Very Difficult Cases In Dealing With Direct Money Lenders

When you find it difficult to get loans for your house or commercial property directMoney Lender pitch in to provide you the loan that others are denying you. You may find getting a loan difficult because of your credit rating, the choice of location may be remote and not of interest to the traditional lenders, the choice of your building material may be creative and not approved by the agencies. In such a case private individuals or companies who specialize in giving loans to individuals with special needs step in. These individuals or companies are known as money lenders.

When do very difficult cases while dealing with Money Lenders arise?

While direct money lenders pitch in with loans when everyone else turns you away, because of the same reason they charge you a high interest rate and a high fee on the borrowing making the chances of foreclosure greater or getting you in a difficult situation otherwise.

Here are five very difficult cases of dealing with Direct Money Lenders

1.When you meet a loan predator who will lend you money but design the loan in such a manner that it becomes difficult for you to repay the loan.

2.When the loan value ratio is very high. In cases where the direct Licensed Money Lender are giving you loans which form a high percentage of the property you are likely to end up in difficulty because in such a case because of the high interest rate and the high principal amount the repayments will become tough to negotiate.

3.When the initial fee is very high. Sometimes the initial fee is as high as eight percent of the loan and this is obviously not a good condition. In such a scenario the interest rate is also pushed up because if you were taking a loan of $100,000 at a 12% interest and end up paying $8000 at the beginning of the loan itself then effectively the principal that you are taking is just $92000 and not $100000 thus pushing your rate of interest higher.

4.Direct money lenders are often difficult to find and one can only get through to them with the help of agents and brokers. However these brokers or agents may not be interested in getting you the best deal but only make maximum profit for themselves and in doing so not only get you a more expensive deal but one that does not suit you as well.

5.When you have not appraised either the property correctly or taken a accurate view of your financial situation. In either case there will be a mismatch in the loan payment versus the money you have resulting in your facing a difficult situation.

How to avoid getting into a difficult situation?

If you take care of a few basics it will ensure that you do not end up facing any troubles from the direct money lenders. For starters make sure that you do not get into such a loan unless there is a real need. For instance if the traditional organizations are shying away from giving you a house loan because you want to build a cabin in a remote area ask yourself whether you really need that cabin? Avoid as much as possible falling into the very difficult cases of dealing with Direct Money Lenders scenario.

Or if you are being denied the loan because of poor credit ratings be wary of the fact that it is only because you are poor at managing your finances. Since the interest rates are very high here and the lenders have a first mortgage over your property you must be doubly careful as any default in repayment would result in the lender proceeding on foreclosure.

At the first sign of trouble get in touch with your lender and try to restructure your deal if you feel that it is going to be a difficult case going forward or a repayment default is imminent.

Author - Bill Darken - There's a good student loan area along with more relevant general loans assistance such as home, car, and consolidation loans. There are highly informative eye opening articles and up-to-date loans news as well, see it here at Licensed MoneyLender Singapore or if the previous link is not working, you can paste this link in your browser