Intellectual Property Protection: Legal Right Protection

Intellectual property, although intangible, is still ownable and your intellectual property rights should be protected. Modern business, especially since the rise of the internet has seen a rise in the creation of intellectual property. However the internet makes it even easier for someone to steal your ideas and work. An intellectual property lawyer who is trained to help reclaim patent, trademark, copyright and trade secret rights can help protect your intellectual property.

Types of intellectual property include patents, trademarks and trade dress, copyrights, and trade secrets.


A patent is granted by the government allowing a (usually) 20 year monopoly on an invention previously “not generally known.” Patents are intended to encourage investment in research and development. If you create a new useful process for doing something, a machine, manufacture, or even an improvement on something already in existence, you can patent your invention and prohibit others from “making, using, offering for sale, or selling…or importing” the invention in the U.S. Your right to patent your invention is a constitutional right (Article I, section 8).
Patents are subdivided into three groups: design, utility, and plant. Design patents protect innovations in the appearance (although not the structure or function) of an item. Utility patents are for wholly new inventions including machines, industrial processes, compositions of matter, and articles of manufacture. Plant patents cover innovations in plant-life, such as new species of plant created from the reproduction of cuttings and grafts of existing plants.

Patent lawyers will research previously granted patents for you to see if a similar product has already been patented or whether you should apply for a patent for your invention. A patent attorney will also tell you if your idea is not patentable because it is a law of nature, a physical phenomena, or abstract. You should find a specialized patent or intellectual property attorney because in order to prosecute a client’s patent application, he or she must be registered with the U.S. patent office. A patent lawyer will also have to have passed a science and engineering exam to better understand and serve clients.


Trademarks are granted for words, names, symbols, or devices which separate and distinguish businesses and services. These include arbitrary names such as Kodak, suggestive names such as Caterpillar (tractors), descriptive names which indicated the business’ products or services, and generic names which are descriptive. Generic and some descriptive names cannot be protected, so a trademark or intellectual property lawyer should be consulted to see if your name qualifies for trademark rights.
You can also file an intent-to-use application to reserve a name that will later be trademarked. (This is especially important with the expansion of business on the internet.)

Trademark lawyers can also be sought to make sure that your new business isn’t using a registered mark. The consequences for using a registered mark, even though you may have put money and advertising into promoting your business, include being sued for infringement.


Copyrights protect the individual’s expression of an idea, but do not protect the idea itself (see patent). Copyrights are intended to promote scientific progress. You can copyright your writing, performance (music, dance), art, sound, compilations. You cannot copyright ideas or uncompiled facts, words, or phrases (these could be registered as trademarks, though, so consult an intellectual property lawyer). If you come up with an idea or invention while working for a company, it is able to be patented or trademarked by the company you work for, but copyrightable work belongs to you, the employee, not the company employing you. However, there are loopholes, and an intellectual property lawyer will help you both with the process of getting your expression copyrighted but will also save you trouble and time in getting over road blocks.

If you are a company, you need an intellectual property lawyer who specializes in copyrights because especially with internet businesses, you will need to make sure that contractually your web site design can be copyrighted to your company and will not belong to the employee or independent contractor who created it. This also applies to software.

Trade Secrets

It is important to protect your business’ trade secrets so they will not be misappropriated. Whereas patents have a limited time of coverage and after 20 years are released, trade secrets are always protected. To qualify as a trade secret, it must have independent economic value to the company. For example, the recipe for Coca-Cola is a trade secret, not a patent, and therefore will never be released because without maintaining the secrecy of the recipe, the business would not be able to compete by offering an individual product.

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A Step By Step Guided Plan To An Energy Efficient Home Saving You Thousands

You need a plan to prepare for your future, your energy future that is. Energy Efficient Homes are the hot commodity amongst real estate professionals, designers and builders these days – but why? The short answer is that these homes will SAVE you tons of money. The amount of money you’re going to save through implementing energy efficient home strategies is staggering and will only grow as energy prices continue to rise to an all time high.

There has never been a more crucial time to gain the maximum benefit you can for your wallet and home. These simple techniques coupled with an organized, well thought out approach will provide you a road map for the savings you’re seeking. If you’re tired of increasing energy bills and can’t seem to find a better way to save some green then going green will accomplish your goals and provide a healthier home for you and your family – Not to mention the increased equity you’ll get from making minor but substantial improvements. So how do you achieve an energy efficient home, providing savings, health, and peace of mind?

