Home Loans Australia News
Wed, 2 May 2007
Interest rates on hold: reprieve for homeowners
In a boon for the nation's mortgage belt, the Reserve Bank decided at its quarterly meeting on May 1 to leave the official cash rate unchanged at 6.25 per cent. The Reserve Bank's decision followed the publication of a much lower than expected March-quarter consumer price index, which showed inflation rose just 0.1 per cent for the quarter and 2.4 per cent for the year. This was well within the Reserve Bank’s target of 2-3 per cent. In a rare show of consensus, many economic forecasters are now predicting a further easing in inflation and most believe interest rates will stay on hold for the rest of 2007, particularly given the impending federal elections.
Tue, 26 February 2008
Payday Loans Can Powerful Tool For Those In Financial Need
If you are in a tough financial situation, and find yourself needing cash and your next paycheck is several days away a payday loan just might be the solution to all of your financial needs. If your think you have seen those ads for the fast cash payday loans, and you and others you know assume right away that they are scams, maybe you should think again. Sure they do charge more interest than a more traditional loan for the cash that they lend you until your next payday, but you know what, there are plenty of people who need money immediately, and have been saved by a easy, simple fast payday loans that give you cash when you need it.
Yeah, I know that I am well off now, and really want very little in my life but this was not always quite the case, just as it is not the case for millions of Americans today that work hard and live from paycheck to paycheck. There was a time when I was on the edge of absolute abject poverty with not a thing in the world. It had gotten so bad that the banks were threatening to repossess my car, which would have meant that I would not have had a vehicle to travel to and from work, and if I lost my job I would only get deeper in debt and had zero income. I needed money pretty darn bad. So, I decide to look into getting money through a payday loan advance.
By money, I mean almost a thousand dollars. It's strange to have all that cash in transferred to your bank account when your used to your balance never being over a couple of hundred dollars, and knowing that you can not spend any of it on luxury items. It is all set aside for important bills, which I paid and I was no longer worried about losing my car, or anything else for that matter. The payday loan I received saved my job, and my car.
I had suddenly gotten enough to get back on my feet again. The process of getting my payday loan was really quite simple. I filled out the forms on the Internet and gave them all of the information they requested, including my bank account number and bank routing number. Very quickly I was informed my loan was approved and the money would be in my bank account within twenty four hours, and sure enough the money was tin my account the next morning. I did not have to beg a loan officer to ignore my bad credit, or convince someone that the reason I needed to borrow the money was for a good cause. There was absolutely no embarrassment on my part or judgments from the payday loan company. I did not even have to fax the payday loan company any documents, the whole process was just easy.
Several weeks after I got my loan, I paid it off. Since I paid the loan off on time the company let me know that I could get another loan with them without any problems if I needed it. I took the up on that offer several months later; I borrowed less money this time to make sure I had enough cash for my vacation. Payday Loans can be a powerful tool to help those in financial need, if used correctly.
Source: http://powerfulpaydayloans.com/
Wed, 05 March 2008
Do you have all the right Info on Credit Card Debt?
Are you drowning in credit card debt? Many people around the world (not just Americans) are. The root cause of America’s problems with credit card debt stem from a lack of education by American consumers in how credit cards (and debt) and interest actually work. If you’re drowning quick and need info on credit card debt, this article can be thought of as something of a life preserver.
The first thing to know about credit card debt is a formula called the Rule of 72. When you put money on a credit card, there’s interest to pay. Interest is the annual percentage of the initial amount borrowed that you have to pay extra each year for the average balance on the card. In a very simple case, if you borrow $1,000, at 18% interest, and maintain an average balance of $1,000 you’ll have to pay $180 in interest during that year. The rule of 72 is how banks and credit card companies make their money. Divide 72 by the interest rate you’re being charged, and you’ll have the time frame (in years) in which your accumulated interest payments on your credit card debt will equal the amount borrowed. In the example above, 72 divided by 18 is 4, so if you float your balance around $1,000 for four years, you’ll have paid roughly $1,000 in interest.
The best way to use a credit card is to pay the balance off every month in full. Unfortunately, credit cards make it really prominent to see the minimum monthly payment which is usually a payment that covers the interest and about 25 cents to a dollar of the total amount owed. If you’ve gone overboard on credit binging, that may not be doable. However, it’s usually possible for most people to dig themselves out of the hole with some fiscal discipline. It takes planning, effort and the right info on credit card debt .
The first step: Start by sorting all your info on credit card debt in descending order of interest rates. If you can make a transfer from a higher rate card to a lower rate card, do so.
Second, figure out what your minimum payments are. Now, look at what you bring in each month, and save a month’s worth of receipts. Look at what you can trim out of your budget to pay down those debts. If, for example, you go to a coffee shop every morning, that’s an additional $5 to $7 you spend every working day. Over a 21 day working month, that’s $105 dollars. If you always eat out for lunch, that’s an extra $5 there as well. We’re not saying give up all the luxuries in your life; but try and limit your Starbucks consumption to, say, every Friday, or every payday, and make coffee at home before you leave instead – a home brewed cup of coffee costs you about a nickel, rather than $5.
Next, go through your list of credit card debts. Set each card to get a payment of at least 10% over your minimum payment each month; devote all the extra to paying off the highest rate card you’ve got. Leave your credit cards at home; if you need some electronic way to pay for things, get a debit card from your bank and have it deduct straight from your checking account. Hopefully this info on credit card debt helps with a method or two on ways to improve your credit and debt standing.
Source: http://www.beatlandscreditrepair.com/
Mon, 17 March 2008
How To Get A Bad Credit Home Equity Loan
Home loan competition is red hot at the moment and consumers should be focused on taking advantage of this. The hot competition in the home loan market means there are thousands of different loans now available. If you’re not sure you’ve got the best home loan for you seek advice from a financial adviser or undertake a review of your loan with an industry accredited mortgage broker.
Borrowers should also be cautious not to take what appears to be the cheapest interest rate. In many cases there are fees, charges and conditions that may impact the real cost of loans with that particular lender. You need to be particularly cautious and do your homework to ensure that you get the best possible outcome.
Refinancing can sometimes result in lower interest rates, lower (or no) monthly fees and reduced charges for features on your loan. The savings made can then be used to boost your repayments which could cut years off your loan, saving you even more.
Even a small improvement in the interest rate you’re paying could end up reducing your monthly payments significantly and saving you thousands. Refinancing can also be very worthwhile if you want to borrow more for renovations to add value to your property.
Many people assume that their bank will offer them the best deal on offer but this is not always the case. They don’t necessarily have the best products, nor do they provide you with the right advice to meet your specific needs. An accredited mortgage broker can help you compare your current home loan to hundreds of alternatives from a wide range of the most popular lenders in around an hour. They can also help you co-ordinate the process and paperwork associated with refinancing.
