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Avoiding Loan Delinquency

Avoiding Loan Delinquency

If you have a loan and are struggling to make the payments, you could end up falling into loan delinquency. Delinquency can be a big problem, although if you take some steps to get yourself back on track, you won’t fall further behind. If you want to know more about how to avoid or get out of loan delinquency, then here are some useful tips to help you do just that.

What is delinquency?

Loan delinquency is when you fall behind with your monthly repayments. If you are late with just one payment, then you are technically classed as delinquent. Loan and credit repayments will appear on your credit report, so slipping into delinquency can seriously harm your credit rating. Also, if you are frequently delinquent with your loan repayments you could end up in default.

Delinquency to default

If you are continually delinquent with your payments, then you could end up in what is known as loan default. This means you have failed to pay back your loan due to persistent non-payment or late payment. If this happens, you could end up having to pay the whole amount back at once or have your possessions taken from you. You could even end up in court if you cannot pay the amount back. This will have serious consequences for your credit report, and it may take years for you to repair the damage.

Budget for your loan

The first way to avoid loan delinquency is to budget for your loan before you even take it out. Make sure that you will be able to afford the monthly repayments even if you are having a tough month financially. If possible, have savings in place to cope with emergencies so that you never slip into delinquency. If your budget accurately then you are much less likely to have delinquency problems.

Pay by Direct Debit

Although many loans require you to pay by Direct Debit if you have one that does not then make sure you still pay this way. Paying by Direct Debit will ensure you never forget to pay on time. Simply make sure you have enough funds in your account at the right time each month and the payment will be done for you. This will stop you from accidentally paying late and so slipping into delinquency.

Repayment holiday

If you think you are going to slip into delinquency but that it will be a temporary problem, you could ask your lender for a repayment holiday. Many loans come with this facility, which allows you to take a month or two off from payment in order to straighten out your finances. However, you need to remember that you will still pay interest in these months and your loan period will be extended.

Get help

If your delinquency is threatening to end up with you in default, then seek help from your lender or a financial advisor. The quicker you begin to sort the problem then the quicker you will get yourself out of debt.

Buy A Used Car: 3 Reasons To Say In With The Old

Buy A Used Car: 3 Reasons To Say In With The Old

You know it is time to buy a replacement for your vehicle. Repair bills are looming on the horizon or eating into your checking account. Every time you turn around something seems to be going wrong — both large and small annoyances make driving an ongoing hassle. Once you have made the decision to go car shopping, the first question you must face is whether to go new or used. Here are three reasons you should buy a used car.

Why You Should Buy a Used Car

The top reason to buy a used car is that new cars are a losing proposition. New cars depreciate fast. Did you know that as soon as you drive a new car off a dealer lot it will instantly depreciate between $1,000-$2,000? After the first three years, most cars are worth only about 60-70% of their original value. However, if you buy a used car then you will have to pay a lot less for a nice car and you will not have to worry about that depreciation.

Once upon a time buying a used car was a risky proposition. There was a good chance you could buy a lemon or a car that had been used and abused or even been in an accident. Today the savvy consumer does not have to face these risks which leads to the second reason for buying a used car. It is safer (and less risky) than it has ever been before. Many reputable dealers offer one-owner vehicles that are still on warranty so that takes some risk out of the equation, but in addition today there are many research tools available on the internet to help you learn about the reputation and performance history of a particular vehicle model you are considering plus you can even run the vehicle identification numbers to determine if a specific vehicle has been in an accident. It is probably a lot less risky to buy a used car than a new unproven vehicle that might turn out to be a lemon. You can also get a pretty accurate value for a vehicle so you know how much you should pay.

Finally, buying a used car takes a lot of the stress out of new car ownership while still letting you enjoy the benefits of a new vehicle. Dealers will give a vehicle a turnout so it will have that new car smell, but because you do not have to worry about the price you paid you can sit back and enjoy your new-to-you vehicle without worrying about tempting fate. Plus, many dealers have more room to deal on a used car than they often do with a new car so you have more bargaining power.

So if you are looking to buy a car then you should consider buying a used car because it will save you money, it is safer than ever before, and it is less stressful. Need an auto loan to buy that dream car? We can help!