An energy efficient home can be summed up into 7 simple steps and strategies. Through programs which teach these simple techniques in great detail you can gain the competitive advantage and get on track to your energy goals. Distinguish yourself as the most energy efficient home on the block! Ok, to get to it. The first step towards saving money every month is:

STEP 1 – YOU Must Commit To Continuing Improvement.

The behavior of you and your family is one of the single most important aspects of saving energy at home. In our Americanized view of, “bigger is better” and “more baby more”, we can have a hard time grappling the concept of conscious conservation. The good news is this can become FUN! Imagine playing games with your kids, spending quality bonding time, finding more creative ways to save Energy, use less and teach them great life lessons in frugality! People who really see the financial returns from their home performance continue to strive to achieve higher and better performance with regular assessment of their homes energy performance, creating a breeding ground for savings and a healthier environment. Commitment is the key here. Without it, you’ll never get anywhere. Are you committed to saving money, energy, and creating a better world?

STEP 2: Understanding Where You Are At

In order to know where you want to go you must know where you are. Many home owners bock at this not wanting to pick up the phone or pay a few bucks for a professional energy audit to be done on their future energy efficient home, but I assure you it will be a growing and learning experience. An energy audit will allow you to identify where you can best allocate your resources to gain the maximum amount of savings, putting your hard earned money to work for you. Also, and energy audit will give you a baseline where you can measure your homes energy efficiency and performance once you get on track to your energy efficient home goals.

STEP 3: What Are Your Energy Goals?

In order to achieve a performing energy efficient home which will save you money you need to have clearly laid out goals and how you will achieve them. Not to sound like another self help book (I read a lot of them!) but truth is truth. You need to know where you are, where you’re going and have a plan to get you there. The alternative, floating in space hoping that electric bill miraculously goes down by $200 in the spring – not likely. Yet again here is another opportunity to bring the family closer together and motivate everyone to achieve the energy goals.

STEP 4: Creating Your Plan

As an Architect I work a lot with plans – as you might guess. We don’t go build the building and hope it works out! There is preparation and a laid out plan to get the end result. So decide what you are going to do to achieve your goals. How are you going to do it? Who is going to do what? Get the family involved and realize it’s easier than you imagine – you just need to get going and momentum along with an action plan will get you saving money sooner than you think.

STEP 5: Execute Your Plan

This is where your energy efficient home is made – in the execution. A lot of people start things all the time, but the gold goes to those who see the plan through and play like champions to the final buzzer. Get your family motivated, set weekly energy goals or habits, get creative and make it happen.

STEP 6: Take A Look In Your Review Mirror.

We’re all familiar will evaluations. Evaluations in your job are the most common but you need to do the same in your energy efficient home. You’re going to gain so much insight with the evaluation process in the form of knowledge on how to keep gaining the most you can in savings with your home. Opportunities for further savings will come out of unexpected places and create new revenue streams to be saved, invested, or heck, take the family out to a fancy dinner and movie! This brings me to my final point…

STEP 7 – Reward Your Accomplishments

You finally did it. You’re sitting in your energy efficient home with a smile on your face and a little fatter wallet. Take those extra family holidays or save more for an earlier retirement, all the while knowing you are doing your part to save the only resource we all share, but take for granted – our planet. The bottom line is you CAN have an energy efficient home and it is only up to you. With so many great books, eBooks, articles, companies and industries aimed at helping you get to your energy efficient home goals you won’t have any trouble if you stick to the plan. I’m here to help you. Post a comment below and let me know what you struggle with in achieving your home energy efficient Goals

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Real Estate Broker’s Guide For Retirement Planning (Part 3 of 3)

The two most common ways to use SDIRAs in real estate are:

(1) Purchase an investment property (2) Fund a real estate loan

Purchase of an investment property:

A real estate agent listed an REO fourplex that was in pretty bad condition. The owner prior to the lender getting it back from the foreclosure proceedings drained the property, did no repairs or maintenance, just collected the rents from the tenants as long as he could. Eventually two of the tenants moved out because of the poor conditions and the other two quit paying rent because they learned the owner was going to lose the property to foreclosure. They called the owner’s bluff and quit paying and the owner disappeared from sight. About 12 months after the notice of default was filed the lender now owned the property and listed it with a local real estate agent. The agent upon listing the property gave the two remaining tenants “cash for keys” and both tenants packed up and vacated their units. The property was now 100% vacant.

