Predatory Lending Practices: Car Title Loans
Car title loans are frequently used by those in desperate situations. The car title loan industry has received a lot of negative attention for predatory lending practices. Here are a few reasons that you should stay away from car title loans.
Interest Rates
One of the biggest reasons that you should try to avoid dealing with car title lenders is the interest that you will pay. The interest rates associated with car title loans are extremely high and could be considered usury. Since the loan is typically for only 30 days, you might not think that the interest rate is that high. Many people are so desperate that they will gladly agree to any interest rate that is put in front of them. However, when you take the time to calculate the rate, it comes out to as much as an APR of 300. Therefore, you are paying an unbelievably high rate of interest compared to that on almost any other type of loan.
Cheap Auto Loans Help Boost Car Sales
Cheap Auto Loans Are Here Again
When Dana Johnson, the chief economist at Comercia Bank, released research on auto affordability last week, he noted a: “decline in financing rates.” And the bank, which is headquartered in Dallas, Texas, reckoned that those rates fell a full 19 basis points during the last quarter of 2009.
Meanwhile, the Federal Reserve concurs that auto loans are now cheaper. Its statistical release concerning consumer credit in December 2009, which was published on February 5, shows that the average rate for new car loans from auto finance companies are at their lowest since at least 2005, the earliest period covered by the report.
Small wonder, then, that the dollar value of those loans in the last quarter of 2009 was 27.5 percent higher than during the same period in 2008. We all love great auto loan deals!
Auto Loans and the Economy
Secretary Charles Erwin Wilson famously told a U.S.
Easy Ways to Get No Cosigner Car Loans
The few privileged ones with excellent credit scores can easily avail inexpensive vehicle loans. However for the not-so-lucky buyers, there are some propositions available. One just has to explore the right places. The one big mistake bad credit consumers make is not surveying the market thoroughly. The top finance institutions will have a long list of good credit customers. So, they will be brutal towards the imperfect borrowers. Interest rates will be sky rocketing, and repayment terms very severe. Hence, individuals with any sort of credit issues should approach specialists. Bad credit car loan without cosigner is one such avenue worth exploring. It permits all types of borrowers to enjoy the comforts of an automobile.
Traditional lenders do not offer such loans. One has to approach financial institutions that concentrate on this area.
Great News For Home Equity Loans
Good news from the Federal Reserve this week. The interest rates on your home equity loans should remain low for a while longer.
How The Rates On Your Home Equity Loans Work
The interest rates on your home equity loans are most likely based on Prime Rate. Prime Rate usually tracks the Fed Funds Rate plus 3%. The Federal Reserve’s Federal Open Market Committee (FOMC) is the body that decides when to raise or lower the Fed Funds Rate. The FOMC decided this week to leave the Fed Funds Rate unchanged, signaling several more weeks of cheap home equity loans.
The Current Fed Funds Rate
Currently the Fed Funds Rate has been at 0.000% – 0.250% for over a year. The Feds have been keeping interest rates low in order to stimulate the economy. As the economy shows signs of slow growth, the FOMC has been considering when to start raising their key interest rate.