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Loans Bad Credit Online – Financial Literacy Week: Credit discipline should be taught young | Fintech Zoom



Loans Bad Credit Online – Financial Literacy Week: Credit discipline should be taught young

The theme of this year’s Financial Literacy Week is “Credit Discipline and Credit from Formal Institutions”.

By Rajan Bajaj, Founder & CEO, Slice


Since 2016, the Reserve Bank of India (RBI) has been conducting Financial Literacy Week every year to propagate financial education messages on a particular theme across the country. The theme of this year’s Financial Literacy Week is “Credit Discipline and Credit from Formal Institutions”.

I have always been a big advocate of the importance of financial literacy and I strongly believe that from educational to financial institutes, they should all do their bit in driving more awareness and education around good financial management. Which is another reason why RBI’s annual ‘Financial Literacy Week’ is a very good initiative which can potentially transform things ground up. And this year, their theme is the closest to my belief system – “Credit Discipline and Credit from Formal Institutions”. Here’s my two cents on it.

In our culture, ‘credit’ is frequently associated with ‘debt’. Financial information, from credit cards to investments, is an area that is perpetually surrounded by rumours, bad practices, and myths which give it a bad reputation. In reality, good credit discipline will not only grow your wealth but open up a plethora of opportunities in your future. Given the growing and accessible digital infrastructure and as one of the youngest populations in the world, India has an opportunity to build a highly empowered workforce.

As per a report published by Morgan Stanley in 2019, 46 per cent of India’s workforce consists of millennial and GenZ who contribute around 70 per cent of the household income, yet not enough importance and value is given to their financial literacy. Unlike the social norm of our country, credit discipline and good credit behaviour needs to be taught as soon as someone steps into the realm of financial independence. A financially intelligent young population will not only create personal wealth but also contribute holistically to the financial fabric of the country in turn strengthening the economy and other institutions.

RBI’s repeated emphasis on financial literacy driven by the theme of credit discipline this year needs to lead to an active conversation around early credit education and how that can prove to be viably effective. Myths and misinformation surrounding credit have plagued people for years. The truth is that a credit line is not the problem, unwise spending habits are. Credit can, infact, open up several possibilities. It allows you to not compromise on your dreams and to follow your passion. It also allows you to build a good credit score which can eventually lower your cost to borrow. And that could potentially mean saving lakhs of rupees in the future on your home, car, or education loan or even to start a business.

Big dreams, lack of financial planning: Plight of Indian women in life goals preparedness

In the backdrop of the ‘Financial Literacy Week 2021’, here are six tips, especially for youngsters, that will help bring credit discipline into your lives and help you make the most of your credit cards.

1. Find the right solution for yourself

Whether it’s a physical or virtual credit card, or a one-time buy now pay later option, it is essential that you do not blindly settle for the first option but take time and evaluate all your needs. To get you started, here are a few things you must check – annual fee terms, APR on paying minimum due amount, hidden fees, joining fee, process of rewards redemption and benefits.

2. Start low and grow

Don’t chase the sun and the moon when it comes to a credit limit on your cards. A credit limit that is 1-2x of your monthly spend is a good place to start when choosing a new card. Your credit limit is bound to grow as you maintain and demonstrate healthy credit behaviour. Focus on cultivating good credit discipline, especially with your first card, and the rest will fall into place.

3. Don’t shy away from your passbook

We love shopping but not looking at the final ‘damage’. Make checking your passbook a daily or weekly habit to stay in touch with your expenses. Some of the best credit solutions come with the best apps. They offer interactive passbooks and visual representations of your spending history. Get comfortable with the app of the solution you choose and thoroughly navigate and explore it. Check your balance and expenditure often. Not only will it help you stay on top of your spending, you’ll also be able to spot any fraudulent charges.

4. Let your goals lead the way

The biggest challenge with spending is identifying your real priorities. Don’t let your FOMO decide where you spend. Set goals for yourself in life and plan your budgets around it. If you wish to pursue photography, look for the best EMI solutions for your camera and plan your monthly expenses based on this. If you have set goals, then skipping a movie or a restaurant visit here and there will not be a problem. Cultivating right spending habits in the initial days of using a credit card can be a game changer and a healthy limit utilization will also help you build a better credit score.

5. Work towards building a good credit score

A crucial credit card lesson is that your card usage impacts your credit score. Credit score is an analysis of your ability to handle loans and other financial obligations. Responsible repayment is critical in defining your credit worthiness. Practice good credit habits like paying your dues on time, low card utilisation, using fewer cards etc., and you’ll see yourself building a good credit score.