Source:http://www.realestate.com.au
Sat, 22 March 2008
Online Refinancing Option
Although the Internet is useful for handling important matters, some people are leery about obtaining a loan through online mortgage brokers. Online refinancing is becoming increasingly popular. Most mortgage websites include comprehensive information about refinancing. The objective is to lessen nervousness and increase your trust in a lender or broker. Home buyers may complete applications online and receive a quote within a few hours. Through online refinancing, homeowners receive two quotes. If refinancing by way of a mortgage broker, the broker will obtain estimated quotes from different lenders. Requesting estimated quotes from various lenders will not lower credit scores. Homeowner can browse lenders and compare rates. Next, homeowners may select a lender from the brokers list and request an official quote. Upon reviewing an applicant's credit rating, lenders send an official quote highlighting the best interest rate and closing fees.
Source: http://home-loan-rate.blogspot.com/
Thu, 27 March 2008
Refinance Your Home Loan
by LetYourMortgageMakeYouRich.com
A Home Equity Line of Credit is just one Option
You can refinance your home loan a number of different ways depending on your credit worthiness. You might even consider refinancing for a shorter amount of time in order to save thousands of dollars in interest in the long run.
Of course, you'll need to discuss your options with your lender and find out what kind of interest rate you can get for different types of loans. If you intend to refinance your home loan for a home equity line of credit, your interest rate and terms would be quite different than if you were refinancing in order to save money on interest. Your mortgage broker will be able to advise you as to what your best options are.
While a home equity line of credit will be there when you need it for either unexpected expenses or a major purchase, you should ask your mortgage broker a lot of questions because if you refinance your home loan as a home equity loan you have the choice of obtaining a lump sum or setting up the home equity line of credit.
Check with more than one lender before you refinance your home loan. Make sure you understand the different loan terms available and the risks involved with each. If you will not have a fixed rate of interest, make sure you understand on what criteria it fluctuates. Is it tied to the prime rate? Don't let anyone talk you into anything, especially something you don't quite understand.
Make a comparison study of the different types of loans and interest rates available. You can literally save thousands of dollars depending on how you finance your home. Be patient and do plenty of research so you will get the best deal available.
Fri, 11 April 2008
Bad Credit And Your Home Equity Loan
Low interest rates home equity loans have become increasing popular. The collateral of your home provides an easy way to secure an equity loan, and even homeowners with poor credit can obtain a home equity loan quite easily. Caution must be exercised to balance your debt payments, though, when using a home equity loan to avoid foreclosure.
There Are Few Restrictions On What You Can Use Your Home Equity Loan For.
Low rates home equity loans can finance any need, but you must choose a type of home equity loan carefully to ensure you can repay according to the loan terms. One type of loan may offer balloon payments, offering a lower monthly payment with one large lump sum due at the end of the loan. Others types of loans may offer higher monthly payments that divide the borrowed amount equally over the life of the loan. Your situation may be best suited for either one.
Shop Around Before You Make Your final decision.
If you choose a home equity line of credit, be sure to shop around carefully. As a rule, your credit limit will be assigned based on a formula: 75% of your home's assessed value minus the amount that you still owe on the home. However, the specific credit limit that you receive will be partially based on traditional credit factors such as credit history, employment status and ability to repay.
Your annual percentage rate, or APR, is partially determined by your credit rating. Shop around to find the best APR for which you are eligible. You also need to compare closing costs and similar financial factors in order to find the best overall deal. Interest rates on home equity loans are generally variable, which means that they are tied to a fluctuating publicly available index. Your interest rate is, by law, required to have a certain cap above which it may not rise.
Did you know?
A home-equity line of credit (HELOC) is a variable-rate loan that works much like a credit card and, in fact, sometimes comes with one.
Don't Be Surprised If There Are Some Additional Fees.
Make sure that you have a clear understanding of all the fees that will be involved in your home equity loan. You may be required to pay upfront closing costs, an application fee, a property appraisal fee and other charges. You may also be charged annual maintenance or membership fees as well. If you only plan to use a small amount of your available credit line, you might end up paying hundreds of dollars for the privilege
Home equity loans are ultimately secured loans. Your home serves as the collateral for your loans. Therefore, it is quite important that you fully understand the way that your loans will be handled. There are many factors to consider when choosing among the various low interest rates home equity loans that are currently on the market.
Have A Repayment Plan In Place Prior To Taking The Loan.
A clear strategy is the best goal to have for repaying your low rates home equity loans. Paying more than the minimum monthly payment is one strategy to repay a loan and rid yourself of debt sooner. Setting aside a special fund to repay the balance on a balloon payment is another alternative. No matter what, making timely payments every month is necessary to avoid a foreclosure on your home. Whatever your decision, be informed and make the best choice for your situation.
In the end, the final choice for your home equity loan will be up to you. Use these valuable tips for making the best choice on your next low interest rates home equity loans.
Source:http://www.financeandbusinessfacts.com/
Sun, 20 April 2008
Personal loans for homeowners – one of the numerous rewards for being a homeowner
By Amanda Thompson
You no longer look at the pictures of homes cause you yourself bought one. Well, you know how you got that, it was a huge investment. Now that you are facing some financial issues and you are thinking of taking a loan to cope with monetary crisis. Taking loans is a growing phenomenon. And this has a lot to do with the changing configuration of the current economic scene. Monetary and fiscal requirement of the people have increased and in turn led to increase in loan borrowing. So, it is not exceptional that you are looking for loans. If you are a homeowner in the pursuit of personal loan, all I can say is “you are fortunate”.
Personal loans for homeowners are one of the most universal loan types available. You must have encountered it in its one form or another. It is know by many names like homeowner loans, secured loans, homeowner personal loans, mortgage etc. Personal loans for homeowners are straightforward loans which can be moulded to fit in any circumstances whatsoever.
Personal loans for homeowners exclusively deal with homeowners which mean they are unavailable to tenants. Homeowner personal loans are a great instrument for exploiting the equity in your home, to further your interests in any fashion you desire. Equity is difference between the market value of the home and the total debt against it in the form of mortgage or lien. Lien is the right to take another’s property if an obligation is not discharged. Personal loans for homeowners can be highly profitable and can save a lot in terms of your money. In case you are taking personal loans for homeowners you need to look carefully for one erroneous step would land you on alien grounds.
Keep some things in mind while looking for personal loans for homeowners. First sort out why you need homeowner personal loans. Personal loans for homeowners are offered for many reasons like home improvement, wedding, education, debt consolidation, buying a car and cosmetic surgery. The thing worth appreciating about personal loans for homeowners is that the loan lender is not concerned about the purpose the loan is taken for. Thus, homeowner personal loans cater freedom along with many other things.
Personal loans for homeowner allow you to borrow amount from $5,000 to $500,000. The amount you can take is dependent on your income and the equity in your property. Taking money that is more than you require or that is beyond your ability to repay is a serious slipup that should be avoided. Homeowner personal loans allow you to borrow upto 125% of your property. With personal loans for homeowners you might be tempted to borrow more than required. Avoid not fall into this lure for there is nothing worse than an unpaid debt.
