unsecured personal loan

Source: http://business.theage.com.au

Source: http://www.business-standard.com

Source: http://www.business-standard.com

There is no better time than the present to plan for getting rid of excess debt. Any time borrowing threatens to spiral out of control, it is smart to take action before you find it difficult to pay off loans or credit card balances.One of the best ways to control debt is to manage borrowing and spending habits wisely. Borrow only when necessary, shop around for competitive rates and pay off credit card balances every month.

Although high-rate credit card debt can quickly grow if you carry a balance, credit cards are also handy money-management tools when used wisely. Take advantage of the interest-free loan period from when you charge a purchase and the time the monthly balance is due. Credit cards can be very convenient as they help supplement cash flow and usually have other features that can save you money. Examples of extra benefits are free purchase protection insurance, extended warranty, gift certificates, merchandise redemption and travel rewards. However, careless credit card use can lead to financial difficulty because credit card interest is higher than other types of borrowing.

If you have significant card balances or other high-rate debt, one of the best ways to get it under control is to consolidate borrowing.You can take out a lower-cost, unsecured personal loan at a financial institution and use it to pay off existing debt. You will significantly reduce interest costs and make your financial life less complicated because you will have fewer payments to worry about every month.In essence, you will be rolling a number of separate bills into one payment. Another option is to pay off high-rate debt with a secured loan, such as a home equity line of credit.

It may even be possible to trade higher-rate personal loans for lower-rate debt. Although this may not work when rates are rising or stable, it is a viable strategy when rates decline and new loans become cheaper than existing loans. Consider taking out a new loan at a lower rate and use it to pay the outstanding balance on an existing loan. Your financial institution may let you refinance a loan at lower rates; if not, consider borrowing from another institution.

Borrowing can be appropriate when cash is needed for short-term need, such as the purchase of a car.At first glance, it might seem that it is better to liquidate investments rather than going into debt for the purchase. But it is important to understand that selling high-quality investments to cover short-term cash obligations can have negative tax consequences, not to mention lost investment income, growth and compounded interest.

Instead, a solution that might be considered is borrowing against your securities.You have to be mindful that this involves greater risks than using cash resources only and is not appropriate for everyone. Your responsibility to repay the loan and interest may continue, even if the value of the securities declines. And if the value of the securities declines, you may be required to deposit funds, additional securities, or sell the securities in your account.

Having said that, it is a technique that could keep your portfolio intact, may have tax advantages, and will provide the short-term cash that is required. If you are considering this option, consult with your accountant or tax adviser about your particular situation.And if you need help with debt in general, it is a good idea to speak to your financial adviser. Or you might want to get help from a credit counsellor. The sooner you get out from under a mountain of debt, the better off you’ll be.

Source: http://www.financialpost.com

LONDON (Thomson Financial) - A Competition Commission investigation will soon unveil possible sanctions against Britain’s biggest banks over up to 1.5 billion pounds of alleged excess profits made from the sale of insurance to cover customers against their failure to pay off personal loans due to sickness and unemployment, reported the FT Weekend newspaper citing lawyers and industry insiders.

However, bankers told the paper that action by the commission to restrict or remove their ability to sell so-called payment protection insurance would be likely to lead them to seek to recoup lost revenue by raising charges in other areas, not least by raising loan interests rates.

One banker said: ‘Personal loan rates have been uneconomic for a while. Rates are likely to go up if PPI is sold separately.’

Despite industry lobbying, the paper says that the commission will stick close to its provisional conclusion this year that banks selling the insurance are earning as much as 1.5 billion pounds a year above a reasonable rate of return by selling to buyers who are in effect a captive market.

Source: http://www.forbes.com

Before championing a big legislative pay increase, Illinois Senate President Emil Jones provided himself with tens of thousands of dollars in interest-free loans from his campaign fund.Under Illinois’ relatively loose campaign-finance laws, there’s nothing illegal about politicians dipping into their campaign funds that way. But it’s highly unusual.

Since 1989, the South Side Democrat has taken out $120,528 in personal loans from his political fund and repaid $96,900 of that amount — leaving nearly $25,000 unaccounted for.Just last year, Jones withdrew $5,800 from his fund in 20 separate loans of $200 or $300 each between July and December.In October alone, he had eight disbursements of $300 apiece over a 23-day period.

Last week, Jones sparked criticism when he proclaimed, “I need a pay raise.” That was in support of a pending 12 percent legislative pay raise set to take effect unless legislators took steps to block it. Jones stands to see his salary rise from $91,824 to $102,547.

A government watchdog group questioned whether Jones is using his campaign for personal expenses rather than political ones, under a loophole in a 1998 law that was supposed to ban the personal use of campaign funds.

“It absolutely looks like a slush fund,” says Cindi Canary, director of the Illinois Campaign for Political Reform. “He is living under a whole set of rules that no one else in the public is.”

Jones’ camp declined repeated requests from the Chicago Sun-Times for comment on how he has spent the money from his interest-free loans. A top aide would say only that some of the money was spent on gasoline. Campaign records don’t appear to show what the loans were for. Nor is there anything in the public record stating the terms of the loans.

Source: http://www.suntimes.com

Source: http://www.moneynews.co.uk

Source: http://www.nzherald.co.nz

Source: http://www.londonstockexchange.com