MyLoanAdvisor wants you to have all the information possible to make an educated decision on which loan fits your needs and to prepare you for the loan process. Find the answers to your loan and banking questions, by loan type, below. If you can’t find your answer here feel free to contact us anytime.


Short Term

What is a “cooling off” period in a short term loan?

Different states, such as Illinois, only allow their consumers to have a loan out for a certain amount of days. For example, if you are only allowed 45 consecutive days to have a loan and want to apply for a new payday loan within that time you would go over your 45 day period. You'll have to wait seven days after the closing of your first loan to be eligible to take out the next. This would be your "cooling off period".

How many personal loans can I have?

It depends on the type of loan. For example, if you want a payday loan the amount of loans you can have out at a given time will vary by state. If you are needing a larger loan and are lumping multiple loans to achieve a larger price, such as four $25,000 loans for a $100,000 medical bill the lender will see the other loans you have out and this could effect your interest rate and credit. Instead, try taking out one loan using collateral.


What is the difference between a loan modification and refinancing?

When you refinance you take out a new loan at a lower interest rate. When refinancing your home you can choose to use your current lender or move to a new lender that may be able to offer a lower interest rate. With a loan modification only your current lender can modify your current loan by changing the terms, interest rate, principle, etc. This change in the original terms can also be called a foreclosure modification or mortgage adjustment.

What is an amortization schedule?

A table that shows principle amounts versus interest when making regular payments on an amortizing loan, usually a mortgage, over time. The first date begins one full payment period from when the loan was taken out rather than the first day of the loan.

What is a graduated payment mortgage loan (GPM)?

Geared towards younger borrowers who expect their salaries to increase over time on a set monthly payment schedule. The payments start lower and increase over time in the form of a negative amortization for 5 to 15 years. After that, the increased payment remains the same for the rest of the term. The risk lies in over estimating what you believe you will earn eventually.

What is a hard money loan?

A loan secured by piece of real estate in which the quick-value of the loan is usually analyzed from. These loans are usually offered from investors or private companies. The interest rate of these loans are not based on the Bank Rate but the real estate market. These are usually higher rates then sub-prime loans.

What is a budget loan?

A loan that includes taxes and insurance in the mortgage

What is a flexible mortgage?

A residential loan that allows flexibility in the monthly repayment requirements. This loan type allows a borrower to pay off a loan, make higher capital payments, delay payments, borrow payments back, or not make payments on time without the large fees that incur in traditional mortgages. This loan is best for self employed borrowers who make irregular income.

What is a bridge loan?

A shorter term loan temporarily used until longer term financing can be established often used in commercial real estate for a quick purchase. Bridge loans are typically more expensive with higher interest rates.

What is the difference between the annual percentage rate (APR) and an interest rate?

The interest rate is a yearly amount a lender charges for allowing you to borrow money for a given time. The interest rate is calculated by dividing the amount of interest by the loan amount. For example if you are given $10,000 and the lender charges you $500 a year to borrow that amount you could find the interest rate by: $1000/$10,000 = 1%. An APR takes into account two different factors: your interest rate and any additional costs such as closing fees, private mortgage insurance, etc. The APR includes the total amount of credit given and assumes you will have the loan for the full term.


What is a franchise dealer?

A franchise dealer sells new and used vehicles for manufacturers including Chevy, Ford, GMC, Toyota among others. The name of the manufacturer is often included in the business' name (i.e. John Smith Toyota).


Do student loans hurt your credit?

Student loans effect your credit like any other loan. Defaulting and missing or making late payments can hurt your credit. On the other hand paying on time and paying off your student loans can effect your credit score positively. The main difference between a student loan and other loans that filing bankruptcy will not remove the loan from your account.

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