Personal loans for homeowners would invite lower interest rate, in fact the lowest in the market. Homeowner personal loans require your property as a security. Under no circumstances forget the fact that you can lose the property under non repayment condition. The terms and condition along with repayment terms are very pliable. The interest rate on homeowner personal loans is dependent on many things like the loan amount, the loan term etc. Start by researching about interest rates. Keeping an eye on the current interest rate trends and key economic indicators will anticipate good chances of finding lower interest rates and saving money.
Personal loans for homeowners are appealing due to the fact that they offer money to even sub prime borrowers. 9% of the mortgages in the last year were sub prime, amounting to 388bn pounds in money. Bad credit with homeowner personal loans is compatible. Bad credit with homeowner personal loans would mean comparative higher interest rates. Loan lenders are eagerly considering homeowner loans applications with bad credit. If you are in the loan race for homeowner personal loans, it would require you to know your credit score. You would be paying more as interest rate if you have bad credit score.
With online application process, you get quotes from various loan lenders to compliment your financial condition and expectation. The options with personal loans for homeowners are stretched along the length and breadth of the loan market. Personal loans for homeowners are easy on interest rates, they conform to your loan expectations and you can protect your repayment in case of adversity by applying for payment protection. Is there more? Yes – you can have personal homeowner loans even if you are sub prime borrower or self employed or unemployed. With personal loans for homeowner, everything is possible. Isn’t that promising? All I can say is “if you are a homeowner, you are fortunate.”
Thu, 29 May 2008
18 Personal Loan Tips For Intending Borrowers
If you're thinking of borrowing money to buy a car, boat, debt consolidation, home repairs, medical bills or anything else for that matter, here are some red hot tips to make the process much, much easier.
Avoid unsecured loans if possible
Avoid using unsecured personal loans if you can put up some security for your borrowings. This will get you a lower interest rate. A home equity loan, or redraw of extra repayments, allowing you to borrow against the equity built up in your own home or an investment property, is the best option of all, and could get you finance at up to 5 percent less than a personal loan.
Be honest in loan applications
Be honest about why you want the loan. Your bank may be able to offer you a loan option that better suits your circumstances. There are an increasing variety of different types of personal credit these days; car loans, commercial loans, leases, home equity loans, are just some of the examples.
Can't get a standard loan? There are alternatives
If the banks, building societies and credit unions won't lend to you because you're self employed, newly arrived in the country or have a poor credit history, consider the booming non-conforming and "low doc" loan market. A number of non-bank lenders offer loans which especially cater for this type of borrower. The interest rates on non-conforming loans are generally higher but come down after a few years of on-time repayments.
Check your statements for errors
There are claims that more than 50 percent of loan statements contain calculation errors. Simple mistakes, like the entry of the incorrect balance or the application of the wrong interest rate at the wrong time can be costly and mostly favour the lender. We all make mistakes, even bank computers make them and that's why borrowers should keep a close eye on loan statements. Various software for your home PC is available that can run a check on your statements.
Consider smaller lenders too
When shopping around for a car loan, consider community banks, credit unions and other smaller financial institutions which might be more approachable, and offer lower interest too.
Do you have to take out a personal loan at all?
Think twice before borrowing money without security. You may have a better option already available; home equity extension to your home loan, a new loan that uses your property as security, a credit card, or even a rich relative!
Do you qualify for a 'relationship discount'?
Relationship discounts are available from banks and credit unions for those borrowers who consolidate a range of banking business with the one institution. Home and personal loan interest rate discounts, term deposit bonuses, savings account fee waivers and credit card annual fee waivers are commonly offered.
Don't just take the dealer finance
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Don’t accept loan or lease finance offered by a car dealer before comparing the offer with finance options offered by your bank or other credit providers. Dealer finance might be less hassle but you could well end up with an expensive loan and more restrictive terms and conditions. The same goes when buying furniture or any consumer goods where finance terms are offered.
Don't make multiple applications
Don’t fill out applications at several financial institutions and have all of them checking into your credit history. This can make you look desperate and lower your credit score.
Don't rely solely on comparison rates
All lenders must now include "comparison rates" in advertisements for their home loans and personal loans to help consumers get a feel for their total cost - fees and the interest. Don't rely solely on comparison rates when choosing a loan and beware of their shortcomings. They only take into account fees and interest rates, not the features and how suitable the loan is for your circumstances.
Have the right information when applying
What you will be required to supply in any application for lease finance will depend on whether the lease is for personal or business use.
Personal lease applications will require:
· proof of current employment
· income details or tax returns
Business lease financing requires more detailed information and may include your:
· balance sheet
· tax returns
· cash flow projections
· business plan
Confirm with the lender what you will need before the interview.
Have you considered a credit card?
Consider also a credit card as your source of credit. Interest rates are generally higher but credit cards are easier to secure and offer greater flexibility of repayments.
Honesty counts
Be honest about why you want the loan. Your bank may be able to offer you a loan option that better suits your circumstances. There are an increasing variety of different types of personal credit these days; car loans, commercial loans, leases, home equity loans, are just some of the examples.
Keep accurate records
Keep accurate records of your deposits and ATM transactions. It is also wise to keep copies of your loan application and approval documents in a safe place.
This is the best way to avoid hefty fees which may be charged by a bank when its customers want to see copies of their cheques or loan files.
Know what interest rate applies
When offered car finance, either lease or loan, always be sure you know what interest rate applies. Lenders often ‘sell’ you their finance packages by quoting the monthly repayments only. This may disguise a high interest rate.
Look beyond the banks
Get a feel for what's on offer across the wide range of financial providers around these days. Credit unions, building societies, mortgage originators, community banks and boutique online or telephone banks may offer better interest rates or lower fees than the big banks because they are anxious to win new business or they are non-profit organisations.
Try lenders with whom you are a regular customer
Take advantage of the human factor. Being a familiar face may earn you some slack if your credit background is smudged.
Understand what's on offer
Is the interest rate fixed or variable? What up-front, annual or ongoing fees are charged?
Source: http://www.money-tips.com.au/
Wed, 11 June 2008
9 Ways to Stretch Your Income
Here are some great tips for stretching every dollar.
1. Save a penny, keep a penny.
Dump your pocket change into a jar each night.
Invest it in a high-interest bearing account at the end of each month.
Woman's Day magazine recently suggested this money-saver, adding that if a couple puts just one dollar each into the jar every day, the sum will top $700 at the end of the year.
Invested at 10 percent interest over 10 years, that pocket change will grow into $12,000.
2. Use your computer.
You can save big money by shopping online, if you know where to look.
Do a Google search for coupon codes before you start shopping from online merchants.
You can also purchase a local coupon book for offline purchases (The Entertainment Book, for example.) I use mine all the time for groceries, oil changes, and dining out.
3. Write letters.
Whether you love the product or hate it, write the manufacturer a letter.
A company that receives a complaint is bound to make amends.
