Why Consolidate Your Loans or Other Debt?

Substantially Lower Your Total Monthly Loan Payments
Typically, you can get a much lower interest rate on a consolidation loan than the
percentages you are paying on most of your credit cards. Credit cards can run 16% to 28%
interest, depending upon your credit history and credit score. In addition, the U.S. Congress
has authorized an increase in the minimum monthly payment you are required to pay. The
new minimum monthly credit card payment will be about 4%, up from 2%. This will
obviously raise your minimum monthly payment amount. Remember, you should only
consolidate if the interest rate on your consolidation loan is lower than the interest rate on
the Loans you are consolidating.

It Is Much Easier to Make Fewer Monthly Payments
When you have many credit card and other payments, it is inconvenient and time
consuming to have to make so many individual payments. To top it off, it is much easier to
accidentally miss a payment, making your credit even worse. This will drive your loan and
credit card payments even higher and make your life more difficult. You have a much easier
situation if you have only one loan payment to worry about.

Pay Off Your Loans and Debts Much More Quickly
Because your monthly interest payments are so much lower, you can pay off your loans,
debts and credits cards much more quickly. This can save you substantial interest
payments over the long term. Be careful though, if you stretch out a debt consolidation loan
too long, you could end up pay substantial interest. Even though the interest rate is much
lower, you have the ability to stretch out the repayment for a longer term.

You May Be Able to Avoid Bankruptcy With a Consolidation Loan
If you think you are close to declaring bankruptcy because of too little cash flow, a
consolidation loan may be just what you need to free up extra cash each month to allow
you to meet your financial obligations.

Paying Off Your Debts With a Consolidation Loan Can Stop Creditor Calls
If you dread those phone calls from creditors you can get relief with a consolidation loan .
By paying credit cards or other loans off, or bringing your financial obligations current, you
can end the constant stream of collection and creditor phone calls.

A Consolidation Loan Can Have Substantial Tax Benefits
In many cases, you may be able to deduct loan interest as expenses before paying income
tax. You will reduce your taxable income by the interest amount. In addition, this may also
put you into a lower tax bracket, further lowering your tax burden. You need to check with
a qualified tax professional to be sure.

A Consolidation Loan Can Help Eliminate Late Payment Fees
Since you are only making one payment, you chances of making late payments are reduced
considerably. This is one of the places people get behind on their payments. You are late
with a payment, so the credit card issuer adds a $39.95 late charge. Now you have an even
larger payment and a greater balance to deal with. By reducing the chance of late payments,
a consolidation loan can really help get your financial life under control.

Something else to consider is that many credit card companies have what's called a universal
default clause. The universal default clause states (in the very fine print) that if you are
more than 30 days late on a payment, they can invoke the clause and up your interest rate
to those in the terms of your credit card agreement (These can reach about 30%!). The
problem is that this clause looks at all your financial obligations. If you are more than 30
days late on your Nordstrom card, for example, your Visa card interest rate could go up.

Debt: Learn How To Manage It and Reduce It

Most of us do have to take on a certain degree of debt to have the most basic things to sustain even a modest lifestyle. Few can afford to buy a house outright, without a mortgage, for example. However, excessive or unmanageable debt is not desirable, not if financial security and health is what you hope for. Learning about debt – how to choose your debt wisely, how to manage it and how to reduce it – can help you to keep control of your fiscal life and to make your future secure.

Personal Debt

Personal debt, often referred to as consumer debt, often involves a significant proportion of credit card debt, in addition to consumer financing of goods. Furthermore, for many people, a good portion of their personal debt is for things that they wanted, as opposed to things that they needed. With personal savings tumbling into negative numbers during the past few years, something that has not been seen so extensively since the Great Depression, it should come as no surprise that many are burdened with excessive personal debt, particularly credit card debt.

