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The Truth About Credit Card Debt. #payday #loans #no #brokers


#credit card debt consolidation
#

The Truth About Credit Card Debt

from daveramsey.com on 04 Aug 2009

Myth: Aren’t there positive uses of a credit card? Like rebates and airline miles?

Truth: Responsible use of a credit card does not exist. Credit card debt is a major problem in America.

There is no positive side to credit card use. You will spend more if you use credit cards. Even by paying the bills on time, you are not beating the system! But most families don’t pay on time. The average family today carries $8,000 in credit card debt according to the American Bankers’ Association.

Now let’s talk about the rebates. If you were using a credit card at 5%, you would have had to have spent $80,000 to get $4,000 rebates on new cars that lost $6,000 of value when you drove them off the lot. That is not a good deal!

Cash vs. Credit Cards

When you pay cash, you can “feel” the money leaving you. This is not true with credit cards. Flipping a credit card up on a counter registers nothing emotionally. A study of credit card use at McDonald s found that people spent 47% more when using credit instead of cash. This is money you could have saved!

If you “have to” use plastic, I suggest a debit card. I use them for travel and the occasional convenience of ordering something over the Internet or phone. Other than that, I use cash.

Personal finance is 80% behavior. You need to cut out habits that make you spend more. You do not build wealth with credit cards. Use common sense. When you play with a multi-billion dollar industry and you think you’re going to win at their game, you are naive. You cannot beat the credit card companies.

Start living on cash today! Dave’s budgeting forms are a great, free way to begin.

Save $500 or more on your insurance by using Dave’s Endorsed Local Provider .


A Bad Credit Debt Consolidation Loan. The Honest Truth #title #loan


#debt consolidation loans bad credit
#

A Bad Credit Debt Consolidation Loan

Are There Better Options?

I hate to be the bearer of bad news but a bad credit debt consolidation loan is not the answer to your debt problems .

Why?

For two reasons.

1. If you already have bad credit you face three challenges.

a) getting the loan in the first place

b) getting a big enough loan to meet your needs, and

c) getting the loan at an interest rate that actually saves you money and helps you pay down your debts faster.

and

2. Debt consolidation loans, whether you have bad credit or good credit, are usually not effective in getting people out of debt unless they make other, more important changes in their life and financial habits.

My guess is that I’m probably not telling you something that deep down in your heart you don’t already know.

But take ‘heart’.

not getting a bad credit debt consolidation loan may be a blessing in disguise.

I’ll touch on this later.

YOUR BEST SOURCE FOR A BAD CREDIT

DEBT CONSOLIDATION LOAN

WARNING. I want to start by making it very clear that I DO NOT recommend short term bad credit loans as a method of debt consolidation or debt relief. There are much better options available to you. To learn more about these options I recommend that you find an independent debt counselor that can evaluate your situation, help you prepare a debt plan, and recommend the appropriate debt relief option. You can either meet with a counselor in person where you live, or, if it is more convenient, you can discuss your situation over the telephone. The debt counselors that I recommend offer a free initial telephone consultation after which you will have a debt reduction plan in place as well as an estimate of your potential savings. If you wish, you can contact them here .

NOW. I know that many people will nonetheless ignore this warning and continue their search for such loans. Therefore, I want to make sure that you at least get the best loan, at the best rate to suit your needs. The solution? Deal with one loan broker who works with over 70 lenders to get instantly approved and the best deal.

a) You can apply online.

c) Your cash is deposited overnight into your bank account.

Talk to an independent senior debt counselor today (for free) and receive a personalized debt reduction plan.

Alright, let’s have a closer look at the reasons why a new bad credit loan is not the answer to your debt problems, help you avoid the bad credit debt consolidation loan scams that are out there, and more importantly, discuss some bad credit debt relief options that actually may work for you and get you on the path to debt freedom.

First Things First. Ask Yourself. Why Do You Have Bad Credit?

I ” don’t know.

Do ” you “?

No, really. Do you know exactly why you have bad credit? If you don’t, then this should be the first thing that you investigate. Were you late on your debt payments? Have you missed debt payments completely? Are you facing a hardship in your life like divorce, job loss or an unexpected illness that has lead to events that have affected your credit score/report? You need to understand the reasons intimately before you can decide on a debt relief plan of attack. (And you certainly need to know this before you consider a bad credit debt consolidation loan.) I’ll touch on this more in the next section. For now let’s look at the challenges of consolidating your debts with a new loan when you have bad credit.

Challenge #1: You have bad credit. You are already in significant debt. In other words, any lender will likely look at you as high risk. Sorry, but that is the truth. The fact is, you are going to have a difficult time just finding a debt consolidation lender who will work with you. (But take heart, this may be a blessing in disguise. In fact I know it is. Keep reading.)

