| Personal Loan Rate Tricks
When you're shopping around for a personal loan, what's the first piece of information that grabs your eye? Whether you're looking at individual advertisements, or studying a table which compares several loans all at once, the thing most likely to catch your eye is the Annual Percentage Rate (APR). In theory, the APR is supposed to provide you with a true comparison of the cost of borrowing. Thus, the APR factors in charges for credit, including interest and any compulsory fees. However, in the real world, lenders have discovered how to manipulate APRs in order to disguise the true cost of borrowing. Here are three fiddles to watch out for: 1. Misleading 'typical' APRs Until the late Nineties, personal-loan providers would offer the same standard interest rate to all applicants, regardless of their personal circumstances.
Avoid interest rate 'roulette'
Consumers are being urged to take measures to ensure they are able to cope with any further rises in the Bank of England base rate.New research from Legal & General shows that in the last 30 years the bank's interest rate has increased 58 times, on each occasion putting homeowners and borrowers under pressure.The rising cost of borrowing makes expensive forms of debt, such as credit cards, an even less attractive personal finance option."Borrowers will be waiting to see if they are going to be in the red or the black in the base rate roulette next week," said Stephen Smith from Legal & General."Rates are still at a relatively low level compared to 70s and 80s, and many people would struggle with today's debts at yesterday's prices. Whilst the boom and bust has flattened out since the turn of the millennium, borrowers are still facing a probable hike in rates in the near future," he added.Consumers who are feeling the strain from the three successive rate rises – and who are worried about the likely prospect of further rises – can use a secured loan or homeowner loan to help cut their monthly outgoings.© Adfero Ltd .
Rural youth can boost FIs, Insurance Cos` turnover
Financial Institutions (FIs) and Insurance Companies can rope in about 200mn Rural Investors in their fold provided they design innovative savings and loan schemes on lines of commercial banks and even post offices and multiply their annual turnovers by disbursing agri, housing, personal and education loans and easy insurance schemes at affordable rates to potential aspirants, according to Associated Chambers of Commerce and Industry of India (ASSOCHAM). In a paper on 'Investment Potential Prospects of Rural India' brought out by the industry chamber, it has been stated that of the 700mn rural population, about 200mn rural youth have reasonable per capita income, but investment opportunities are virtually non-existent. "This is because, these have no access to popular savings instruments of various commercial banks, insurance companies and post offices branches in ulteriors of countryside and are disparately looking to channelise their finances for suitable returns. A good number of rural investors are also aspiring to become self reliant but lack avenues for credit in areas for food processing, better horticultural and agricultural facilities, training for skill development to process their milk etc., says the paper.
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