so. The move is part of a Wall Street reform bill that would expand a law already in place which gives consumers the right to access one free credit report annually from the top credit reporting bureaus Experian, Equifax, and TransUnion.

Currently, consumers have access to the free annual credit report which does not include a score. Getting a credit score can only be accomplished by paying up to $15 for each score directly ordered from the credit bureau. Consumers can also get a copy of their score after being denied credit. Another option is for consumers who chose to sign up and pay for a membership in a credit monitoring service and in return get a copy of their credit score for ‘free’.

The amendment will allow all consumers to obtain their credit score. Research shows that approximately 65% of adults with a credit history have not checked their reports in the last year with one-third of adults having no idea where their credit score stands. Without understanding a credit score, consumers can be at risk for being denied credit.

Credit scores are formulated based on a numerical scoring system and in years past a score of 700 was considered good. Now, a score of 740 or better is necessary to get the best loan and mortgage rates. Scores below 680 are borderline good and anything under that can be considered fair to bad. Many consumers fail to realize the exact impact on their credit. A low score not only can lead to a denial of credit, it can also hurt the chances of qualifying for a low interest mortgage, applying for a new job, or renting an apartment. Credit scores also affect a person’s ability to get a good rate for their car insurance as many insurance companies use a credit score to gauge a driver’s responsibility.

If the bill is passed, consumers may be more inclined to view their scores but some wonder if it will be helpful in the big picture. The three credit reporting bureaus use proprietary information to calculate scores and the FICO score is the most used score among lenders. Without additional information, the three digit number may not mean much but many agree it is a good first step.

Are Free Credit Scores Coming Our Way? was created by and is property of American Consumer News.

Jessica Ortego is a small business owner and Peruvian immigrant. She owns a small housecleaning business and prior to joining the Mission Lending Circle of Cesta, had no credit history. In the last year, Jessica has borrowed from the lending circle fund to grow her business, and due to establishing a credit history through the circle, she has also now qualified for a car loan.

Recently, Citibank has shown interest in boosting this program, and is currently investing into The Mission Asset Fund. As of right now this program is only available through OneCaliforniaBank, an Oakland based bank, but with Citibank investing it may become more available nationally.

The program is small, but growing. The program also benefit’s the regions Latino community access to loans, and increases their respective credit ratings. Most Latinos in the program are immigrants with bad credit, or no credit history yet. This program, Based out of Oakland and through OneCaliforniabank, the program has since increased the participants credit scores in as much as 49 points in 3 months time.

The program has shown a zero default rate as of right now, with all 155 participants involved. The average loan is more than $1000 dollars. Since the program was created, more than $216,750 in loans have been provided to 155 group members. The Mission Asset Fund hosts monthly meetings that not only explain how these lending circles are made and how they work, but also hold classes on how to start your own businesses and expand upon your business. It’s kept fair because everyone pays the same amount into the circle, and everyone will get a loan, in turn, and will then pay the loans back to the fund with monthly payments.

With Citibank’s interest, the Mission Asset Fund is preparing to show how the lending program could potentially increase more immigrant communities’ access to credit. Starting in June, the Mission will operate through Citibank instead of OneCaliforniaBank. “Working with Citibank is going to give us the flexibility to work nationally and ultimately gives us a larger infrastructure to work with,” Quinonez said, the director of the Mission organization.

Lending circles have great potential of helping millions of people weary of traditional loans, those unable to obtain traditional bank loans, or who have been burned by the behavior of some of the bigger loaning institutions who cut back lending during the economic downturn.

A lending circle can instill a sense of trust and familiarity. There is very little stress involved seeing how there are no fees, hidden or other wise, and no interest. Its simply friends and family helping friends and family. It would require no co-signer and helps build your credit. The pool is even insured by banks to recover money stolen. It seems like a win-win all around.

Citibank (NYSE: C) Invests in Mission Lending Circles in California was created by and is property of American Consumer News.