Challenge #2: If you are looking to get a bad credit debt consolidation loan, chances are you have a significant amount of debt. (If you only have a small amount of debt then my advice to you right now is to forget about consolidating your debts altogether. It won’t be worth it.) But if you do have significant outstanding debts, and bad credit, your chances of securing a big enough loan to pay off your existing debts is slim to none. (Remember however, that even if you did get the loan, you are not reducing your overall debt obligations by merely shifting your debts from one creditor to another.)

Challenge #3: Let’s say that you do find a lender who will not only lend you the money, but lend you a large enough sum to consolidate all of your existing unsecured debts. Now you’re in business! But wait, they will want to be compensated for extending a large, unsecured loan to someone with bad credit won’t they? And that compensation will come in the form of the “risk” portion of the interest rate they will charge you. In plain English that means.

the interest rate will be so high that you won’t benefit from paying off your existing debts with a new loan.

Would It Make A Difference If You Had Good Credit?

The whole premise of a debt consolidation loan is to shift debts with high interest rates into a new loan with lower interest rates and usually lower monthly payments. So if you had good credit and can secure a new loan with a significantly lower interest rate and better terms, then yes, under certain circumstances this makes sense. But even in this “perfect” scenario, there are many pitfalls. In fact, before anyone considers borrowing money to “shift” debts I recommend that they “prove” that they can handle it. Not prove to a lender, but prove it to themselves.

Beware The Bad Credit Debt Consolidation Loan Scams

It should be no surprise that there are a number of “scams” out there when it comes to this type of loan. The most prevalent of these involves getting unsuspecting people to pay up front fees in order to “process” their application. Of course, in most instances the application is denied and the scam artists keep your money. There are other debt consolidation scams as well. You can read more about them here.

Why Not Getting A Bad Credit Debt Consolidation Loan Is A Blessing In Disguise

You cannot borrow your way out of debt. And taking on even more credit, when you are already up to your eyeballs in debt can be (and usually is) a true disaster in the making. A very high percentage of people who take on more credit to shift existing debts, end up in even more debt within a short period of time.

Because they haven’t dealt with the real money problems in their lives. They slapped on the “debt consolidation loan bandage” thinking it would stop the bleeding, rather than making the hard decisions and implementing the life changing actions they needed to. Actions that would help them to get out of debt. and not simply shift their debt. which is all that a bad credit debt consolidation loan will accomplish. So don’t worry if you cannot get a debt loan because of your poor credit. There are much better options available to you.


The truth about hard-money loans #secured #personal #loans


#hard money loans
#

The truth about hard-money loans

Q: What is a “hard money” loan?

Hard-money lenders do not rely on the creditworthiness of the borrower. Instead, they look to the value of the property. The lender wants to make sure that if the borrower defaults, there will be sufficient equity in the property over and above the amount of the loan. Accordingly, you will not get a hard-money loan of 80 or 90 percent loan to value; typically, they will range from 50 to 70 percent loan to value.

Such loans are considered loans of last resort. If you are unable to get a conventional loan from a bank or mortgage broker, you may be forced to negotiate with a hard-money lender, who often are private individuals lending money from pension plans.

And beware: Those loans are more expensive and often have more onerous terms than the standard mortgage backed by the federal government, Fannie Mae or Freddie Mac.

Who typically gets such a loan? If you have bought a house and haven’t yet sold your existing one, you might get a hard-money bridge loan. They are typically short-term. Other users are homeowners with bad credit but lots of equity in the home who want to avoid foreclosure. Unfortunately, from my experience, all too often the hard-money lender ends up owning the property.

There are many legitimate hard-money lenders. However, as in every profession or industry, there are some bad apples. Some hard-money lenders are loan sharks whose sole objective is to take your house away from you.

If you need a short-term loan and decide to confront a hard-money lender, have your attorney review all of the legal documents the lender will ask you to sign. You want the money, but you don’t want to lose your valuable home.

Q: We have a time share that we want to deed back to the resort, but they want $1,750 to take back the deed. We are in our 70s and want to know if we can just give the deed back without paying the fee.

Can they put a lien on our house? We don’t care about credit ratings, since we pay cash for everything.

A: You cannot just “give away” the deed. It has to be accepted by the resort and recorded among the land records in the county where the property is located.

If the resort will take back the deed and relieve you from any and all further obligations, I would jump at that opportunity. Obviously, I would try to negotiate a lower buyout or try to work out a payment schedule. However, from the many readers who have time-share problems, your situation is unusual.

