loans or mortgages

patricia · Joined: 16 Jan 2008 Posts: 133 0.92 Dollars($)

Which is a better place to check out loans or the difference between banks or finance companies. I was thinking that banks give a better rate and finance companies have a higher rate.

larry · Joined: 27 Jun 2007 Posts: 3328 473.40 Dollars($)

Hi patricia,

Statistic shows that bank gives mortgages to the lower risk borrowers but finance companies gives mortgages even to the higher risk people. This shows financial companies give you more option on loan terms and rates.

Best of luck,
Larry

Guest 0.10 Dollars($)

I agree with larry here. Finance/mortgage companies have more options available with them compared to banks. The reason perhaps is banks have to focus on a wide range of services and not only mortgages. There are credit cards, personal loans and the like. But finance companies dealing with mortgages are specifically focussed on mortgage lending only.

patricia · Joined: 16 Jan 2008 Posts: 133 0.92 Dollars($)

Where do finance companies get the money they loan?

larry · Joined: 27 Jun 2007 Posts: 3328 473.40 Dollars($)

Hi patricia,

I think finance companies borrow from commercial banks to get the money and that is why may be their interest rates are a little bit higher.

Best of luck,
Larry

jbarto65 · Joined: 04 Nov 2007 Posts: 626 -0.11 Dollars($)

I think that finance companies have a much higher rate than your local banks, however they seem to be a little more lenient when it comes to borrowing, I have always found our local bank to be a bit snooty when it comes to lending anything, My brother in law just experienced this and closed his account that he had for over 30 years with the same bank, he went to get a refinance and their intrest rate was phenominal, he closed his account and went elsewhere, he was very upset about this. He has not experienced much outside of that particular bank. I can understand him being this mad, they could have done something to help him out for as long as he has been there, but they chose not too. I am not sure what he is doing now.

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