Opening multiple P2P loans gives you opportunity to effectively build up your credit score. If you currently have a bad credit score or have filed for bankruptcy, it is recommended that you don’t apply for the P2P loan right now until there is a significant improvement in your credit history. You must be have proof to show that you can manage your finance responsibly.

It is possible to apply and get approved for more than one peer to peer loans from a single lender but there is a maximum amount that you cannot exceed. For example, you are not allowed to borrow more than $20,000 from a single lender.

Only borrowers that are aged at least 18 years old will be approved for loans. Both permanent resident and people who are visa holder for long term will be accepted. In addition, you must show your social security number and have a working bank account. The monthly payment for the P2P loan will be automatically deducted from the balance in your bank account.

It is advised that you don’t request for a loan that is more than your ability to pay it back. Paying back the loan on time is necessary if you want to avoid getting charged with late fees. Just like bank loans, you must keep up in paying back your loan otherwise the lender has the right to take actions against you.

You can considering covering your P2P loan with insurance so that you will have money to pay back the loan in case anything happen and you cannot work. You can always contact the lender and discuss for a lower range if you have a problem in repaying it.

P2P lending is only a short term solution and you must never rely on it to gt money for your temporary expenses. To solve this problem, you must control your spending and budget your expenses according to how much you earn. Just like bank loans, borrowers that can demonstrate they have good credit score will get lower rate and those with bad credit score will be charged with higher interest rate.

There are serious consequences if you fail to pay back the loan as you are supposed to. Missing a payment can seriously affect your credit score and it can also cause problems of approval if you want to apply for additional loans from the P2P lending network.

Many people use a debt consolidator to get out of debt and there is nothing wrong with that, however, with the proper planning, and the ability to follow a plan on your own, you could do it yourself and save the money you would have to pay a debt consolidator.

So where do you start? Gather up all your debt; retail credit cards, major credit cards, outstanding bills, basically everyone you owe money to, and add up the total to see how much you actually owe. Keep in mind if you have a mortgage and a car payment, but are not behind, these still need to be the bills you pay first, regardless of debt. Keeping a roof over your head and having a way to get to work are also key to reducing your debt.

Next, look at your income and regular expenses. From this you need to create a budget. If your debt is high, then there are a couple of things you need to do; first, stop using those credit cards, and second look at your other expenses and see where you can make some cuts. For instance, if you eat out quite often and it isn’t reimbursed as a business expense, it’s time to start eating at home. There are many very simple, yet delicious meals you could make at home that cost pennies on the dollar compared to eating out.

If you have some small debts (say less than $100) pay them off first. Extending those small debts over a long period of time will end up costing you four times what you actually spent. With your major credit cards, look at how many you have and consider how many you really need. If you have more than one or two major credit cards, you need to consider which one or two you want to keep and close the other accounts out. The easier it is for you to pay on credit, the easier it is for you to get deeper in debt.

A big part of reducing your debt is to spend less money. Most of us live above our means and that results in debt. Now, a car payment and a house payment don’t necessarily count as living above our means unless you have a mortgage that is really more than you can afford or a car payment for a car that is more expensive than you need, but just wanted. For example, no one really “needs” a Ferrari, so if you have a really expensive car, consider trading it in for something more affordable.

Now it’s time to look at those larger credit card or other types of debt. For the cards you have decided you are going to close the accounts on, call the company and see if you can work out a payoff deal. That is what professional debt consolidators do, and there is no reason you can’t try to negotiate one for yourself. You would be surprised at how many major credit card companies are willing to reduce your debt if you make one lump sum payment, or if you agree to a payment schedule.

You can also do some other debt consolidation on your own. When you are thinking which major credit cards to keep, look at the ones with the least interest; those are the ones you want to keep, while throwing away the higher interest cards. Some major credit card companies will even offer to reduce your interest rate if you move your other debt to their card. Then not only do you get a lower interest rate, but you also are sending out fewer payments each month, which makes it easier to keep track of your money. It may take some time and some diligence but if you are serious about getting out of debt, and willing to put the work into it, you can do it without feeling like you gave up everything to get there.