A Buyer’s agent had the perfect buyer for it. He had been working with John for a couple of years. John was self-employed owner of a computer company. John couldn’t fix anything but his childhood friend was a general contractor and was able to do all the needed work on John’s previously acquired properties. John did have experience owning rental properties, all of which were bought in similar condition to the fourplex. Over the years John had taken advantage of the opportunity to set up an IRA and always contributed the maximum to it. John was not aware that he could use his IRA to invest in real estate, something he understood and loved being involved in. John had been very fortunate with his IRA investments by investing in mutual funds that had performed real well. When his knowledgeable real estate agent shared with him that he could set up a Self Directed IRA and invest in real estate, he knew this was the perfect situation for him. He contacted one of the Custodians from the list I provided and completed the paperwork that enabled the new Custodian to have his existing IRA rolled over into a SDIRA. His timing was perfect, two months later the stock market did its meltdown. John had $177,000.00 now sitting in his SDIRA in which to invest in real estate.

John and his agent were very selective; they didn’t jump at any deal. They waited over a year until the right deal came along. A deal that John could use his skills to maximize his return on investment.

The property was listed for $275,000. John and his agent knew that this fourplex had sold for $200,000 more than the list price three years earlier. John’s agent presented an offer for full price the first day it hit the market. John had already been preapproved for a 55% loan to value non- recourse loan with the bank that he had been doing business with for years. Within a SDIRA the loan has to be non-recourse so don’t expect any loan to be more than 65-70% loan to value. Don’t forget that the law requires the property to be the only collateral. There can be no personal guarantee which allows the lender to come after the SDIRA holder in event of foreclosure.

John had estimated the rehab of the property would be at least $15,000 with a worst case cost of $20,000. In his proposal he used the worst case figure knowing that with a $125,000 down payment and $5,000 closing costs he would still have $27,000 left in his SDIRA. The remaining funds could be used for holding costs as he was rehabbing the property and screening for good tenants. John’s contractor friend estimated that he would have the property in A+ condition within a month.

Within three months John with the help of his real estate agent had four quality tenants each renting a unit at $850/month. John is now receiving in excess of $1,200 per month that is going into his SDIRA.

Monthly Operating Statement:

$3,400.00-Monthly rents of $850.00 X 4 units

-$200.00-6% allowance for vacancy

-$1,000.00-30% operating expenses. John’s agent does management

-$900.00–$150,000 non-recourse loan for 30 years at 6% interest

Bottom-line is $1,200.00+ per month is going into John’s SDIRA. Each month the management company sends the Custodian a check, John never handles any of the funds. John’s SDIRA is only earning 8% per year, but John has already turned down two offers in excess of $370,000 to sell his A+ fourplex which is one of the most desired properties in town.

What excites John the most is that if he decides to sell the property he doesn’t have to do a 1031 Exchange to defer taxes. The sale proceeds will go directly into his SDIRA and will be deferred until he starts withdrawing funds after he turns 59 1/2.

John’s real estate agent has shared John’s success story with a couple of his existing clients as well as three solid referrals who would like to form a business group with John for future projects. Some of the investment funds will be from SDIRAs and some will not be. Properly set up this is allowable. They have a couple exciting possibilities that they are making offers on.

Fund a real estate loan:

This is my favorite area of SDIRAs. I started arranging private investor loans in 1997 and was given the opportunity to see the power of controlling your retirement through SDIRAs. As I started meeting private individual investors and I brought potential loans to them I was amazed that many of them had millions of dollars to fund real estate loans. Often when it came time to vest the loans (the beneficiary name on the loan) it was vested in part or in whole in a SDIRA.