Experts feel that while Bank of American is making the effort, they are indeed behind in priorities overseas as many of the major competition have long been established in China or are on the cusp of doing so.  Chinese regulators must approve foreign banks before they can set up a major retail banking presence in the country. Citigroup (NYSE: C) has gone through the approval process some time ago, as have Goldman Sachs (NYSE: GS). Currently, JPMorgan Chase (NYSE: JPM) is working on forming a joint venture to expand its investment banking operations in China.

Bank of America did not choose to take the same route before the financial crisis they underwent. Instead, Bank of America acquired a minority stake and a seat on the board at China Construction Bank. They also opened a Shanghai banking branch but did little else to take advantage of opportunities in China, the fastest growing global market. Bank of America targeted America and expanded its franchise for the East Coast to the West, becoming number one in almost every category of retail banking. They led in mortgages, deposits, and credit cards. This achievement was of little merit during a time of economic suffering and consumer credit defaults.

Moynihan stated ‘”In the past our consumer strategy was to be a sales machine and to measure success mainly on a number of products sold. This served us well. But as our market share rose and the economy fell, the strategies resulted in … too many products sold to customers which weren’t working for them.”

Bank of America has benefited from the government-incentivized refinancing options and its shares have increased tremendously from where they were just over a year ago. Its shares have traded up 12% from the beginning of 2010. The company realizes the need for a real strategy that will help build relationships with wealthy Americans and new partnerships overseas. Time will be needed to build these relationships as well as proof of performance.

Bank of America (NYSE: BAC) On the Fast-Track for Growth was created by and is property of American Consumer News.

For those who have not been guaranteed a full scholarship to their choice of school or who have not been able to put away enough cash in a college savings plan, this is the time to get prepared to find financing.

Experts advise families start now to take the necessary steps for financing the costs of higher education. Here are some guidelines to make the most of the time left:

Start Applying
Too many people are under the false notion they do not qualify for different types of financial aid. There are many scholarships and grants available from local resources like the government on both state and federal levels. They are also available from the colleges being attended.

Get Ready
The FAFSA form (Free Application for Federal Student Aid) is available online at fafsa.ed.gov. Representative say students and families should begin applying by mid-February if this is their first year in college. For returning students, the form should be received in the office by early March. It is advisable to wait until after tax returns for the previous year have been completed and filed so that filling out the FAFSA form is more accurate. Experts also encourage families to complete the form on their own and not seek out special consultant services for help. The fees for help can be exorbitant and unnecessary. The people at FAFSA can assist with the application process for free. Acceptance for FAFSA will likely be available by the end of March so families will know relatively early where they stand and how much they are eligible to receive.

Loans Should Be An Option
Many families are only looking at free scholarships and grants but experts say loans are still a good way to finance higher education. Apply for loan amounts that are not outrageous so they can feasibly be repaid after graduation.

Student Involvement
There are many colleges and universities that offer on-campus working opportunities. Students can find an on-campus job to earn money towards their education and expenses. It is also a good way to socialize in a new environment. Caution should be directed towards off-campus employment because it has been shown to cause distractions and other problems. During busy times like exams and holidays, on-campus employers are sympathetic to a student’s studies and are more apt to being flexible. The same is not always true of off-campus employers.

College-Bound Kids Better Start Securing Financial Aid was created by and is property of American Consumer News.

How can it work against you? Here are just some of the current trends in social networking sites:

Hiding From a Debt? They’ll Find You
Collection agents, not always known for their above-the-line practices, will often scour the internet in search of your contact information. Since many debtors will refuse phone calls or ignore written correspondence, they stand a good chance that active social media players will be online. If you are posting about the new outfit you bought or the great vacation you just took, you can bet they’ll step up their aggressive collection tactics since they know you have the money. While laws will not allow collection agents to contact you through your profile, some will still disguise themselves in order to secure good contact information for you. Some especially unethical agents will even sabotage you on your home page.