I do want to comment about your statement that you don’t care about your credit rating. You may pay everything in cash and be a multimillionaire, but there may come a time when you will need credit, and a poor credit rating can, and will, haunt you for the rest of your life.


The Truth About Payday Loans #how #to #consolidate #student #loans


#bad credit loans not payday loans
#

The Truth About Payday Loans

What is a Payday Loan?

Payday loans can be very costly. Borrowers should use them with caution and pay the amount back as soon as possible. These loans are usually priced at a fixed dollar fee, which represents the finance charge to the borrower. Because the loans have such short terms, the cost of borrowing is very high. In return for the loan the borrower usually provides the lender with a pre-dated check or debit authorization.

How Does it Work?

Say your car broke down and you decide to borrow $300 for the repairs from a payday lender. You ll write a post-dated personal check for $340 (the amount plus a finance fee) made payable to the lender. You enter this information online when applying for a payday loan through the internet. The lender then advances you $300 for a set period, usually 14 days. When that period is up, you pay the lender $340 in cash, let them deposit the post-dated check or write another post-dated check for the amount plus an additional finance fee. If you do not pay the debt in full at the end of the term, you will be charged additional fees and finance charges.

Get a Free Credit.com Account Sign up for Credit.com and get your FREE Credit Score & Personalized Action Plan to help improve it. Free & updated every 30 days.

Who Uses These Types of Loans?

Generally, anyone with a checking account and steady income can obtain a payday loan. However, it is most common for borrowers who don t have access to credit cards or savings accounts to use this type of lender. Since these loans don t require a credit check, people with no credit or credit problems often turn to payday loans. Military personnel and recent immigrants also commonly use payday loans.

What Are the Benefits?

Payday loans can be a good tool for quickly and easily borrowing cash during an emergency if you don t have other financial options. For example, you might use a payday lender for an immediate and temporary financial need such as a medical bill, car repair or other one-time expense. Payday loans are helpful for people who don t have credit cards or savings available. Because the loans do not require a credit check, they are easy for people with financial problems to obtain.

What Are the Negatives?

It is crucial that you repay a payday loan as soon as possible. Many people get into trouble with these types of loans when they are unable to quickly repay the debt. If you can t repay the loan at the end of the term, you ll be charged expensive additional fees. It is very costly to be stuck in a payday loan cycle for a long time and can lead to larger financial problems. Payday loans are also much more expensive than other methods of borrowing money. In most cases the annual percentage rate (APR) on a payday loan averages about 400%, but the APR is often as high as 5,000%. A standard credit card has an APR of 12% and a standard loan APR is around 7%. If possible, it is better to use a credit card or tap into your savings in the event of an emergency.

What About Usury Laws?

Numerous states have very specific laws that regulate the lending industry. Called usury laws these regulations define permissible lending terms and rates. Some states also have laws that regulate the amount a payday lender can lend to consumers and how much they can charge for the loan. Other states ban payday lending outright, such as New York. These laws vary widely. Payday lenders often work around these regulations by partnering with banks based in other states, such as Delaware. It is important to read the fine print on the payday loan offer and understand your consumer rights. You can read Credit.com s summary of state-by-state payday loan restrictions online.

Should I Apply for a Payday Loan?

Before you consider applying for a payday loan, step back and consider your options.

Ask yourself if it really is an emergency. Payday loans can be helpful for one-time emergency costs such as medical fees but are not a good idea for funding unnecessary expenses. Is it possible to wait to repair your car or pay your bills until your next paycheck? Remember, a $25 late fee on a bill is cheaper than a $40+ finance charge for a payday loan. Think about other ways to borrow money:

Alternatives to Payday Loans

  • Negotiate a payment plan with the creditor
  • Charge the amount to your credit card
  • Receive an advance from your employer
  • Use your bank s overdraft protections
  • Obtain a line of credit from an FDIC approved lender
  • Borrow money from your savings account
  • Ask a relative to lend you the money
  • Apply for a traditional small loan
  • Ask your creditor for more time to pay a bill
  • Use a cash advance on your credit card

If you have evaluated all of your options and decide an emergency payday loan is right for you, be sure to understand all the costs and terms before you apply.

  • Shop around for a trusted payday lender that offers lower rates and fees.
  • Borrow only as much as you know you can pay back with your next paycheck.
  • When you get paid, your first priority should be to pay back the loan immediately.

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What Can I Do to Prepare for Financial Emergencies?

You can t always predict an emergency, but you can be prepared. Ideally, you should keep enough money to cover your household expenses for two months in a savings account. If this goal is too high, aim to save at least the amount of one paycheck. It is also a good idea to have a few credit cards available for unexpected costs. If you don t have a credit card, you can search for a credit card online.