Over the years as I developed my investor relationships I enjoyed the investor’s stories of their financial successes. Many of the investors started having their SDIRA invest in real estate loans back in the 1970′s. When they originally started they were usually buying seller carry back notes at a discount. Eventually that changed to broker arranged real estate loans as the laws changed in the early 1980′s. Broker arranged loans created an opportunity to be in compliance with usury laws. Of course they still bought discounted carry back notes as the opportunities appeared. The broker arranged loans were the type of loans that I was presenting to them. They typically were a loan that for various reasons needed to be funded by a private money source. Loans where:

(1) Borrower had lots of equity and needed quick loan (2) Borrower was in foreclosure (3) Borrower has an unusual type property (4) Borrower had poor credit (5) Borrower needed funds for tenant improvements to lease out the property

The list was endless with reasons borrowers needed a private investor funded loan. It was very challenging and exciting to arrange these loans. The guidelines on the loans were often unique to the particular situation, but the loan to value very seldom changed:

Single family owner occupied 70% Maximum loan to value

Single family non owner occupied 65% Maximum loan to value

Commercial 60% Maximum loan to value

Industrial 55% Maximum loan to value

Land 35% Maximum loan to value

Of course certain situations dictated higher or lower loan to values. As an example a residence in Newport Beach, CA would definitely generate a higher comfort level and higher loan to value than a house in a less desirable part of South Central Los Angeles. Every loan would have its own pluses and minuses which would factor into the rate/terms and loan amounts.

The recent passing of the SAFE Act in 2008 has had the effect of inspiring many new laws on both the state and federal level that have a great impact on single family loans.That is why it so important to do business with professionals. Work with people who know the laws, are members of the proper industry professional groups such as California Mortgage Association in California, have experience and a proven track record. The last thing in the world you need is a real estate loan that violates the law.

Recently my company had a loan request for a warehouse building brought to us. The building was free and clear in a nice industrial section of Southern California. The owners of the building had recently inherited it and were not in need of a large amount of cash, which in this case the buyer/borrower didn’t have. The owner was willing to carry back a 2nd trust deed if the buyer/borrower could arrange a loan. The buyer/borrower had very poor credit due to the rapid expansion of his business and the constant need for cash that he wasn’t paying back on time. The buyer/borrower had been turned down by every lending institution in town. Frustrated because the building would be perfect for his expanding business and with the possibility that the seller would be willing to help with the financing this was an opportunity that he couldn’t lose.

The sales price was $1,700,000 which appeared to be a very fair price, but as always we ordered an appraisal from an appraiser who specialized in this type of property. There is too much at stake to guess on the value of a property. The potential liability in event of something going wrong with the loan later on because of an “inflated value” presented to us by either the borrower or mortgage broker is a very high price to pay. We also required an environmental report due to the type of property. Don’t skip any steps, do your due diligence.

The appraisal did come in at the $1,700,000 sale price. We agreed to make a loan for $1,000,000, which was about 60% loan to value. My investors were happy to get 10.25% monthly interest only payments for five years with a two year prepayment penalty. My investors were very secure with a 1st trust deed on a nice warehouse in a fairly decent area of Southern California.

The buyer/borrower was very happy because he was able to acquire a great property for his growing business without expending valuable cash reserves. He was well aware with his poor credit and the need to get a stronger financial statement it was going to be at least two years before he was going to a bank loan.

The seller of the property was also very pleased because they received a million dollars and a monthly payment check from the $700,000 second trust deed that they carried back from buyer. 100% financing didn’t provide the needed protection for the seller of the property. They also got a personal guarantee from buyer as well as cross collateral on another property owned by the buyer.

Privately funded real estate loans are an important part of real estate financing, especially in today’s tight real estate finance market. Through your SDIRA you can participate in them.

I can hear you thinking, “I don’t have that kind of money to fund loans”. I don’t either, yet my investors and I would do these loans. You are allowed to pool your SDIRA (or other investment funds) with other investors to make loans. Often this is accomplished with a loan pool or with a private money lender that is skilled at grouping investors together. The group of investors would take title to the loan as “tenants in common” and have an undivided interest per their percentage of the loan. It wasn’t uncommon to have six to eight investors on one loan.

