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Sep 28, 2017 - 34 minute read

What happens if personal loan is not paid

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What happens if personal loan is not paid

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What happens if personal loan is not paid

Mortgage lenders set interest rates based on their expectations for future inflation; the supply of and demand for mortgage-backed securities also influences the rates. When the Federal Reserve makes it more expensive for banks to borrow by targeting a higher federal funds rate, the banks in turn pass on the higher costs to their customers, and consumer loan rates, including those for mortgages, tend to go up (see The Most Important Factors that Affect Mortgage Rates and How The Federal Reserve Affects Mortgage Rates ).

Typically linked to what happens if personal loan is not paid interest rate are points, fees paid to the lender (or broker).

The more points you pay, the lower your interest rate. One point costs 1 of the loan amount and reduces your interest rate by about 0.

In general, people who plan on living in a home for a long time (10 or more years) should consider points to keep interest rates lower for the life of the loan. The final factor in determining the interest rate is the individual borrower's financial profile: personal assets, credit worthiness, and the size of the down payment he or she can make on the residence to be financed. Conventional Mortgage Requirements.

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