"I resolved in 2009 to get a hold of my credit card debt. I have been able to refinance about $10,000 total in credit card debt that would have taken several years to pay off, due to the high interest rates," McElravy told WalletPop, adding, "Although my monthly payment is about the same, I will have all of it payed off within the next two or three years. I plan on making extra payments when I can."
This experience is similar to what we found when we looked at what it is like to get a loan from a peer-to-peer lender in our review of Lending Club back in March. After 9 months with a new, lower loan rate and a fixed payment schedule, we are still happy with our peer-to-peer loan.
"As many Americans resolve to get rid of debt in the new year, a Lending Club personal loan offers a refreshing alternative to the traditional lending institutions," said Rob Garcia Sr. Director of Product Strategy at Lending Club. in an email to WalletPop, "better loan rates, instant rate quote, and fixed monthly payments mean our borrower can pay off existing balances faster and more cheaply."
The rates on peer-to-peer loans from Lending Club are favorable when compared to the credit card rates offered from many big issuers. The national average interest rate from Lending Club on a 36-month loan is 9.8%, while it is 14.34% on credit cards as reported on Creditcards.com. There are even greater savings to be had for borrowers with a good credit score.
In addition to the lower rate, we also like the ability to handle the entire lending process online with the exception of one phone call to verify some of the information. When you compare this to other lenders, such as Wells Fargo or Capital One that require you to call a banker or have an invitation to get a personal loan, the advantage is clear.
One caveat that McElravy notes is that you do need to have decent credit to get a loan through Lending Club. Currently, the minimum score is a 660, so not everyone will qualify. Another thing to keep in mind is that if you are a member of a credit union or a community bank, we do suggest you check with your banker because you can often get a favorable rate without lots of red tape or upselling.
If you want to cut your debt in 2011, getting a personal loan that transforms your high-interest rate credit card debt to a lower rate personal loan with a fixed repayment schedule is one of the best steps you can take. Thanks to Lending Club's streamlined online loan process, getting a personal loan is easier, and smarter, than eve
Chase Customers With Small Direct Deposits Will Pay More
Martha C. WhiteMartha C. White RSS Feed
Dec 22nd 2010 at 5:00PM
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Filed under: Banking, Banking - Checking Account
finger with dollar on it - chase small direct depositsBeginning in February, Chase will begin charging a growing number of its customers for basic checking accounts. What might raise some objections is who's being singled out for these new fees: account holders who receive small direct deposits of less than $500. Right now, anyone who gets a direct deposit can have the $6 monthly fee waived, but that's about to change.
If someone -- say a person on unemployment, or a senior citizen receiving government benefits -- gets less than $500 per payment period, they'll be hit with the fee. Multiple deposits that add up to $500 don't count. Consumers who use their debit cards to make five or more purchases in each statement period also can have the fee waived.
For poor or unemployed people on a fixed income, though, the prospect of going out to the store -- especially if they need to rely on public transportation -- to deplete their meager savings five times a month is sure to be stressful at best, and onerous or impossible at worst. A Chase spokesman tells WalletPop via email, "Chase is offering customers multiple ways to enjoy the convenience and value of Chase checking without a monthly service fee." Unfortunately, most of those ways involve having money -- either keeping a high balance in the account or having an over-$500 direct deposit.
The reason banks are putting the screws to its customers is that it's losing money thanks to new regulations. Recent restrictions on credit and debit card interchange fees stand to put a serious dent in the income it receives from merchants when those stores accept your card. As we recently pointed out, one finance executive predicted that banks probably stand to lose about $3.6 billion on reduced debit card fees alone. In addition, banks lost money when the CARD Act went into effect and imposed limits on fees and interest-rate hikes on credit cards.
In general, consumer advocates prefer the implementation of account fees to the pre-regulation status quo; beforehand, customers were often taken by surprise when they were hit with a fee or a rate hike. Now, if customers don't like the new fees, they can evaluate their options in a more equal fashion and switch banks if they don't like the service they're getting. As for Chase, when WalletPop asked how low-income account holders such as senior citizens would be affected, the spokesman replied that only 7% of Social Security recipients receive payments of less than $500. For the sake of those 7%, WalletPop certainly hopes they're not Chase custome
Gergana KolevaGergana Koleva RSS Feed
Dec 22nd 2010 at 2:00PM
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