Need a Loan? Good Luck
Even creditors have been using social networking searches to find out what kind of risk you might be. Considering a personal loan or a mortgage? Banks and other lenders are getting very tight with their money and outside of your credit score they want to know what kind of person you are and what risk you might pose to defaulting on the loan. While there is no scientific formula for a lender to assess your Twitter account, they may be scared enough about what you say to refuse your loan.

Loose Lips? Lose Your Job
Potential employers can easily do searches on candidate names since social media profiles are often at the top of search engine results. Employers will be looking for negative comments about your current employer, coworkers, and other job-related activities. They can also look at the times you post to see how hard you are really working each day. If you have naughty pictures associated with your profile, they too can cost you a potential position in a company.

Gone Phishing – Took All Your Money
Since people often have no problem typing in a ton of personal information on their home page because they want everyone to know how well they are doing in life, scammers have made a happen of targeting social media users. It’s nice to let friends know who your grandma is but providing her last name will give scammers insight as to what your mother’s maiden name is. This is one of the top security questions people have to answers to gain access to their financial and personal accounts.

Ultimately it is up to consumers to use common sense when it comes to posting information that essentially the world can see. Protecting your information can sometimes be as easy as not providing any. Remember that while your friends can see and appreciate your updates, the whole world can be watching.

Social Networking Can Damage You Outside Your Social Circle was created by and is property of American Consumer News.

Loan Scam

One young woman wanted to secure a loan from an online source.  As she was considered a high risk, it was difficult for her to get the money from conventional sources.  She went online and found a business in Baltimore that just so happened to specialize in high risk loans.

She happily completed the application complete with private Social Security numbers.  She was very excited to have been approved for the loan and was told the money would be coming soon.  She was then asked to make monthly payments as collateral and then the scammers topped up the account with fees. 

Becoming suspicious when the money was not forthcoming, she contacted local law enforcement.
 
Mystery Shopper Scam

Another savvy consumer became wise when he got an invitation to become a “Mystery Shopper”.  A legitimate business where companies higher a ‘secret shopper’ to pose as a customer to record how customer service and products are displayed and then report back to the corporation.  Recording things like how long before you were acknowledged, how long you have to wait in line and if they check in the lower rack of the shopping buggy can be assessed.

This scam however, was no such thing.  In a legitimate situation you do the analysis and then submit the review and any receipts before getting paid.  This was not the case.  And this sceptical person was given a check for $2,980.00 to do a $100 shop at a variety of retailers, fill out an evaluation and then mail it back.  The second step in the scam was to wire $2,000 via Western Union to a New York bank to check to see if Western Union was conducting themselves in a proper fashion.  This is what prompted the consumer to involve the police and shut them down. 

Some Mystery Shopper scammers are even developing relationships by establishing trust through a series of smaller paid audits before asking for the larger Western Union transfer.  The big hole is that once you pass on the money you are on the hook for it. 

Remember that if it is “too good to be true, it usually is”.

Consumers Beware – This is The Holiday Scam Season was created by and is property of American Consumer News.

You know the conventional wisdom about borrowing money from family members or friends? Never, ever get involved on either side. Even if you pay off the loan and everything is “ok” between you, there is still a possibility that things could go wrong. Then, you would be in a difficult position with this person and you might even damage the relationship beyond repair.

Relationships are the funniest things in the world. One minute everything is ok and the next there is a major problem; mainly because people refuse to handle things in a non-emotional way. Often, what should be a small matter gets blown out of proportion.

Now, add in finances into that kind of environment and you see why the fireworks start so quickly and explode into major, relationship-crashing events.

What are the consequences? The consequences are broken friendships or family relationships in which people who were once close, refuse to speak with one another ever again. You have to answer the question “is it worth it?”

But now there might be a different way to make this work.

What has changed? Enter the world of peer-to-peer lending, with a twist: an organization through which the loan is set up and administered. A company that specializes in this type of activity helps set everything up between the two parties, and the arrangements can be made and handled even though you might live miles apart.

