Month: May 2019

About Bad Credit Home Loans – What You Need to Know in 2019?

If your credit is low and you are willing to make a home purchase, perhaps you might be really worried about availing loan. However, there exists a possibility to receive home loan even with a bad credit. Though, a poor credit history can make the entire process slightly difficult. Therefore, it becomes essential to put efforts towards increasing the credit.

How to apply for a home loan with a Bad Credit?

Here mentioned are few tips that can facilitate Home Loan with poor credit:-

Bad Home Loan Image

    • A larger down payment- Saving and contributing towards a down payment will be really helpful in paving a path, towards helping you get approval for home loan such as lal dora home loan. It makes your lender acknowledge and trust your ability to contribute money towards the loan. You may save for the down payment by cutting down the insignificant expenses, trying to generate more sources of income etc. You might even seek the help of friends and relatives who are willing to help you with the finances.

    • Speak to your credit counselor- It can be one of the best ways to go about in your endeavor towards availing home loan on lal dora property or any other property. The Credit Counselor’s might review and analyze the particulars of your monetary situations. Accordingly, provide appropriate advice with anything related to the loans especially in the context of bad credit. However, you need to keep in mind that it is not necessary that all the counselors dealing with bad credit are skilled and aware in the same capacity. Therefore, you must be careful in choosing the apt one to guide you in the right direction. There are several counseling agencies specially dealing with such services.

    • Payment of down debt and lower DTI- The lenders will meticulously observe your debt-to-income ratio (DTI) while determining whether the loan should be sanctioned or not. It is calculated with a mathematical procedure which includes dividing the complete debt with the gross monthly income. If your debt-to-income ratio is higher than you need to have, you must take essential steps to improve it. This can be done effectively by increasing your income and paying down on the debts.

    • Emphasize on track record of on-time payments- It is suggested to wait for few months before applying for a mortgage in the events of a record of delay in payments. This would play a vital role in reducing it’s impact. In that gap, you must try to have a record of payments done on time.

Home loan after foreclosure

If there has been a foreclosure, the waiting period might increase further. At times, it can take months or even years to end. However, if the reason behind such foreclosures were severe medical conditions or loss of job and financial crunch as a result of it, certain exceptional rules would be applicable, thus, helping you avail loan.

Is refinancing a Bad Credit Home Loan possible?

Bad Credit Home Loan Image

The main purpose behind refinancing the mortgages could be availing a lower interest rate which can be affected by the bad credit. In such a situation, you must get in touch with the Lender to better your credit; to the extent it is possible.

Conclusion:-

From the overall analysis, it can be concluded that though getting loans with bad credit might be slightly challenging and a time consuming procedure. However, there are positive chances to avail it.  All you need to do is to search for the right Loan Service Provider Company which would guide and assist you through the entire process, right from applying for the home loan to successfully purchasing your house.

How Overdraft Facility is Helpful For Business?

An Overdraft is a financial tool which is a line of credit provided by the banks to the individual and business entities. These facilities provide Businesses and Individuals access to funds beyond your available credit funds, ensuring that you are well covered for emergency expenses and other short term cash flow issues. In the current financial scenario, banks grant this facility to the customer’s savings account as well.

It is a type of credit facility whereas bank loan is a facility for borrowing a certain fixed amount of money. Using such facility, a user can withdraw cash as and when he requires up to the amount he needs. However, in bank loans, a fixed amount is given to the user irrespective of his financial requirement. The interest charged on the overdraft facility is only limited to the amount of money withdrawn.  While in case of the bank loan, interest is charged on the amount sanctioned by the bank. An operational account is essential to use such financial facility, unlike the bank loan.

Business Overdraft:-

overdraft loan facility

There can be multiple applications of Business Overdraft such as paying salary to the employees, managing or settling the invoices, buying stock and meeting other essential expenses.

The fees associated with bank overdraft are distinct from one bank to other bank.

These are the charges that may be applicable on overdraft:-

  • Interest: It is calculated as a percentage of the amount that is overdrawn.

  • Daily Fees: Certain types of banks may charge a daily fee on the amount that is overdrawn till the time it is repaid to the bank. However, there are alternatives to this such as there might be a weekly fee or a monthly fee. Generally, these fees are charged on the amount overdrawn.