Texas Direct Lenders, is the #1 source for finding help with consumer finances, loans and credit issues for consumers in Texas. Contact our editorial team for future topics on money and savings articles.

Debt To Income Ratio.
Your debt to income ratio is the percentage of your monthly income which goes towards your monthly debts, such as loan payments, car payments, leases, credit card payments and other debts. The general rule of the thumb here is that your debt to income ratio should be no more than 38 percent of your monthly income. A few select lenders do show some leeway here, if you have other factors that can help to negate this, such as having excellent credit, high savings or a high income. In these cases some lenders allow up to a 45% debt to income ratio, but you should not count on any lender ever offering you that, instead try to stick to the 38% debt to income ratio example. You can easily add up your debts and figure out your debt to income ratio. If your debt to income ratio is too high you should work on lowering it to below the acceptable threshold, before applying for any loan.


Payment History and Charge Offs
Every lender puts a high emphasis on your past payment history with other creditors. It is reflected directly on your credit report in black and white, there are no shades of grey here. Late payments count heavily against you, but not as much as a charge off does. A charge off is where the creditor has written off the debt and possibly even sold the debt to a 3rd party such as a collection agency. If you have any charge offs on your credit report, you should address those by paying them off, unless you have less than a year to go before they fall off of your credit report. Remember all bad debts fall off of your credit report after a period of 7 years. If you do decide to pay off a charged off debt, try to pay it back in full, as partial payment settlements are marked as “settled in full” on your credit report. Accounts settled in full do not give you the level of credit repair that paid in full accounts do.

Poor Credit History
This is easy to fix as far as top reasons for being denied a loan go. For many people it simply can be having to few open accounts. The other major factor here is too low of a credit score. Most lenders are looking for credit scores of 620 or higher for personal loans. It is not difficult to make your score rise above 620. I once had credit issues and was able to raise mine from a 540 to 660 in less than 6 months. The key here is to reduce your credit utilization and to also have enough open accounts on your report that lenders can better gauge how responsible you are. You should pull your credit reports as well, since upwards of 25 percent of all credit reports contain errors which lower your score. Should you find any errors you should dispute them and have them removed from your credit report. With time and dedication you can turn a poor credit history into a fair credit history.

I did some research on these codes, and gained a lot of knowledge on what makes a person a credit risk. We will go over the codes, so you too can gain this knowledge, and avoid these habits. By knowing exactly what creditors are looking at on your credit report, and what mistakes to avoid, you will improve not only your credit score and credit report, you will also have less risk of being denied credit in the future. For ease of explaining these codes EQ stands for Equifax, TU stands for TransUnion, and EX stands for Experian. Not all credit reporting agencies all use the same codes, for example only TransUnion uses code 19.

Amount owed on accounts is too high: EQ1 TU1 EX1

Level of delinquency on accounts: EQ2 TU2 EX2

Too few bank revolving accounts: EQ3 TU N/A EX3

Too many bank or national revolving accounts: EQ4 TU N/A EX4

Too many accounts with balances: EQ5 TU5 EX5

Too many consumer finance company accounts: EQ6 TU6 EX6

Account payment history is too new to rate: EQ7 TU7 EX7

Too many recent inquiries last 12 months: EQ8 TU8 EX8

Too many accounts recently opened: EQ9 TU9 EX9

Proportion of balances to credit limits is too high on bank revolving or other revolving accounts: EQ10 TU10 EX10

Amount owed on revolving accounts is too high: EQ11 TU11 EX11

Length of time revolving accounts have been established: EQ12 TU12 EX12

Time since delinquency is too recent or unknown: EQ13 TU13 EX13

Length of time accounts have been established: EQ14 TU14 EX14

Lack of recent bank revolving information: EQ15 TU15 EX15

Lack of recent revolving account information: EQ16 TU16 EX16

No recent non-mortgage balance information: EQ17 TU17 EX17

Number of accounts with delinquency: EQ18 TU18 EX18

Date of last inquiry too recent: EQ N/A TU19 EX N/A

Too few accounts currently paid as agreed: EQ19 TU27 EX19

Length of time since derogatory public record or collection is too short: EQ20 TU20 EX20

