Category: Money

Nov 12 2009

Bad Bargains When Shopping

The holiday season is upon us and with it will come many tempting deals. But are those REALLY bargains?

Here is a handy article to help keep you on your toes when you shop. Bad Bargains

Mar 02 2009

Getting A Loan by Cliff’s Notes

Cliff’s Notes are commonly known for condensing large amounts of information into a small and compact form.

Cliff’s Notes Getting A Loan is a condensed version of the larger topic on how to go about getting a loan.

Cliff’s Notes book tells you all you ever needed to know in order to successfully qualify for a loan in this 121-page handbook.

Getting a loan can be time consuming and a bit overwhelming.  It is mainly overwhelming because of the unknown factors that you will encounter in the process.  This handbook is short and concise, and explains the process of obtaining a loan in a clear and straightforward manner, a good thing in these turbulent financial times.

So if you are in the market for a loan, it’s best to be prepared.  Obtain this handbook and read all that is involved in getting loan.

Many companies make it seem so easy, or lure you with a 0% APR, but there are many aspects of the process that are conveniently left out by these advertising ploys, until you have to face a loan officer or banker. By that stage you might feel you have gone too far to back out, or are already committed without having learned what the bottom line really is going to be.

This handbook will condense the massive amounts of paperwork and fine print that is often overlooked.  The main points,  the most important points, are featured and explained in detail.  The format is easy to read and comprehend, and is material that can be absorbed in a small amount of time.

Put your precious time to good use and learn all you need to know about getting a loan with this handbook.  Never worry about the hidden costs or fine print, because you will be prepared with the correct questions and a checklist to follow in order to make sure you are making the right decision for you and your family or business.

This Cliff’s notes booklet is a great asset to have when getting a loan; the information is short, simple and concise and will save you a great deal of time, money and hassle.

Feb 22 2009

Five Reasons to Refinance Now

The Federal Reserve has lowered its interest rates several times during this current economic crisis.

As a result, mortgage interest rates have begun to fall, and hundreds of thousands of homeowners have sought re-financing for a variety of reasons.

Besides being afforded the opportunity to save money (which is critical during this recession, so long as you are sure you are not incurring more risk), here are five other reasons why refinancing now is considered to be a goodidea.

1.  It takes advantage of lower interest rates to replace the higher rate you may be paying now.

2.  Refinancing from a 30-year to a 15 or 25-year mortgage will substantially yield savings as well.

3.  You can switch from an adjustable rate mortgage to a fixed rate mortgage.  Since the stock market has been so volatile of late, reassessing your mortgage loan is appropriate at this time.

4.  Some homeowners decide to refinance so they can pay off debts such as credit cards, student loans, or medical bills.  In addition, they may apply for refinancing if they decide to make improvements to their home, providing additional equity in the home. (Again, be careful about the reasons you want to re-fi. You don’t want to end up in worse shape than before).

5.  Refinancing is needed if the mortgage you are holding has a balloon provision that does not carry a conversion option.

Regardless of why you would choose to refinance now, it is not going to be all smooth sailing even if the interest rates are very favorable. There is a sea of paperwork and fees to wade through, and there may be rocks and sharks. So take time to research lenders’ rates, fees, and other conditions that apply.

In addition, before refinancing, it is important to ensure that you have paid down some of your debt.  This is particularly necessary since most lenders today will not offer lower interest rates if the FICO score is below 750.

Since the entire purpose of refinancing is to avail yourself of lower interest rates, anything you can do beforehand to improve your credit score and bring your overall credit rating up to excellent according to the lenders’ new standards, is worthwhile.

Refinancing one’s home during a recession is not to be taken lightly.  You need to look at your financial status and decide whether or not you can afford to do so at this time.

You also need to ensure that your job is secure, and that you have not missed any debt payments that could underscore the bank’s reluctance to offer lower interest rates during the refinancing process.

Learn as much as you can about refinancing.  Call several lenders and arrange an appointment with each. Then compare each option side by side in a table or graph in terms of terms, fees, any up front costs, and so on.

Use this comparison to help you decide on the company that offers the best rate and terms that will comfortably fall within your financial situation, and present and future prospects.

Feb 20 2009

Refinancing: Fixed or Adjustable Rate Mortgages?

