Entries Tagged 'Debt Consolidation' ↓

Fundamental Tips To Debt Consolidation

Fundamental Tips To Debt Consolidation

Debt is the number one problem of almost every household in society today. We all want to live lavishly but have no means or very little means to do so. There is no end to the advertising of material things that would add to our personality and put a huge dent in our pockets! What happens when the dent is so huge that it seems overwhelming? We must lick our financial wounds and try and consolidate debt to make life livable again. In order to do that, we must do some things to consolidate debt without creating more debt.

The Debt (2011 film)

The Debt (2011 film) (Photo credit: Wikipedia)

The first thing to do is to consolidate all outstanding debt if possible. Get all the credit card debt and see if contacting the credit card company and paying at least ten dollars more than the minimum will help to relieve the outlandish interest charged on the principle.

The second thing to do is to establish and adhere to a budget. Plan every activity and plan every dime that is spent for activities so that it is no surprise. Learn to live on less. Eat out less often. Eating out is a major expense that can cause major debt in more than one way. The last thing to do is to try to curtail all unnecessary expenses like cable, internet and other “luxuries” to a bare minimum. Cell phones should be a bare minimum expense. Try to spend money on only what is needed and not what is a desire. These tips can help with debt consolidation and decrease debt also.

Unsecured vs Secured Personal Loans – What You Need to Know

Unsecured vs Secured Personal Loans – What You Need to Know

If you are looking for more information about the difference between secured personal loans vs. unsecured personal loans, then you have come to the right place. Also, this article will cover debt consolidation and where you might apply for them.

Secured Personal Loan

Secured personal loans are bound to an asset that are deemed collateral for your debt. Loan providers place a lien relating to the asset, providing them with the justification to take your asset in case you default with your payment obligations. In case the loan provider needs to take the asset as a result of your delinquency, your asset is going to be offered for sale. In case the price for your asset does not entirely take care of your debt, the lending company may possibly go after you so you could cover the difference.

English: Online Loans Today, All Loans in One ...

English: Online Loans Today, All Loans in One Place (Photo credit: Wikipedia)

Home loans and motor loans both are good examples of secured loans. The home loan is secured by the house. In the same way, the auto loan is then secured by the motor vehicle. Should you turn out to be delinquent on these kinds of loan repayments, the lending company may decide to foreclose or claim the house.

Unsecured Personal Loan

With unsecured loans, loan companies do not have the rights to any sort of collateral for your financial debt. In case you fall behind with your payments, they do not have any rights to claim any asset of yours. Nevertheless, the lending company might take different measures to force you to cover your debt. For instance, they might employ the services of a debt collector in order to coax you to pay your debt. In case that does not do the job, the lending company might file a lawsuit and request the legal court to deduct your salary, claim an asset, or place some sort of lien upon your assets unless you have covered the debt. They will also declare your delinquent state towards the credit reporting agencies so it could be reflected on one’s credit history.

Personal credit card debt is considered the most common unsecured debt. Some other unsecured loans include court-ordered child support, medical bills, payday loans and student loans.

Debt Consolidation

Debt consolidation is a kind of loan that lumps up your entire existing loan into one big loan. The biggest advantage to this is that the monthly payments are usually smaller. The interest rate is typically smaller. Debt consolidation is still considered as a loan. Therefore it can be secured or unsecured. Banks, debt Consolidation Companies and other financial institutions typically offer unsecured or unsecured debt consolidation loans.

Debt Consolidation with Peer-to-Peer Lending

Debt Consolidation with Peer-to-Peer Lending

Personal loans, debt consolidation loans and home loans were once the exclusive products of banks, but this is no longer the case. Those struggling with money problems now turn to companies like P2P loans, payday loans, family loans and Prosper in order to reduce monthly repayments and keep household bills in-check.