Debt Consolidation Loans: A Last Resort

Debt Consolidation Loans: A Last Resort

No one ever wants to be in debt but it happens and at that point, debt consolidation loans are the answer. It can help take back control of your finances and stop letting that debt the quality of your daily life. Debt can occur through unexpected medical bills, education expenses, credit cards, personal loans, and homeownership. If you have not been able to handle the debt yourself, it is first important to assess your situation and the total amount of debt to determine the best way to pay it off. Debt consolidation is more than likely the way to go as compared to the option of bankruptcy and it should be considered, but you very well could handle your debt on your own which is why it is important to evaluate your financial situation.

Included in your evaluation of your options and the best route to take in paying off your debt is the importance of understanding the basics of debt consolidation loans. Simply put, debt and bill consolidation is the process of totaling your outstanding debt, and assessing your situation is a determination of the amount you can afford to apply each month to this debt. Look at your income, total monthly debt, total monthly payments and the total amount of debt to be included in the bill consolidation.

You should next determine the percentage of your debt and consolidation total for each creditor, which is important in order to find the best offer the creditors make to reduce your payments. Lower interest, reduced payments, and sometimes a reduced payoff amount are all possibilities during negotiations with creditors. For example, if your debt and bill consolidation total is $5,000 and you are required to repay a particular creditor $400 per month, take the $400, dive it by $5,000, and multiply the result by 100. This will give you a percentage, which is 12.5% in this example. You then know that 12.5% of your debt and bill consolidation total is due to that creditor. If your disposable income after subtracting essential expenses is $1,000 per month, you can afford to pay this creditor $125 per month.

One thousand multiplied by 12.5%. The average amount paid each month from debt consolidation, as compared to paying the creditor yourself, may or may not be less than, for example, the $125 above. If it is not, debt consolidation may not be the best way to pay off this creditor while it may for others. Or, the negotiations the consolidator is able to make with the creditor may result in a much lower payment, and reducing your debt through debt consolidation is probably your best solution in this case.

It does not hurt to contact the creditors yourself and try to negotiate a lower interest rate and reduced payments. Often if you explain your situation, they will work with you. It goes without saying that bankruptcy should be the last resort but debt consolidation may not something to jump into right away.

Getting A Home Loan With Bad Credit

Getting A Home Loan With Bad Credit

Everybody wants to be able to get a house one day, and in many cases, it can actually be cheaper than renting. So why should bad credit stop someone from getting the necessary home loan to be able to buy their house? The truth is that these days there are more than a few lenders who would be ready to give you, on certain conditions, the bad credit mortgage you want. Here are some details about it.

It is true that having bad credit will eliminate you from some of the best deals, but it does not eliminate you altogether. The first thing you need to do to ensure that you can get the best deal available to you is to look at your current credit report and check it over for incorrectly reported problems. These can easily happen and they are probably much more common than most people think. After you correct any inaccuracies, you can continue the process.

The next step would be to decide whether you believe you need to have a bad credit mortgage quickly, or if you want to take a little time to repair your credit rating. Of course, it is recommended that you repair your rating some and it will enable you to get a better deal.

Decide what kind of loan you want. You will need to know which one you want when you start making your application. There are basically two kinds, a fixed-rate mortgage, and an adjustable-rate mortgage. A fixed-rate mortgage remains the same in terms of interest and payments throughout the life of the loan. An adjustable-rate mortgage, on the other hand, changes every period (could be monthly or yearly) in terms of interest and payment amount.

Go to your bank’s mortgage officer, or look online and begin to see what you can borrow. Don’t get so excited, though, when a lender extends you an offer that you fail to compare with other offers. Truth is that there are many that will lend you money – but many will not be in terms you will want to accept. Look over all terms carefully, compare interest rates, and then all fees separately. Be careful about extra long terms – longer than 30 years. While it does lower your payments, it also definitely increases the amount you owe.

In order to get better deals, you should be able to put down at least 20% of the cost of the house. Also, you will want to use it in such a way that it should be the last time you will ever need to get a bad credit mortgage. Your credit can be repaired, but do not get a home loan bigger than what you may be able to safely handle. A financial counselor can advise you on what is the best way to arrange your finances and can recommend to you what is a safe amount of mortgage for you to handle. Remember, your home is now the collateral for the mortgage, so you will want to take care to keep your new credit levels intact.

Getting Approved For Your First Unsecured Credit Card

Getting Approved For Your First Unsecured Credit Card

Credit cards are considered as one of the necessities in today’s life. Besides, with an unsecured credit card, you can literally purchase any product or service without having money in your pocket at all. No longer will you run the risk of getting your money stolen by simply having a credit card.