Being selective about the debt you choose to take on and learning how to make wise financial choices goes a long way towards preventing such fiscal crisis and chaos. However, even if mistakes have been made, taking the time to learn about debt and how to manage it can be a great help in reducing debt and starting to rebuild credit.

If you’re facing overwhelming personal debt, there are ways that you can alleviate the situation. You do have options. You can take steps on your own to start bringing your debt under control and to rebuild your credit or you can enlist the assistance of a credit counseling agency. Another option, one that many find useful, is a debt consolidation loan. This can simplify the process, resulting in a single debt payment due every month. Learning about the various options available to you will help you to choose the best solution for your particular debt situation.

Mortgages and Other Debts

Mortgages and business loans are other common debts, as most people do need a mortgage to finance a home and many businesses also require a certain degree of financing to get up and running. While these types of loans are arguably necessary, as saving up the amount necessary prior to the purchase or investment is not a viable option for most, applying wise borrowing strategies and debt management skills are important. Understanding how these debts work and how much they cost you in the end can help you to avoid taking on more debt than you need to, and can help you to structure a repayment schedule that you can stick to successfully.

Take the time to learn about debt, understanding what it costs you, how to manage it and how to reduce it. This will help you to be selective about the debt that you take on, will help you to get the best terms and rates when you do take on debt and will help make sure that your future is secure and fiscally sound.

Debt Consolidation Loan Hints

What is debt consolidation? Debt consolidation is the process of obtaining one loan to pay off other non-secured consumer loans and credit cards.

What is the purpose of debt consolidation? The object is to obtain a low interest rate loan with low monthly payments, without adversely affecting your credit rating or risking other assets.
As an added benefit, the maker of the consolidation loan should take over all contact with your creditors, which should relieve you of any further collection attempts from the creditors that were part of the consolidation.

What is a secured loan? Any loan that has a provision for the return or collection of an asset when payments are not made. Secured loans are usually made for cars and houses. Secured loans on houses are either first or second mortgages.
Secured assets usually have special rules applied to them in bankruptcy preceding and usually cannot be taken from the consumer to pay off other non-secured debts.

What is a consumer loan? A loan resulting from a shopper's purchase that isn't secured to an asset. Consumer loans typically result from credit card purchases and balance transfers.

When should I use a debt consolidation loan? A debt consolidation loan should be used when your credit card payments become unmanageable by normal budgeting methods.
Debt consolidation loans are one of many solutions that can temporarily reduce debts. To prevent further debt from accumulating you will need to change your buying habits.

What do debt consolidation loans cost? Their are many institutions that offer free consultation and claim to be nonprofit debt consolidation agencies. Typically, up front fees are not charged, but you should always ask what fees will apply to the loan before you sign it.
True nonprofit agencies will want you to agree to a budget, and may make you agree to let them manage your money.

What should you ask before getting a debt conolidation loan?

1. What fees apply to the loan? Small service fees are typical, large commissions should not be paid. Be wary of any company that claims it can reduce your debt, and avoid any company that wants to charge you a large commission to reduce your debt.

2. What is the interest rate on the loan? This should be much less than your credit card rates. A high interest rate will prevent you from paying the consolidation loan off. Try to get a fixed interest rate so your payments do not change.

3. What are the payments on the loan? The payment should be lower than the amount you were paying before the consolidation.

4. Will the loan adversely affect my credit rating? Make sure the loan procedures are explained to you before you sign the loan. Avoid lenders that are not clear on this issue.
Obviously, companies that claim they can reduce your debts have a greater chance of causing harm to your credit rating.

When shouldn't I use a debt consolidation loan? The object of getting a debt consolidation loan is to ultimately improve your financial situation.
Loans that require you to pay high fees, or promise large debt reductions are extremely risky and should be avoided. Never pledge secured assets (your car or house) to obtain a debt consolidation or other type of consumer loan.

How should I go about finding a good debt consolidation loan? Shop around. For all loans and bank services, it is always helpful and financially rewarding to compare different companies' products.
Once you narrow down your search, use your favorite online search engine (like www.google.com) to check out the companies and find out what other people think about them.