Look into www.prosper.com or www.virginmoneyus.com. These two businesses offer to manage loan arrangements between family members and friends. They also offer traditional lending as well.

Known as “social lending,” you will find these services offered: loan documents, electronic funds transfer, email statements, credit reporting, year-end reporting, changes and re-structuring if needed, hand-holding and tough love.

Can this work for you? You might still be skeptical, and you have every right, but there is credibility to this business model and it is working for many people.

The steps to making this happen include: creating a loan proposal and finding someone to lend you the money; then, contacting one of these companies to manage the loan details; and finally, setting up an interest rate and payment schedule and consummating the transaction.

It’s not perfect but it is a giant leap from the normal methods of borrowing from family and friends. At least there is a structure to which both are beholden. Using this can help save relationships and actually make it an enjoyable experience!

Revisiting Loans from Friends or Relatives with Peer-to-Peer Lending was created by and is property of American Consumer News.

Now, the state of Wisconsin is beginning to crack down on payday lenders in an effort to reign in the practices of these types of businesses. The legislature there is about to pass a law prohibiting the charging of interest rates to consumers in excess of 36%. While that sounds high, consider that most payday loan annual rates compute to about 525%. It appears that there is some movement in Washington D.C. to begin to pursue national regulation as well.

The main reason to avoid these types of loans is to keep from paying the high interest rates and charges that are assessed for taking out these loans. But there are other reasons to avoid them, too.

How payday loans work is that you write a posted dated check for the amount of the loan that you need plus the interest. You are given the money you need and then when your pay check comes through, the payday loan company will deposit your check and then on the strength of your paycheck the money is paid back along with the fee.

The consequences. While payday lenders take measures to be sure that they get their money, there is no guarantee that you will be able to pay the loan off if you run into problems. Those problems can be things like illnesses or loss of job. If you are not able to work the hours that you need in order to make the money to pay back the loan, then you will suffer heavy consequences financially.

Rolling loans. Another reason to avoid these loans is because of the rolling loan feature. These companies try to get you hooked on using their services by attempting to sign you up for a rolling loan whereby the current loan you have with them is rolled into another. The snowball effect of this will drain your account quicker than you can imagine.

Questionable collections. If you are in the unenviable position of not being able to pay back your payday loan, you will be subjected to all kinds of harsh collection practices including threats of turning over your posted dated check to police as a bad check. In short they will make your life miserable until you pay them back.

The state of Wisconsin is the only state in the union that does not have an interest rate cap for lenders. That is the main reason that they are moving on this type of legislation so aggressively. But the best way to stay out of trouble with payday loans is to refuse to obtain them in the first place.

Stop by MyPaydayLoanCash.com for safe and secure payday advances today!

One Type of Loan to Avoid at All Costs was created by and is property of American Consumer News.

They have options that can help fit your situation. Your job is to contact several of these institutions and find a loan that will fit your circumstances.  Do not forget to check your local credit union as well.  Banks and credit unions will offer you the best rates available.

Mortgage brokers. Just as an independent insurance agent offers policies from several different companies, a mortgage broker operates on the same principle.  They have many more options and loan products from which you can choose.  Basically, you will pay higher fees with a mortgage banker because that is the way they make their money in the form of origination fees and servicing fees.

These types of lenders have no large bank which backs the loans that they process, so they must use backing outside of their company.  You will find these in the federally guaranteed mortgages of a Fannie Mae or Freddie Mac type.  Most often, once the mortgage has been closed, you will find them selling the mortgage to another bank.  This is merely a transfer and does not change the terms of the mortgage itself.

Determining which one is right for you is not a cut and dried decision.  It is a process that depends in part on your comfort level in dealing with these institutions.  Many times, a real estate agency can make recommendations that are neutral and reliable, because of the number of real estate deals that they see.  They are not immune to the good and bad that goes on in the mortgage funding business.  If you take your time and ask around, you can find a good source of money for your home loan in your community.