On the same token, many companies will acknowledge--and encourage--your satisfaction with coupons and discounts.
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4. Shop smart.
Look at the grocery store ads before heading off to the store.
Maybe you can reserve a few items for purchase at a nearby store that is offering unusual bargains.
5. Ban impulse buying.
Make it a family policy: if you see something you like, write it on a wish list and wait at least three days before buying.
6. Watch out for "nickel and dime" expenses.
Those little snacks and coffee stops can easily add up to more than $500 per year.
7. Shop around.
Research purchases on the internet.
Before making a big online purchase, visit http://www.dealtime.com and http://www.mysimon.com.
8. Refinance your home.
Signing a few papers can save you big money on your mortgage payments. In fact, if you refinance and consolidate your debts into your home mortgage you'll find that your monthly outgoings can decrease dramatically.
It's really not as big a hassle as you might think.
Ask your friends and family for the name of a good mortgage broker
9. Examine credit card use.
If you're paying credit card debt, you're paying not just 17 percent more for your purchases than you need to, you're also missing out on the money that the sum could earn for you if you had invested it.
Try calling your credit card company and ask if there’s a way to lower your rate.
One two-minute phone call recently reduced our rate by 4 percentage points. That was one call I wish I'd made a long time ago.
The most important thing is to recognize that you control your finances. Empower yourself with smart spending.
Source:Susie Cortright
Fri, 20 June 2008
16 Simple, Everyday Ways to Save Money
Here are 16 of the simple, everyday changes that have worked for us.
1. Use a coupon, absolutely whenever possible. I was really surprised by how many money-saving opportunities are out there when I knew where to look.
For local purchases, get an “Entertainment Book” each year and you will save on those inevitable everyday expenses ranging from dining out to accommodation and admission to movies, theme parks, etc.
For online purchases, stick to the reputable retailers. You certainly will not save any money if you are the victim of fraud or if you are simply unable to return an item. And before you start shopping, always look for a coupon code that will allow you to save on your purchase. In the past, many online retailers sent out promotional codes as a series of letters or numbers that could be entered at checkout. Now, many retailers use a button or text link that automatically activates your coupon when you click through, so it is often a good idea to find the coupon first, before you start to shop.
2. Shop around. The internet is an amazing tool for researching products and retailers, as well as for comparison shopping. We make nearly all of our large purchases online. It is also important to know where to shop. For holiday gifts, plan ahead and check out the big online discount stores. Many offer significantly reduced prices on trusted brands. And you can get great delivery rates too, even on large gifts. I once had an enormous game table shipped to me for $2.50.
3.Keep a running list of gift ideas for your loved ones. I have found that when I am confident that a gift is perfect for the recipient, I am much less likely to overspend. But that kind of inspiration rarely hits me during the pre-Christmas rush, so I need to keep a list going the whole year through.
4. Budget. Of course, it is important to know what you are really spending. For years, the budget I had in mind was really more of a “wishful thinking” budget. But this quickly led to debt. It pays to get realistic. Whether you use a computer program or a simple ledger book, make sure you know where your money is really going.
5. Save for the future. Take 10 percent of your income and put it in savings, right off the bat. Now you know what you need to cut back on (or how much more you need to earn) to shore up the deficit.
6. Plan ahead. You will want to make sure you have money in the bank for emergencies. Experts say you should have three to six months of living expenses set aside, for those just-in-case times. It sounds like a lot, but start socking away money each month, and it will add up fast.
7. Get organised. When your home is organised, you will be less likely to spend money on items that are already hiding in the nether reaches of your closet and drawers. The same goes for your refrigerator and kitchen cupboards. Purge and organize before you shop.
8. Simplify. There is a certain romance to the “simplify your life” movement. And having too much stuff really does weigh us down. Take a look at everything in your home. If it does not add joy, beauty, meaning, or usefulness to your life, give it away. And when you are tempted to buy something new, it must pass the same test.
On a quarterly basis, go through your house and ask yourself these same things again. Go through your closet, attic, garage, and basement and purge those items that do not add genuine joy, beauty, meaning or usefulness to your everyday life.
9. Reduce, reuse and recycle. A simple lifestyle, for me, is about reducing my urge to over-consume. It is about being kind to the environment. It is about spending less money on material things, so that I have more time and money to spend on memories with my family. Make changes that will help the environment and your purse at the same time. Install water saving kits on your toilet. Write on the back sides of paper. Use reusable containers in your lunches. All these little things really do add up, and it is important to show our children how we can all be part of the solution.
10. Shop without your kids. I know that if I get a shopping cart at Coles and I do not have a list, I will spend $150. If the kids are with me, I will spend even more. This is another reason it makes sense to do your shopping online. You are less likely to purchase the incidentals.
11. Make sure that your credit card is paying you back via an incentive program. I found a credit card that allows me to earn points on my daily purchases toward our annual vacation trip, including airline miles and hotel accommodations. Since most of my expenses each month are incurred at the grocery store, I found a card that rewards specifically for these types of purchases. Of course, you will need to make sure that you are paying off your balance each and every month. Paying a high interest rate on your credit card will quickly negate any savings you accrue on your incentive plan.
12. Lower your interest rates. If you are carrying a balance on a credit card, give the credit card company a call to see if they will give you a lower rate. Sometimes, it is just that easy.
13. Shop around for insurance. The money you pay for car, home, life and health insurance can vary greatly. Do some research to find out if you are getting the best rate.
14. Be wary of the influence of TV commercials and print ads, especially on your children. We hear fewer cries of “I want that!” when we keep our kids programming to those channels rely less on advertising dollars, such as the ABC and some pay TV channels.
15. Play “Time Warp.” This is a technique I first learned from “My Monastery is a Minivan,” by Denise Roy, and I use it quite a lot. It goes like this: When you are tempted to make a purchase, mentally fast-forward through the life of the item. For example, in her book, Roy thinks she needs new candleholders. She imagines spending time at the mall to find them, soon having to clean them, and then, years down the road, packing them in the giveaway box. She shirks the purchase and soon rediscovers the heirloom candleholders that are packed away right in her own home.
I like to play this "fast forward" technique in reverse, too, asking: What new clothes did I buy last season? (Sometimes, I can not remember). Where are those "I have to have it" items now?
16. Keep your mind on abundance. When you are thinking about money, it is really important to get out of the poverty mindset. Too often, when we are focused on saving money, we are living from a perspective that focuses on lack and scarcity, which tends to bring about more of the same. It has been really helpful for me to make a conscious effort to see the world as infinitely abundant and to rest in the notion that my needs will be taken care of. This is generally a simple matter of thinking more about what I *do* have than what I do not have.
All my days of penny-pinching have certainly proven to me that it truly does not take money to make us happy. Many of my fondest memories have occurred in the smallest homes. My child’s favourite playthings tend to be the inexpensive items that were never designed to be toys at all.
And it is the simple, everyday pleasures that are the sweetest, when enjoyed together.
