You Can Have Debt Relief

Posted on September 3, 2008

We have all had blemishes on our credit in our lifetimes. For some it may be because of unforeseen medical bills which led to collection agencies calling on debts? Maybe you lost a job and went delinquent on car or house payments? Or maybe just after college your student loan payments came up faster that your first real job and you were forced to go into forbearance? These stories are getting more and more common with the current state of the economy. MSNBC has reported that the number of U.S homes heading toward foreclosure more than doubled in the first quarter from a year earlier. CNN Money said that the unemployment rate was at a 4-year high right now. With the prices of gas and food rising some people are facing the reality of not being able to pay off outstanding debts but the help of a personal loan is almost impossible with their current credit situation.

Being in debt can make you feel as though you are drowning and when your credit score is weak it can feel as though there are no options. But bankruptcy can scar your credit report for 7 – 10 years. It can stay on court records for over 20 years. Sometimes a small personal loan is the answer in desperate times to get control of your finances again. There are places where people with bad credit can turn to for personal loans and in some cases even an unsecured loan. In order to repair poor credit scores, building healthy credit is the answer. Paying delinquent debts in full, getting back to place where you are in the black and paying remaining balances in a timely fashion can get you feeling in control again. Bankruptcy is not the only answer to feeling safe again. Check out some more loan tips here.

» Filed Under Loans, Debt, Credit Repair | Leave a Comment

Other Options When Refinancing a Loan through the VA

Posted on February 27, 2008

The following is a guest post: 

If you are a veteran who is looking to refinance a specific type of loan that does not fall under the typical VA refinancing categories, you may still be able to refinance. The VA has two main types of refinancing loans. These are The Interest Rate Reduction Refinancing Loan (IRRRL) which is used to get a lower interest rate than on your current loan, and the Cash Out Refinance Loan which is used to get cash out of the equity in your home. However, the VA does offer other options for those veterans who are trying to refinance different types of loans.

The other types of loans that the VA also refinances include:

* Assumed Loans. Mortgage loans that were assumed by a veteran when purchasing a home can be refinanced with the VA. Usually a mortgage is assumed at purchase because it is at a prime interest rate which is lower than the buyer could obtain by getting their own financing. In some cases the interest rate a buyer thinks they are getting is inaccurate and they end up paying a higher rate. The VA allows veterans who have assumed mortgages from a purchase to refinance into a lower interest rate through the VA. However, if the veteran has allowed someone else to assume a mortgage from them that has a VA Home Loan Guarantee with it, then they are not eligible to refinance.

* Construction Loans. Veterans can refinance a construction loan through the VA. Some people get construction loans to build a home while they try to sell their own home or may tie into a high rate when they first get a construction loan and want to refinance when they are ready to move into the home. The VA does allow construction loans to be refinanced at a lower interest rate.

* Land Contracts. If you are a veteran who has a loan and are paying to purchase land through a installment land sale contract you can refinance with the VA. A land contract is when you agree to purchase land for a specified price and basically pay a mortgage on the land until you have paid that price and own it. Many people do this when they are planning to build a home and purchase the land first in order to keep their mortgage payment down when they eventually build. The VA will refinance land contracts for veterans.

It is important to know that these loans are offered by the VA, but are similar to other VA refinancing loans. They are like Cash Out Loans in their requirements, but the borrower can not take cash out at closing and the maximum amount allowed for their loan is different.

To refinance any VA loan you must also pass the application process from the VA approved lender. The VA can help make it easier to get a loan by giving the lender a partial guarantee, but the veteran still has to follow the guidelines and application process.

Another important fact to know is that the amount due on the previous loan, the fees, the closing costs, and any costs associated with energy efficient home improvements are eligible to be financed into the loan as long as it does not go above the maximum loan amount.

For more information on alternative VA refinancing loans go to www.va.gov

» Filed Under Loans | Leave a Comment

Five Options In A Financial Worst Case Scenario

Posted on January 11, 2008

So let’s say you get into a worst case scenario of not having enough money for a very urgent short term expense.  What is the best route to take?  Many personal finance blogs talk in depth about long term savings strategies and those are very important.  An emergency fund of three months pay is a must have, but not everyone has this in place when getting your finances turned around and out of debt.  So here are some options to get out of a financial worst case scenario:

