Three Benefits of Making a Down Payment When You Borrow Money to Buy a Car

Posted by on Jun 14, 2016 in Uncategorized | Comments Off on Three Benefits of Making a Down Payment When You Borrow Money to Buy a Car

If you are taking out a loan to finance a car, you may want to consider using a down payment. Whether you are taking out a loan from a bank or from a financier who works specifically with people with bad credit, there are a range of benefits of having a down payment. Here’s a look at some of the benefits. 1. Lower Monthly Payments When you make a down payment, you reduce the amount of money you have to finance. As a result, your loan is smaller, and that is reflected in your monthly payments. Although a down payment requires a big chunk of cash upfront, it saves you money every month for the lifetime of your loan. 2. Reduced Interest Payments Over the Course of the Loan By borrowing less money, you reduce the amount of interest you pay over the lifetime of the loan. For example, imagine you borrowed $10,000 to buy a car. If you have a 6 percent interest rate, you pay $600 in interest on the first year of the loan alone. However, if you have a $2,000 downpayment, for example, you only need to borrow $8,000, and during the first year of the loan, your interest is only $480. That saves you $120 in interest during the first year of the loan, and every following year, you save more on interest. 3. Down Payments May Help You Qualify for a Lower Interest Rate Although making a down payment is not a guarantee that you will receive a low interest rate, in some cases it can help. A down payment directly reduces the amount of money you have to finance, and as a result, it reduces the lender’s risk. Essentially, if you borrow the entire value of the car and you default on the payment, you lose nothing except the car itself when the lender repossesses it. In contrast, if you put some money down, you make that investment into the vehicle, and if you default on the loan, you lose the vehicle as well as the down payment. Based on this logic, many lenders assume that if you make a down payment, you are more invested in the vehicle and thus less likely to stop making payments. As a result, the risk is lower, and the lender may extend you a lower interest rate, even if you have bad credit. For more information about bad credit car finance, contact a professional...

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Migrant Mortgage: Understanding Home Loans for Non-Citizens

Posted by on Nov 16, 2015 in Uncategorized | Comments Off on Migrant Mortgage: Understanding Home Loans for Non-Citizens

A permanent residential structure is an important asset to consider acquiring if you have migrated into Australia. This choice has long-term economic benefits compared to renting an apartment. In simple terms, the cumulative rental fee for apartment space will be high for prolonged residence. In addition, a permanent house will gain value over time, allowing you to sell it at a profit in the future. One of the crucial aspects that you must evaluate when looking for a home is financing. As a migrant, you will find diverse home loan opportunities to help you acquire a good home, without exorbitant interest rates. Here is a brief description of the important migrant mortgage elements. Eligibility The eligibility criterion for migrant home loans is not very different from the regulations imposed on Australian citizens. However, the restrictions applied are more stringent, and they can vary depending on your specific mortgage provider. Naturally, you must be a legal adult to qualify for a migrant loan and have the right documentation to prove that you are a legal resident. You must be currently employed, and your income should be able to cover the potential mortgage payments. You should also be able to provide evidence of your existing assets in form of equity, savings and even liabilities. Additionally, you should have loan security and a good credit history where applicable. Permanent Residence If you have permanent residence in Australia, you will find it easier to obtain a migrant loan. Moreover, people with valid permanent residence documentation can borrow more money to cover for a larger percentage of the property value. However, you should inquire about the specifics from your lender because your circumstances can affect the exact amount that you can obtain. For example, a mortgage dealer is more likely to give you a large loan if you are working and living in Australia as opposed to overseas. As a permanent resident, you are also eligible for first homeowner’s grant. This will be awarded if you are purchasing your first home and are planning to use it as your primary place of residence. Temporary Residence Home loans for migrants with temporary residence are only provided by select lending institutions. The conditions and restrictions imposed are more stringent, so you will need to provide evidence of your financial reliability. For instance, you will need to submit to a review of your assets and liabilities in the overseas. Additionally, you are not eligible for the homeowner’s grant, and you will need to present a long-term working...