Mortgage Banker or Bank for Your Home Loan? was created by and is property of American Consumer News.

Credit Scores of Old
A credit score of 720 used to be considered excellent to lenders but this is no longer the case. Many mortgage companies want to see a 740 or higher to feel confident in lending. As a result of the 2008 situation, most lenders have tightened their belts and have issue stiffer requirements than ever before. So it will be highly important you know where you stand credit-wise. Order your copy of your credit report today and find out what your score it. If it falls short of the 740 mark, start working towards paying down your debt and decreasing your debt to income ratio. Analyze your credit report for errors and report them immediately to the credit bureau. If the credit bureau can not ascertain that the mistake is legitimate, the correction could help to improve your score rather quickly.

Proof of Income
Not long ago, those applying for mortgages would go through the extensive application process and think there couldn’t possibly be any more paperwork to complete. However, now that lenders have upped the anty, applicants are required to do even more extensive work. For instance, it used to be good enough to state your income on the application. Now most lenders will also require solid proof of how much money you make. Applicants looking to breeze through a no-documentation loan may want to reconsider their option because loans with little or no documentation are very rare. Before applying with a lender, make sure you have copies of all your tax returns in recent years as well as copies of your pay stubs put in order. The last thing you want to have to do is scurry around looking for missing paperwork.

Other Records
In addition to your income, expect to provide other documentation during the application process. As your clear through 2008 documents for your upcoming taxes, you should keep a separate file to collect your bank statements, monthly bills you are paying on, and other relevant documents. If your debt to income ration is high, the lender may require some additional convincing.

Saving the Cash
As you pour over your finances and necessary documentation, you should also start putting away as much cash as possible for your down payment. Because improving your credit and getting your financial records in order takes time, you can focus on the renewed importance of saving as much as possible to get the house you’ve been dreaming about without too much hassle.

Tips for Getting a Mortgage in 2009 was created by and is property of American Consumer News.

One such notable problem that has been in the news lately is the subject of  loan fraud. Uninformed or misinformed consumers have been victims of such fraud al too often and happens during times that should be of celebration, such as when buying a home for the first time.

There are a few things consumers can do to protect themselves during the loan process and even before, to help ensure that they do not become a statistic of fraudulent loans.

1. Contact more than one company to evaluate each of the pros and cons of the loan offer. If a loan company tells you that they are the only company that will give you a loan, walk away immediately. Getting several quotes can help you ensure you are being treated fairly.

2. Be very cautious about revealing too much information about your need for the cash. If a company understands such vulnerabilities, you could be facing an unfair advantage against the loan company.

3. Under no circumstance should you be told to lie or provide misleading information in order to get a loan. It should be a huge red flag if someone asks you to change information concerning your income, cash, or expenses. Walk away from any situation like that, no matter how badly you need the loan.

4. Never let anyone force you into borrowing more money than you are comfortable repaying. When an offer sounds too good to be true, it generally is.

5. Pay close attention to the terms of repayments. Balloon payments and interest only payments should be avoided. It is important you know and understand all of terms of the loan so there are no surprises. This includes repayment terms and all fees and penalties that can be incurred due to a late or missed payment.

6. Never, under any circumstances, sign a loan form or contract that is incomplete or has blank areas on them. Check each page for correct information and read over all documents, no matter how tedious they may seem. If you find any information that is not true, make sure it gets corrected immediately and entirely before proceeding.

7. During closing, make absolutely sure that you are signing exactly what was agreed upon and that additional information has not been added or changed without your consent.

Don’t Get Suckered into Fraudulent Loans was created by and is property of American Consumer News.

There are several ways to assess the reliability of an online loan provider. What you may think doesn’t matter may be the little things you should really be paying attention to and looking at carefully. Here are a few tips for checking out the lenders on the web.

Company Standing

With the convenience of the internet, a quick search can reveal reviews and critiques by fellow consumers who have done business with the company previously. In addition to hearing feedback from strangers, you can also check with family, friends, and the Better Business Bureau to see if anyone has complaints about company service.

