Finance Companies Can Do!Monday, November 22, 2010 3:27
Many finance companies help people when they are suffering from bad financial condition by offering loans. Therefore, you surely would understand that finance company plays important role in many people’ financial situation. Actually, these types of companies have some major roles and knowing what they can do may be very advantageous for you.
First off, finance companies are different from traditional banks or mortgage lenders. Usually, the finance company gives loans from available capital sources and gains profits from the interest paid by borrowers. Most of these companies will want you to require collateral. More loans mean more collateral.
Secondly, finance companies provide loans for people with bad credit score. Many people with poor credit will find it difficult to loan from traditional bank lenders or unsecured credit cards. Surely, finance company charges a higher interest rate. However, even though borrowers with poor credit will be able to fund from finance companies, they will still more requirements should be acquired by borrowers in order to get the fund, for example they should have a verifiable income source, serial numbers and identification information for the collateral, and the last is a verifiable address.
The third role of finance companies includes the major purchase financing. You can apply for the loan for several main purchases like used cars, appliances, musical instruments, electronics, or even other big-ticket items. Commonly, the company will set the direct work with retailers that sell the items the borrowers needed. Therefore, the finance company will secure the financing faster because the company already knew the retail value, depreciation and resale value of the item. The process is even faster than taking the fund from other sources. In fact, the cash will be provided for financing 100% of the retail price. This way, you can avoid the down payment.
Finally, it is obvious that finance companies can become reliable cash resource. It means you can get the cash directly from the company. Through this direct cash fund, borrowers are now able to use the money as soon as possible for medical emergencies, education expenses, or just financing a vacation trip. When the company ask you the exact reason for the loan, the best answer can be “personal expenses.”