Source: Jamie Jefferson
Mon, 30 June 2008
Getting the Most Out of Your Bank
Having a bank that meets all of your financial needs is an asset that many people don't appreciate. If you have a bank that doesn't meet all of your needs, however, it's pretty easy to tell. In order to get the most out of your bank, you may need to investigate the services that your current bank offers, or you might have to find a new bank entirely that offers the services that you need.
Here are a few tips to help you to find out which financial services your bank offers, to help you find a new bank if your current bank simply doesn't offer the services to meet your needs, and to help you take advantage of special offers and account features so as to get the most out of your banking experience.
Explore the Options Your Bank Offers
The first thing that you should do in order to make sure that you're getting the most out of your bank is to explore the features that your bank offers in order to make sure that they meet your needs. Request information from your local branch office on all of the account options and features that the bank currently offers, taking them home to read over them at your leisure and determine whether or not you're missing out on certain advanced account features.
When reading the information, be sure to look out for any common features that you've heard advertised to see if your bank currently offers them... you should also be on the lookout for any features that are offered free of charge that you currently do not use, or any that are offered free elsewhere that your bank currently charges for.
Shop Around to Find the Right Bank
Should the services that your bank offers not meet your expectations or needs, you might want to consider shopping around at other banks in the area in order to find a bank that does offer the features that you want. This doesn't mean that you should close your current accounts right away, or at all... many individuals will keep accounts at several different banks so as to keep their money separated for different purposes.
Request the account features that different banks offer, comparing them to each other and to your current bank, so as to find the local bank that best meets your current needs.
Take Advantage of Special Offers
Many banks will have special promotional offers for new customers, or have special deals that they offer current customers in appreciation of their continued business. In both cases the offer is usually a temporary one, as is the case with most promotional interest rates or special account features. However, even a temporary interest rate or promotional account feature can save you some money for the term of the promotion, so it's well worth the time to investigate the offer further to see if it's worth it.
You should be aware of services that are free during the promotional period and that are charged for later... if it's not a useful feature, you need to make sure that you cancel it before you begin to get charged for it.
Online Account Management
One useful tool that many people don't take full advantage of is online account access and account management. The online tools may allow you to check balances, transfer funds from one account to another, or even pay bills directly from your account... it largely depends upon your bank and the specific features that they offer.
Source:Bill Stone
Mon, 07 July 2008
Good Debt Versus Bad Debt
Some people see debt as a curse, and other people see it as a friend. It can be used to make you miserable, or it can be used to make you wealthy beyond your wildest dreams. The trouble is, how do we know what is good and what is bad?
Well it basically boils down to this. Good debt puts money in your pocket after you have paid for the debt (interest), and bad debt takes money from your pocket on an ongoing basis. In todays society, the world has gone through an explosion in bad debt. In the United States for example, for every $1 a person earns, they spend $1.20. In Australia things are getting worse too. We spend $1.02 for every dollar earned. Back in the 1980's we would earn $1 and save 20c.
The single most influencing factor in this curse of bad debt is the credit card. It is so easy to get a credit card these days, and even school kids have them. Most people I know have several of them, and you know what, they max them all out. People get caught in this vicious circle of paying one card off with another, and still the interest bill compounds at an alarming rate.
It is not only credit cards that are doing the damage, it is also the ability to get three years interest free furniture and home appliances with no money down. This is a huge trap, and when people live beyond their means and do not have the means to pay back their debt in the given time they are hit with massive interest rates and so the cycle continues.
So that is bad debt, and I didn't even include cars, holidays and clothes, all charged up on your card! You get the picture.
Now onto good debt. Personally, I love good debt, and any wealthy person will tell you the same thing. With good debt you can purchase income producing assets that put cash in your pocket, even after the interest bill is paid. Some examples of this include property, shares and stocks, and your own business. It even includes things such as art, wine and other rare collectibles.
By leveraging other peoples money to buy such things, you are after a time able to put yourself into a fantastic financial position, and you can now begin to pay cash for those bad debt items like expensive clothes and exotic holidays.
When I was at school there was never any lessons on good and bad debt, and I'm pretty sure they still do not teach effective money and debt management. It is unfortunate that in a society such as ours, that the government does not teach this to every man, woman and child as it has a massive impact on our lives. Just look at the sub prime fallout in the States to see how people who overextended themselves are now really in trouble.
There is a way out if you are in bad debt, and there are resources out there to financially educate yourself before you do get into any trouble.
We only have ourselves to rely upon to shape our financial future, and the longer we leave it the harder it gets. Eradicate the bad debt from your lives, and begin to live without that heavy weight around your neck.
Written by:Clint Maher
Sat, 12 July 2008
Credit Secrets - What They Are Not Telling You
Credit plays a dual role in our society; sometimes a lifesaver, and at other times a murderer.
Trying to float above imminent economical disaster is a daily exercise for the majority.
So, credit companies often seem to be our rescuer, offering attractive interest rates, interest-free repayment periods and extended credit limits.
But, what they don't tell you at the time you apply for credit could be the knife edge you've been trying to avoid all along.
With the credit secrets they never disclose, you could be ignorantly heading for disaster
You can reduce your credit worthiness by applying for a lot of credit facilities: it's a fact.
The more credit you apply for, the more it's likely to reduce your credit rating.
The credit secret is that to the creditor, you're a high-risk customer who would spend easily, someone whom they can charge a higher interest rate from (it's usually clarified in the fine print that you don't tend to read).
They don't want you to pay the whole bill: yes, that's why they have a minimum monthly payment invoice.
The credit secret here is "the less you pay on a monthly basis, the more interest gets charged on your credit remainder."
In the end, you pay almost double the actual credit, because of the prolonged payments.
Low introductory interest rates don't last very long: they lure you with minimal interest rates, such as 4%, for the first six months or so. But, if you delay even one repayment, the interest goes up immediately.
The credit secret? Baiting you ... hook, line and sinker!
Additional fees are always added: if you think your credit repayments are subjected to a mere late payment fee, think again.
Credit cards are subjected to inactivity fees, overlimit fees and transaction fees, while other credit facilities carry additional fees calculated on overdrafts, failure to maintain a minimum balance and account closure.
Knowing these credit secrets will give you an advantage over the money sharks, and save you thousands of dollars over the years.
Written by:Taylor Leonard
Sun, 20 July 2008
Cash could be king
Don't rely on China's boom to carry you through a bumpy time.For years we've been told diversity is the key to investing because while one asset class struggles, another will be doing well and level out the bumps for a consistent return...
.
Well, it looks as though we could be in one of those periods where cash is the only saviour. So it's time for an investment reality check to see where we are in the cycle.
ECONOMY
The US is in recession (we just have to wait for the official confirmation) and it looks as if Britain will follow. Some believe both economies are in for hard landings as they suffer from the credit crunch and plummeting property prices. As inflation starts to rear its head, the US hasn't much room to move, official interest rates being so low. Lift rates to fight inflation and it runs the risk of pushing that economy deeper into recession.