Amount past due on accounts: EQ21 TU21 EX21

Serious delinquency, derogatory public record or collection filed: EQ22 TU22 EX22

Number of bank or national revolving accounts with balances: EQ23 TU N/A EX23

No recent revolving balances: EQ24 TU24 EX24

Number of revolving accounts: EQ26 TU N/A EX26

Number of established accounts: EQ28 TU28 EX28

No recent bankcard balances: EQ N/A TU29 EX29

Time since most recent account opening too short: EQ30 TU30 EX30

Too few accounts with recent payment information: EQ31 TU N/A EX31

Lack of recent installment loan information: EQ32 TU4 EX32

Proportion of loan balances to loan amounts is too high: EQ33 TU3 EX33

Amount owed on delinquent accounts: EQ34 TU31 EX34

Serious delinquency and public record or collection filed: EQ38 TU38 EX38

Serious delinquency: EQ39 TU39 EX39

Derogatory public record or collection filed: EQ40 TU40 EX40

Every single one of these is a reason you can be denied credit. Learn these codes, and review your credit report, and look for any of these factors on your credit report. If you have any of these negatives, do what you can to repair the damage, if possible. These negative behaviors are behaviors to avoid if you care about your credit score.

These lenders examine a number of factors other than your credit score, when it comes down to deciding on whether or not to extend a loan to you or not. Many of these same lenders once upon a time only loaned to those with perfect credit, but this results in a lower profit margin. Many of these lenders have learned that people are more than the sum of their credit score, and that good people have made some credit mistakes, and desire a second chance.

Finding the best personal loan for those with bad credit means finding a reputable lender. You want a lender who has a good reputation, a good standing in the financial community. Finding a lender that is transparent about their fees, rates and terms is also very important when it comes down to selecting the right lender. Some lenders will try and obscure the true cost of a loan through expensive and high fees for example, while giving out a low teaser interest rate, which does not reflect the overall APR due to the hidden fees. Of course any personal loan for those with bad credit will carry a higher interest rate and a higher APR than the same loan made to someone with perfect credit, you will still have many options when it comes to personal loans.

You should avoid predatory lenders, such as payday loan lenders if you are in a bind. Payday loan lenders can have interest rates upwards of 700% or higher. Such interest rates can just send you into a worse financial problem then the one you are addressing via a payday loan. Even with the higher interest rates offered on a personal loan for those with bad credit, the interest will be no where as near high as what a payday loan lender charges. It is very common to see interest rates on personal loans for those with bad credit higher than 24%, but this is much less than 400%, 500% or higher than 700% that payday loan lenders charge. You want to escape and get out of a debt cycle, not get sucked into another bad debt cycle. Personal loans carry a fair and fixed interest rate, with manageable payment amounts.

If you are in need of cash today, take a moment and review some of the personal loan lenders featured on this website. You can not only address the financial needs you have, but also save money on interest when compared to credit cards or payday loans. You can even help boost your credit with the responsible repayment of a personal loan.

You need to consider how closing out an account can affect your credit score. One of the most common misconceptions is that by closing out your credit card account that any late payments or delinquencies will be removed from your credit report, which is not the case. In fact they will remain on your credit report for a period of 7 years. The opposite is true for your good credit behavior. Federal law mandates that negative credit info be removed after 7 years, but your good credit behavior will stay on your credit report forever. That’s the good news.

You might be curious as to just how closing out an account could harm your credit score and borrowing ability. For starters a huge part of your credit score is your credit utilization. Lets say the card you want to close has a zero balance, but a credit limit of $7500, that’s a good thing, since you have open credit of $7500 that you are not using. Not using available credit in your credit line actually boosts your credit score. Now lets say you close that account out, but you have another credit card with only a $3000 credit limit on it, and you have currently $1500 in charges on it. That means once your old card is cancelled your credit utilization rate will rise to a whooping 50% and your credit score will dip. New credit card accounts also hold less weight than older accounts do on your credit report.

