One of the biggest differences is that credit unions operate as a non-profit and are governed by their members elected leader. Most credit unions were established to serve a unique group of people, people that belonged to a certain employer, government employees, and/or other requirements. Now a days it is easy to become a member at your local credit union. And the benefits are quickly out weighing the benefits of banks. Credit unions often can offer lower interest rates and higher approval rates on loans to members. They often also have the same benefits like, free checking, convenient ATM access, and online banking. It is no wonder people are switching to credit unions all over the nation however, credit unions may be operating “out of accordance” with the reason they were set-up.

Traditional banks and credit unions have always had their differences. One of the main arguing point that banks often complain about is the fact that credit unions are not required by law, like they are, to spend a portion of their earning on community reinvestment. Banks spend millions of dollars a year reinvesting in the communities they serve and credit unions are exempt to this law. Also, banks are sick of credit unions operating as a non-profit. They often take in earnings much higher than small community banks and feel it is outrageous to claim they are “not-for-profit” and feel they should be paying higher business taxes and insurance coverage like banks are forced to.

Either way if you have bad credit, you most likely will not be approved to bank at either of these institutions, unless they implement a second chance bank account

Cash loans for bad credit, is  also referred to as a personal loan. Personal loans can be funded by a variety of different lenders but if you have bad credit, you will probably only be approved for  cash loan by a subprime lender, like a payday lender.

When applying for a cash loan with bad credit, you will  need a couple of pieces of information. First you will need a social security number (therefore you have to be a U.S. Citizen AND over the age  of 18) You will also need to currently be employed and making over $750 a month. If you are applying online you will also need to provide your routing and bank account information as these lenders will be directly withdrawling the loan plus interest on your next payday.

Only use payday loans for emergencies and always pay them back on time, otherwise you could end up paying a lot in interest!

Many of these large financial institutions gambled and bet on sub prime mortgages causing inflation in the housing markets and the collapse of the “American Dream.” People were so eager to buy homes, and Wall Street was so greedy to make money that investors lost sight of what a “good” investment was. They bet on bad credit mortgages mixed with high interest-only loan which only lead to payment defaults, foreclosures and price/equity drops.

Another large player in the economic crisis of 2009 was the American auto companies, losing out on profits to more efficient, higher-demanded European, Japanese and other automakers.

When the government bailed out all of these large businesses with tax payer’s dollars, everyone bi-partisian agreed it had to happen to prevent a financial meltdown but most agree this was not a “good use”  or even “legal use” of the American taxpayers dollars. Private industries WANTED and still want to remain private and separate from the government yet when they needed bailout funds most were all too willing to take their “handout”

So what happened on main street? People lost jobs, homes, belongings, health benefits and other items, including for some the chance to ever own a home again, the chance to ever achieve that American dream.

So what happened to Wall Street? Well profits definitely dropped, investors lost gains but in the end MOST of these financial institutions AND auto dealers got to keep their businesses going as they were deemed “too big too fail”.

So what now? Congress is currently under going financial reform policy which will hopefully prevent this kind of “reckless” spending from Wall Street to ever happen again. They are currently trying to set up rules and agencies that will monitor these companies in an effort to hopefully keep investors on the straight and narrow. Investors and many large financial companies have publicly come out against any Federal regulation within the financial industry but the message from Congress is, “You don’t get a choice” Over the next few months, the House and the Senate will fight out the exact language and amendments included in the bill but hopefully it will end as a win for main street. After all they are the ones who truly lost in this battle on Wall Street.

Bad credit auto loans

Bad Credit mortgage loans

Bad credit credit cards

Bad credit personal loan

While yes, you will be paying more most likely in interest because of your not-so-perfect credit history, at least you can still access the funds when you need them the most. Remember to always exercise caution when taking out any loan and take care of any inaccuracy’s on your credit report today. Get a free copy of your credit report now

1) Close your bank account or payday lenders will continue to try and deduct the funds owed by you

2) Call the collections department or help line. See if they would be willing to set-up a pay back plan you can afford.

3) If you can’t set-up a pay back plan and need a more comprehensive debt eliminating solution, and have other outstanding unsecured debt (ie credit cards) you may consider consumer credit counseling or debt consolidation These two options are a lot less detrimental on your credit score as opposed to bankruptcy, and bankruptcy can only be claimed once every seven years.

4) If you wish to get out of all debt, secured or unsecured your best bet may be bankruptcy.

Since payday loan lenders make money based on the high-interest rate on short-term loans, this is not a profitable group to extend loans to for the most part. While 36% APR may seem like a lot, you have to understand that about 60% of people who take payday loans don’t pay them back. This is the MAIN reason why payday lenders charge so much in interest for their payday loans.

For example if you took out a $500 payday loan, on average you would be paying $125 interest on that loan in two weeks, so you would pay back $625.  Now this is just below the mark for the APR as this is a 25% interest rate but you need to understand it is a 25% interest rate for TWO-WEEK loan, what happened if they can’t pay the loan back on time? The lender can only charge $55 in late payments, fees or interest before they hit the max 36% APR cap for the YEAR. This is not enough revenue to create a profitable business therefore due to the cap on military lending or military payday loans, most payday loan lenders no longer lend to military or their families.