Company Website

While it may be a pop-up advertisement that caught your attention in the first place, you definitely don’t want to be inundated with pop-ups while reviewing the website. Make sure that the pages of the company site load quickly and efficiently and that the information content makes sense to you and is complete. Be wary if there are a lot of error messages with page loads or if written information seems incomplete.

Company Privacy

Obviously there will be plenty of your personal information disclosed during a loan application. Check out the privacy policy on the website. A huge red flag should be thrown if there isn’t one on the site. If there is a policy posted, review it for content and sensibility.

Company Profile

Check out the About Us or Profile page of the company on the website. Look for the company history, mission statement, and staff profiles. Not all companies will have the same information but there should be some information that provides you with background information. If not, you have to wonder what the company is hiding and why they are not sharing more about themselves when they expect you to tell them everything about yourself.

Company Application

Many online lenders offer you an initial form or application to complete in order to gauge approval potential. If you feel uncomfortable with the information being asked of you, you probably should trust your gut instincts and look for other loan alternatives.

Company Offers

If you have solicited information from other companies, it is important you read all of the fine print, including the fees, interest rates, and terms. This should be one of the most important pieces of information for making a decision. Compare at least 3 company offers before making a decision. Do not just go with the first company that gives you an approval or you could end up in a financial nightmare.

Company Communications

Once you have made a decision to move forward with the loan process, pay attention to how the company representatives treat you. If it is not easy to reach the company staff or you find it difficult to deal with the employees, you should consider moving on to a different company. After all, you will have to deal with these people for a long period of time and it is your money and personal finances that are affected by the loan so you must take control of the situation.

How to Thoroughly Check Lenders on the Web was created by and is property of American Consumer News.

Here are some tips to keep in mind when preparing to borrow money from someone you know.

1. Ask yourself honestly why you need the money. If you can’t be honest and upfront about reason you need the money you are looking to borrow, you do not need to be asking for a loan.
2. Consider all of the options you can reasonably use to pay back the money before approaching someone for a loan. The lender will feel much more comfortable if you have thought the situation through prior to asking for the money.
3. Consider the consequences of reneging on the loan. No one wants to lose a close relationship over a financial situation. If you foresee any reason that would present a problem with the person you are asking, do not ask for the loan.
4. Put everything in writing just as you would with a professional lender. No matter how much the amount is, put all aspects of the agreement in writing. Make a copy for each involved party. Make sure your agreement includes:

• The names of the lender and the borrower
• The date of the loan agreement
• How much money is being borrowed
• How much the minimum regular payments will be
• Any interest rate applied to the initial loan
• The date the loan is to be repaid in full
• The timeline for making payments (weekly, monthly)
• The total amount of payments to be made

Depending on the size of the loan, the lender may not be interested in arranging a formal agreement; however, it is still a good faith effort to ensure you will not default on the loan. If the sum of money is particular large, it may be worthwhile to utilize the supervision of a lawyer to protect the interest of both parties, should something happen during the deal. It may also be important to the lender to feel confident knowing you are working on a solid plan to avoid a similar situation in the future. If you are expecting a loan from them, they are expecting not only repayment, but honesty in return.

Ultimately, your gut instinct may help you decide whether or not to approach a family member or friend for a loan. If you do not plan on sticking with your agreement or you make promises you know you can not keep, it is in everyone’s best interest that you look elsewhere for financial assistance. Respecting your family and friends and maintaining a good relationship can not be repaid if you lose their trust over a financial matter.

Having one too many credit cards could have you running for the quickest online loan you can get. A consolidation loan is one of the many debt solutions that could help you with spiralling loans and credit cards. Check out all your options which can help you get out of debt – an IVA or Debt Management might be more suitable for your financial situation.

Personal Loans: Should You Borrow Money from People You Know? was created by and is property of American Consumer News.