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Personal loans are unsecured loans and by this very definition represent a high risk to the lender. So lenders usually limit the amount of money they are willing to lend. Lenders use credit history not only to define the limits of the loan amount but also determine the rate of interest. Individuals with good credit are able to borrow more money with a lower interest rate than individuals with poor credit.

That said individuals who are employed and have bad credit still have access to personal loans-the interest rates are higher and the amounts the individual can borrow are lower. Credit unions and some banks and savings and loans have begun to offer short-term personal loans to their members and clients who have bad credit. These institutions offer the lowest rates available to individuals with bad credit. In addition the often provide credit counseling and can give the individual strategies to improve their credit rating.

Once the only option for people with bad credit, payday loan companies still meet a need in the community. Usually the only requirement to get a loan is that the borrower be employed. With payday loans, the borrower writes a post-dated check for the amount of the loan and the interest. For instance, if the amount of the loan is $100, the borrower would write a check dated for his/her next payday in the amount of $115 to $130. When the next payday arrives either the borrower comes in and redeems the check or the lender deposits the check.

Payday loans are particularly risky for borrowers because of the shortness of the term. Most borrowers were living paycheck to paycheck before an emergency put them into financial crisis. One payday is not a long enough term to get the borrower out of the financial crisis brought on by the emergency. All too frequently borrowers have no choice but pay the fees and roll the loan over for another two weeks.

Once a borrower begins the cycle of rolling over their loans, there is often no way out. The payday loan that was meant to solve an emergent problem has become the problem itself. If for instance, a person borrowed $100 and wrote a check for $130 to pay the principle and interest, only to find out that come payday, they didn’t have the funds to repay the loan. The borrower then pays the $30, and rolls the loan over. If the borrower rolls the loan over three times, he/she has paid $90 in interest in six weeks.

Personal loans are available to individuals with bad credit. Smart consumers will shop around and find the personal loan with the longest term and lowest interest rate to meet their emergency needs.

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Unsecured credit card debt consolidation refers to the process of consolidating all of the credit card debt that you owe into just one monthly payment without having to put up any of your assets as collateral. While it sounds great, there are some negative aspects of the unsecured credit card debt consolidation process. In fact, not being careful can make your financial circumstances worse after the process is over with than it was in the first place.

So here are just a few ways you can do unsecured credit card debt consolidation and the things you should keep an eye on when doing it.

Balance Transfer To A New Card

You may get offers like this in the mail all the time and they really are not a bad offer except for the fact that you are taking on yet another credit card to do this. This way of unsecured credit card debt consolidation will offer you something like a book of checks that you can write to other credit card companies and consolidate that debt under your new card. To make it more attractive the new credit card company will usually offer 0% interest on all transferred balances which is a great help.

If you can avoid using that new card then you just did a great thing but if you start using that new card then you just added to your debt while simultaneously reducing it at the same time. Just be careful with this and use it to do unsecured credit card debt consolidation but then cut up the new card and never use it.

Consolidating Debt by Means of a Finance Company

This method of unsecured credit card debt consolidation is definitely the least attractive because the interest rates that a finance company will charge are sure to be around twenty-five percent annually. That interest rate is almost certainly higher than the ones that you would have been paying on the credit cards you owe money on. Finance companies consolidate your debt by combining the principal on all the credit card accounts you owe and then making a ten year plan for debt elimination.

A ten year loan at 25% to pay off credit card debt is probably the worse kind of unsecured credit card debt consolidation there is. You are better off with the credit card consolidation deal mentioned previously than doing this method.

There are numerous companies out there who would love to help you consolidate your debt. The difficulty does not come in finding one, the difficulty comes in finding one that is reputable and fair. Don’t choose a debt consolidation company based on their commercials and ads. Companies advertise all the time that in all honesty, should not be in business.

Never give personal identifiable information or sign anything until you have done your research on the debt consolidation company. There are always companies who want your business only to take advantage of your needs. As with other businesses, both good and bad exist.

Check consumer information and protection sites such as the Better Business Bureau. If you find the company listed on such a site, read all there is to say about them. You may find them to be a solid company with good reviews or they may be fraudulent or high cost. Don’t think that if the company does not appear on the site they are automatically cleared for your business. Maybe they haven’t been reported yet. This is why you need to have other avenues for researching.

A good debt consolidation company will not ask for higher interest rates than those you are already paying and they won’t ask for large amounts of money in fees in order to “process” your loan. The best debt consolidation companies have a decent working relationship with most creditors and will provide credit counseling for you as part of the service they provide. You should have your questions answered without being put off or charged for time.

The best debt consolidation companies are those that are non-profit. Be advised that “non-profit” does not mean “no pay”. They are considered non-profit because they do not charge over and above that which will pay their expenses. They are not charities. Another warning: Some companies claim to be non-profit when that is far from the truth. Employ the same strategies with non-profits as you would for any other debt consolidation company.

A good place to look for advice and information is the National Foundation for Credit Counseling. The NFCC gives accreditation to debt consolidation services based on a set of guidelines that are ethically sound. They may be able to direct you to a reputable debt consolidation company in your area.

