USA Loans - Ways to Get US Loan
Loans are extremely popular in the USA. Just about everyone who drives a new car or owns a home has a loan of some kind. The loan business is a multi billion dollar industry and there are literally thousands on financial institutions just waiting for people to come in a take out loans. There is a lot of money to be made on interest and this is why even people with bad credit can obtain loans. In fact, there is even more money to be made off giving a loan to someone who has bad credit because the interest rates on bad credit loans are almost always high. Following are some of the different loans, as well as the ways a person may obtain one of them, whether his/her credit is good or bad.
Home Mortgage Loan
Typically, when applying for a mortgage on a home, the first thing that will be assessed is a person’s credit history. If a person has good credit, documents such as proof of income, proof of identity, and a social security number will be needed. If the person seeking a US home loan is not a citizen of the United States, that person will have to have papers proving his/her eligibility to work in the this country. The only exceptions to this rule would be if the individual had been granted asylum for some reason, or has obtained what is called an investment visa. In this case, a deposit of about 10%- 20% of the total sales price is typically required. If a US citizen has bad credit and wishes to obtain a loan, there may be programs available to him/her, such as the first time buyers program, or a private loan with a much higher interest rate, using some sort of collateral as security. Individuals who are self employed, and would like to use, “stated income” will need to provide tax returns for the past several years.
Automobile Loan
Typically, unless a person has saved enough cash to buy a car outright, a loan will need to be taken out. The requirements for US car loans vary, depending on what type of car loan is being sought, as well as whether the car is new or used. In addition, if a person does not have very good credit, the chances of that individual obtaining a low interest rate car loan are very poor. Usually, used car lots will have a number of different options in terms of credit. Many used car dealers provide internal financing and allow a person to put a down payment and make payments directly to them just by using employment as credit. This means that anyone who has a job can buy a car, regardless of his/her credit score. The downside of receiving a car loan with bad credit is that the interest rates are almost always through the roof. A better alternative for someone who is struggling with credit issues is to get a family member or close friend who does have good credit to co-sign on the car loan.
Personal or Commercial Bank Loan
There are many financial institutions which provide US bank loans to people needing money for personal use, as well as commercial use. The two forms of banks loans are unsecured and secured. The main requirement for obtaining an unsecured bank loan is typically excellent credit, as well as solid proof of the ability to repay the loan. If a person has bad credit, there may be a chance he/she can get a secured bank loan. The downside of a secured bank loan is that collateral is normally required to obtain such a loan. The good news is that the interest rates are typically much lower on secured loans. This is because the bank has something they can hold onto in order to assure they will be repaid, one way or another.
Many financial institutions offer an easy online application to help people speed up the process of applying for a loan. Before deciding to take out a loan, no matter what the purpose, it is important to consider carefully what type of loan is needed, how much money should be borrowed, and of course, how the loan will be repaid.