However, with all the advantages that a credit card can give you, you will find that it is quite difficult to apply for a credit card and getting approved. There are a lot of things you have to consider before a credit card issuer or a bank can get you approved for a credit card.

The first thing you need to know and need to have when applying for a credit card is a good credit rating. Your credit rating is one of the essentials that a credit card issuer or a bank will look at in order to get you approved for a credit card. By having a good credit rating, you will be sure that you can get yourself approved.

However, if you don’t have any credit history or a bad credit rating it will relatively be hard or even impossible for you to get approved for a credit card. In order to obtain a credit history or repair your credit rating, you can always apply for a secured credit card.

Unlike an unsecured credit card, it will require you to deposit money on an account. The amount you deposit will be the credit limit for a secured credit card. You will also receive a monthly billing statement like an unsecured credit card.

You have to remember that a prepaid credit card and a debit card are different from a secured credit card. Debit cards and prepaid credit cards will never repair or build your credit rating.

One main disadvantage of a secured credit card is that it will usually have a high-interest rate than most unsecured credit cards. However, it is also a great way to control your credit card purchases. It is also a great way for you to become a responsible credit card holder and help you prepare to own an unsecured credit card.

Not only that it will also help you build a good credit rating or help you repair a bad credit rating. With this kind of feature, you will definitely get yourself prepared to own an unsecured credit card.

Owning a credit card will also mean being more responsible for your purchases. With a secured credit card, you can train yourself to be a more responsible credit cardholder. This is because, aside from the advantages that an unsecured credit card can give you, there are some people that buy irresponsibly. The feature that a credit card offers will usually tempt people to buy things that they don’t really need and will often result in getting into huge amounts of credit card debt.

By first getting an unsecured credit card, you will be sure that you can be a more responsible credit cardholder.

So, if you want to apply for an unsecured credit card, getting a secured credit card first is recommended if you don’t know what you are getting into or if you want to build a credit history or repair your credit rating.

Good Money Management Builds Credit and Protects Assets

Good Money Management Builds Credit and Protects Assets

You should consider how to build credit using good money management skills today. Your first step is to keep a record of outgoings and use a strict budget that you can stick to. Bankruptcy and debt consolidation may add more costs to an already bad situation. You will have to deal with more expenses, high interest, and repayments that may not be enough to satisfy your creditors. This can be stressful and worrying.

The best remedy is to start saving money.

“Do not save what is left after spending; instead spend what is left after saving.” ― Warren Buffett

 

Ways for Building Your Money Management Skills

Firstly, try purchasing accounting and budgeting software that enables you to save. It may seem like just another added expense, but the cost will benefit you in the end. Part of this process will be to track your outgoings and incorporate them into a monthly budget plan. The software will assist you by making the task much easier, but if you prefer you can set up a manual table with paper and pen.

Next, label your table with the heading of Daily (or weekly) Spending – Week of ________. Make sure that you list all your spending requirements, savings, income, taxes, banking fees, food, rent, etc. Each week, when bill payments are due, spend as much as you can on the first, leaving a minimal amount of money for the following week’s essentials. For example, if your telephone bill is $114, your utility bill is $59, and your cell bill is $180 and you get paid only $300 then it will be obvious that you do not have enough to cover this. It is now time to cut down on unessential items. Do you really need two phones?

Forget going to the cinema, budget on rentals, but unfortunately, you may simply have to do without this week. Listen to the radio or watch t.v.

Try to also develop a table that includes your estimated monthly repayments and your living expenses. List your gross income, pensions, bonuses, child support, retirements, and other deductions. Then work out what can be saved and put it towards paying down your debts. Sadly, you will have to reduce your groceries, medicinal, personal, pet, holiday, and gifts costs. Are there any assets that you don’t really need? Do you need that second car? Why not sell it and clear some more debts?

These simple little tips, along with good record-keeping, will help you to gradually reduce debt, fix your credit score and rating, and help re-establish your credit. You may want to think about getting a higher-paid job if your current one offers measly wages. In fact, taking on another job part-time on top of your regular employment can pool in more money. Always remember that there is always a way to rebuild your credit and repair the damage done.

Good Money Management Is The Only Way Out Of Debt

Good Money Management Is The Only Way Out Of Debt

Establishing a budget, keeping on track with it, and keeping a record of all of your expenses is the real solution for rebuilding and repairing your credit once it has been damaged. Don’t be tempted to file for bankruptcy; you will only ruin your chances for the future. Even the solution of a debt consolidation loan will only add more and a continued debt burden. You have to pay interest on the loan, and you will just be worried about making it until it is finally paid off. The best solution is to save your way out of debt by establishing good money management skills. It is a much better idea to keep track of your expenses so you know what you are spending your money on and then you can eliminate unnecessary expenses and start to save.