Debt consolidation loan

Did the credit card computations scare you into looking for another option? There's always a debt-consolidation loan. Offers for these financial products are an e-mail box staple. Chances are you get a dozen or more everyday suggesting this as the solution to your growing debt problem.

A major appeal of consolidation loans is convenience. Instead of paying 20 different creditors who are charging different rates at different times of the month, you take out one big loan and pay off all those accounts. Then you make a single payment on that loan once a month.

But ease doesn't automatically translate to savings.

Before you sign on the dotted line, be sure that the costs of the new, bundled loan will truly be less than what you're already paying various creditors. If you are not sure ask for finance advice For many consolidation-loan candidates, their current credit woes mean they won't get the lowest-available interest rate. Plus, when there is nothing to secure the loan (such as your home), expect the lender to bump up the rate.

Calculate interest and fees on all your existing accounts to determine the total of the payments you now make. Then compare those amounts with the consolidation loan numbers to make sure it truly is a better choice. Also, think about Refinancing Options, hoping that You will don't need that, but I say at least have prepared plan B.

And, as with any product, shop around. The bank down the street may offer an attractive loan rate, but a check of your local credit union could turn up better terms, says Deborah McNaughton, author of "The Get Out of Debt Kit."

"Credit unions also tend to be more lenient than the offshore banking banks," adds McNaughton.

Debt consolidation: cure or continued credit problems?

Interest rates haven't been this low for decades, tempting some consumers to take on additional debt to ease existing credit woes. The goal is to consolidate various higher-interest balances into one, easier-to-handle and less-costly package.

But be careful of what looks to be a quick fix.

"You're getting symptomatic relief, not a credit cure," says Chris Viale, general manager of Cambridge Credit Corp., a nonprofit credit counseling agency based in Agawam, Mass.

This fighting-fire-with-fire approach can take several forms. There are debt-consolidation loans, balance transfers to a zero-percent credit card and home equity loans or lines of credit.

But, says Viale, 70 percent of Americans who take out a home equity loan or other type of loan to pay off credit cards end up with the same (if not higher) debt load within two years.

Viale's statistics underscore a major problem with debt consolidation: It feeds upon the tendencies that got you in trouble in the first place. By taking on yet another creditor, you're adding the proverbial fuel to the fire. In this case, it's your money that's burning.

Plus, if you've taken on so much debt that you're looking for more as a solution, chances are you won't qualify for the very low interest rates you see advertised. Those generally go to people with stellar credit ratings.

However, if you're at the end of your credit rope or swear that this time you'll be more disciplined, debt consolidation may be something to consider despite its risks. Here are some popular forms of debt consolidation, how they work and a look at their pros and cons.

Debt consolidation: cure or continued credit problems?

Interest rates haven't been this low for decades, tempting some consumers to take on additional debt to ease existing credit woes. The goal is to consolidate various higher-interest balances into one, easier-to-handle and less-costly package.

But be careful of what looks to be a quick fix.

"You're getting symptomatic relief, not a credit cure," says Chris Viale, general manager of Cambridge Credit Corp., a nonprofit credit counseling agency based in Agawam, Mass.

This fighting-fire-with-fire approach can take several forms. There are debt-consolidation loans, balance transfers to a zero-percent credit card and home equity loans or lines of credit.

But, says Viale, 70 percent of Americans who take out a home equity loan or other type of loan to pay off credit cards end up with the same (if not higher) debt load within two years.

Viale's statistics underscore a major problem with debt consolidation: It feeds upon the tendencies that got you in trouble in the first place. By taking on yet another creditor, you're adding the proverbial fuel to the fire. In this case, it's your money that's burning.

Plus, if you've taken on so much debt that you're looking for more as a solution, chances are you won't qualify for the very low interest rates you see advertised. Those generally go to people with stellar credit ratings.