Now that you know all about payday lenders, you can decide if this kind of loan meets your needs. Payday loans can be useful for consumers who need emergency cash for a short period of time. These loans come with high costs and many dangers. If you have limited options and if you understand how to use payday loans correctly, you can make the most of these services.

To learn more about payday loans and to find other options for personal loans, read more from our experts by visiting our Loans Learning Center .

Comments on articles and responses to those comments are not provided or commissioned by a bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by a bank advertiser. It is not a bank advertiser’s responsibility to ensure all posts and/or questions are answered.

Please note that our comments are moderated, so it may take a little time before you see them on the page. Thanks for your patience.


Truth about small business grants from the government #debit #card #loans


#small business funding
#

Truth About Small Business Grants From the US Government

By Robert Longley. US Government Expert

Robert has logged over 26 years of experience in municipal government in Texas and California cities. He has also served as About’s Guide to U.S. Government since October 1997.

You can also read more about Robert’s current and past work on his Google Profile: Robert Longley .

No matter what you may have read on the internet or seen on TV, the truth about small business grants from the U.S. government is that there are none.

However, there are some very specialized federal and grants available to small businesses that — like most government grants — come with some catches .

These grants are available only to businesses in specific fields or industries identified by the federal or state government as being especially important to the nation or state as a whole, such as medical or scientific research and environmental conservation .

Some Special Government Grants are Available

Just like most federal grants. SBIR grants are awarded on a competitive basis, with potentially hundreds of businesses competing for the same grants. As a result, the application process itself can involve sizeable expenditures of money and time.

Similar to federal SBIR grants, state government agencies sometimes offer discretionary incentive grants to businesses that, in the agencies opinion, help stimulate the state s or region s economy and advance beneficial causes such as alternative energy development.

However – as the SBA points out – the stringent eligibility requirements for these state government grants often target larger employers and prevent many smaller businesses from successfully competing for them.

The Grants Bottom Line

In the words of the SBA, if you are seeking free money to launch or expand your business, forget about it. Not only are government business grants difficult and often expensive to apply for, the governments awarding them typically demand some return on their taxpayers investment. Businesses getting these grants are strictly required to perform as promised by developing and selling new technology and benefiting the regional economy.

As the SBA recommends, most small businesses or potential small business owners with a good business plan. a viable market. a great product or service, and a passion to succeed, are far better off seeking small business loans than government grants.


A Bad Credit Debt Consolidation Loan. The Honest Truth #get #a #loan


#debt consolidation loans bad credit
#

A Bad Credit Debt Consolidation Loan

Are There Better Options?

I hate to be the bearer of bad news but a bad credit debt consolidation loan is not the answer to your debt problems .

Why?

For two reasons.

1. If you already have bad credit you face three challenges.

a) getting the loan in the first place

b) getting a big enough loan to meet your needs, and

c) getting the loan at an interest rate that actually saves you money and helps you pay down your debts faster.

and

2. Debt consolidation loans, whether you have bad credit or good credit, are usually not effective in getting people out of debt unless they make other, more important changes in their life and financial habits.

My guess is that I’m probably not telling you something that deep down in your heart you don’t already know.

But take ‘heart’.

not getting a bad credit debt consolidation loan may be a blessing in disguise.

I’ll touch on this later.

YOUR BEST SOURCE FOR A BAD CREDIT

DEBT CONSOLIDATION LOAN

WARNING. I want to start by making it very clear that I DO NOT recommend short term bad credit loans as a method of debt consolidation or debt relief. There are much better options available to you. To learn more about these options I recommend that you find an independent debt counselor that can evaluate your situation, help you prepare a debt plan, and recommend the appropriate debt relief option. You can either meet with a counselor in person where you live, or, if it is more convenient, you can discuss your situation over the telephone. The debt counselors that I recommend offer a free initial telephone consultation after which you will have a debt reduction plan in place as well as an estimate of your potential savings. If you wish, you can contact them here .

NOW. I know that many people will nonetheless ignore this warning and continue their search for such loans. Therefore, I want to make sure that you at least get the best loan, at the best rate to suit your needs. The solution? Deal with one loan broker who works with over 70 lenders to get instantly approved and the best deal.

a) You can apply online.

c) Your cash is deposited overnight into your bank account.

Talk to an independent senior debt counselor today (for free) and receive a personalized debt reduction plan.

Alright, let’s have a closer look at the reasons why a new bad credit loan is not the answer to your debt problems, help you avoid the bad credit debt consolidation loan scams that are out there, and more importantly, discuss some bad credit debt relief options that actually may work for you and get you on the path to debt freedom.