As for the Australian economy, we're in much better shape than either Britain or the US for a couple of reasons. First, the Australian Government is flush with cash after a string of budget surpluses has allowed a series of slush funds to be built (future, infrastructure fund, education, hospital funds and so on). There is plenty of money to throw at the economy if we come to a screeching halt.
Second, while I still think the Reserve Bank went too far in the last back-to-back rates rises, it has room to cut rates if the economy slows too much. Our official rates are among the world's highest, so there is plenty of room to cut.
Third, there is the China and India argument. Economists say that while those countries continue to keep buying our commodities, the mining boom will continue and that will underpin the economy.
Economists reckon there is no sign of the boom slowing, and they expect it to continue for years. I'm not as confident on this front. Sure, China has a big domestic market to feed, but it is an export-based economy and if its customers in the US and Europe start ordering less because their economies are in recession, it must have an impact on China's growth.
Sharemarkets are also lead indicators on the health of economies and companies. It worries me that the Shanghai stockmarket is down more than 50 per cent since the start of the year, and India is down 40 per cent.
But with mortgage approvals dropping to an eight-year low and consumer confidence the worst since the 1991 recession, average Australians are preparing for the worst.? SHAREMARKET
When boring old listed property trust GPT gets into trouble I really start to worry.
Then there's retailing star Harvey Norman, down from more than $7 in November to $3, the banks continually pounded, and now even BHP is back around $40. The sharemarket looks ugly, even the energy stocks (which have cushioned the full impact) dropping back.
As I've said before, this 5000-point level on the ASX-200 will be a critical indicator. If the markets bounce up from there solidly, some experts will be happier. If the market drops below that, there is a lot more pain to come.
Now I know there are many investors just itching to get back in the market and take advantage of some of these "cheap" blue chip shares. But I'm not yet convinced. There are three things you can do when looking at the sharemarket - buy, sell or sit on the sidelines. I'm still leaning towards the last.
Some say the resource stocks are good buying, but while they haven't come down as much as others, they're still pretty expensive when you look at the uncertainties ahead.
If you can't help yourself, talk to your broker and maybe start nibbling at some of the blue chips, but I think it is just too dangerous to take a major position believing this is the bottom of the market.
RESIDENTIAL PROPERTY
Banks have clamped down on financing, and auction clearance rates are terrible for the minority brave enough to openly sell. A mate looking for a house in Melbourne told a real estate agent he was disappointed with those available. "Don't worry," the agent said. "I've another 30 in this price range whose owners aren't game enough to publicly list them in this environment."
The best advice in residential property is just don't be forced to sell. If you're doing it tough with higher interest rates, do everything to hang on, because a forced sale could crystallise a big drop in value.
Investing for rental yield could be an option, depending on the property, but tread carefully.
CASH
Cash is king.
It's pretty hard to go by an 8-9 per cent guaranteed return in this environment, for the time being anyway.
Source:http://www.financialservicesonline.com.au
Sat, 26 July 2008
5 Tips to Compare Mortgage Quotes
5 Tips to Compare Mortgage Quotes:
1. Mortgage rates can change daily, and sometimes even multiple times per day depending on economic factors. For accurate mortgage rate comparisons, try to get quotes on the same day!
2. For most loans, the lender's rate sheets have pricing based on a lock period, which are offered in increments such as 15, 30, or 60 days. A lock guarantees the rate for a specific time. Longer lock periods usually have higher rates. Compare mortgage quotes for similar lock periods.
3. Increasing the mortgage rate will decrease the points, while reducing the rate will increases the points. Mortgage quotes have tiered pricing that allows you to buy the rate, or the points up or down. Compare quotes with the same number of points, such as, zero points, or one point.
4. Compare the APR , and have lenders quote the loan points separate from other fees. In addition to standard title, escrow, or appraisal fees, lenders have other fees with names like, processing or underwriting fee. Property taxes, home insurance, and pre-paid interest are not lender fees.
5. Approximate credit scores can be used for general mortgage quotes. If you want a firm rate, the lender will need to run your credit report, but the rate is subject to change until locked. Lenders normally use the middle of 3 credit scores from the borrower who is the primary wage earner!
Source:Posted by Handy Saputra
Mon, 28 July 2008
7 Cash Flow Steps to a Healthy Budget
The word budget can strike fear into even the strongest of people. If there is one thing very few people are ready for when they leave the safety of home for the first time it is dealing with money. There are not too many people who even know how to balance their chequebook after they open their first chequeing account. So creating a budget can be a scary proposition for anyone who isn't good at keeping track of their money.
But if we look at a budget in a different light then maybe it will be easier to live with what it is. And all it is is a cash flow plan. All a budget does is track where the money is flowing from and where it is flowing to. Cash flow; it's what makes the world go around.
Here are 7 steps you can use to plan your cash flow and before you know it you'll have built a budget. Start with a piece of paper and a pencil; you can save those fancy budgeting software packages for later.
1. Write down your monthly income. If you are a salaried worker this should be easy. If your income is not that steady then add up the past three months worth of income and average it by dividing by three. This will give you a good starting point.
2. Start writing down all your monthly expenses. Mortgage, rent, car payment, credit card payments, utilities, groceries, eating out, entertainment, and anything else you spend money on. For those expenses that fluctuate, such as groceries and gas, use the three month average method to get an accurate amount.
3. Here's the scary part for most people. Subtract the expenses from the income and see what's left. You will either have a positive cash flow or negative cash flow. Unfortunately in this day of increasing debt most people have a negative cash flow.
4. Once you have your monthly cash flow laid out in front of you you can start assigning your money to your expenses. As you make those payments throughout the month write them down to see how your spending lines up with what you have budgeted for that particular item.
5. If you have a negative cash flow then you can start looking at everything you have written down and find areas where your spending may not be in the best interest of you financial goals. As you do this you can free up money for more important financial considerations.
6. The first time you do a cash flow plan it probably won't work out quite right. It normally takes about three months to get everything working right while you figure out where your money has been going every month. Be patient with your budget and before long it will start working and you will regain control of your money.
7. Once you are comfortable with your written budget and you have better control of where your money goes and what it does then consider investing in some budget software such as Quicken. It can make your cash flow plan much easier and with the added features like retirement and tax planning it can give you a solid financial future.
By using these 7 cash flow steps you can begin your budget quickly and easily. Only by taking back control of your money can you improve your financial future for you and your family.
Written by:Andrew Bicknell
Tue, 05 August 2008
Ten Ways to Thrive in Uncertain Economic Times
Even in the worst economic environments some people will be more successful and resilient than others. Why? Because some people simply have a better psychological relationship to earning and spending money. This allows them to make the most of the opportunities around them and avoid common mistakes.
If you want to weather uncertain economic times and build a strong wealth foundation, you need to have the best relationship with money you possibly can. Here are a few tips to help you do just that!
