Eight Ways to Consolidate Debt
May 31, 2007
Next to winning the lottery, a debt consolidation loan is a debtor’s dream. With one monthly payment and a fixed monthly payment schedule, you can actually see an end to those monthly payments.
In reality, consolidating bills isn’t always easy. If you have a lot of debt, it can be hard to find a consolidation loan at a lower interest rate. And if you’re not careful, you can end up deeper in debt than when you started.
Your goal in consolidating your debt should be to lower your overall costs. To accomplish this there are two things to keep in mind:
1. Get the lowest interest rate possible
2. Have a plan to pay off your debts in 3 ? 5 years.
Here are some of the best ways to consolidate:
Using Credit Cards
The good news about this method is that with a good credit rating, you may get a much lower rate than other forms of consolidation loans. And since credit card issuers don’t require collateral, you aren’t "risking the farm."
Top 5 Credit Misconceptions
May 30, 2007
We have all heard the rumors?from neighbors, relatives or friends. There are a wide variety of myths floating around about what you should and shouldn’t do to improve your credit reports and credit scores. The buck stops here! Phelps Creek Financial Coaching has exposed these urban legends to provide you with the truth about credit…
1. Your score will drop if you check your credit - Fortunately, this one is definitely not true.Checking your own report and score is counted as a “soft inquiry” and doesn’t harm your credit at all. Only “hard inquiries” from a lender or creditor, made when you apply for credit, can bring your credit score down a few points. Worried about damaging your credit while shopping around for a loan? Multiple inquiries for the same purpose within a short amount of time (a few weeks) are grouped together into a less damaging period of inquiry.
2. Closing old accounts will improve your credit score - To close or not to close, that is the question. Many people advocate closing old and inactive accounts as a way for improving your credit. In most cases, closing accounts will actually have the opposite effect. Canceling old credit accounts can lower yourcredit score by making your credit history appear shorter. Think twice before closing the oldest account on your credit report. If you want to reduce your levels of available credit, ask for your credit limits to be reduced or close newer accounts instead.
Student Home Purchase Plan
May 30, 2007
Tuition costs are climbing, housing costs are climbing, it seems like all the costs for students are climbing these days. Students can afford cost increases less than any other demographic in Canada. Because of this, parents and students alike are looking for new ways to offset the costs of education.
Student loans can be used to defer these costs to some extent, but they need to be repaid after graduation. It’s difficult to climb the corporate ladder or get ahead in life when you have $30,000 worth of debt before your first job is even found!
Bursaries, grants, and scholarships are another great source of funding for a student. However, the amount of money available is thinning, and the competition is growing stiffer for this money each year.
The average student, over a 4 year degree, pays over $16,000 in tuition and books. Housing costs approximately $38,000 for a 4 year degree. This is based on rent of $800 per month for 48 months.
Budget Planning - Its Elementary My Dear Watson
May 29, 2007
Does it feel like you have to be Sherlock Holmes to solve the mystery behind balancing your personal budget? Are you living a mysterious thriller where your realization of “financial independence and security” is a vicious repeating cycle of debt? Don’t be afraid?…Somehow you’ve ended up lost in the "plastic zone". ‘ The “plastic zone” is a scary place. But you’re not alone. There are millions of people today living the same mysterious life in the plastic zone. Remember green money? You know, that green paper with presidents proudly displayed on them. They have virtually disappeared from the "plastic zone." Is real Money a foreign object to you? Is the balance of your checking account mysteriously stuck at Zero? It’s time to solve the mystery.
You don’t have to be a financial wizard to solve this mystery. And you certainly don’t have to be Sherlock Holmes. You see it really is an elementary concept. If you ask any elementary school student they’ll tell you that you can’t take 10 from 5. There can be no negative integers in this equation. Simply put, you can’t spend more than you have! You have to fit your “living” within your “means.”
Mortgage Prepayment Penalties - Just Say No
May 28, 2007
One of the most common terms found in a new home loan is a prepayment penalty. This type of penalty says that if the borrower pays off the loan early, commonly during the first five years of the loan, then the borrower will be responsible for paying an additional amount of money, typically about six months interest on 80% of the mortgage balance. Sub-prime market loans will typically carry prepayment penalties more than standard mortgage loans.
You may plan on keeping the house for the entire duration of the prepayment penalty, and be tempted not to worry about it much. But sometimes life circumstances change, so it’s wise to avoid any type of prepayment penalty if you can. A typical prepayment penalty might equal five months worth of monthly loan payments, so it’s worth checking on. Of course, you should always ask (before you sign) if a new loan has a prepayment penalty. In fact, ask the lending officer to point out to you in the document where a prepayment penalty is discussed.