  • Fixed Setup Fee: For initiating the overdraft facility, the banks might also charge a fixed setup fee.

Advantages of Overdraft facility for business

overdraft facility for business

  • It acts as safety net: Since you would only require to pay interest on the money you actually overdraw, therefore, it could serve as a comparatively low cost safety net that you don’t even need to use.

  • It has flexibility in terms of limits: It would enable you to communicate to the lender about the period you would like the business overdraft to be accessible for. There is a possibility that you may even be able to get it renewed according to your preference. You can close it any time you wish to but you will have to pay the outstanding balance or fees, in such a situation.

  • Provides cash flow: When you are lacking in sufficient funds and need to meet the expenses, you can fund a wide range of business entities with the help of Business Overdraft facility. So, it keeps all your financial worries aside in a difficult financial position.

  • Can be used as security: Both the secured and unsecured business overdrafts can be provided by the Lenders. However, a major advantage of a secured overdraft is that one may need to pay only a minimal interest rate in exchange for offering asset or property as security. In the case of unsecured loan, a higher interest rate would be charged. Therefore, it is better to go for the secured overdraft facility, considering it involves lower interest rate.

Conclusion:-

overdraft loan facility

By analysing the various benefits attached to the Overdraft facility, it can be comprehended that opting for Overdraft facility for business, to meet an important financial need in any urgent or crisis situation would be of immense help. However, it should be considered only if it seems a viable option for a particular financial business need.

What is Cash Credit Loan and How Does it Work?

About the Loan:-

Cash Credit Loan is basically a cash loan which is provided to any business entity or company so as to meet it’s financial requirements, thus minimizing the working capital gap.  This source of finance is facilitated for a short term for about 12 months. Any company which goes for such loans can withdraw the money from the bank account whenever it is required within the fixed withdrawal limit. For the grant of the loan, it is important that it is pledged against stock and assets of the company.

There are a number of factors which decides the borrowing limit of CC Limit Facility such as the creditworthiness. It essentially depends on the structure of the company, current assets and liability. Interest is charged only on the amount of money that is being borrowed irrespective of the borrowing limit. Such type of loans can be utilized for various purposes like purchasing raw materials, payment of the wages for the workers and labourers, sourcing money for the purpose of sales.

What Are The Merits and Demerits of Cash Credit Limit Loan in Delhi?

Cash Credit Limit Loan In Delhi

Merits:-

  • It is easy and convenient for the bank to provide cash credit loan till the time collateral security remains, and value of the loan is determined.
  • There is a flexibility to deposit money as and when you have surplus funds, to lower the burden of interest.
  • It can be used for something that will bring a return on your investment. For instance, home improvements. The loan may be availed in the form of a particular deposit amount. There is also a provision of receiving line of credit with a cash-secured credit card.
  • In order to make use of such loan, you can borrow from the same bank where you would have deposited money in a saving account or certificate of deposit. In this case, the lender need not worry much while approving the loan since the risk involved is low.
  • In those situations where the credit scores are less, you might even be able to avail better rate with these loans than with the unsecured loans.

Using the Cash Credit Loan to Build Credit

  • If your primary goal is rebuilding your credit, you need to make sure the loan works in your favor.
  • You can choose to go for a lender that effectively report payments to the credit bureaus. This would be necessary for the changes in the credit scores.
  • You must also check the credit intermittently to verify that the payments are reported.
  • Paying on time is crucial to stay away from the harm that the late payments can cause and thus, make you suffer financially further as a result of it.

Apart from the several benefits, there are few shortcomings related to these type of loans too.

Demerits:-

  • A company cannot depend on it for a longer period of time, since it is a short term loan and usually businesses are in need of loans over and over again.
  • New companies can have difficulty obtaining this loan as the approval depends on payment of the minimum commitment charge regardless of whether the company utilizes the cash credit or not.

Conclusion:-

CC Limit Facility

Even with a few downsides, going for Cash Credit Limit Loan in Delhi would be a wise decision. The individual applicants too can avail this type of loan facility against their fixed deposits as a loan and save on interest. The application of such loans is best in the situations of urgency, thereby, it can be a life savior in the complex financial scenario.

For any help with loan related to CC Limit Facility, you may get in touch with the skilled professionals, who deal with these financial aspects.