Build Credit in your Name
If you have delinquent credit and are married, you might want to build your credit in your name instead of using your spouse. Somebody has to have stability. Also if you are divorced and all the credit cards of credit information are in your...
Financial Flat? Bad Credit? need a fix?
Failing finances are a common problem now-a-days. How does
one extricate himself from a heavy debt load? There are ads that
offer to do that ... for a price. It may be the answer for some.
However, there are things one can do for himself.
...
Legislators Ponder New Credit Protection Laws
Legislators in Washington, D.C. are considering several credit-related consumer protections as outlined in The Fair and Accurate Credit Transaction Act of 2003 (H.R. 2622). If approved, consumers could benefit from the most wide-ranging changes...
Options for Individuals with Bad Credit
If you've had problems with your credit in the past, you might think that your options are extremely limited in regards to financial matters. While it's true that it can be more difficult to find loans and credit cards when you have bad credit, that...
Save on your insurance by improving your credit score.
Did you know that you could make sure to get the best rates on your auto and homeowners insurance simply by having a good credit score. Additionally a great credit score will allow you to get the best interest rates on your credit cards, car loans...
The True cost of Credit
The current house price boom has perhaps passed its peak as I write this, but that doesn't stop the mortgage companies from offering yet more new and tempting products that look like good deals for a consumer. But be warned - The standard mortgage, running over 25 years is set like that for a reason! When you see companies offering '40 year mortgages' or 'low start' mortgages, or perhaps even 'interest only' mortgages, you should understand these shiny new products may have a nasty sting in their credit tail!
Perhaps the ultimate expression of lending absurdity is Japan, where at the peak of their last boom, 'Grandfather - Father - Son' mortgages were common. These committed unborn future generations to mortgage payments incurred by their predecessors (a situation thankfully illegal in most parts of the world!). Could it ever happen here? Probably not, but the extension of 'standard' mortgage terms on lower interest rates are not actually a good thing for the ordinary Joe, even though they are touted as being 'more affordable', and should be viewed with deep distrust, simply because it means YOU WILL PAY MORE over the life of the loan. Don't believe me? Try working out the math,
instead of simply looking at the monthly repayment figure.
Using the good old loan calculator on www.nodebtever.com we can see that a standard $100,000 loan at 5% over 25 years will cost you over $175,000. That's a big $75k in interest. What about the same loan over 40 years at 4%? That's cheaper, right? WRONG! You'll pay over $200,000 over the period - an extra $25k or so! And if interest rates stay at 5%, add another $30k to make $55k of extra costs for you!
A repayment mortgage will suffer an additional penalty on a longer loan - the amount of capital you pay off each month is adjusted to take account of the fact that it now runs over 40 years, not 25, and this means you build up equity in your property far slower than in a shorter loan.
So what's the advice? If you can't afford a house on a 'traditional' setup, rent. The price will undoubtedly come back into line with wages at some point. If you already have a mortgage, overpay when you can - the difference over the years can amount to TENS of thousands of dollars!