  1. Ask family.  This can be a bit tricky for many of us that do not like to mingle family and business, but it can be a worthy option at a low or no interest rate.  I would lend my family money in a second if I have it and am in the position to help.
  2. Work overtime or second job.  Earning more money quickly is an ideal solution.  Look for quick cash oriented jobs where you could work a weekend or a few night shifts.
  3. Sell something.  Many of us of “extra” items around the house that can be quickly sold on craigslist or eBay.
  4. Cash advance from a credit card.  This option can be expensive and risky.  But in a worst case scenario it is an option.  Many cards have limits for single day cash advances and begin accruing interest right away.
  5. Payday loans.  A last resort that can help get you out of the worst of the worst case scenarios.  This is another option that has to be handled with care.  Use it with the full understanding of the fine print, the fees, and the risk of late repayment.  And remember the golden rule of payday loans is to not make it a pattern!

» Filed Under Unexpected Expenses, Emergency Fund, Saving | 1 Comment

Mint.com: So Close To A Great Web 2.0 App

Posted on October 17, 2007

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Mint.com released its Web 2.0 financial app a few weeks ago and I have been dabbling with it ever since.  What a great concept, but bad execution.  This type of web based financial application has been destined to hit the market sooner or later, and from my experience Mint should have waited for the later.  In my time testing the product I had multiple failures including:

  1. Difficulty connecting to approved banks.  Some banks I could pull my information into the application and some would hang.
  2. Transactions labeled incorrectly.  Transaction titles were changed from what was the correct title to some other label.
  3. Spending trends skewed.  As a result of transactions having incorrect labels my spending trends were skewed greatly.

The bottom line is to get me to switch from Quicken to another product it has to exceed Quicken’s performance.  Having a web based application that saved me time, effort, and money would be valued, but at this time Mint is not that product.

» Filed Under Financial Apps | 2 Comments

Traditional Saving Is Back Again

Posted on October 15, 2007

With the possibility of a looming recession, a growing but volatile stock market, and a bursting of the housing bubble many have resorted to old fashioned saving again.  It appears that the NY Times and other major media elements are making saving look appealing by writing numerous reports on the advantages.

» Filed Under Credit Cards, Saving | 1 Comment

HOW TO: Destroy Your Credit Score

Posted on October 11, 2007

There are hundreds of articles out there detailing ways to improve your credit score.  Damaging your credit score is something most people do not have a problem with.  Analyzing the reasons for killing a credit score is important in order to fix the problem.  Here are six ways to kill your credit score:

  1. Be a big spender at the wrong time.  Timing can be everything with money.  For example, cashing out your retirement fund to early and risk paying big penalties thus giving up future earnings. 
  2. Forget about payments.  Stay organized and on top of what is due and at what time.  This is a credit killer everyone can avoid just by paying the minimum amount each month.
  3. Be too thin on open credit.  Part of the credit score is calculated on how much open credit you have.  If you have only one $500 limit credit card and it is maxed out, that is far worse than having two credit cards with $5000 combined limit and a $500 balance.  Ensure you have some credit that is not used.
  4. Be too eager.  Let your money grow and mature before making the big indulgences.
  5. Closing unused accounts making your balance closer to your limit.  Similar to number three in that it is important to have a portion of credit that is not used.  Consider cutting your card up, but holding off on closing the account.
  6. Be too care free.  Not everyone enjoys mulling over finances for hours each day.  But attempt to give your finances at least a portion of time each week to ensure you understand where everything is going and what is coming due.

» Filed Under Credit Repair, Credit Report, Credit History | 2 Comments

Specialized Certifications To Boost Career

Posted on October 10, 2007

In the government technology industry specialized certifications have become commonplace for employees as well as employers seeking out specific skill sets and to meet government requirements.  Obtaining these certifications have become a necessity for employees trying to advance their career and stay abreast of the current trends in the industry. I have completed two of these in the last two years and just last week passed my second one (hence taking a couple of weeks off blogging to study each night).  It definitely feels good to have it behind me and be done with the studying for a while until I go back to grad school.  The certifications I completed are the Project Management Professional (PMP) and the Certified Information Systems Security Professional (CISSP).  

As I am studying I have to ask myself how much will these certification really help my career.  It is valued by my current employer so that is reason enough to get it, but past that in my field valuable experience is much more marketable.  Without the real world experience to back the certification up, the cert itself is pretty much worthless.  Not to mention these have become somewhat expensive to obtain and it feels more like a money making scheme than an actual secondary education.  There are study prep materials, training courses, test fees, association fees, annual dues, and many other fees just to keep your name attached to the certification.  Nevertheless I am glad to be done with the certs at least in the short term.  I am sure another will crop up as the next “must have” cert.

