Bennett Lending Advice: When to Get a Loan
There are times in our lives when getting a loan can be absolutely necessary such as emergencies with our vehicles or even for medical reasons. Typically emergency loans are for a set amount of money to cover a bill and they are paid back based on a set schedule of payments that can be flexible with your pay day or other bank deposits. They say money is the root of all evil, but why not alleviate issues that come up in your life with a loan? Often we have the money in our bank accounts to cover things, but we don’t want to take away from how we are living currently or to be stretched too thin, so making payments towards a loan can be a huge financial help.
A Debt Consolidation Loan
Many of us have multiple accounts that we would like to may one payment on to avoid having to log in to several accounts per month or send multiple paper checks. (Have you seen how costly those are getting?) There are many myths about debt consolidation and Dave Ramsey debunks those:
- Debt consolidation is a refinanced loan with extended repayment terms.
- Extended repayment terms mean you’ll be in debt longer.
- A lower interest rate isn’t always a guarantee when you consolidate.
- Debt consolidation doesn’t mean debt elimination.
Refinancing a Loan
There are also refinancing loans: Refinancing is done to allow a borrower to obtain a better interest term and rate. The first loan is paid off, allowing the second loan to be created, instead of simply making a new mortgage and throwing out the original mortgage.
We have refinanced our home twice and while some people would disagree with the idea, we have seen extreme benefits. Refinancing is also an option for those of us who have mounting student loans and have a hard time keeping up with the often hideous payments. Many also look into programs to change their loan terms for student loans such as income based repayment (ibr) which can take an often hard to make payment and reduce is based on the amount of money you make per year.
What Do Companies like Bennett Lending Do?
The role of a lender is to lend money for buying property. The lenders can be banks, credit unions or private individuals. They do not lend people money but instead secure or buy mortgages from mortgage lenders, thereby replenishing their cash flow and enabling them to continue to provide loans to others.
Many people speak to lenders prior to house-hunting because they get all of the needed information including how much they pre-qualify for. Knowing this important information can help in the search for a home and narrow down decisions based on what you can afford. In our area visiting a lender before an auction of a home is an absolute must because the auctioneer needs to see a full amount of what you qualify for before you can place your bids. A payment is typically due on the day of the sale to make things final and having a lender involved does nothing but help those who do not have huge amounts of cash laying around.
No matter what your financial situation is, having a lender involved in your life can be a great help.