6. Keep checking your rewards and points

Rewards are a big reason we sign up for a credit card in the first place. So it only makes sense that we get the most out of it. Check your points regularly and keep a tab on the new offers you are eligible for. Usually card providers will bring new offers to you every month, so keep checking their website or app periodically. Be careful when redeeming rewards as some providers end up charging a fee for that also. Go slow with the checkout process of reward redemption and keep reading terms and conditions to ensure you’re getting the best deal.

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Loans Bad Credit Online – Financial Literacy Week: Credit discipline should be taught young

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How Do I Sell My Vehicle With Joint Ownership?



A joint auto loan is when two borrowers have rights and responsibility to the same vehicle and loan. If you have a cosigner, then you, the primary borrower, have all the rights to the vehicle. Here’s what you need to know when you need to sell your car with two people responsible for the loan.

Selling a Joint-Owned Vehicle

Joint owners are typically spouses or life partners who combine their income to meet income requirements or get a larger loan amount. Both co-borrowers are responsible for paying the car loan and have 50/50 rights to the vehicle, so both their names are listed on the title.

Since your co-borrower has the same rights and obligations to the vehicle as you, you must get their permission to sell the car. In most cases, they also need to be present for the sale to sign the title. This may not always be the case, though, so it’s important to know how to read your car’s title.

If you have it, take a look at your vehicle’s title for the names listed on the back where you sign to transfer ownership. For example: let’s say your name is Jane and your co-borrower’s name is Joe. You’re likely to see either:

  • “Jane and Joe”
  • “Jane or Joe”
  • “Jane and/or Joe”

If you see “and/or” or the connector “or”, this typically means only one person needs to be present for the sale of the car. But if you see “and” this means both of you need to be present to transfer ownership – this is usually the case with joint ownership.

In all three cases, you still need the permission of the co-borrower to sell the vehicle even if they don’t have to be physically present to sign the title. If you sell it without the co-borrowers consent, it may be considered a crime because it’s their property, too. Moving forward, discuss the sale with your co-borrower to avoid potential legal trouble.

Selling a Car With a Cosigner

How Do I Sell My Car With Joint Ownership?If you have a cosigner on your car loan, then things become easier. A cosigner doesn’t have any rights to the vehicle and their name isn’t on the title. Their purpose is to help you get approved for the auto loan with their credit score, and by promising the lender to repay the loan if you’re unable to. A cosigner can’t take your vehicle, sell it, or stop you from selling it yourself.

However, it’s nice to let them know if you do decide to sell the car because the auto loan is listed on their credit reports. If you can, reach out to them about your plans to sell the vehicle. The car loan’s status impacts them and could affect their ability to take on new credit when it’s active.

If you sell the vehicle and the lien is successfully removed from the title, then you’re both in the clear.

Removing the Lien From a Vehicle’s Title

If you still have a loan on your car, then your number one priority is paying off your lender. Your lender is the lienholder, and you can’t sell a vehicle without removing them from the title – they own the car until you complete the loan. This typically means paying off the loan balance until naturally during the loan term, or getting enough cash to pay it all off at once from a sale.

When you’re selling a car with a loan, you want to get an offer for your vehicle that’s large enough to cover your loan balance and to remove the lien. If you don’t get a large enough offer, then you need to pay that difference out of pocket before you can sell the vehicle. Or, you may be able to roll over the remaining loan balance onto your next car loan if you’re trading it in for something else.

Looking to Upgrade Your Ride?

Many borrowers ask for help to get the car they need. If you need more income on your loan application to meet requirements, asking a spouse or life partner to chip in can do the trick. If you have a lower credit score, then a cosigner with good credit could help you meet credit score requirements.

But what if you want to go it alone on your next auto loan and your credit isn’t great? A subprime lender could be the answer. Here at Auto Credit Express, we’ve been connecting credit-challenged consumers to dealerships with bad credit resources for over two decades, and we want to help you too.

Fill out our free auto loan request form and we’ll look for a dealer in your local area that’s signed up with subprime lenders. These lenders assist borrowers with many unique credit circumstances to help them get the vehicle they need. Get started today!

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Fixed-rate student loan refinancing rates sink to new record low for the second straight week



Our goal here at Credible Operations, Inc., NMLS Number 1681276, referred to as “Credible” below, is to give you the tools and confidence you need to improve your finances. Although we do promote products from our partner lenders who compensate us for our services, all opinions are our own.

The latest trends in interest rates for student loan refinancing from the Credible marketplace, updated weekly. (iStock)

Rates for well-qualified borrowers using the Credible marketplace to refinance student loans into 10-year fixed-rate loans hit another new record low during the week of May 3, 2021.