However, if you're at the end of your credit rope or swear that this time you'll be more disciplined, debt consolidation may be something to consider despite its risks. Here are some popular forms of debt consolidation, how they work and a look at their pros and cons.

Mobile Home Loans With Bad Credit

A mobile home loan with bad credit is possible because a lot of lenders understand that people want to own a mobile home for their affordability, yet these homebuyers often have a poor financial background. Many financial companies have taken on the task of creating programs that help potential buyers to receive mobile home loans with bad credit. Programs that provide these loans also provide competitive rates from lenders, within a short period of time, through one of numerous financial providers.

Lending is relatively simple to get with a lot of companies working to make it possible. Many online sites offer services where potential homebuyers have the opportunity to receive information on products and services that are offered. Most banks and finance companies do not like working with individuals seeking mobile home loans with bad credit, but numerous online financial organizations are available to take up where these financial institutes leave off.

A lot of the online services that provide information allow for immediate quotes. Usually the sites offer up to three or four quotes with no fee or agreement. Receiving a mobile home loan with bad credit is not only easy with the help of these financial companies; it is also possible to receive lower interest rates because of the competitive rates that are being offered.

Obtaining lending can be done in less than a day. The majority of the companies that offer these types of loans advertise the ability to deliver quotes within a 24-hour period. Even going to a local bank requires more time and preparation. Also, when using an online service for information on mobile home loans with bad credit, the information can be processed and received at any time, not just during operating hours like those of a bank.

There are a variety of companies offering competitive rates on borrowing in a very timely manner. Another advantage of obtaining a mobile home loan with bad credit from an Internet website is the convenience. Christians understand the meaning of truth and the need to act in a truthful manner. Some people, however, prey on innocent people who trust everyone. The Bible says to trust in God, not in man. "The Lord is my rock, and my fortress, and my deliverer; my God, my strength, in whom I will trust; my buckler, and the horn of my salvation, and my high tower." (Psalm 18:2). Trust should only be given when it is deserved. It is very necessary to understand which sites are secure and legal when applying for a mobile home loan with bad credit.

Loan Sources For Those With Bad Credit

General Description Available for residents of USA Do You Have Bad Credit? Don't give up! YoureApproved has been formed to help those who have bad credit find the credit they deserve. Personal loans, business loans, credit cards and mortgages are all obtainable through YoureApproved! No matter how bad your credit condition is, you will not find a better resource than YoureApproved! When you become a member of YoureApproved, you will receive instant online access to Exclusive Bad Credit Lender List and Credit Repair Kit. You will also receive updates to their list of bad credit lenders. When you become a Member, you'll get: • Loan Sources for Those with Bad Credit YoureApproved have more than 80 Little-known Banks & Companies that offer Bad Credit Loans, Bad Credit Home Loans, Bad Credit Auto Loans, and Bad Credit Personal loans to people with Bad Credit or even a Bankruptcy. Many require absolutely NO COLLATERAL & NO CO-SIGNERS. Home ownership is not necessary. • Credit Cards for Those with Bad Credit YoureApproved have more than 50 Banks & Companies that offer Bad Credit Unsecured Credit Cards and Merchant Cards to people with good credit, no credit, bad credit, or even a bankruptcy.

Online Loans with Bad Credit

Credit is the one thing in the United States that a person can’t live comfortably without. More and more lenders, landlords as well as anything that you would purchase on credit are tallying those credit scores. It is harder to obtain a loan as well however recently some options have emerged that are helping those who have bad credit get a loan and it is as easy as turning on your computer.

