SACRAMENTO, Calif., Sept. 25, 2013 /PRNewswire-iReach/ -- In June and July consumer debt trended upwards due to increased consumer lending, but credit card borrowing or revolving loans declined over that same period of time. In June consumer borrowing was up $11.9 billion and in July it was up $10.4 billion. But when you examine the numbers more closely, you find that consumers are opting for nonrevolving loans like personal loans, auto loans and student loans instead of credit card borrowing. In fact, nonrevolving loans shot up $12.3 billion in July to a record $2 trillion, but credit cards fell $1.8 billion to $850 billion. This followed an even larger drop of $3.7 billion in June.
What does this trend say about borrowers? They're borrowing more money, but credit cards are losing their appeal as borrowers turn to nonrevolving credit to finance their purchases. Nonrevolving credit is a loan that is paid back over a period of time at set monthly payments or installments. Examples of these types of loans are auto loans, student loans and unsecured or secured personal loans. Once the loan is paid off you don't use it again like a credit card. On the other hand, revolving credit is debt that has a credit limit that is paid down. Once you pay the credit limit down you can use it again.
An automobile loan is an example of a secured loan since the loan is backed by collateral, which is the car. If the loan is not paid as agreed, the lender repossesses the car. In contrast, an unsecured loan is not backed by an asset but by the borrower's creditworthiness, normally indicated by his or her credit score. Typically, since the loan is not backed by collateral the interest rate is higher. A credit card is a form of unsecured debt, but many lenders also offer unsecured personal loans.
Personal-loans.com is one of the leading websites for obtaining loans. The company does not actually lend you money, but they give you access to their vast network of reputable lenders who specialize in various types of loans. Their expertise is in connecting the borrower to lenders who provide a variety of secured and unsecured personal loans to borrowers with different levels of creditworthiness. Plus, Personal-loans.com helps prospective borrowers access these lenders with a brief, easy-to-fill-out online form. So by simply filling out the online form, borrowers can access hundreds of lenders.
"Our job is to find the best available lenders for our customers. This means scouring the lender universe to locate reputable and flexible lenders who can give our customers the best rates, terms and service on a personal loan," stated Personal-loans.com CEO, Mr. Roger Render. "We are constantly expanding our lending network, evaluating lenders and adding only the most reputable to our database. We aim to be the number one destination consumers turn to when they require a loan."
"We also are always on the outlook for new loan programs to provide on the website that will benefit our customers," he continued. "The great thing about these types of loans is that borrowers can use them for any purpose. They can use the loan to consolidate debt, make home improvements, pay medical expenses, or even have some fun by going on an exotic vacation." Mr. Render continues, "Unlike a credit card, the borrowers are not stuck paying off the loan for the rest of their lives. The personal loan has a predefined payment period and then they're done. After years of paying credit cards and making no real progress consumers like the idea of a loan with a beginning, an end and a set monthly payment. A nonrevolving personal loan offers them that."
According to the recent consumer borrowing trends, it is obvious that unsecured personal loans are gaining momentum as credit cards are losing momentum. Personal-loans.com is prepared to meet rising customer demand with their growing network of lenders and unsecured personal loan programs.
To learn more or to apply for a personal loan, visit www.personal-loans.com.
Media Contact: Roger Render, Personal-Loans.com Ltd, 305-942-8085, firstname.lastname@example.org
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SOURCE Personal-Loans.com Ltd