For borrowers with credit scores of 720 or higher who used the Credible marketplace to select a lender, during the week of May 3:

  • Rates on 10-year fixed-rate loans averaged 3.60%, down from 3.69% the week before and 4.32% a year ago. This marks another record low for 10-year fixed rate loans, besting the previous record of 3.69%, set last week.
  • Rates on 5-year variable-rate loans averaged 3.19%, down from 3.23% the week before and up from 3.04% a year ago. Variable-rate loans recorded a record low of 2.63% during the week of June 29, 2020.

Student loan refinancing weekly rate trends

If you’re curious about what kind of student loan refinance rates you may qualify for, you can use an online tool like Credible to compare options from different private lenders. Checking your rates won’t affect your credit score.

Current student loan refinancing rates by FICO score

To provide relief from the economic impacts of the COVID-19 pandemic, interest and payments on federal student loans have been suspended through at least Sept. 30, 2021. As long as that relief is in place, there’s little incentive to refinance federal student loans. But many borrowers with private student loans are taking advantage of the low interest rate environment to refinance their education debt at lower rates.

If you qualify to refinance your student loans, the interest rate you may be offered can depend on factors like your FICO score, the type of loan you’re seeking (fixed or variable rate), and the loan repayment term. 

The chart above shows that good credit can help you get a lower rate, and that rates tend to be higher on loans with fixed interest rates and longer repayment terms. Because each lender has its own method of evaluating borrowers, it’s a good idea to request rates from multiple lenders so you can compare your options. A student loan refinancing calculator can help you estimate how much you might save. 

If you want to refinance with bad credit, you may need to apply with a cosigner. Or, you can work on improving your credit before applying. Many lenders will allow children to refinance parent PLUS loans in their own name after graduation.

You can use Credible to compare rates from multiple private lenders at once without affecting your credit score.

How rates for student loan refinancing are determined

The rates private lenders charge to refinance student loans depend in part on the economy and interest rate environment, but also the loan term, the type of loan (fixed- or variable-rate), the borrower’s credit worthiness, and the lender’s operating costs and profit margin. 

About Credible

Credible is a multi-lender marketplace that empowers consumers to discover financial products that are the best fit for their unique circumstances. Credible’s integrations with leading lenders and credit bureaus allow consumers to quickly compare accurate, personalized loan options ― without putting their personal information at risk or affecting their credit score. The Credible marketplace provides an unrivaled customer experience, as reflected by over 4,300 positive Trustpilot reviews and a TrustScore of 4.7/5.

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Provident Financial calls time on doorstep lending business



Provident Financial has confirmed plans to shut its 141-year-old doorstep lending arm, as its full-year results highlighted the strain the coronavirus pandemic and growing customer complaints have put on subprime lenders.

The Bradford-based company reported a pre-tax loss of £113.5m for 2020, compared with a £119m profit the previous year. The biggest drag was a £75m loss in its consumer credit division, which includes home credit.

Malcolm Le May, Provident chief executive, said: “In light of the changing industry and regulatory dynamics in the home credit sector, as well as shifting customer preferences, it is with deepest regret that we have decided to withdraw from the home credit market.”

Jason Wassell, chief executive of the Consumer Credit Trade Association, which represents alternative and high-cost lenders, said the decision showed that “the current regulatory framework does not work for the market, or its customers”.

“The result in this case is that access to credit will be reduced for hundreds of thousands of people.”

Provident built its name as a provider of home credit, or doorstep lending, which involves a team of local agents who regularly visit borrowers to collect repayments and discuss their products.

Proponents believed agents’ local expertise and personal relationships with borrowers allowed them to achieve better results than traditional bank lending to people with bad credit scores, but the approach has increasingly been superseded by digital models in recent years.

Provident’s business has also been affected by a series of self-inflicted and external difficulties. Its consumer credit division has been lossmaking since a botched effort to modernise the unit in 2017, which led to a pair of profit warnings and an emergency rights issue. More recently, its recovery has been hampered by an increase in customer complaints that prompted an investigation by the Financial Conduct Authority.

The complaints rise has been driven by professional claims management companies, echoing a broader trend across the subprime lending industry which has also affected companies such as Amigo, the guarantor lender. Executives also accuse the Financial Ombudsman Service, which adjudicates on customer complaints, of overstepping its mandate and encouraging huge volumes of complaints.

Provident said it would wind down or sell the consumer credit division, with either option expected to cost it about £100m. 

The move will see Provident exit the most controversial areas of high-cost credit to focus on what it describes as “mid-cost” lending through its Vanquis credit card business and Moneybarn vehicle finance arm. Vanquis and Moneybarn both remained profitable during 2020, despite more than a quarter of Moneybarn customers requesting payment holidays at the height of the pandemic.

The results were slightly better than average analyst forecasts, and the company said Vanquis and Moneybarn had both reported “improving trends” during the first quarter of 2021. Shares in Provident nonetheless dropped more than 10 per cent in early trading.

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