Lenders now compete for potential loan clients and they have opened their doors to those with bad or questionable credit. The newest tool for lenders to reach these folks who might not otherwise walk through the door is the internet. There are a number of reasons why a person who is credit challenged would not step into a lenders branch office to attempt a loan. First many who have bad credit are conditioned to believe that they can’t obtain a loan so they figure why try. Second, borrowers who have bad credit usually don’t want to announce or justify way their credit is that way in the first place. Bad credit comes in many ways that may have nothing at all to do with the way you manage money. More and more lenders are realizing this and trying to find a way to help those with bad credit get loans. This is where the internet comes in; a borrower can do everything online and never have to sit in front of a person at all.

An online loan works like this, lenders, through saturation e-mails, e-mails that go out to a blanket buyer list, and online websites offer the best possible rates for those with bad credit. These lenders can come from many different types of institutions such as savings and loans, commercial banks and credit unions. The individual does their own research and finds an online loan website that fits their needs and clicks on the application area of the site. The borrower can now fill out all of the paperwork sitting at home. There are no hard sells from the lender and if the answer is no, the only person the wiser is the borrower and an anonymous lender on the other end of the fiber optics.

Online Bad Credit Loans

1. Bad credit loans must be secured by personal belongings.

False They can be secured or unsecured. Secured means that there must be collateral attached. Failure to pay could result in loss of a home or other personal belongings. Receiving unsecured bad credit loans means no collateral is attached and approval for borrowing is on the ability to repay through income and past payment history.

2. Bad credit loans can be approved even if bankruptcy has been declared.

True They can usually be approved even if an applicant has recently declared bankruptcy, foreclosure, repossession or divorce. Many companies accept clients with bad or no credit history. Specialist companies who deal with lower than average credit applicants can be found easily on the Internet.

3. Bad credit loan clients who pay on time improve their credit score.

True Those who pay on time and in full will improve their credit score dramatically. They will later be able to apply for more loan programs with better interest rates. It can be an alternative way to begin building good credit for life.

4. Bad credit loans will have higher interest rates than standard loans.

True Since credit is not yet established the financial lending institutions are able to charge a higher interest rate. Most people would be approved for a standard loan, so the higher interest rate is charged for those that pose a higher risk to the lender. Interest rates can still be negotiated, and it is wise to obtain a copy of an individual credit report to know exactly where you stand from all the national credit bureaus.

5. Bad credit loans are a way for companies to extend grace.

True
Deuteronomy 15:7 - If there be among you a poor man of one of thy brethren within any of thy gates in thy land which the LORD thy God giveth thee, thou shalt not harden thine heart, nor shut thine hand from thy poor brother:

Bad Credit Personal Loans - FAST Online Personal Loan for Bad Credit!

Bad Credit Personal Loans are simply personal loans for people with poor credit, no credit, or other challenging credit problems, such as bankruptcy or past repossessions. If you have found yourself needing a personal loan but feel that your bad credit is holding you back, then you have come to the right place. We specialize in personal loans for bad credit and have helped thousands nationwide who were in the same situation you are in now. Bad credit personal loans can be acquired online in minutes and can be used for any purpose. These personal loans are simple to acquire through the instant online application and do not require you to have major collateral commitments. To acquire your fast and free approval now go to the online application and see how easy it is to get approved for your Bad Credit Personal Loan.

Personal loans for bad credit are not only designed to provide you with a personal loan despite challenging credit issues but these bad credit personal loans will help you to rebuild your credit. Most people who search for a bad credit personal loan usually end up getting frustrated because they are dealing with lenders who try to filter out high risk credit. Our services are different in the fact that our national network is comprised of bad credit lenders who do not shy away from challenging credit. We specialize in fast online services for bad credit personal loans and provide services anywhere in the Nation.

Bad credit personal loan approvals take just a few minutes when you apply over our secure online application for bad credit personal loans. You simply will not find an easier place to get approved for a personal loan with bad credit that offers you fast online services and competitive loan rates. Not only will you be dealing with a team who knows and understands every imaginable credit challenge but you will be on the right track to repairing your tarnished credit. Personal loans for people for bad credit can be used for any purpose that you see fit, and you can get your fast and free online approval by going now to our secure server to apply for Bad Credit Personal Loans.