A small first investment you might want to make is a software program that will assist you in budgeting and saving. By making it easier to keep track of things, this small expenditure will save you a lot in the long run. The first thing you need to do is establish a budget. A software program will ask you all the questions you need to establish a budget. By answering the questions, the program will put all of your income and expenses in the correct categories and show you what you have leftover. You can also do this on your own, by using a form where you write all of your income on one side and all of your expenses on the other.

Each week write down what you spend on each item, how much you put in your savings account or retirement fund, taxes, etc. Record your earnings and track how much you have left. If you see that each week you have nothing left to pay an essential bill, you will have to change your payment system. Each week as you pay your bills, try to make as large a payment as you can on each of your necessary bills, such as rent or mortgage, electric, water, phone, etc. Then you have to survive on what is left by cutting back on non-essentials. You may have to stop going to the movies for a while and just rent inexpensive ones from the library.

You may have to cut back on eating out. Next, examine all of your essential bills to see how you can save money there. If you start to limit the phone calls your family makes, if you make sure to turn off lights and stop wasting water, you can probably save a lot of money. Making these cutbacks and sacrifices will pay off big if you can catch up on all of your bills. You will not even remember which movies you missed while you were putting money away to pay off all of your bills.

Another way to ensure that you build a good money management skill is to make a survival budget. What is the absolute minimum you and your family need to survive? Cut every expense down to its lowest, like budget meals every night, no entertainment except whatever is free, basic water, basic T.V. cable, basic telephone. Follow this survival budget for a few months and you will be shocked at how much extra you will have to pay off your bills and debts. Certain items are important to keep up, such as health insurance and your rent or mortgage, so you don’t end up with no roof over your head or medical bills you can’t pay. But everywhere you can cut back, you should. Any savings can be applied to catch up on bills or debt.

The other strategy for good money management is to look at is your income side. Can you ask for a raise, or can you find a better-paying job, or perhaps you can find a second job? Find any way you can (any honest way, that is!) to increase your income while you cut down on your expenses, and you will repair your credit before you know it.

Government Credit Repairs

Government Credit Repairs

If you are building a credit history, suffering bad credit, or else your credit is great, there are sources available that will help you maintain credit, repair credit, and build a credit history. If you have bad credit you must at least apply for two loans and be turned down before, the government will consider giving you a loan. Your credit report is not what is important, rather declines are the focus. Government credit is available to help people start a new business, loans for single parents, loans for education, and so on. The government offers loans to special individuals and often has 0% interest or low interest against the loans.

The government also offers grants to assist people in getting back on their feet again and the grants are yours. You do not have to repay the government anything, but you must use the money for what it was applied for. DC recently reported that there are new sources available that make it easy for families and individuals to repair their credit and get back on their feet again. When credit is bad, we have difficulty when applying for a home, car, apartment, credit cards, and so on. We are virtually disregarded in almost all cases. Today private lenders and the government are teaming up to make our economy more productive by helping those in need, including repairing credit.

Other resources are available to help those of us that are re-entering the employment market as well as helping those of us without jobs. There are funds available to those of us with low and high-risk credit scores. If you need a home, consolidate debts, car, or else start up your own business the government and private agencies are waiting to help you along. Reduced loans and free programs are available that will benefit millions in the economy that are suffering from bad credit histories.

Legal Aid is one source available that can help you with the repair of your credit, as well as many other sources and this source is free of charge in almost all cases. If you are paying, high fees to rent an apartment you might want to fill out an application with HUD. HUD pays a certain amount toward your monthly rent each month and you are required to pay the remaining balance. Think of the money you will have left each month to apply toward building your credit history. HUD also has a solution for first-time homebuyers with bad credit.

Under the Homebuyers Bill of Rights allows us the right to purchase a home if we have bad credit. The government resources and private institutes have lowered their Interest Rates to around 5% for homebuyers and extend up to $500,000 for first-time buyers helping them buy a home. The government and private institutes are also offering debt consolidation loans assistance with late payments, people that are starting a new business, and home improvements. Imagine the potentials?

