The year 2012 is a shaky year for finances. The economy is still sluggish, the job market is questionable and the credit scores of millions of Americans have taken a serious hit since the downturn of the economy in 2008. This makes looking for a loan in 2012 a slippery slope for many Americans. Even if you have impeccable credit history, you may still have a problem securing a loan for a rate that is affordable. Banks and other lenders are becoming stricter regarding who they will lend money to, meaning that if your credit score is phenomenal, you may be denied a loan because you have too much debt or because you work for yourself; plenty of other situations apply, as well.
Students – If you are looking for a student loan in 2012 you may have trouble finding one. Many banks are not offering private student loans anymore. Those that are require significant credit history with an impeccable score, meaning many students will need a parent or friend with excellent credit to cosign a loan on their behalf. The federal government does offer loans to students that do not require a credit check; these are called Stafford loans. These loans must be repaid once a student graduates or leaves school and they do not require a credit check or credit history.
Home buyers – Home loans are still being offered to people. Those that have less than perfect credit will need a large down payment or the help of a federal program to apply for a home loan. Additionally, home loans for people without exceptional credit will come with steep interest rates, making payments more expensive and the cost of the home much more over time. Still, many people without good credit are still managing to find a way to apply for a home loan in 2012.
Car shoppers – Vehicle loans are more difficult to get. Without a hefty down payment, many lenders and auto companies are unwilling to finance buyers for a new or used car unless they have perfect credit. This is leading to an increased number of vehicle sales through buy here pay here car dealerships, which often require at least 20 percent of the total cost of the vehicle up front; sometimes more.
Consolidation loans – Consolidation loans are loans that are big in 2012. Many people are looking to consolidate their finances by taking out a large lump sum loan in order to pay off their smaller debts; freeing up their income and making one large payment to their consolidation loan rather than several small payments for their debts. Consolidation loans are much easier to secure than a home loan or a vehicle loan and many people are opting for them.
Obtaining the type of loan you want or need in 2012 may be very easy or it could be a process; it all depends on your credit score and your personal finances. Always remember to shop around for the best rates for loans; banks and credit unions are a good starting point for obtaining loan information.
Photo credit: alancleaver_2000