Secured Loans and Debt Consolidation

Having bad credit normally means that unsecured loans aren’t a realistic option due to the high APR. This means that many borrowers that are seeking debt consolidation opt for secured loans. Is it really a sensible idea to turn unsecured debt, such as credit card debt, small unsecured loans and personal overdrafts, into a secured loan?

Secured Debt Consolidation and Creditor Harassment

A secured loan provides collateral for a lender, providing it with far greater powers to recover debt in the event of loan default. It can lead to creditor harassment for up to 12 years in event of house repossession and resultant negative equity. Rather than get a secured loan, commencing a debt solution could prove to be a more effective alternative.

Whilst debt consolidation has too many negatives for those with bad credit, it could prove a useful option for those seeking to protect a good credit rating. Those that do have bad credit may be better served by choosing a debt Consolidation solution, such as an Individual Voluntary Arrangement or debt management plan.

Good Credit two major P2P sites — Prosper and Lending Club Loans

P2P loans are a peer-to-peer lender, which means that people lend to people. P2P loans offers good credit customers a low APR personal loan over 3 years. A customer can pay back their personal loan early should they wish. Unlike a payday loan, a P2P loan isn’t suitable for those with bad credit. Individuals that have missed payments or defaulted on a loan should seek an alternative source of finance.
No Credit Check Payday Loans

Payday loans are designed specifically for people with bad credit and don’t involve a credit check. A payday loan isn’t a debt consolidation loan, it is there to help people deal with a short term money problems, such as paying the rent or mortgage. The main problem with payday loans is the high APR so they should only be used in an emergency situation.
Get a Family Loan to Resolve Money Problems

Getting a family loan is a perfect solution for those with money problems, especially when bad credit is an issue. A family loan allows someone to borrow money from friends or family at a low APR, often interest-free. The only real issue is not being able to pay back the personal loan should further money problems arise.
Prosper Personal Loans

Specializing in US customers, Prosper offers personal loans to customers with average credit or a good credit history. Being a peer-to-peer lender, Prosper personal loans operate on a similar platform to P2P loans. Prosper are particularly useful to US customers as only homeowner loans are normally available to them.

Those experiencing money problems should always see if a family loan is possible before checking other sources of personal loans. People with bad credit will find that personal loans charge a high APR of 50-60% or higher in the case of payday loans. Good credit customers should use either an online loan comparison service or see if they can get a personal loan from peer-to-peer lender, P2P loans.

Is Taking out a Personal Loan for Home Improvements Sensible?

An unsecured personal loan can be an excellent way to perform home improvements as it can help to build home equity. However, it is important for those seeking to borrow money can afford the monthly repayments and have job stability. Avoid home improvement loans when bad credit is an issue.

Having access to personal loans can open up many avenues to a borrower, including debt consolidation, home improvements and even buying a car. Those with a bad credit rating may find that paying a high APR makes unsecured debt consolidation unattractive.
Doesn’t a Charging Order Turn Unsecured Debt into Secured Debt?

It is true that a lender can get a charging order and turn unsecured debt into secured debt. However, the process of getting a charging order is very involved and means that a lender has to register a County Court Judgment or CCJ against a borrower before this can even be contemplated. Should a borrower come up with a repayment plan, a charging order could be prevented by a judge.

Consider a Debt Solution before Getting a Secured Debt Consolidation Loan

Unless someone has a job that depends upon good credit, it is worthwhile considering a debt solution, such as a debt management plan, when experiencing money problems. Getting a secured debt consolidation loan could serve to worsen money problems, especially if the borrower fails to close down sources of credit that had been consolidated by a homeowner loan.

What If Your Credit Rating Isn’t as Good?

Even if a lender does agree to loan you the money, those with adverse credit will have to pay a higher rate of APR. You will normally need to be a home owner and your loan will be secured on your property. You will also need to have sufficient equity in your property.
There are some unsecured loans available, but most will attract a rate of interest in the region of 25%. If you are paying more attractive rates on your other credit agreements it is highly questionable whether you should consolidate.

What Type of Loan?