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Factors to Consider Before Refinancing Your Car Loan

Posted by on Jun 15, 2015 in Uncategorized | Comments Off on Factors to Consider Before Refinancing Your Car Loan

Many people know a lot about refinancing their home mortgages but some do not know about car loan refinancing. Consequently, they miss an avenue through which they can access funds for other activities like settling urgent medical bills. This article discusses some factors you should have in mind as you refinance your car loan: Your Average Car Ownership Duration Many people never owned a given car for very long before trading it in for another one. As you consider refinancing your car loan, think about the length of time you usually take before you feel the urge to buy another car. That timeframe is very important because it will guide you on the duration of the car loan you should get. For instance, if you normally buy a car every five years, the car loan you obtain should not exceed five years. This is because it may be hard for you to get any money out of the sale of your car if the loan has not yet been paid off. The Interest Rate at Which You Bought the Car This is another important factor to look into. If interest rates are higher than they were at the time you bought the car then it is not wise to refinance that car loan. This is because you will be paying too much (in interest and administrative costs of the loan) for the money you get. On the flipside, if rates have plummeted then it makes financial sense to refinance since you will lower your overall indebtedness by obtaining a cheaper car loan than the one that you used to buy the car. Monthly Deposit Vs Long Term Cost Many people only look at how much they will be required to deposit as a monthly payment when they refinance their car loan. This focus may be misleading because it does not give you the full picture of what the total repayment amount will be. For instance, a monthly repayment figure of $200 for 60 months may seem very affordable but when you realize you will pay a total of $12,000 in addition to administrative costs then the loan no longer seems very attractive. Contrast this with another person who makes $300 monthly payments for 36 months. That person will pay $10,800 plus an administrative cost. The lesson here is that you should look beyond the monthly payment as a determinant of how good a car-loan refinance product is. Look at the bigger picture instead. When you think carefully about the issues above, you will be in position to shop for the best car-loan refinancing that will not drain your finances. To learn more, contact a company like SMA...

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Questions To Ask Before Hiring a Debt Collector

Posted by on May 26, 2015 in Uncategorized | Comments Off on Questions To Ask Before Hiring a Debt Collector

If you’re a creditor, trying to pry money owed to you by a client or customer can be frustrating, especially if the debtor has changed address or gone on the run. That’s why you may want to consider hiring a debt collection agency that employs methods such as direct contact, threat of litigation and negotiation to get you the money you are owed. But before you hire one of these professionals, here are some questions to ask them to ensure that you are getting the most bang for your buck. Do You Have Errors and Omissions Insurance? —Errors and Omissions (E&O) insurance is a commercial liability policy that protects a business from lawsuits brought about through charges of negligence or failing to perform professional duties. It also covers businesses against suits brought about due to libel or slander, and will pay for defense costs associated with these types of lawsuits. You must ask a debt collector about E&O insurance, so that if the collector uses tactics that result in a lawsuit from your debtor, you will not be named or have to pay for defending that lawsuit because you hired the debt collection agency. What Type of Fee Structure Do You Offer? — Some debt collection agencies will offer you a flat fee, which you pay regardless of how much debt the agency can recover. Other agencies proceed on a contingency basis, in which a percentage is charged based on the total amount of money that is recovered from your debtor. In many cases, you won’t pay anything at all if the debt collection agency can’t recover any of the debt, so that may be the model you prefer, although with large debts, some agencies will only offer a flat fee. Do You Have Skip Tracing Services? — Skip tracing is ideal when your debtor has left his existing address and is on the run without leaving an address after departing his last residence. Broken down into its two words, ‘skip’ is an American slang word for people who leave their residence without notice, and ‘trace’ is the process by which a debt collector or bounty hunter tracks down the person who has fled. Skip tracing is accomplished through several methods, including analyzing financial accounts to determine if a cash machine or bank transaction was recently made and where it was made, as well as examining credit reports, tax information, public records, courthouse records, air travel records and driver’s license applications. Debt collection agencies don’t perform magic, but they do have resources that can help you recover at least a portion of the money that is owed to you. For more information, contact a local company like National...