By the use of grouping investors together to fund a loan I received a statement today for my share of a $150,000 loan that goes into my SDIRA. I did this loan with two other investors six years ago. The loan amount of $150,000 is secured by a $650,000 lovely single family vacation home(non owner occupied) in a great part of Southern California. The loan pays 12% interest and the monthly payment from the borrower always arrives on time. 12% sure beats the wild swings of the stock market lately. You that are familiar with the Rule of 72 know that 12% will double your investment in six years.

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Improve Your Poor Credit Score and Secure Yourself a Loan

So you are thinking of getting some extra money to make some urgent home repairs, the porch door needs replacing, along with a new hot water system. Unfortunately you do not have the money in the bank, but neither do you have a secure porch door or any constant hot water.

Have you considered personal loans? A lot of people take out personal loans for this type of repair. Car repairs and even holidays are used by people with their newly acquired finances. Most people have heard that a poor credit score is not a good thing (However even those that have a poor financial history can still get loans). But how do you make a good rating?

One of thing major pieces of advice from experts, before you apply for finance it is best to get a credit report completed from a reputable source. This will give you an idea of the chance of getting your application approved. In the United States of America there are three levels of credit rating, basically the higher it is the better it is.

An excellent rating is above 760, a good rating would be between 700 and 759 and a poor rating would be between 640 to 699. if you are at the top end, 760 and above then there is no point in making your rating any better. However with other ratings it is worth trying to improve as it will help your chances of succeeding in the application.

There does seem to be a bit of a chicken and egg situation sometimes, you need finance but have a poor score,but to improve you need a lender to give you a chance. Well, luckily there are things that you and your family if you have one, can do to improve your rating.

Having a poor rating does not mean you have to be stuck with it, starting to pay the bills on time instead of late or not at all will start to get you on the right path. Some lenders will still give applicants loans even with a low score, but the total given will be lower than usually and the percentage rate will be considerably higher. So you will pay more over the period of the finance.

Families can help too. If a member of your family has a good rating then some credit card companies can add you to that family members credit card as an authorized user, this will help with any poor credit score. Also having a family member with a good rating co-sign the loan could help you get what you need.

Finding the correct lender for your score is a good way to make sure that you are getting what you deserve, if you have a high score you deserve some of the best deals on the market. Instead of going to your bank or card company you can go online and search for a matching company. Companies like this are a good place go to make sure you achieve the best deal.

What are a matching company and what do they do? You enter your details on their online program and your information will be fed to several of their approved lenders, in turn the lenders will then return to the matching company with a list of loans that they are able to offer.

Once the offers come back it is then up to the applicant to choose one and complete all the necessary paperwork. A check will then be received within a matter of days and your new boiler and door fitted soon after.

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Payment Options for Shopping All the Way

Everyone is busy. Busy in shopping online and in the malls. Popular online portals are breaking and making new sale records! All thanks to the convenience and the availability of easy payment options and funds!

Here are few of the factors that are making online businesses a success

Credit Cards: A credit card is plastic money. It is one of the easiest form in which a person gets a personal loan.

All online portals as well as retailers in malls accept credit cards issued by various banks.
Online payment becomes very simple and safe, thanks to the one time passwords generated for such transactions.
A PIN is sufficient for shopping using a credit card at any retail store.

Personal loans for shopping: When we apply for a personal loan, we don’t have to provide the financier with the details of what we want the loan for.

Thus these days’ personal loans are being used to finance shopping.
They can also be used as wedding loans, vacation loans and educational loans.

Payment Processing: As far as payment processing is concerned, the following factors matter to both the consumer and the online retailer.

Uncomplicated manoeuvring on website: It is important for the payment process to be step-by-step and easy to understand. Most websites work on this section very carefully and thus the online shopping experience is satisfactory.

Processing Costs: Processing costs matter to the retailers. More the processing fees they have to pay to providers of payment gateways like Visa, the lesser are their margins. So to have an effective business the processing costs need to be low.
Number of payment options: Multiple payment options should be available for the customer to make payment. This makes the shopping a convenient proposition.
Time taken to process transactions: Processing time not only tests your patience but sometimes also the strength of your internet connection!

Cash on Delivery: This is also known as “collection on delivery.” This is a very popular mode of making payments for shopping in the developing world.

It enhances impulse purchases.
A credit card is not an essential possession for the buyer.
The buyer can check the quality of the product and then pay

So this festive season, do not hesitate to shop and to gift! The availability of funds for shopping is not difficult anymore. Also the convenience of online shopping has brought various retailers to our doorstep. So let us shop all the way!