First Things First. Ask Yourself. Why Do You Have Bad Credit?

I ” don’t know.

Do ” you “?

No, really. Do you know exactly why you have bad credit? If you don’t, then this should be the first thing that you investigate. Were you late on your debt payments? Have you missed debt payments completely? Are you facing a hardship in your life like divorce, job loss or an unexpected illness that has lead to events that have affected your credit score/report? You need to understand the reasons intimately before you can decide on a debt relief plan of attack. (And you certainly need to know this before you consider a bad credit debt consolidation loan.) I’ll touch on this more in the next section. For now let’s look at the challenges of consolidating your debts with a new loan when you have bad credit.

Challenge #1: You have bad credit. You are already in significant debt. In other words, any lender will likely look at you as high risk. Sorry, but that is the truth. The fact is, you are going to have a difficult time just finding a debt consolidation lender who will work with you. (But take heart, this may be a blessing in disguise. In fact I know it is. Keep reading.)

Challenge #2: If you are looking to get a bad credit debt consolidation loan, chances are you have a significant amount of debt. (If you only have a small amount of debt then my advice to you right now is to forget about consolidating your debts altogether. It won’t be worth it.) But if you do have significant outstanding debts, and bad credit, your chances of securing a big enough loan to pay off your existing debts is slim to none. (Remember however, that even if you did get the loan, you are not reducing your overall debt obligations by merely shifting your debts from one creditor to another.)

Challenge #3: Let’s say that you do find a lender who will not only lend you the money, but lend you a large enough sum to consolidate all of your existing unsecured debts. Now you’re in business! But wait, they will want to be compensated for extending a large, unsecured loan to someone with bad credit won’t they? And that compensation will come in the form of the “risk” portion of the interest rate they will charge you. In plain English that means.

the interest rate will be so high that you won’t benefit from paying off your existing debts with a new loan.

Would It Make A Difference If You Had Good Credit?

The whole premise of a debt consolidation loan is to shift debts with high interest rates into a new loan with lower interest rates and usually lower monthly payments. So if you had good credit and can secure a new loan with a significantly lower interest rate and better terms, then yes, under certain circumstances this makes sense. But even in this “perfect” scenario, there are many pitfalls. In fact, before anyone considers borrowing money to “shift” debts I recommend that they “prove” that they can handle it. Not prove to a lender, but prove it to themselves.

Beware The Bad Credit Debt Consolidation Loan Scams

It should be no surprise that there are a number of “scams” out there when it comes to this type of loan. The most prevalent of these involves getting unsuspecting people to pay up front fees in order to “process” their application. Of course, in most instances the application is denied and the scam artists keep your money. There are other debt consolidation scams as well. You can read more about them here.

Why Not Getting A Bad Credit Debt Consolidation Loan Is A Blessing In Disguise

You cannot borrow your way out of debt. And taking on even more credit, when you are already up to your eyeballs in debt can be (and usually is) a true disaster in the making. A very high percentage of people who take on more credit to shift existing debts, end up in even more debt within a short period of time.

Because they haven’t dealt with the real money problems in their lives. They slapped on the “debt consolidation loan bandage” thinking it would stop the bleeding, rather than making the hard decisions and implementing the life changing actions they needed to. Actions that would help them to get out of debt. and not simply shift their debt. which is all that a bad credit debt consolidation loan will accomplish. So don’t worry if you cannot get a debt loan because of your poor credit. There are much better options available to you.


The Truth About Payday, Pawnshop and Car Title Loans – US News #online #loan


#compare payday loans
#

The Truth About Payday, Pawnshop and Car Title Loans

They may put you in worse financial shape than when you started.

Desperate times call for desperate measures. Lost explorers may resort to eating bugs to survive, pressured athletes may cheat to win and those in financial trouble may take on dangerous loans to tide them over until they’re financially stable. What they may not realize is that these seemingly innocent loans often cause consumers to end up in worse shape than when they started.

It’s easy to understand why consumers flock to payday, pawnshop and car title loans – on the outside, they just look like convenient ways for people with subprime credit to borrow money. However, there’s no such thing as easy money. Read on to learn the truth about these three risky loans, and find some alternatives you should consider instead.

Payday Loans

How they work: The payday loan process usually begins with you writing a post-dated check for the loan amount plus interest and fees. When the loan is due, the lender collects the balance unless you choose to roll the loan over (in exchange for more fees, of course).