1) Study Success, Don't Focus on Failure.
Most of us know plenty of examples of people who do not make enough, save enough, or who use money poorly.
How many examples of prosperous, successful people can you easily call to mind?
Decide what true and healthy prosperity looks like to you.
Then interview people, watch the news, and collect examples until you have a list of 50 wealthy, admirable, and inspiring people. Write this list down.
When you feel discouraged or unmotivated - read your list.
You will notice just by doing this that you see more opportunity and you are able to impress your boss or close more sales without even trying hard.
2) If In Business for Yourself, Collect "No Thanks" Responses, Don't Try to Get Clients.
In a tough economy, we often get scared and push too hard.
Often this can make it harder to get sales.
Instead, make a game of how many calls you can make, free consultations you can offer, talks you can give, articles you can publish, how many ways you can improve your product or service, etc.
Assign yourself points for each activity. Play with someone else. When you both get enough points, go do something outrageous and fun.
When you focus on the "no" not the yes you get less discouraged and stay more consistently engaged- which is particularly important when you are trying to sell in a tough market.
3) If You Work for Others, Don't Try for a Raise or a Better Job.
Instead try to figure out how you can add more value and make more money for your company.
Make it a game - how much better can you do this month than last? Document your efforts and your results.
Then you will be in a good position to ask for a raise or to present your case to a better employer.
4) Be a Language Detective.
What are you and others around you really saying about money?
Do you talk about money struggle, how money can be a pitfall or the evil ways of the rich?
Do others around you talk that way?
Listen and learn, and then change the messages you speak and hear to support your new core beliefs.
You will feel better and others will notice the change too.
5) Forgive Yourself Unconditionally for Your Money Past.
Fear and negativity from past experiences will affect the unconscious signals you send out to others as well as your own confidence and self discipline around money.
Even if you are not aware, of it a bad attitude about money could be affecting your opportunity.
To start a serious change, create a forgiveness letter to yourself and read it aloud to yourself every night for 30 nights before going to sleep.
You may also wish to talk with a coach or therapist about issues that come up as a result. This will help clear your way psychologically for new abundance.
6) Stop Making Money a Secret.
Tell someone you love about your debt or your earning goals.
When you don't talk about what you make, what you owe, or what you spend, and you are afraid to ask others about their money - you increase the shame and confusion about it.
Challenge yourself to go talk to five people about money - ask and tell all and give yourself the gift of real world perspective.
7) Stop Moving the Goal Post for Your Projects.
Some people say they want to put $5000 in savings, but when that goal has been met, it quickly becomes "not enough."
Give yourself the room to appreciate what you have done and accomplished. Make a list of 50 "successes" you have had over the last six months and keep it handy.
This will help keep you motivated and moving. If you want to move on to bigger goals, make sure you know that they are separate goals and not extensions of previous ones.
8) Make Saving Money a Reward.
Whenever you do something wise or good, take one dollar and put it in a jar.
Let this positive energy stay in there and grow for six months to a year. Then take out your savings and invest it in something that will have a long-term impact on your happiness (for example: education or training, savings, investments or anything that will have a long-term impact on your net worth.)
9) Focus On Quality Not Price.
Try not to haggle very often. In many cases, this creates an unconscious belief in lack. Either a thing is worth the energy or money is being asked or it is not. If it is, give it willingly. If it is not, look and ask for higher quality or a more satisfying purchase - not lower price!
10) JUST DO IT!
Complete those tasks you know are undone and are nagging at you and draining your mental and emotional energy. You know you need to return those library books, call your aunt, move your 401k, change your insurance, or whatever your personal procrastination items are.
The more unfinished business we have the more impulse spending we tend to engage in. Unfinished business leaves us feeling drained and keeps us in a state of inaction and denial. Both things are bad for your money. You will find that when you complete (or consciously decide to take off your list) unfinished to-do tasks, your start making better money choices.
Experiment with these ten tips and you will end up BOTH spending less and earning more. And that after all is how wealth is built in ANY economy!
Written by: Mari Geasair
Mon, 11 August 2008
Money Buddy guide to … buying your first house
The task of buying the perfect home for you and your family can be a daunting prospect, with the necessary financial considerations a seemingly endless list of outgoings. So where do you start?
The First Home Owner's Grant
In July 2000, the Federal Government established the First Home Owner's Grant, designed to assist first time buyers with the cost of purchasing a home.
To be eligible for the First Home Owner's Grant, the following criteria must be fulfilled:
The purchaser must be an Australian citizen or permanent resident buying or building their first home in Australia.
The property must be a recognised house, home unit, flat or other self-contained fixed dwelling, specifically designed for residential purposes.
The Grant must not have been claimed previously.
The home must be occupied by the applicant within twelve months of purchase settlement or building completion.
Application for the Grant must be made within twelve months of settlement or building completion.
If the home costs less than $7,000 dollars then the amount paid under the Grant will equal the purchase price.
The tax-free, one-off payment of $7,000 is not means tested, so any first home buyer who meets all the criteria is eligible. Applications made in joint names will only be entitled to one payment for the single property.
The different State and Territory Governments around Australia also have additional eligibility criteria, such as minimum age limits and periods of occupancy. All are different so check with your local authority for their specific details.
How much can I borrow?
Every lender is different but as a general rule of thumb, most lenders will offer owner-occupiers up to 95% of the total purchase price. Some loans are designed to cover the full purchase price, however these loans often come with limitations, higher fees or additional conditions attached, so always remember to read the fine print.
The total amount loaned will depend on a number of variables, such as family income and expenditure.
Saving for your home
A deposit is just one cost associated with buying a house. Others include:
Loan application fees.
Stamp duty.
Legal costs.
Insurance – including mortgage cover, home buildings and contents.
Inspection fees – including building inspection, pest and termite inspections.
Utility connections – water, electricity, gas, telephone.
Council rates.
By setting realistic goals, cutting back on unnecessary costs and keeping to a budget, saving for your first home doesn't have to be an impossible task.
The home buying process
First and foremost you need to know how much you can borrow. Without this information your house hunting could turn out to be a big waste of time. Most lenders offer a pre-approval service in which you can find out exactly how much you can borrow, even before you begin your search.
Have a good idea of what you are looking for including location, size, type of dwelling and price. Don't be pressured into making a decision by the real estate agent; take your time, because it could end up being the most expensive mistake of your life.
When you finally find that perfect home, transfer of title is a necessary legal process. This can be completed through either a solicitor or conveyancing firm. There are kits available to help you complete this process yourself, however it is a complicated procedure and not recommended for the novice.
And, finally, take all the advice you can find. This is an important and expensive exercise so, once it's all over and done with, you need to be able to relax and enjoy your new home.
Source:http://www.moneybuddy.com.au
Mon, 18 August 2008
Which Credit Card is Right for You
If you're in the market for a new credit card, there is a bewildering array of cards to choose from. There are even more incentive offers, so how can you decide on the card that is best for you? Here are some of the factors to consider.
