| The costs of bad credit
As with any other personal loan, the interest rate you get largely depends on your personal circumstances. However, with this particular type of loan, the single most important factor in determining the rate you get is your credit history. A poor credit rating means that the interest rate you will pay will be markedly higher than with other unsecured personal loans. As most bad credit loans are likely to be variable rate deals, you should be aware that your loan repayments will change in line with interest rates. Click here for more on fixed and variable rates. If you intend to pay your bad credit loan off early then make sure that you know what the early redemption penalties (if any) are. Remember: if you want to repair your credit rating over time then you need to make every payment on any loan you are given.
Japanese lenders deny loans to credit risks
TOKYO: Aiful, Japan's biggest consumer lender, and its two closest rivals rejected more than half of loan applicants in January as they seek to trim costs by weeding out borrowers who could default. Aiful cut approvals by half, granting unsecured personal loans to 36 percent of applicants in January, compared with 72 percent in February 2006, according to data on its Web site. Acom, the second-biggest lender, cut approvals by a third to 47 percent in the same period. Promise ratified 40 percent. Bad-loan costs have mounted in the $170 billion consumer finance industry since Japan's courts last year opened the door for borrowers to claim refunds of interest and regulators reined in collection tactics. The three biggest lenders forecast a combined $5 billion loss in the year to March 31 and may struggle to return to profit as a new law caps their charges at the same level as banks.
Welsh town 'personal finance blackspot'
A WELSH town has received the unenviable accolade of being branded a "personal finance disaster" in a new survey. Caerphilly came second in a league of shame naming the 10 most "financially-troubled" spots in the UK. In its survey, the internet directory service locallife.co.uk contrasted the town's high number of businesses dedicated to financial problems - such as debt collectors - with the low number of businesses associated with healthy personal finances, such as accountants. A spokesman for the website said, "On an overall per capita basis, Caerphilly had more debt collectors, insolvency practitioners, money lenders and pawnbrokers than almost anywhere else in the UK - as well as having a lower number of accountants, banks, building societies, independent financial advisers and mortgage, tax and pension advisers." He added, "Caerphilly has amongst the most financially troubled residents in the UK." .
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