Bad credit personal loans online

There are many bad credit personal loans online. More and more companies are offering quick cash loans (like Internet Cash Advance) to people with bad credit, without the inconvenience of having to go to a bank of office and fill out paperwork. Payday loans are available with no credit check to anyone with a steady income who needs some fast cash for the short term. Online personal loans are easy to apply for, the approval is immediate, and they are safe.

No credit personal loan

Sometimes, having no credit is as bad – or worse – than having bad credit. No credit personal loans are available for people who do not yet have a Credit Rating. If you do not have a record with credit cards and mortgage payments, but need some fast cash, then no credit personal loans may be the perfect solutions. PayDay loans allow you to borrow money with no credit or bad credit. Moreover, online personal loans can help you establish good credit.

If you have bad credit – or no credit - Try a Internet Cash Advance loan online – It’s fast, safe and easy.

Debt Collection Abuse: A Real Life Account

A woman received a phone call one afternoon. The caller identified himself as an investigator out of Dallas County. He said a warrant had been issued for her arrest and that she should reveal her location so the investigator could ”take care of this matter before it escalates any further”. Otherwise, he told her, “the police can pull you over and arrest you. They will take you to jail and you will have a lot more problems than you have right now”.

What was her crime? Nothing! It was a scare tactic used by collectors to get her to turn over her car to repossession specialists. She had fallen behind on her car payments when unemployment ran out. Now the collectors were taunting her with threats of arrest and incarceration if she did not surrender the vehicle.

What the collectors did is illegal, not to mention unethical. They lied to her to intimidate and frighten her into surrendering the car. If she had been able to record the conversation as proof of the dialog she could have sued the collectors for $1,000.

Changes to Reverse Mortgages Expected in 2008

Legislation pending in Congress would change laws governing federally insured reverse mortgages. Although these changes appear likely to occur sometime during 2008, the timing is not certain.

If enacted, the changes would affect only the federally insured Home Equity Conversion Mortgage (HECM) program. They may make HECM loans more attractive to you in the following ways:

Larger Loan Amounts

At present, HECM loan amounts are based on home values. But there are county-by-county limits on how much value can be used to determine loan amounts. Until the new legislation is enacted, the county limits will range from $200,160 in most non-metro areas to $362,790 in many urban areas.

Under the pending legislation, the county-by-county limits would be replaced by a single national limit, which is likely to be about $417,000, or perhaps higher. So if your home’s value is greater than the current limit in your county, you may qualify for a larger loan amount if the single national limit is enacted.

Lower Loan Fees

At present, the HECM origination fee is limited to whichever is less: 2 percent of a home’s value or 2 percent of the county’s home value limit. If this amount is less than $2,000, however, lenders may charge a $2,000 origination fee.

Under the pending legislation, this fee would be limited to whichever is less: 1.5 percent of a home’s value or 1.5 percent of the new single national home value limit. The $2,000 minimum fee limit is likely to remain in force (see above).

Broader Eligibility

At present, you cannot get an HECM loan if you live in a cooperative, and the program does not explicitly permit using an HECM to purchase a home. Under the pending legislation, some cooperative owners would become eligible, and using HECMs for home purchases would be explicitly permitted.

Also during 2008, HUD is expected to make changes in the HECM counseling program and the definition of the non-recourse limit in the HECM program handbook.

HECM Counseling

Based on HUD proposals during 2007, the agency is expected to issue new rules requiring that all HECM counselors must pass a national competency exam, follow a specific counseling protocol, and meet continuing education requirements.

Non-Recourse Limit

A HUD legal review has concluded that the definition of the non-recourse feature in HUD’s HECM program handbook is not accurate. Based on this finding, HUD is expected to clarify that the non-recourse limit on HECMs applies if the home is sold to repay the loan. But if the home is not sold, and the loan is repaid with other funds, then the full loan balance must be repaid, even if it exceeds the home’s value.