An easy way of shopping is using a credit card. It forms an integral part of most people’s financial planning. When used in the right manner, it helps reduce financial liability and optimizes financial resources.

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Are Online Personal Loans Good For People With Bad Credit?

While the rise of online lending in itself makes it more convenient for people to apply for finance, is this development a good thing for those who are already struggling? There are companies out there who charge expensive annual percentage rates (APRs), leaving many people in more trouble than when they first started.

But it doesn’t have to be this way. Over the last few years, online lending has earned itself a bad reputation. The internet leaves many people vulnerable to fraud, so you should always exercise caution when inputting your financial details. The best way to make sure your information remains safe is to find a secure, reliable lending platform.

There is an unfair irony attached to lending today. Those with bad credit are often led to believe they have no financial options if they have made mistakes in the past, often making their situations seem more desperate than they actually are. This can result in people making bad decisions and can lead to borrowing through unstable sources.

Meanwhile, any lenders that do accept you with bad credit will charge extortionate interest rates because of your history, making it more difficult for you to meet your monthly repayment obligations – thus worsening your situation. This is a trap that many people fall into, and it gives online installment lenders a bad name.

However, this doesn’t need to be the case. If you can find yourself a reliable lending platform, you will be connected to a secure network of trustworthy lenders who can offer sensible solutions to your borrowing needs. Many of these lenders will assess your application, even if your credit file isn’t perfect or your income is lower than average.

Instead of (or in some cases, as well as) running credit checks, these lenders will take other factors into consideration, including your income and employment circumstances, and how long you have lived at your current address. They may even ask for references they can contact who will vouch for your character personally.

Even those who receive benefits as a form of income will be able to apply, giving everyone a fair and carefully considered chance of borrowing money. In these cases, applicants won’t be accepted for higher loans than they can afford to pay back, and interest rates will be low, meaning there is a better chance of managing repayments.

If you have poor credit and need to borrow money, consider a personal installment loan, but make sure the APR is advertised between 5.99% and 35.99%. There should also be a number of options in terms of flexible repayment, offering you the chance to pay the money back anywhere between six months and six years, depending on what you can afford to pay per month.

Small, carefully considered personal loans could actually help you build a financial profile making you eligible for better future borrowing. As long as the lender is responsible, and offers reasonable interest rates, online lending platforms can actually give people with more opportunities than many other lenders in terms of improving their situation.

With this in mind, personal loans can be beneficial to those hoping to improve their credit score, but only if some caution is exercised by both parties, and you only apply to borrow an amount you can afford to pay back.

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Five Reasons for Refusal of a Personal Loan

Don’t you wish personal finance were a mandatory course in college? Unfortunately, too many of us learn by mistake. When you need a personal loan and are rejected, you might be baffled as to what went wrong- and how to fix it. Here are some clues.


No credit is a situation where you have never used credit and therefore have no credit history for the bank to review. They have no way of making an educated decision on whether or not you will pay back a personal loan based on your credit history. No credit is worse than bad credit. Qualifying for and making regular payments on these types of introductory forms of credit can overcome a “no credit” score:

· Student Loans

· Secured credit card (includes a down payment amount)

· Being added to a parent’s or spouses good credit: card, car loan, etc.


Low credit takes on several forms. If you’re using more than 30% of your allowable debt, it can negatively impact your score. Too many inquiries from shopping around for loans will also hit you hard. Lapses in payment, defaults, or bankruptcies are giant red flags and can take a long time to rebuild from.

Other things that lenders may look at are whether or not you have sizeable assets should you default on the loan. They also check to see if your debts are diversified or if you are only carrying one type of debt.


Proof of income is generally required when applying for a personal loan. If you are unemployed or underemployed, it can work against you in the loan approval process. Lenders may also require a work history to see how long you have been with your current employer, and to determine if you typically have job stability. Frequent job loss or change will tell a creditor that your payments may not be reliable.


Believe it or not, your application can be rejected due to your proposed purpose for the loan. Financial institutions have the right to set up the parameters surrounding their disbursements and can accept or reject your application based on what you want to use the money for.