If you have the choice an unsecured loan should almost always be chosen for two critical reasons.

If you do encounter financial difficulties you can enter a Debt Management Plan or an Individual Voluntary Arrangement, particularly if you have gambling debts. It gives you a greater range of options should you end up in a position where you lose your job or your personal circumstances change.

As you aren’t utilizing the equity in your home, it will be easier to attain secured finance should you ever desperately need to. This gives you another chance should the unexpected happen.

Turning unsecured into secured debt is a serious business, but there are genuine reasons why it should still be considered.

A secured loan will normally allow you to get a better rate of interest. The reason for this is that the creditor is afforded greater protection.
Those with bad credit are unlikely to be able to get any other kind of loan. There may be no other choice.

You will be able to repay the loan over a longer period of time which means that your monthly payment will be lower and more affordable. It is, however, important to be aware that the longer the loan the more interest you will pay over the duration.

Consolidation loans provide people with simpler, more manageable finances. You can’t put a price on having a payment structure to your debt and knowing that in a certain number of years that debt will be completely paid off.

Seek Financial Advice

Before proceeding with any type of debt consolidation it is advisable to consult an independent debt advisor to make sure that the loan is right for your personal circumstances.

How You’re Wrong About Debt Consolidation

How You’re Wrong About Debt Consolidation

With so many mixed messages presented by so many different sources, it can be difficult to know which to believe when it comes to finances. Facts can be misrepresented and myths develop a life of their own. But if you find yourself reading this article because you’re considering debt consolidation, read on. There are three myths that will be debunked in the following paragraphs.

Myth #1—Debt consolidation causes damage to your credit rating

In reality, the act of debt consolidation is a way of better managing your debt so that your credit report is NOT totally damaged. Consolidation shows that you are serious about paying off the debt. In fact, putting all of your debts together in one loan often shows up on the credit report as balances being paid off.

For example, assume you had a $2000 balance on a credit card that charged 12% interest, a $5000 balance on a different card that charged 15% interest and a $3000 balance on a third card that charged 18% interest. If you went to your bank and negotiated a loan for $10,000 at 10% interest, you could pay off all three credit cards with the money from the loan and save money on interest in the long run, too. In addition to only having one debt payment each month, you have shown those three credit cards paid off on your credit report.

What’s the catch? Well, it’s simple. You have to make your payments on the consolidated loan in full and on time to maintain the good credit standing.

Myth #2—Debt consolidation is the same thing as debt settlement or bankruptcy

Actually, the three are very different approaches to resolving debt. Debt consolidation is a strategic plan to pay off all of your debt. Debt settlement, on the other hand, is an attempt to reduce the amount you owe to various creditors to help resolve unpaid balances. Bankruptcy is the most complicated of the three because it involves court proceedings and a judge. Additionally, bankruptcy stays on your credit report for a number of years and will affect your ability to acquire loan money in the future.

Myth #3—Debt consolidation costs you more funds over time

The common argument that created this myth is that consolidation loans are only able to lower your credit payments by extending the life of each loan. An extended loan means you pay interest for a longer period of time. So, under certain circumstances this myth can be true. However, it is not universally true and does not HAVE to be true for you.

Take the earlier example as a case study. If everything else remained the same (length of loan, minimum payment, etc.), you would save approximately $45 each month in interest charges by consolidating at 10%. Choosing to apply that $45 to the remaining balance on your loan would serve two purposes: paying off the loan faster and paying even less interest. Take time to do the math to determine what would be the most beneficial for you financially over the course of the loan. Resist the temptation to assume the worst because you heard a myth.

Tiffany Marshall is a freelance writer who writes on behalf of the debt collection professionals at Direct Recovery. Call them for some of the lowest debt collection rates in the industry.

New Beginnigs After Bankruptcy

New Beginnigs After Bankruptcy

English: Part of Title 11 of the United States...