One Check or Many?

After 30 years at the Ford Motor Company, Walter Murdoch* is one of the lucky ones. He’s already set to retire at age 56. His long career as a receiving clerk, plus a prudent habit of putting money aside, means Walter has all three legs of the proverbial retirement stool to support him: Social Security, a company pension, and savings in a 401(k) account. His wife, Susan, has these, too.

But like many folks getting ready to retire, Walter has a decision to make. Should he take his pension in one lump sum right away or opt for lifelong monthly payments? Specifically, he must choose between $265,000 now and monthly checks of $1,670.

For most people the decision is straightforward—the relative safety of unending support makes more sense than seizing a pile of cash in hopes of investing it at a superior rate of return. Census Bureau data shows that seven of eight retirees do take monthly checks. But at a time when pension obligations weigh on many companies, including Ford, the choice requires extra care. To make a sound decision, Walter needs to answer the following questions:

1. Is your health a concern? Here’s one clear exception to the preference for monthly payouts. If family history or a medical problem leads you to believe you may not have long to live, taking a lump sum and investing it yourself makes sense. It puts more money at your disposal and allows you to leave any remainder to your heirs. (Monthly checks last as long as you do or, at a reduced rate, as long as your spouse does.) In Walter and Susan’s case, health isn’t an issue.

2. Do you need the cash? Debt prompts people to take lump sums, but do this as a last resort. You may be better served by the discipline of monthly payouts. And never raid a pension to pay off your mortgage—think about moving to a cheaper place instead. Fortunately for Walter and Susan, they own their ranch home and have little debt.

3. Can you stomach greater risk? If stock market fluctuations make you nervous, a monthly check is the logical choice. That puts the investment risk where you want it—with a pension professional. Of course, brokers may advise you to cash out a pension and let them handle it—Walter’s did—but the risk is still yours, permanently. Walter said, “No thanks.”

4. Is your pension fully insured? Finally, consider the source of those checks. When a company defaults on its pension plan, its best-paid employees lose out, because the government agency that insures pensions caps coverage. Worse, the earlier you retire, the lower the cap. Walter will join a growing army of retirees depending on Ford, which, according to its 2005 annual report, had a whopping $11 billion in unfunded obligations. But Ford hasn’t defaulted, and if it did, Walter is insured for up to $1,819 a month—more than enough. To see what you’d get if your pension fund defaulted, go to the website of the Pension Benefit Guaranty Corporation.

Types of Credit

Information

There are many different forms of Credit: Here is a list of some of the most popular forms of credit used in Europe, remember it is not hard Establishing Credit but You know what are types of credit and what are your obligations.

• Overdrafts
• Credit cards
• Personal loans (from banks or building societies)
• Credit Union loans
• Hire purchase
• Credit sale agreements
• Top-up mortgages
• Moneylending

Each type of loan is described briefly below.

Overdrafts

An overdraft is a way of borrowing on your bank account. Overdrafts are given on your current account so that when your balance is 0 in your account you can still spend up to a certain limit. It is suitable if you have short-term cash problems and for spreading out the costs of expensive events such as Christmas or holidays. Generally the APR on an overdraft is between 8% and 12% and there are other fees associated with overdrafts. Be sure to pay off overdrafts within specific timeframes as the costs add up they also have a habit of becoming permanent.

Credit Cards

A Credit Cards allows you to borrow money on a monthly basis. Credit cards are accepted as a means of payment for goods and services in many places around the world. One advantage is that there is no interest charged on borrowings if you pay your full bill within a set number of days. Credit cards are flexible and can be used to pay for items and services that you may buy on-line or by telephone. They are also useful if you need to access cash in another country. They are not suitable for long-term borrowing as interest rates are high. Loans taken out on credit cards are economical only if you pay your bill in full and on time every time you receive a bill. Credit cards can be useful for consumers if you have a problem with an item you have purchased. In this situation your credit card bill or statement can be used as proof of purchase.