Debt is an ever growing problem for our society. Huge numbers of people are declaring bankruptcy every month and far more are struggling to meet their minimum payments.

The effects of bankruptcy can be far reaching and can impact people’s lives long after the bankruptcy has actually ended, making it difficult to obtain credit and even spoiling many employment opportunities when companies credit check potential employees.

For some, it may be their only option but for many, there may still remain a chance if they take action.

47% of credit card holders only pay off the minimum balance on their card each month. This is the worst way to pay them off, guaranteeing that you will still be in debt for many years to come.

It seems to be almost the norm in our culture to think that we are owed something and that we should be able to get the things that we want as soon as we want it. The banks and credit card companies have spent allot of money trying to convince us of this. That way, they can keep us owing them money and working for them forever!

Fortunately, there is still time for most of us to avoid the inevitable if we make the change now. Here are my top 7 tips to get you out of the debt trap.

Tip 1. Write down all of your debts. It sounds simple, but you’d be amazed at the difference that this one simple step can make. Make a list of all of your debts, list the amount, who it is owed to and the monthly repayments. This can be hard as it is difficult to face up to this problem, especially if you have been hiding from it for some time. It is the most important step though so get started now.

Tip 2. Prioritize your debts. Which are the most pressing debts? If you stand to lose something (like your house) by not paying then that is the most important debt. Next, if you have already had trouble and have come to an arrangement with a creditor, you should try to stick to it. Next, list your debts by interest rate, highest to lowest.

Tip 3. Get rid of your credit cards. If you don’t have them then you can’t make it worse by using them. It may be scary at first but you will soon get used to managing without them.

Tip 4. Examine your credit report. Your credit report shows you your payment history. You can get a copy cheaply from many places online. You should check it for any errors that could harm your credit rating and write to the companies concerned to have them corrected. This will ensure that your credit problems do not cause you trouble into the future.

Tip 5. Make a budget and stick to it. A budget can be the single most important step that you can take to not only get out of debt but also to ensure that you start to prosper financially, no matter where you are now. It is actually pretty easy to do. You can find easy, free instructions on my website on putting your budget together.

Tip 6. Never swap unsecured debt for secured debt. Companies will throw offers at you once they learn that you are in debt trouble and you are a home owner, but they will reposes your home at the first opportunity if you start missing payments so don’t do this unless you have no other option and always seek impartial advice first.

Tip 7. Don’t do it alone. There is plenty of help and advice available to you; you just have to look for it. Talk to debt charities, I guarantee that they won’t be surprised or shocked no matter how bad your situation is. They will however be able to offer good and helpful advice.

It now costs almost $32,000 a year on average to attend a private university,
and around $13,000-$16,000 to attend a public university. Where’s a
middle-class family supposed to get all that money? That’s what this article
is about.

It’s surprising, but there are many sources of student financial aid out there.
But you have to be savvy about how to go about applying for it.

The First Steps

In some households, it’s the parents who take on most of the work involved in
applying for student financial aid; in others, the high school student does it all
himself or herself. In what follows, I’ll address the high school student directly
to make things easier, recognizing that most readers of this article will be parents, not students (however, please email this article on to your teen-ager!)

To The Student

As a student bound for college, one of the first things you should do — preferably
in your junior year — is to speak to your high school guidance counselor about
available financial aid. He/she can steer you to many scholarships, loans, and
work study programs you’d never find on your own. Remember: there are
thousands of student aid sources available, not just the few you may be
aware of. It’s your guidance counselor’s job to know about virtually all of them.

One thing your guidance counselor will tell you to do right away is to complete
the FAFSA form. FAFSA stands for Free Application for Federal Student Aid. This
basic form will be used to determine your financial aid requirements by nearly
all schools and institutions which offer financial aid. So you want to complete
it carefully and accurately. You can access the form online at fafsa.ed.gov. Or
you can get it by calling 1-800-FED-AID.

FAFSA is administered by the United States Department of Education. You
should file it early during the second semester of your senior year, as soon
as your family has prepared their tax return (you’ll need information from that
return to use in the form). It takes 1-2 months to get your evaluation back,
which will be called a Student Aid Report. Based on the financial info you
provide about yourself and your family, the US Department of Education
will estimate how much money you can contribute from your own
resources toward your total college expenses.

So for example, if that figure is $10,000 and your expected total expenses
at a college you plan to attend will be $13,000 for the freshman year, your
“Financial Need” is $3,000. Many colleges will, as part of their acceptance
procedure, offer financial aid packages that cover most or all of the Financial
Need amount.

Also, some schools require the so-called PROFILE forms. These are administered
by the College Board and are used primarily by private colleges to estimate your
eligibility for nongovernmental loans (such as those provided by the college itself). The PROFILE is somewhat similar to FAFSA but considerably more detailed. You can obtain and file the PROFILE at: Collegeboard.com.

Be sure to check with your guidance counselor and/or the schools where you’re
applying to find out if there are any other forms you need to fill out.