English: Part of Title 11 of the United States Code (the Bankruptcy Code) on a shelf at a law library in San Francisco. (Photo credit: Wikipedia)

Life sometimes seems to deal one bad hand after another. Individuals who lose their jobs or encounter major medical bills can end up feeling overwhelmed financially. There are many circumstances, especially in today’s economy, that can make it seem like there is no point in trying anymore.

When the financial pressures create a sense of defeat, it is time to contact one of the qualified Phoenix bankruptcy lawyers. These professionals have been trained to deal with what may seem like insurmountable problems. Often, the solution to difficult problems is simply turning to someone who is experienced and knowledgeable in dealing with them.

Many people view bankruptcy as a sign of failure. In reality, the laws exist for bankruptcy to give individuals a second chance and new beginnings. When circumstances and events beyond an individual’s control create a financial dead end, having the slate wiped clean is sometimes the only alternative. Individuals will find that it is easier to rebuild and get on with life without the burden of excessive debt.

Two Phoenix bankruptcy lawyers that can help deal with removing that burden are Mark W Lischwe PC (www.bankruptcyarizona.com) and Thomas Law Office (www.thomaslawoffice.net/phoenix-bankruptcy)attorney.html) A call to their offices can schedule a free consultation to discuss specific options and alternatives.

Five Great Jobs for Quick Holiday Cash

Quick Holiday Cash

Quick Holiday Cash

It’s the most-expensive time of the year. Whether it involves buying presents or paying for travel, the holidays can cost a lot of money. Here are five jobs that don’t require much training but still pay good money to help you cover those extra holiday expenses.

5. Amusement and recreation attendants

Families typically get together during the holidays and they need things to do besides sit around and annoy each other. Take advantage of the increase in holiday entertainment options and find a part-time job as an amusement or recreation attendant. A job like this might pay $9.60 an hour- and possibly get your family in at a discounted rate.

4. Ushers, lobby attendants, or ticket takers

I don’t know about you but one of my family’s Holiday traditions is to go see a movie while we are together. I don’t think my family is alone- Hollywood seems to save all the great movies for the month of December (I’m so excited to see the first installment of “The Hobbit”- aren’t you?). Getting a job at the movie theatre (or even the local stage theatre for their annual Christmas shows) can be a great way to earn around $9.69 an hour (and maybe get a free show in, too).

3. Cashier

The reason we all need a little extra cash during the Holidays is because we are spending a lot of it ourselves. Getting on the other side of the counter can be a good way to earn some money- and possibly a little discount at the store as well. Cashiers could expect to make around $9.73 per hour.

2. Garment or textile pressers

This might sound like an undesirable job- I know I picture someone in a sweatshop somewhere in Chinatown- but a good, blue collar job like this can be a great way to make a little extra cash for the Holidays. The nice thing about jobs like this is that they are stable and predictable and you don’t have to deal with the stress that comes with serving customers. Working as a presser could pay as much as $9.87 an hour.

1. Personal and home care aides

So much of a focus of the Holidays is a drive to serve people in need. Why not combine your desire to be helpful with a job as a personal care aide? Although this might sound a little intimidating, basically this job is about helping someone with some chores around the house or offering a little company. This can be a very important job around the holidays when families might be traveling and simply needing someone to help “check-in” on a loved-one while they are away. Home or personal care aides might expect to make about $9.88 an hour.

There probably a few more jobs that could qualify– for example in a previous blog post I wrote that waiting tables, working in food prep and recreational protective service workers (think lifeguards) as the top 5 highest-paying, lowest training jobs. Each of the jobs could qualify as a “great jobs for quick Holiday cash” as well although my more recent data shows that those jobs don’t pay as well as they once have.

You have lots of options when looking for a good job for some extra Holiday money.No matter which option you choose, I hope you find enough to really deck the halls and have a happy Holidays.

David Zimmerman is the developer of http://jobland.us/ which is dedicated to help people consider their career options and make an informed decision about their current career (or find a completely new occupation.