Personal loans

Banks and building societies offer personal loans to customers. These loans are suitable for medium and longer term needs, for example, a car loan or a loan for home improvements. Typical APRs currently range from between 7.5% to 11%. Banks or building societies may also charge other fees and charges. Generally, you pay a fixed amount back every month. If your loan is a variable rate loan you may be able to pay more than this back when you have it. This allows you to pay off the loan sooner. It is not advisable to take out a personal loan to cover day-to-day expenses.

Credit Union loans

Credit Unions also offer loans to consumers. You must be a member of a Credit Union before you can take out a loan. Credit Unions are based in the community or workplace and you must be living or working in a particular area or working for a particular employer to become a member. You may need to have saved some money in a Credit Union before getting a loan. Credit Union loans are suitable for short and longer-term needs such as loans for holidays or cars. They are also useful for refinancing other loans. The Credit Union Act 1966 regulates Credit Union loans. The APR cannot be over 12.68% and loan protection insurance is provided on all Credit Union loans. Another advantage of Credit Union loans is that they are very flexible and loan terms are easily negotiated with local credit union officers.

Hire purchase

These are hire agreements offered by shops or garages so that you can hire and eventually buy particular items. Items bought on HP are normally expensive items such as a car or furniture or electronic equipment. You do not own the item until the last instalment of the loan is paid. Sometimes the last instalment is called a 'balloon payment' which is a larger payment than any of the other instalments. Be sure that you can pay off this final amount before your take up this finance. Hire purchase finance is not flexible

The store or garage offering the loan is called a credit intermediary. This means that they operate as an agent for a finance company.

Personal Finance, 8/e

Kapoor/Dlabay/Hughes' personal finance is the #1 market-leading personal finance articles. It provides comprehensive coverage of personal financial planning in the areas of money management, career planning, taxes, consumer credit, housing and other consumer decisions, legal protection, insurance, investments, retirement planning, and estate planning. The goal of this text is to teach students the fundamentals of financial planning so they can make informed choices related to spending, saving, borrowing, and investing that lead to long-term financial security. Personal finance informations, 8/e provides many financial planning tools using a step-by-step approach to help students identify and evaluate choices as well as understand the consequences of decisions in terms of opportunity costs.

Online Learning Center

This Online Learning Center is designed to enhance your learning by providing content designed to help you succeed in your course:

Study Tools In Each Chapter

• Chapter Summary
• Multiple Choice Quiz
• Narrated PowerPoint
• Crossword Puzzle
• Creating a Financial Plan
• Flashcards
• eLearning Session

5 Ways to Save on Gas

Make no bones about it, gasoline is expensive and it isn’t getting any cheaper. You don’t need to switch to public transportation to cut costs at the pump. There are a few basic things you can do that could considerably save on gas

• Keep your car maintained. By keeping up with regular maintenance your car will run more efficiently and burn less gas. This includes regular oil changes, air filter replacement and properly inflated tires.
  
  
• Drive smart. Aggressive driving leads to increased acceleration and braking that can use unnecessary gas. Try to maintain a steady speed for as long as possible and use the cruise control over long distances.
  
  
• Alter your daily commute. If you commute through heavy stop and go rush hour traffic you might be able to and from work an hour or so earlier or later in order to miss the rush. Avoiding this type of traffic can not only save gas but also create a less stressful drive.
• 
  
• Consider a hybrid. While purchasing a new vehicle may be costly up front the savings in gasoline usage can pay for itself. Combine this with a potential tax credit for purchasing a hybrid and you may be able to save hundreds of dollars a year.
  
  
• Combine errands. Plan your travel in a way that maximizes your time on the road. If you can, plan trips to the grocery store, dry cleaners or any other errands so that they are part of your daily commute. There is no need to make a separate trip if you pass these locations on a daily basis.