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Debt

What Is A Mortgage Calculator?

House hunting can be a lot of fun and you may get caught up in the excitement of looking at a variety of homes and dreaming about what your life could be like if you owned one of them. Before you get too excited, though, it is important to do some number crunching to see how much house you can really afford. Forexample, the Halifax mortgage calculator is worth taking a look at. It is quick and easy to use and within a couple of minutes you will have a better understanding as to what types of mortgages are available to you. It will also help you to discover what type of mortgage you want.

Things to pay attention to when using a mortgage calculator:

Fixed or Variable Rate

Remember, not all mortgages are the same. There are many different types available to suit various needs. For instance, you may decide you want a fixed rate mortgage so you don’t have to worry about interest rate fluctuations. Alternatively, you may decide a variable rate works better for you because you predict interest rates will be low for a long time.

Length of Term

How long do you want your mortgage for? Do you want a 5 year term or just a 1 year term because you think you might be selling and moving within a short time of purchasing the home? A very popular term length is 5 years but people have their reasons for going for shorter terms such as if there is a much better rate for a shorter term, etc.

July 10, 2013

Debt

5 Tips For Minimizing Mortgage Debt

Mortgage debt can be one of the biggest financial burdens. Right now, people owe over 7 trillion dollars in mortgage debt. While the debt problem is steadily waning as we slowly climb out of the last economic crash, there are still millions of people flailing to get out of the deep end. For many, there is no end in sight as to when they will be pulled out. The government is trying to come up with relief efforts to alleviate people’s debt as a result of the housing bubble, but most financial analysts are saying it is up to individuals to do their best to minimize their own debt.

Here are 5 tips for minimizing mortgage debt:

Remortgage. When you apply for a loan with a lender and get approved for a mortgage, you are usually set up with an introductory rate, which usually has much lower interest rates. However, most people don’t realize that around the one-year mark your lender automatically reverts your mortgage to the standard rate, which means higher interest rates and thus a bigger mortgage debt. If this happens or you expect it to happen, see if you can negotiate with your lender on a more agreeable rate – they might even lower it.

Find another lender, pay back more capital, and build more equity in your property. According to a recent article in a lending expert blog, more and more people are finding it easier to shop around for another lender that has more agreeable rates. One of the reasons why people’s mortgage debts are so high is because the interest rates are making it harder and harder to pay back their loans. However, if you find another lender with lower rates, you can effectively be paying more of your loan off and swimming further and further out of debt.

June 14, 2013

Debt

5 Things To Consider Before Taking Out Student Loans

While taking out a college loan can be a valuable resource to afford a higher education, it is incredibly important to consider a few things before you do. About 60% of people who go to college take out student loans to supplement their tuition and other costs, but it can have serious implications, especially if you have trouble paying it back. Out of all the students that do rely on loans, a staggering percentage is having trouble paying them back. This is not the fault of the lender or even the interest rates, but mainly because of the dismal job market. Basically, new college grads are finding it harder and harder to find work.

Here are 5 things to consider before taking out student loans.

Make sure that you read between the lines. Often there might be hidden fees or changes of interest rates, which can severely affect your chances of ever being able to pay back your loans. A financial aid counselor should be able to guide you through all the terms of your aid package so that you aren’t missing anything. If you are, they will certainly point it out or answer any questions that you might have.

There are different types of financial aid that are available, so it is important to know which one works best for you. There are financial aid programs that offer loans that you will need to pay back or you can apply for a state or federal grant, which is essentially free money to be applied to your higher education that you don’t need to pay back. It’s wise to find out what you are eligible for, before you sign up for anything.

May 18, 2013

Debt

Should You Attempt To Pay Off Your Mortgage Early?

There are many pros and cons of paying off your mortgage early. Many homeowners would jump at the chance to pay off their mortgage if they could, but there are often many unforeseen circumstances if they do, like increased taxes and expenses. However, if you only have a few mortgage payments left it might be worth it to get it over and done with, because of the accruing interest it can put your last mortgage payment further and further away. While the homeowners market is still better than the renters market, it is important to know where you stand before you pay off your mortgage early.

For one, you could save a lot of money. A mortgage is just a fancy banker name for a home loan. With any loan there will typically be interest rates until you can pay it back in full. This is a clever way to adjust for inflation, which is important when it comes to a mortgage, because you will be making payments over a long period of time. If you pay your mortgage off early you could be saving a few hundred thousand dollars just in interest rates alone. Usually this is only worth it when you are about 10 years away from the end of a 30-year loan.

Next, by effectively getting rid of your mortgage payments you will have a lot less to pay for in terms of living expenses. This can give you more room to pay for things like vacations and other luxuries that you otherwise couldn’t afford. Or you can be smart with the extra money and invest it in the stock market or in another property and rent it out. When it comes to having extra money, it is always about finding a way to make it work for you.

May 15, 2013

Debt

Can You Borrow Money From Your Life Insurance Policy?

If you’re in a current situation where you need a significant amount of cash, but you don’t want to rely on your credit cards or take out a home equity or payday loan in order to get it, another option that you might want to consider is borrowing money from your life insurance policy. If you weren’t aware of the fact that this is something that you can do, it is, although we definitely recommend that you explore some of the pros and cons with taking out this particular kind of loan before making the decision to do so.

The Pros of a Life Insurance Loan

First, let’s explore some of the benefits that come with taking out a loan on your life insurance policy. One thing that people like most about this particular choice is that most life insurance loans tend of have a lower interest rate than a loan that you would take out with a bank. Plus, there is no pressure to pay the loan back. You will simply receive a statement at the end of the year letting you know how much is owed, including the interest (which tends to be between 5-9 percent). So, as you can see, there are some good things that come with taking out this kind of loan.

April 20, 2013

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