Why they’re dangerous: These loans boast notoriously high interest rates that make it almost impossible for borrowers to pay off their balance on time. Even if they pay a small amount each payday, this often just covers the interest and fees, leaving the balance intact. Richard Cordray, the Consumer Financial Protection Bureau director, said in a statement last year that payday loans are long-term, expensive debt burdens: “For too many consumers, payday and deposit advance loans are debt traps that cause them to be living their lives off money borrowed at huge interest rates .” It should come as no surprise that payday loan borrowers often find themselves needing to rollover or take on new loans, trapped in a vicious cycle of debt.

Pawnshop Loans

How they work: Pawnshop loans typically involve you giving the pawnshop an item that you own (like a television, piece of jewelry or computer) as collateral, and the pawnshop lends you a percentage of the item’s value.

Why they’re dangerous: These loans are short-term and typically have very high interest rates and a variety of fees. If at the end of the loan period you can’t afford to pay the balance plus interest and fees, the pawnshop may keep your item and sell it.

Car Title Loans

How they work: Like pawnshop loans, car title loans use one of your possessions (in this case, your automobile) as collateral to secure a short-term loan for a fraction of what your car is worth – provided that you own the car free and clear. Just sign over the title of your car, and hand over a set of keys.

Why they’re dangerous: As with payday and pawnshop loans, these secured loans typically come with very high (often triple-digit) interest rates and loads of hidden costs, from storage fees to repossession fees. This brings up another huge red flag – if you miss just one payment, fail to pay the fees or aren’t able to pay the interest accrued on the loan by the end of the term, your car could be sold or repossessed. Also, since title loans are often only 30 days long, borrowers only have a short amount of time to pay the principal, interest and fees. Since they usually aren’t able to pay everything back when it’s due, they often renew the loan and the nightmare begins all over again.

How Do These Loans Affect My Finances?

The most redeeming qualities about secured loans are that lenders typically won’t check your credit, and the loans aren’t reported to the credit bureaus. But while you’re frantically trying to gather enough money to pay off those loans, you may neglect paying off things that do affect your credit. So while they may not directly affect your score, know that secured loans can still cause trouble for your credit health .

Alternative Options

Even if you’re strapped for cash, you don’t need to agree to ridiculously high interest rates. Instead of taking on risky loans, consider these other options:

  • Short-term loan products: Small banks or credit unions may offer you loans with better rates and repayment terms.
  • Asking for an extension: If you call your creditors before you miss a payment, they may be willing to give you a due-date extension or work out a payment plan.
  • Borrowing from loved ones: It may be uncomfortable, but asking friends or family for a loan could still be a better alternative than secured loans. Just be sure to pay them back – you don’t want to burn bridges.
  • Payday advances: If you have a benevolent employer, try asking for a payday advance. Since it’s your money, not a loan, you’ll save money on interest.
  • Emergency assistance programs: You may find emergency assistance from community organizations or social services programs. Contact your local Department of Human Resources to inquire about options.
  • Cash advances on credit cards: While not ideal, the 25 to 30 percent in interest you may be charged for a cash advance is certainly better than triple-digit interest via the loans covered earlier.

Final Thoughts

Personal finance experts always recommend building up an emergency fund so you can avoid dangerous situations that are hard to escape. If you’re not desperate for money yet, don’t wait until an emergency strikes. Avoid living paycheck to paycheck at all costs, even if you have to trim your spending and live less comfortably.

If you’re in a situation where you need to borrow money quickly, don’t let emotions lead to rash decisions. Assess whether you’ll realistically be able to repay the loan or not, and be wary about lenders who don’t check your credit or income to make sure you can afford the loan. Other red flags include loans that have astronomically high APRs, loans that don’t advertise the APR and situations in which funds can be automatically deducted from your checking account.

It may seem hopeless, but you can get through this tough time without taking on a secured loan. Just remember: Evaluate your options, know what you’re getting yourself into and breathe.

Jenna Lee is the social media manager for CreditKarma.com. a free credit monitoring website that helps more than 22 million people access their credit score for free.


The Truth About Credit Card Debt. #parent #student #loans


#credit card debt consolidation
#

The Truth About Credit Card Debt

from daveramsey.com on 04 Aug 2009

Myth: Aren’t there positive uses of a credit card? Like rebates and airline miles?

Truth: Responsible use of a credit card does not exist. Credit card debt is a major problem in America.

There is no positive side to credit card use. You will spend more if you use credit cards. Even by paying the bills on time, you are not beating the system! But most families don’t pay on time. The average family today carries $8,000 in credit card debt according to the American Bankers’ Association.

Now let’s talk about the rebates. If you were using a credit card at 5%, you would have had to have spent $80,000 to get $4,000 rebates on new cars that lost $6,000 of value when you drove them off the lot. That is not a good deal!