If you have just built up your credit, closing that high interest account could be harmful to your credit score. Your credit report heavily relies on age of account. If your credit report is short, opening a new card and keeping the old card but rarely using it might be the best thing for your credit score. If you close out an account in good standing with a short credit history for the rest of your accounts, your score will take a dive. I would recommend keeping the card open in this case and using it only 2 times per year to keep the account in good standing. If you fail to use it at least twice a year, the credit card company might close the account due to inactivity, which would also hurt your credit score.

So when is a good time to close an old credit card account? Basically if you have a long credit history, and a few open accounts in good standing that have some age to them. This way you have other accounts for your credit report to lean on that are aged and in good standing. The loss of one account in this case should cost you very little in the way of points on your credit score. Make sure you call to cancel the card, and make sure that you have the balance entirely paid off before you decide to cancel. If you have rewards points make sure to use them up before you cancel the account.

Texas Direct Lenders leads the way for #Texas borrowers seeking help with loans, credit cards, debts and saving money in 2015. If you are interested in reviewing a topic on consumer finances, please reach out via email.

Hours of contact
They may only contact you between 8:00 a.m. to 9:00 p.m. local time

Failure to cease communication upon request
Once you send this letter, and you should send it via certified mail, the collections agency or creditor can only contact you to tell you of impending legal action such as a lawsuit. They may also contact you once to ask for your attorney information if you have indicated you have or are seeking legal representation. They may also contact you once inform you that collection efforts are being terminated.

Using a telephone to harass
They may not call repeatedly throughout the day to cause the telephone to ring non stop. This is clearly behavior intended to annoy, abuse, or harass person.

Calling a debtors workplace after being told no
If you inform a creditor or collections agency that calls to your workplace are unacceptable or prohibited by the employer, yet they continue to call, they are now in violation of the Fair Debt Collections Act.

Direct contact with a debtor who is known to be represented by a lawyer
If a creditor or collections agency contacts you after they have been given the name and phone number of your attorney, they are violating the law.

Misrepresentation or deceit
Collections agencies may not misrepresent themselves, your debts, or any related information to you. They also may not lie about pending legal action if no pending legal action actually exists.

Communication with third parties
A creditor or collections agency is not allowed to disclose your debt or debts to anyone, other than your spouse or your attorney. They can contact others to gain location and contact information, but may not disclose your debts or allude to debts.

Reporting false information on a debtor’s credit report
They may not intentionally report false, incorrect or misleading information to credit reporting agencies. They also may not threaten to do this during the collections process.

Threatening arrest or legal action
Unless you have committed fraud and they can prove it, they may not threaten arrest in an attempt to collect the debt. They also may not threaten legal action, they can however inform you that legal action is being taken.

Seeking unjustified amounts
A collections agency or creditor may not for example tack on collections costs to the debt, or any other fee or amount not proscribed by law.

There is also conduct that collections agencies, creditors, and debt collectors are required to do. This includes the following:

Identify themselves
Collectors must identify themselves as debt collectors in every communication, either by mail or by phone, that the communication is from a debt collector. They must also inform you that any information they gain may be used in an effort to collect the debt.

Provide name and address of original creditor
Collections agencies must respond to written requests made within 30 days to provide you with the name and address of the original creditor. This rule is in place to prevent fraudulent debt collections.

Notify you of your right to dispute
Within 30 days of their first contact with you, they must inform you of your right to file a dispute of any or all the information related to a alleged debt. They must also provide verification of your debt if asked within 30 days of receiving a §1692g notice, if they cannot verify the debt, all collections actions must cease, and the credit reporting agencies must be notified.

Lawsuit venue
If the collections agency does file a lawsuit, they must file the lawsuit in the jurisdiction where the contract was signed, or where you live.

If a debt collection agency violates these rules, you may sue in a court of law for actual, statutory, attorney’s fees, and court costs, provided that you can prove these rules were violated. It is not advised to file a fake lawsuit, as the court can award the collections agency an attorney fee if it can be shown you filed the lawsuit in an attempt to harass the collections agency, and yes that has happened before. You may also contact the Federal Trade Commission to report violations of the FDCPA.