» Filed Under Extra | 2 Comments

HSBC Online Savings Account Interest Rate Reduced to 4.50%

Posted on September 28, 2007

I was sent an email today informing me the HSBC online savings account interest was reduced today to 4.50% from 5.05%

We are writing to let you know HSBC Direct has adjusted your Online Savings Account interest rate to 4.50% APY*.

This rate remains among America’s highest, at 10× the national savings average**—so you can continue to maximize your savings growth with HSBC Direct, recognized as the “Best Online Savings Account” by Kiplinger’s Personal Finance.

Click here to log in and learn more about recurring transfers, direct deposit, and other powerful ways to get the full benefit of your Online Savings Account’s high interest rate.

Thanks for choosing to grow your savings with HSBC Direct.

Your HSBC Direct Customer Service Team

I had a feeling when the Fed interest rate reduction came out last week this could be on the horizon. Seems like it happened a little quicker than I expected.

» Filed Under Banking, Saving | Leave a Comment

Carnival of Personal Finance: 119th Edition

Posted on September 26, 2007

The 119th Edition of the Carnival of Personal Finance was posted on Monday with tons of content.  Check out some of the articles that caught my attention:

» Filed Under Carnival of Personal Finance | Leave a Comment

House Swapping: Fad or Possibility

Posted on September 21, 2007

House swapping is the increasingly popular activity involving two homeowners staying at each other’s houses for a set period, typically allowing both to vacation gaining a more authentic experience for a low cost.  Homeowner A would live in Home B for a time period, while Homeowner B lives in Home A. 

I have seen this growing in popularity the last few years despite the hesitation most people have initially with letting a perfect stranger in their home while they are not there.  The New York Times reports house swapping is up 40% in the last two years.  Some of the benefits of house swapping include:

  • Save money.  This is probably initially the first advantage most people think of when approaching house swapping.  You would save money on cooking meals, lodging, rental car (some people swap the cars too), boarding for your pet, and laundry among others.  Statistics show that people who swap houses typically take a longer vacation due to decreased cost of per night lodging.  Intervac reports “families save an average of about $5,000 by trading homes and cars instead of booking hotels and rental cars.”
  • Cultural enrichment.  Lets be honest, how much cultural do you really get out of staying at the downtown five star Marriot or Hilton.  They are often all the same.  But immersing yourself in the local culture by living in neighborhoods with other families will beat any organized tour you could take.  Think living in a small town in Italy walking to the market each day.
  • Adventure.  You never know what to expect when staying at another person’s home.  Sometimes that can be good while at others not so great, but nevertheless an adventure either way.

Here are some factors to consider before doing a house swap:

  • Terms of swap.  Ensure you know what you are swapping by checking the sample agreements offered on the home exchange website (see below list).  The terms could include requesting that your guests feed your pets or water your plants as well as fill your car back up with gas.
  • Insurance.  It is a good idea to give your insurance company a call to make sure there are no problems and they are covered during their stay.  Generally since no money is changing hands insurance should cover them in the home and in the car.
  • Valuables.  Store any possessions you have in a locked room or safe.
  • Logistics.  Often times people will meet the other family at the airport if schedules permit to give them a tour and get everything working prior to taking off on their vacation.
  • Cleaning.  It is customary to leave a clean house with fresh linen for your guests.  If you break anything ensure you leave payment for the broken item.

How to do a house swap:

  • Digsville.com.  Annual cost of $44.95.  Founded in 1999 and caters to first timers with over 2500 listings in 55 countries.
  • HomeExchange.com.  Annual cost is $59.95.  15 year old company with 14,000 listings with about 40% in America. 
  • HomeLink-USA.com.  Annual fee is $90.  Started in 1953 the agency has over 14,000 listings with many in Europe.  An added feature is they have local offices in Europe that can assist with on-site problems.
  • Intervacusa.com.  Annual fee is $95 for full membership or $65 for US listings only.  Started in Europe in 1950s and now offers 12,000 listings in 50 countries with local offices in 30 countries.

In conclusion house swapping is not for everyone and to be honest I am not sure I could ever do it.  But one thing is for sure the adventure and cultural enrichment gained by immersing yourself in the local way of life would be a last memory.

» Filed Under Real Estate, Saving, Spending | 4 Comments

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