Cash vs. Credit Cards

When you pay cash, you can “feel” the money leaving you. This is not true with credit cards. Flipping a credit card up on a counter registers nothing emotionally. A study of credit card use at McDonald s found that people spent 47% more when using credit instead of cash. This is money you could have saved!

If you “have to” use plastic, I suggest a debit card. I use them for travel and the occasional convenience of ordering something over the Internet or phone. Other than that, I use cash.

Personal finance is 80% behavior. You need to cut out habits that make you spend more. You do not build wealth with credit cards. Use common sense. When you play with a multi-billion dollar industry and you think you’re going to win at their game, you are naive. You cannot beat the credit card companies.

Start living on cash today! Dave’s budgeting forms are a great, free way to begin.

Save $500 or more on your insurance by using Dave’s Endorsed Local Provider .


The Truth About Car Payments. #loan #sharks


#monthly car payment
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The Truth About Car Payments

from daveramsey.com on 22 Mar 2010

I ll always have a car payment.

You ve probably heard that comment before, right? You might have even said it yourself with a defeated, woe-is-me tone of voice. So what s the deal? Are car payments really just a way of life?

Well, that s the normal way of thinking. But, as Dave always says: When it comes to money, normal is broke. You want to be weird, and weird people don t have car payments.

So how, exactly, do you live without a car payment?

Here s the deal. Recent statistics show that one-third of car buyers sign up for a six-year loan at an average interest rate of 9.6%. Among these buyers, the average price of the car is just over $26,000. This means that one-third of the cars you see on the road are dragging a $475 payment behind them.

The car dealer won t tell you that your awesome new car loses about 25% of its value the instant you drive it off the lot. After four years, your car has lost about 70% of its value!

What does that mean? After six years, you ve paid almost $33,000 for a $26,000 car, which is now worth maybe $6,000. Not a good deal.

Here s a new plan. What if you bought a cheap $2,000 car just to get around for 10 months? Then you take that $475 the average car payment save it every month, and pay for a new car (with cash!), instead of giving it to the bank.

After 10 months of doing that, you ll have $4,750 to use for that new ride. Add that to the $1,500 2,000 you can get for your old beater, and you have well over $6,000. That s a major upgrade in car in just 10 months without owing the bank a dime!

But the fun doesn t end there. If you keep consistently putting the same amount of money away, 10 months later you would have another $4,750 to put toward a car. You could probably sell that $6,000 vehicle for about the same price you paid 10 months before meaning you now have $11,000 to pay for a car, just 20 months after this whole process started.

The bottom line with this exercise is simply this what could you do with that $475 if you weren t paying for the car every month? Anything you wanted!

Think about it this way: If you were to invest that $475 (remember, this is the average car payment in the U.S.) into a good mutual fund with a 12% rate of return, you would have over $100,000 in 10 years! At 20 years, you would have made $470,000. And at 30 years? That mutual fund would be worth $1.6 million!

The numbers will make your head spin, but it really just comes down to simple math. The less money you are spending on your car every month, the more money you have to put into other more important things: your kids college fund, your retirement, and paying off any other debt you might have.

If you ll just follow this simple plan, your life could be dramatically different 10 years from now. You can live without a car payment!

Interested? Watch the video to learn how to drive free and retire rich!

Save $500 or more on your insurance by using Dave’s Endorsed Local Provider .


You Asked, We Answered: The Truth About Debt Consolidation Companies #bad #credit #car #loan


#loan consolidation companies
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You Asked, We Answered: The Truth About Debt Consolidation Companies

Regardless of whether you binge on shopping or simply use credit cards to make ends meet, there may come a time when you need a financial intervention to help organize your bills, repay your debt, and improve your finances. For some, debt consolidation is the answer. But before you jump in head first, it s time for a course in Debt Consolidation 101.

1: When Should You Use a Debt Consolidation Company?

Debt consolidation combines multiple debts into one, single payment, with the purpose of simplifying your repayment schedule and lowering your overall monthly payment amount. A debt consolidation company may be able to help you pay off your debt more quickly and alleviate some of the stress associated with paying bills. So if you have mounting unsecured debt (e.g. credit card bills, store cards, medical bills, student or personal loans, accounts in collection, etc.), working with a trusted debt consolidation company is something to consider.

For these plans to work, you should have some form of income. A debt consolidation company will then work with you to craft a repayment plan based on a realistic monthly payment amount you can afford, as well as advocate on your behalf to your creditors and make your debt more manageable.

2: What Types of Plans are Available?