If you’ve defaulted on debt before, your name may be put on a list of whom not to loan to,’ also known as a “Blacklist.” This will follow you around for a long time and is difficult to erase. If you do resolve the debt issues, get documents to prove the resolution.

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How Can A Personal Loan Improve Your Credit Score?

When it comes to a personal loan, you have to first learn to use it responsibly. Because if you miss a repayment, your credit score will be impacted adversely. And remember, that a credit score is an indicator of how well you manage your personal finances. Also, it plays a defining role when you apply for any kind of loan – secured and unsecured. It is suggested to apply for a loan slightly larger than what is needed so that you will be assured to have enough money to pay all bills necessary and still have some money left over to ensure that your bank account stays current.

A credit score can be defined as a number which reflects the financial situation of a person. If the person is well-off when it comes to financial matters, then he or she is said to have a high credit score. On the other hand, if a person is the exact opposite of this, then they possess a low credit score. There are a lot of factors that are considered by financial institutions for the purpose of evaluating a person’s credit score – usually, the credit scores of people vary from 300 to about 850.

A personal loan is a type of loan that is given by digital lenders, banks and credit unions to aid you in your plans, be it starting a small business, or making a big purchase. Personal loans tend to have an interest rate(s) lower than the credit cards; however, they can also be put to use for combining several credit card debts together into one monthly lower-cost payment.

Now, your credit score is built by keeping in mind various parameters from your credit reports. These reports serve the purpose of trailing your history of utilization of the credit across the duration of seven years. These credit reports are comprised of information, including how much credit you have utilized to date, the type of credit in your possession, the age of one’s credit accounts, whether one has put in for bankruptcy or liens filed against them, actions of debt collections taken against them, one’s total open lines of credit as well as recent inquiries for hard credit.

Like any other type of credit, personal loans are very capable of affecting your credit score. This can be done through the process of applying and withdrawing a personal loan. If you are curious as to how personal loans can end up affecting your credit, then read on to find out more about the context. There are many ways in which your credit can be affected by personal loans and some of them are listed below:

The ratio of your debt-to-income and loan

Debt-to-income ratio is considered to be the measure of your amount of income that you spend on the debt repayments. In the case of lenders, the amount of income that you receive is said to be one of the major factors proving that you are able to repay your loan.

Some of the lenders have come up with their own debt-to-income ratio so that their proprietary credit scores may make use of it in the form of a credit consideration. Do not fall into the kind of mindset that possessing a high amount of a loan would hurt your credit. The most damage it can do is raise the ratio of your debt-to-income so that you won’t be able to apply for loans anymore without it getting rejected or denied.

Paying loans on time will make credit scores soar

The moment your loan is approved, you have to make sure that you settle the payments of each month on time and in full. Delay in repayment may significantly impact the state of your credit score. However, on the other hand, if you make the payments on time every month, then your credit score will soar high, leading to an overall good score. This will not only make your name to the preferred borrower’s list, but it will prove to be beneficial for you in the long run.

Since your payment history is comprised of almost 35% of your credit score, paying loans on time is essential in cases like these so that your credit score can maintain a positive status.

Variety is built into your credit type

There are about five factors that are responsible for determining your credit score. These are composed of the payment history, the length of the credit history, the utilization ratio of the credit, the credit mix and new inquiries of the credit in accordance with FICO®.

The credit mix only accounts for about 35% of your total credit score, whereas when it comes to a personal loan you can have a varying mix of the credit types. This mix of all types of credit is viewed at a high level of approval by the creditors and lenders.

Origination fee charged by loans

Most of the lenders end up charging you an origination fee. This fee cannot be avoided at any cost and is instantly taken off from the amount of the loan payment. The amount of origination fees depends upon the amount of the loan you are about to borrow. Late payments can lead to an overdraft of fees and late expenses. Therefore, make sure that you pay complete repayment for each month before the deadline.

Avoiding penalties when it comes to payments

Some of the credit lenders tend to charge an additional fee if you end up paying your part of the loan earlier than the agreed date. This is because they are looking for moderate amounts of interest on your loan. Now, seeing that you have paid off your part of the loan before time, they will miss out on that interest that they could have possibly made if you had not cleared the debt soon enough before the deadline.

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