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Best car loan options for new drivers

Posted by on Mar 26, 2015 in Uncategorized | 0 comments

Now you’ve passed your P plates, it’s time to hit the road. If you need a car to get to work or just to friends’ houses, borrowing a car from your family members can be inconvenient and subject to the whims of the person you are borrowing from. Young drivers can find getting car loans tricky especially if they have variable income from a casual work. Here are some tips on how to get a car loan, so you have access to your own vehicle. Collect Your Average Pay Slips from the Last 6 Months If your payslips vary over time then collect a history of payslips, and show any particular variations. (Retail and hospitality workers often peak in earnings around December and January, and may have lower earning in February and March for examples). That way you can show examples of high and low payslips and your finance application can reference an average amount. Lenders may choose to use a lower amount, to ensure that you can consistently make payments. Show Your Savings History A savings history can demonstrate that you consistently have excess money at the end of each pay cycle, and the discipline to make regular payments towards a goal. Even if you have withdrawn the money previously for other goals such as holidays, this still shows a positive trend for lenders. The history of savings is a persuasive part of the story of why a lender could lend you money. If you do not have a particularly consistent saving history, it is also helpful to a show a budget where you have determined how much money you have coming in (from jobs or government payments) and money you have going out (to pay other bills, and to maintain the car). Show Any Bills You Pay Regularly Even if you live at home, you should show your payment history on any bills that you take responsibility for such as credit cards, store cards or mobile phone bills. By showing that you regularly make payments against your commitments you can give the lenders faith in your commitment to paying back the loan. If you do not currently pay any bills, taking on some bills in your name can be a good way to prepare for taking on a car loan, and other loans in the future. Using these tips can help you maximise your chances of getting your car loan approved, with the best conditions. For more information, contact Fox Car...

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How to Consolidate and Pay Off Multiple Debts with a Home Loan

Posted by on Mar 12, 2015 in Uncategorized | 0 comments

Are collection agencies or creditors calling you every now and then because of an outstanding debt? If so, consider using home loans to pay of a few debts at once. If you’re interested, there are two types of home loans that you may use to consolidate your debts. Learn about them below. What is debt consolidation? This is a process that enables a borrower to repay multiple debts, using a single monthly payment. To achieve this, you have to take a single loan and use it to pay off all your outstanding debts at once. By so doing, the various debts that you had before are replaced by a single debt, for which you need to make a single repayment every month. Instead of taking a personal (consolidation) loan, you should consider taking a secured (home loan) to consolidate your debts. How can home loans consolidate debts? Basically, there are two types of home loans that you may use to consolidate your debts. Learn how you can use them to pay off all your outstanding loans. 1. Cash-out refinance loan After taking this type of loan, you replace your existing mortgage with a new loan of a higher value than the outstanding balance of your home loan. You can then use the remaining money to pay off other debts, such as store card bills, credit card bills or medical bills, at once. The benefit of this loan is that you use the same security (your home) to secure a new loan. Before applying for this type of loan, you should first calculate the outstanding debt and ensure that the amount that will remain is enough to pay off your outstanding debts. 2. Second mortgage loan The other option to settle your outstanding dues is to take a second mortgage loan. If you have sufficient equity in the property, you may use it to take a second loan and use it to pay off your outstanding debts. In this regard, you can either opt for the one-time home equity loan or apply for the one-time home equity loan. The second option allows you to borrow the required amount from time to time, until you hit the credit limit. While applying for a home loan to consolidate your debts, it is advisable to be very careful. This is mainly because you can easily lose your home. You should talk to home loan professionals to learn more about the process, and which loan will help you to fight off...

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