There are two methods of debt consolidation. Both methods achieve the same result but differ in their approaches. Your success hinges upon your ability to understand these differences and pick the right plan for your needs:

  • Debt Management – This strategy consolidates unsecured debt into a single monthly payment that you send to a debt consolidation company. That company then distributes the designated funds to your creditors. The debt consolidation company works directly with your creditors to secure benefits that help you fulfill your obligations over time. Such benefits may include interest rate reductions, late and over-the-limit fee waivers, and reduced monthly payments.
  • Debt Settlement – This plan helps people who can t repay their debt in full and facing bankruptcy. Under this arrangement, your debt consolidation company will approach your creditors with an offer to settle your accounts for a portion of the amount owed.

A good debt consolidation company can help you choose the best plan for your financial situation based on your income level, type of debt, and ability to make consistent payments.

3: Do All Providers Offer the Same Service?

No! Just as each person s financial situation is unique, so too are debt consolidation companies. Locate a partner that offers various plans and expertly guides you to the right solution based on your needs, not their balance sheet.

Call each company you re considering and ask directed questions about their service offerings. Then, compare the fee structure and services of multiple providers so you can assess each company s reputation and accreditations. Identify the pros and cons about both debt management and debt settlement plans so you can determine which service will best help you succeed.

Additionally, many debt consolidation companies offer more than just service plans, so look for a full-service partner that will not only help get you out of debt, but will also teach you how to remain out of debt in the future. Tools to look for include:

  • Free educational resources
  • Monthly newsletters packed with legislative or regulatory updates and how they may impact your credit standing, expert advice, timely articles about budgeting and other relevant topics, etc.
  • 24-hour account access online or by phone
  • Money management tools ranging from loan calculators to budgeting worksheets and more
  • An online community filled with real advice where you can connect with like-minded people facing similar challenges

4: Are There Bad Debt Consolidation Companies?

Yes! Fail to choose the right company and you could end up in a worse situation than when you started. When you begin your research, try a simple online search to help determine which debt consolidation company is the best. You may even enter the search term good debt consolidation company. Just be careful; the results may not be pleasant if you get mixed up with an unethical provider. To prevent this disaster, follow these tips:

  • Don t accept a plan from a company that hasn t reviewed your financial situation.
  • Don t be lured by companies promising government money to erase your debt. There are no government programs that do this.
  • Read proposed fee schedules carefully. New laws prohibit for-profit companies from charging upfront fees. So if this type of provider wants to charge you fees before they have negotiated an agreement with one of your creditors, they re not legitimate. Non-profit companies have been urged to follow this regulation, but aren t forced to, so the bottom line is to be cautious and careful. Read everything and only agree to what seems reasonable.

5: Is it Important to Work with a Best-Rated Debt Consolidation Company?

Yes! Accredited debt consolidation companies are a worthy choice. Narrow down your search by identifying trusted debt consolidation companies whose solid reputations will provide creditors with an added sense of security, which will translate into better benefits for you. For example, look for debt consolidation companies that are accredited Better Business Bureau businesses, ask friends, family members and co-workers for recommendations.

Debt consolidation plans work most effectively when you choose a reputable and accredited company, stick to the plan and, ultimately, address how you got yourself into debt in the first place. After all, you need to retrain your spending habits, better budget each dollar you earn, live within your means, and possibly remove all credit cards from your wallet, so you re not tempted to use them. With the right plan and right debt consolidation company, you CAN survive your debt.

If you liked this you may also like:

If you have lots of debt, consolidation may save you time and money. Depending on your financial situation, there may be a solution that s right for you.

Debt relief comes in many forms- credit counseling, debt consolidation loans, settlement and even bankruptcy. Each solution will help you get out of debt, but the long term impacts and fees can vary greatly. Understand the myth and reality behind your debt relief options.

Feeling overwhelmed by your debts? Having trouble making ends meet? Unable to get ahead of your credit card debts? A Debt Relief plan may be your solution to getting control of your finances.

When faced with mounting bills, many consumers explore debt consolidation loans as a way to get their finances back on track as quickly as possible. And while a debt consolidation loan may be a great solution for you, it s important to weigh your options to determine the best plan for you and your specific financial situation.

There seems to be a running joke that New Year s resolutions never last. (Why else would we have to keep making them every year?) But if you take the right approach to a resolution such as getting out of debt , there s no reason you can t be successful. If you ve been working to get out of debt and are not happy with your progress, or feel that you are starting to backslide, it s probably time to reassess your budget and fine-tune your strategy. The best way to get started is to: get organized, assess your current situation, develop a strategy that works for you, and make sure your goals are realistic.

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