A Few Insider Tips

Note that scholarships, not loans, should be your primary goal. There are a great
many specialized scholarships out there. Maybe you’re an inventor, or maybe you
have a family member in the Armed Services, or maybe you speak an in-demand
language for which the government or some other institution needs translators,
like Chinese or Russian. You’ll be amazed at how many specialized scholarships
you find yourself qualified for. Check with your guidance counselor and also visit
Collegeboard.com to research this subject.

Beware of fee-based scholarship search services on the Internet. Some of them are
scams. At a minimum, check with the Better Business Bureau and your guidance
counselor before paying anyone money to search for scholarships for you.

Many scholarships require you to write a “scholarship essay.” If so, say the experts, focus on answering the question posed by the essay. The most common reason
for rejection is that the student meanders and drifts off-topic in the essay. Also: be sure to proof-read your essay before submitting!

As for student loans, there are two basic types: those provided by the government and those which are merely guaranteed by the government. The former usually carry
a lower interest rate.

The most commonly-sought student loans today are these two: the Stafford Loan and
the Perkins Loan. You can only borrow about $3000 for your freshman year under the
Stafford Loan (higher amounts for later years), and you must show at least
moderate financial need to qualify. The Perkins Loan provides up to $4000 for the
freshman year but requires a demonstration of exceptional financial need. The Perkins is considered an excellent good loan for students because interest does not accrue while you’re attending college.

If you are unable to put together enough financial aid by means of scholarships and loans, your parents may be able to take out a PLUS loan (Parents Loan for Undergraduate Students) or borrow from a private lender, such as a bank or other financial institution.

Don’t be shy about applying for admission to the school you really want based on cost. Availability of student aid varies considerably among colleges, and the one you want to attend may have a sizable scholarship endowment, in which case it might turn out to be much less expensive than you think.

When estimating financial requirements, don’t focus just on tuition and room and board. You’ll also need money for books, transportation, and personal expenses (entertainment, clothes, etc.) If a college accepts you and then offers you a financial aid package which you feel is less than adequate — and if this is a school you’ve set your heart on attending — write a letter and ask for more financial aid, say most experts. Address the letter to the Director of the
Financial Aid Office (you can get his/her name from the school switchboard).

In your letter, try your best to provide a good, specific reason why you need more aid, such as “My father has lost his job recently” or “Our family has suffered a medical emergency recently.” If you don’t have a good reason you might try, “We have a large family and all my four siblings will be attending college soon.” That one probably won’t work. However, if you have received a larger financial aid offer from another college, you should definitely mention that fact, say the experts.
It’s even a good idea to include the letter offering you the financial aid. This may sound like playing hardball but often gets results, provided you’re a student the college would really like to have.

Check out the college-ranking edition of U.S. News & World Report. It includes the average amount of student financial aid received by each college’s students. This should give you a pretty good idea if a given college is likely to provide the amount of aid you need. Be very careful you don’t get hooked in by a college that offers a great financial aid package for the freshman year, then cuts it back in
succeeding years. Some colleges do this ito get top students or athletes to attend. One way to check this out is to speak with current students at the college who are receiving aid. Also check with your guidance counselor, who may be aware of colleges in your area that have a reputation for this type of tactic.

To Do List: Junior Year and Summer Before Senior Year — Research Colleges and all other sources of student financial aid; Senior Year, Fall — Talk to guidance counselor; apply to selected colleges; apply for scholarships; Senior Year, January — File the FAFSA; File the PROFILE; apply for more scholarships and grants; Senior Year, Early Spring — Review accept/decline letters and financial aid offers from colleges, make your final decision.

The need for debt reduction is as common as dieting and attempting to break bad habits. When debt becomes a burden too large to carry, the need to not only get out of debt, but also prevent slipping back into the same spending habits is critical. If this pertains to you, read on.

Start with Your Own Credit Report, Call Creditors, Do some Consolidation.

Analyzing your debt will be a critical step in the right direction. All three credit bureaus have an impact on your credit worthiness, so it is important to get copies of them and make sure each contains correct information. If negative history is haunting you, write letters or make calls, and see about getting those items removed. If something is reported erroneously, don’t be afraid to challenge it.

Second, make calls to your creditors. Most are more than happy to talk to you about lowering your interest or payments. Logically, they are willing to take less than owed generally, to prevent losing everything to a bankruptcy. If not, you are not out of options. Read on.

Loan consolidation is a valid option. Doing a loan consolidation with a new loan will require decent credit scores, so if your debt is beyond a certain ratio, or your scores are too low, you may need to consider the alternative - debt reduction plans. These consolidate all your credit cards, negotiate payment plans and interest rates with the creditors, and work on your behalf to lower your debt. They usually charge a small start up fee, and add a low monthly fee to remain in business. However, the benefit is you are still paying far less, both monthly and in the long run, to meet financial obligations.

In the meantime, if possible, take on a second job, sell what you don’t need and cut up your credit cards. Low interest loans often mean longer terms so do your best to pay more than the minimum payments on your consolidation loan. If you find consolidation is not your answer and you have no other choice, then bankruptcy is a valid option.