How to Get Approved for Credit in a Financial Downturn

In a recession it’s common for many people to rely on credit cards and loans to balance their finances. It’s the ultimate catch-22 since, during a recession, these financial products can be even harder to qualify for. This holds true, according to historical data from the Federal Reserve Bank of St. Louis. It found that […]

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How Interest Rate Hikes Affect Personal Loan Investors

In December 2015, the Federal Reserve raised the federal funds rate by a quarter of a percentage point. That was the first time the Fed had raised rates in nearly a decade. While federal funds rate changes don’t directly impact … Continue reading →

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Understanding How Mortgage Interest Rates Work

Question: What do home mortgage loans (including second mortgage loans), retail installment loans, automobile loans, home improvement loans, and mobile home loans, have in common — aside from being loans to consumers?

Answer: The interest charge sometimes is calculated monthly and sometimes daily. With a monthly interest rate the borrower is charged for each month, whereas with a daily interest rate the borrower is charged for each day.

Why is this distinction important? Because daily rates are a potential trap for unwary borrowers, countless numbers of whom have found themselves permanently, usually with no understanding of how it happened. The problem has been entirely overlooked by regulators, including the Consumer Financial Protection Bureau.