It is often difficult for us when our credit is bad and not knowing where to start to repair our lives is even more frustrating. If you are suffering from bad credit, you might want to check in on a few options available to you that can help you get out of debt. Life does not have to be difficult and all of us make mistakes.

The Fair Credit Reporting Act (FCRA) offers us protection on our credit report. Our privacy, fairness, accuracy, and other laws say that we do have hope. If you are searching for a way to get out of debt you might want to start up your own business. The government has programs specifically for small business owners. The programs will help business owners to finance their business and guarantees loans to those that are creating a plan to support themselves as well as paying their taxes to the government. This is a wonderful solution for getting back on your feet again and getting those creditors off your back.

To find out more about small business loans, check us out. Bad credit is misery, but it does not have to be a force that destroys your life forever.

Having A Bad Credit

Having A Bad Credit

It is very important to understand how your credit affects your ability to make purchases. Bad credit can affect your ability to make major purchases including a home or a vehicle. In some cases, it can prevent you from gaining employment. We have all heard of businesses that tell you it isn’t a problem. However, that is not the reality of the situation. While they might be able to get you financing, you will pay a much higher interest rate due to your records.

Your rating is based on several factors including your payment history, the amount of debt you owe, the possible amount of debt you can incur on revolving accounts, and the length of time you have maintained your accounts. These factors are combined to formulate your score. The maximum credit score possible is 850. The higher your score, the more likely you can obtain credit at a good interest rate.

Low credit scores indicate to lenders that you are high risk. This means it is likely you won’t be able to repay the loan as outlined. You are labeled as having bad credit and generally sent on your way without the loan you wanted.

How do you get bad credit? The most common way is by opening numerous accounts. On your score, they look at the total limit of credit you have available on credit cards and other lines of credit. The closer your actual balance is to the maximum, the worse your credit will look. Paying accounts late also plays a large role in paving the road to gaining this problem.

Unfortunately, this issue is not something you can repair overnight. It takes a conscious effort to make all your payments on time. This often requires making some changes to your spending habits in an effort to reduce your total debt. Take time to think new purchases through. If it is not a necessity, you may want to use those funds to eliminate debt rather than to make a purchase.

If you have to purchase a necessity such as a vehicle, you might find yourself paying very high-interest rates. If that is your only option, it is strongly suggested you pay the loan off as quickly as possible. This will reduce the amount of money you pay overall for interest. Be sure to find out if the loan has a penalty for pre-payment. You will want to shop around for one that doesn’t.

This situation is a strike against you that affects many areas of your financial abilities. Work hard to keep credit card balances low, make your payments on time, and avoid unnecessary purchases you don’t need. Or, you may reach out to us if you need an expert to help you correct your credit. These things will help you stay away from having this problem.

Home Mortgage And Our Age

Home Mortgage And Our Age

Home mortgage refers to the document borrower signs that gives the lender a right to take possession of the property if the borrower fails to pay off the loan.

We, the people, and they, the people also, love to own things. Some important, some trivial. From small things with great sentimental values to large things that everyone envies. Owning a home for most is a dream come true and for most, it is a dream most will never truly realize.

Yes, most live in a home but as long as you make a payment on the home mortgage, in my opinion, you do not own it. It does not diminish the pleasure you or I drive from living in a home that is not a rental nor do we take less pride in the fact that we actually live in a property that most people can call ours.

After all, we pay property tax, insurance, and homeowner dues. We mow the lawn even when we rather watch football and repair the roof when needed even if we have to borrow some more money to pay for it. We furnish the home, buy indoor plants. We landscape the yard and we throw parties in the back yard and play tag with our rottweiler.

For all practical purposes except one, we own the home. So why am I making a big deal out of this thing called a home mortgage? Maybe I shouldn’t since over the last twenty-some years of homeownership, home mortgage, home equity line of credit, and the second mortgage has helped me out of so many financial troubles that I can hardly count.

As my wife and I get older we also realize that every time we traded our home up we moved to a bigger and more beautiful home which also meant a bigger mortgage. We realize that we cherish freedom more and more and home mortgage obligation is something that we love to have paid off. We like to truly own the home.

As you look at various lenders looking for new home mortgage loans or refinance your existing home, you may also consider that you, at some point, may want to own your home. Perhaps, choosing the lowest interest rate is not the best way to go but the one that with a little hardship helps you own your home a little earlier.

I think one of the greatest financial securities in life is not owning a home but having the home mortgage paid off. What do you think? Do you need assistance in buying your dream home? We can help!