What is a Bad Credit Personal Loan?
May 27, 2007
A UK Bad Credit Personal Loan is a loan designed for the many people with a bad credit rating. A bad credit rating can make your life a misery.
However created, your past record of CCJ’s (County Court Judgements), mortgage or other loan arrears can live on to deny you access to finance that other people regard as normal.
If you are a UK home owner with equity in your property, a UK Bad Credit Personal Loan can bring that normality back to your life. Secured on your home, a UK Bad Credit Personal Loan can give you the freedom, for example, to do the home improvements or buy the new car you really wanted.
With a UK Bad Credit Personal Loan you can borrow from £5,000 to £75,000 and up to 125% of your property value in some cases. . A UK Bad Credit Personal Loan is a low cost loan secured on your UK home. It frees up the spare capital (or equity) in your home for you to use on whatever you want.
How Healthy Is Your Credit
May 26, 2007
There’s only one way to discover the "health" of your credit. You need to examine your credit report. Your credit report is your "consumer identity" that potential lenders will use to judge your credit worthiness.
Use these tips to give your credit profile the "tune-up" it needs for 2004.
Tip #1- Check for Errors Your credit report or profile is more than just a collection of who your creditors are and how much you owe them or have paid them.
The first thing you need to do is carefully check that your credit report is accurate. Nearly 70% of credit reports contain errors.
These errors may be as simple as an incorrect middle initial or address. Or it could be as serious as a creditor reporting that you were late with a payment when in fact you were not late at all.
This error might not seem like a big deal to you. However,to a future lender like a mortgage company it makes a big difference !
Carefully examine your credit report and if you find an error contact your creditor and the credit bureaus. Catch and correct these errors now before it hurts your chances of securing credit in the future.
Open the Cash Vault Inside Your Home
May 25, 2007
Believe it or not, many people do not understand equity and the power it provides.
In its purest form, equity is money. With regard to real estate (specifically, your house or other investment property), equity is measured in terms of the value of the property minus what you owe. So, if your home is valued at $100,000, and you owe $40,000 on it, you have $60,000 in equity (actual money that is available to you, under particular circumstances).
Surprisingly, many people have this type of equity and do not take advantage of it. Some people are actually in dire financial straits and fail to realize their problems can be solved very easily, by taking the equity from their home. Remember, your home is a "vault," and the money inside that vault belongs to you. Best of all, you can use that money/ equity for anything you desire, from home improvement to travel expenses to spending money.
Exactly what is a home equity line of credit or HELOC? A home equity line of credit, which lenders and mortgage brokers refer to as a HELOC, is a different kind of home loan. An equity line has different rates and terms from a conventional first mortgage. In a standard home loan, or mortgage, your monthly payments cover both the principal loan and the interest you are charged.
The Zero Down 80/20 Mortgage
May 25, 2007
This is an excellent loan for those that are lacking the down payment required for other types of mortgages.
The 80 20 mortgage is simply two loans for 100% of the purchase price. It is a first mortgage at 80% of the purchase price with a 20% second mortgage.
If you are a conforming borrower, doing your loan in this manner will save you from having to pay mortgage insurance. Mortgage insurance is almost always required when you have less than 20% down. But with the 80 20 loan you avoid this necessary evil.
If you are a sub-prime borrower, doing you loan in this manner will typically keep your interest rates ½% to 2.5% lower than doing a 100% one loan. A 100% one loan is simply one loan for the entire purchase price.
Many times you will have two choices when it comes to the second mortgage portion of the 80 20 mortgage. The second mortgage can either be a fixed second mortgage or it can be a line of credit.
No Money Down Real Estate - Fund All Your Deals With Private Lending!!
May 24, 2007
If you invest in real estate, you need cash to buy houses. Even if you have a full bank account and great credit, you’ll eventually run short on funds - or short on time to obtain a loan - for the next deal. Private lending is the answer. It is a bottomless pool of readily accessible funds: whether you have great credit or poor; whether you have cash reserves or not.
"Private Lending" refers to the process of borrowing real estate investment funds from private individuals at rates higher than these lenders can normally achieve in the marketplace. The attraction of private lending is the speed and ease of funding a deal.
Here’s how it works?first you find or do marketing to find individuals interested in earning 10-12% interest (or whatever you deem affordable for you and attractive to others) on investments secured with real estate. You’ll find these prospects everywhere. They belong to your local investors association, your church, your civic club, they’re your friends and family, your neighbor next door. You’ll be surprised how easily you’ll locate them, and soon, they’ll be searching you out. Just let everyone know that you pay high interest for their loans on your real estate projects.