What Kind Of Payer Are You?
The most crucial question is whether you are a person who clears the credit card every month or whether you always leave a balance on the credit card.
If you pay up at the end of every month, then you can go for a credit card that offers an incentive. If not, then you need to look at the annual percentage rate (APR) on the card. If you know what your typical credit card balance is, look at the illustrations given by card issuers to give a guide to how much you might have to repay over time.
Taking An Interest
Even with interest rates, you need to be careful. Although your new credit card may come with a 0% balance transfer rate, this is not the only rate to think about. Look at the rate on purchases or other transactions to see what you might be paying. And remember that any payments you make are likely to pay off the transferred balance first, while any new spending accrues interest.
Compare Credit Cards
Want to know which card is right for you? Why not check out our credit card comparison page to view a table comparing features and benefits of some of the most popular cards. Click here.
Hand in hand with the interest rate goes the interest-free period. This is the delay between spending money on the credit card and being charged interest. This can vary considerably depending on the card you choose. The interest free period can be as much as 56 days. And it's how you use it that counts. If you put major spending on the credit card after the statement date, you have a month till the next statement, and then a few weeks to make the payment. This can be a good way of managing cash flow.
Look At The Fees
There are three types of fees that count with credit cards. The first is the cash withdrawal fee. Many credit card issuers charge you for withdrawing cash at an ATM. These fees can be around 2% of the transaction. The percentage is even higher when withdrawing cash abroad. If you must use the credit card, then you're better off making one large withdrawal so you don't pay the minimum fee each time.
Getting Some Cash Back
Some credit cards offer annual cashback deals which are great for people who clear their balance every month, but not so good for others. If you don't clear your balance, the interest charged will wipe out any cashback gains. There are also reward points schemes that allow cardholders to earn money from their spending – and spend it again with a variety of high street and online retailers.
Paying attention to these items will help you to choose a credit card that will match your financial situation.
Source:Amanda Cherry
Sat, 23 August 2008
Bad Credit Home Loans
What options do you have in attaining a home loan with really bad credit? Can it really be done? Are bad credit loans worth it?
What is a home loan?
A home loan refers to the money the home buyer must borrow from a bank or a home finance institution to purchase a piece of real estate, generally secured by a registered mortgage to the bank over the property being purchased.
With really bad credit you may be turned down for home loan financial help as you are considered a risky case. Although bad credit situations are risky, not all lenders consider it so, some even specialize in such loans that approve bad credit. Attaining a bad credit home loan, can offer you the well deserved reprieve from your debts to get your finances in order during times of despair. Don't hold back your dreams due to a poor credit situation as bad credit home loans are available and can be found with a little searching.
It is very important for bad credit new home loan borrowers to become familiar with certain common terms you will encounter when applying for bad credit home loans. Be an informed consumer and understand the home loan obligation you are signing on to. Make sure you are familiar with these terms before you start scouting for a suitable bad credit home loan product to fit your needs.
Principal: The total amount of debt, the principle excludes interest and late charges remaining on a loan.
Refinance: Paying off your existing home loans with the proceeds from a new loan.
Variable rate loan: The interest rate on these bad credit loans fluctuates in response to changing market conditions. As the interest rate fluctuates, your monthly payments will be adjusted up or down depending upon your agreed upon terms.
LTV/LCR: LTV is an acronym for the loan to-value ratio while LCR stands for the loan-to-cost ratio. Both are terms used by various home loan lenders to determine the loan amount that a person is eligible for based upon the total cost of the property you intend to purchase.
Appraisal: A written analysis of the estimated value of the real estate prepared by a qualified appraiser.
Prepayment: Repaying the home loan before the agreed date the loan was due. Be aware some programs can have a penalty for prepayment.
Penalties: Home loans can contain umerous penalties like the above mentioned prepayment penalty, late payment fees, check bounce penalties, there are many. Bad credit loans can have even more. Take the time to read the terms of the loan and don't be afraid to ask for clarification of any item you are not sure on. Be aware and understand the loan documents to know all the fees and penalties.
Sales deed: The sale deed transfers the ownership of the property in exchange for a price paid or considered. This document is required to be registered but in most cases the title company will take care of this.
Home Loans: Be careful with your bad credit home loans terms and conditions. Do not be intimidated, read it thoroughly before signing the home loan agreement. Don't be bullied because of your bad credit, there are loans designed for your bad credit situation and remember they are getting your business. You are in the drivers seat. Clarify anything that does not make sense or does not look right, trust your instincts and get the best home loan terms with confidence.
Source:ReallyBadCreditOffers.com
Fri, 29 August 2008
Choosing The Right Home Loan For You
The current home loan market in Australia is characterised by high interest rates. Official interest rates are at a 12 year high, and standard variable home loan rates are hovering around 9.6%. This means that Australian households are spending more of their income on mortgage repayments than ever.
The global credit crunch has also made it more expensive for banks to lend money to home buyers. The banks are finding it difficult to secure cheap funds, and this added expense is passed onto borrowers. The result is high interest rates that seem unlikely to substantially decrease in the near future.
Importance of comparing home loans
With high interest rates showing no signs of decreasing, getting the best home loan is more important than ever. The number of foreclosures continues to rise as home owners find it increasingly difficult to make their mortgage payments. Carefully researching all of your loan options can help prevent you from finding yourself in a dire situation.
Speaking with various lenders is a way to gather some of the basic information. However, lending institutions are businesses, so they're unlikely to tell you about the loans their competitors have to offer. They'll focus solely on the benefits of their institution's loans. It's up to you to find and review all the various types of loans that are available to you. Without doing independent research you won't get a complete picture of the market.
Another reason it's important is that there are numerous different types of home loans available. Each offers different terms and has its own pros and cons. These are a few of the most common home loans:
•Low doc
•First time home buyer
•Fixed rate
•Variable rate
•Honeymoon
•Split loans
Determining which type of home loan best suits your needs and finances is the best place to start. That way you can focus solely on the types that most appeal to you.
How to compare home loans online
For potential home buyers, a good place to begin your home loan research is on a financial product comparison site. These are sites that help you make side-by-side comparisons of the various home loans being offered. Mozo.com.au is one of the most comprehensive home loan comparison sites on the web. It provides you with comparisons, detailed descriptions, relevant news articles and a variety of financial tools and calculators.
Having all of the information in front of you is the easiest way to compare available home loans. Mozo.com.au returns search results based on criteria you select. You can shortlist home loans and compare rates, fees and features side-by-side.
In addition to comparing home loans, Mozo.com.au is a place to perform a lot of other home buying research as well. One rather unique feature is a set of user ratings and reviews on the loans featured on their website. Borrowers can glean a lot of valuable information from the honest feedback provided by people who have personal experience with a particular lender.
Given the state of Australia's home loan market, now is no time to make a hasty decision. Utilise the tools available to you by visiting a site such as Mozo to easily and efficiently perform home loan comparisons.
By: Mozo
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