In order to determine whether or not to refinance utilizing either  a Fixed Mortgage or Adjustable Rate Mortgage (ARM), it is necessary to lay out the pros and cons for each.

Adjustable Rate Mortgages:  The Pros

* An Adjustable Rate Mortgage allows for lower rates and payments early in the term of the loan.  This allows qualified homebuyers to purchase homes they could not otherwise afford.

* An ARM allows the borrower to take full advantage of the lowest rates without refinancing.  This means that as the rates drop, so do the monthly payments without having to pay the fees associated with refinancing.
* New homeowners tend to save more money.

The Cons

* With an Adjustable Rate Mortgage, rates can increase at any time during the life of the loan.  (The sub-prime mortgage crisis is all the evidence you need.)
* Most borrowers find ARMs too difficult to understand, leaving them to the mercy of the lender.
* In conjunction with ARMs, there is what is called a “negative amortization loan.” This means that you can end up owing more money.

How?  If the initial payments were set so low that they covered only part of the interest rate, the balance will be added to the principal.

Fixed Rate Mortgages: The Pros

* Rates and payments will remain the same for the outset.
* A fixed rate mortgage allows homeowners to manage their budget more effectively.
* Fixed rate mortgages are easy to comprehend.

The Cons

* In order to take advantage of falling rates, fixed-rate mortgages may be re-financed.  That means a few thousand dollars more in closing costs are incurred.
* There are no payments early in the term of the loan.  This can pose a financial burden for homeowners.
* Fixed rate mortgages are the same from lender to lender.  However, most financial institutions sell their fixed-rate mortgages into the secondary market.  As a result, adjustable rate mortgages can be “customized for individual borrowers, while most fixed-rate mortgages can’t.”

For more information, do your research online. It isn’t impossible to get a mortgage, but both parties need to really look before they leap in this current economic climate.

Feb 18 2009

Mortgages and Refinancing: Points or No Points?

Points or No Points:  That Is the Question

In order to ascertain whether or not to opt for points or no points when looking at getting a mortgage or refinancing, let’s first describe what mortgage points are.

Mortgage points are fees paid in order to obtain a mortgage.  Each point is based on 1% of the total amount of the loan.  The most commonly known points are called discount points.

According to Mortgage News Daily, discount points are monies paid to the lender to acquire a loan with a specific interest rate.  Here is an example:

If a loan is for $100,000, one point is worth $1,000.  Each point one purchases will therefore lower his or her interest rate by some amount.

Most borrowers will be able to decide how many points they wish to purchase.  However, they are usually limited to purchasing around four points.

Discount points are paid at closing, but do not apply to buyers who obtain FHA or VA guaranteed loans.

According to Smart Money, there are only a few states that allow you to deduct discount points (North Dakota, South Dakota, Nebraska, Minnesota, Iowa, Missouri and Arkansas)/

Even then, deducting discount points is restricted to certain circumstances.

You may also be able to deduct a portion of your points if you refinance your mortgage to raise money for home improvements, regardless of which state you call home.

Moreover, it takes about five to seven years to recoup the cost of paying a point upfront, according to the article.

What does this mean in real terms?  Here is an example:

Let’s say you take out a $100,000 30-year fixed mortgage, and you have the option of either paying 6% with no points or 5 3/4% with one point.

With the 6% mortgage, your monthly payment will be $600.  And with the 5 3/4% loan, it would be $584, a savings of $16 per month.  After about 62 months, or a little over five years, you would have recouped the $1,000 point you paid upfront.

If you fall into a higher tax bracket, however, you may not need to add any points to your refinanced mortgage.

On the other hand, if you cannot afford refinancing without adding points, experts advise that you add the points depending upon how long you plan to maintain the loan, specifically, six years or longer.

Mortgage and refinancing options are much tougher than they used to be, and they are big commitments for you and the whole family. The key thing is to understand your points, so you can make the right choice financially for you and your whole family.

Oct 02 2008

New Finances area at the site

Given the dire financial news these days, it is not just enough to know how to run a successful business, but how to manage your finances in tough times.
With that in mind, we will also be including insider secrets on finances.

Just click on the finance link to learn more.

Sep 20 2008

Make them Pay for Meltdown

Good article on how the people in charge of the financial companies on the brink of ruin should be made to hand over their golden parachutes and help bail out this country from the mess they have caused:

Make them Pay