Searching for help with consumer lending, credit cards, debt consolidation, money and credit tips, contact the editorial team from Texas Direct Lenders for timely advice and research on all topics related to consumer finance and lending.

Yet things have changed today. The banks have grown tired of losing their slice of the pie so they too have entered into the world of peer to peer lending. Big banks now have flooded the popular peer to peer lending sites such as Lending Club and Prosper. Small investors are having a harder time on peer to peer networks making loans, being cut out by big banking.

What this means is many of the mom and pop lenders and smaller private lenders have moved on from P2P lending. This has has an effect on interest rates. Once upon a time it was common and easy to get very attractive rates on peer to peer lending platforms, but now the rates are much more like traditional bank rates. Also once upon a time people with poor credit could score a loan through peer to peer lending, and while some still can, the majority of opportunities have been removed for those with poor credit due to the changes. The only positive move this has had for P2P lending is that it has increased the pool of money in which to borrow from on P2P lending sites.

It is true that some people have seen lower rates with the changes to peer to peer lending. Those prime borrowers who get a lot of banks competing for their loans receive rather attractive offers. As competition for loans increases, profit margins go down, resulting in affordable loans for those with an attractive credit score. Yet big banks and other financial institutions have already stated clearly that they are securitizing P2P loans. Another change is in the works where peer to peer loans will be traded and sold on secondary markets.

Those who had wished to do business with private investors should now be aware that most of the money going to borrowers is from big banking and big time wall street investors. You may as well go right to the bank if that was your sole motive to use peer to peer lending. Now with the state of peer to peer lending a big bank is likely to fund your loan but remain faceless, there to just collect their money and make a profit.

Now a days peer to peer lending only has about a 10% approval rate. This is a major change from the birth of peer to peer lending where upwards of 60% of borrowers were approved for a loan. If you still wish to use peer to peer lending my advice is to also rate shop with banks and other lenders to maximize your approval chances and to rate shop for the best rate possible. By applying to both personal loan companies and peer to peer you will have more offers to compare and have the best chance at finding the best possible rates.

Sadly the peer to peer nature of peer to peer lending is no more. Yes you can find some true small investors and peers on these sites but they are a dying breed and becoming harder to find every single day. Peer to peer lending is now just another way to reach big banking, but the experience is faceless. It remains to be seen if a new network will rise from the ashes that caters to small investors and true peer to peer lending again.

Can your student loans play a role in weather or not you are approved for a mortgage?, Absolutely they can. Your student loans can effect your debt to income ratio, your credit history, and loan to value ratio. If your student loan debt is high this can effect your generic risk score. Your generic risk score is one of the primary factors for mortgage approval and the best possible rate. Your credit report will reflect how well you have managed your burdensome student debt, and missed payments will hurt. Your lender will pull all 3 credit reports so there is no hiding it.

Student loan debt is an unsecured installment contract, but it does not need to be secured since you cannot go bankrupt on the debt, nor does the passage of time, even decades absolve it. This can help enhance your credit report however, if you have kept up a steady payment history on the account. Add to that your hopefully good payment history on some credit cards and you should be looking good, if your wages can support paying the student loans, the mortgage and living expenses. Student loan credit utilization ratio is never a factor here, unlike credit card credit utilization which would be a factor.

Your mortgage lender may require an additional step, since student loan debts tend to be quite large. They may require you to obtain a payment verification letter from your student loan provider. This is not out of the ordinary so do not stress over it, I guarantee you will not be the first nor the last person to have approached your student lender for verification purposes. As long as you have stayed current in the last year for your payments you should be fine.

Your biggest hurdle will be the down payment for your home. Since most college grads income goes towards basic living costs and their student loan debt you may find it hard to get ahead savings wise. Lenders want to see you have accumulated sufficient assets to make a significant down payment. There are some first time homeowner programs in your area you may qualify for, you can check with your cities H.U.D office to see which, if any programs you qualify for.

All in all as long as your debt to income ratio for front end and back end is not to low, and your credit report looks decent you should be able to get your mortgage. Again this is provided you can afford the down payment barring any assistance for a first time home owners program, many of which include down payment help.