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smart debt

Debt

Am I Eligible For A Home Loan?

It’s now harder than ever for young people to get on the property ladder. House prices are rising astronomically. They’re far outstripping the increase in wages. That means the gap is getting wider and wider for first-time buyers. It’s a difficult time to invest in property, and that’s why home loans are more important than ever.

The only question is, do you qualify for a home loan or mortgage? To answer that question, there are lots of factors to consider. You income, credit history, and your location all determine your eligibility. We’ll start by running through the basic questions that all mortgage lenders will ask. It should give you a rough idea of whether you could qualify for a loan.

Do you have a deposit saved up?

To purchase any property on the market, you need a deposit. Mortgage lenders unfortunately won’t even consider your application without a deposit. Typically, you’ll need between 5% and 20% of the house value just to get started. Many brokers ask for 10% minimum. This minimised the lender’s risk slightly, and proves that you can afford a substantial portion of the property. So, before you approach a mortgage advisor, make sure you know how much deposit you can afford.

September 8, 2015

Debt

The Quick Way To Get Out Of Debt

Being in debt is like having a black cloud hanging over your head all of the time. Nobody wants to owe money, so the best thing you can do is get out of debt as fast as you can. For some people it may take only weeks/months. For others, it may take years. However, if you’re consistent, you should be able to get out of debt pretty quickly.

Set Up a Direct Debit Payment

By setting up a direct debit payment, you won’t even need to think about sending the money over. This won’t give you a chance to decide not to and do something else with it either!

August 13, 2015

Debt

Secured & Unsecured Loans: Which Is Best For You?

If you have been looking into consolidating your debts, or freeing up cash for an essential purchase, then you will have come across secured and unsecured loans. But which one is best for your situation? Find out right here.

Secured & Unsecured Loans

There is a simple difference between secured and unsecured loans. Secured loans are seen by lenders as lower risk because they are taken out against your assets – usually your home. If you don’t pay, the lender can foreclose your home and sell it. Unsecured loans usually have higher interest because they are far riskier for the lender to make; you are just promising to pay them back. So which one is better for your situation?

July 10, 2015

Debt

What You Need To Know About Variable Home Loans

Variable loans are one of the most common types of mortgage loans offered today. The variable home loans are not like fixed loans. If you opt for variable loans, the rate of interest on your loans will vary with the market index. Thus, with these loans, you have the opportunity of paying lower rates when the market rates go down. However, you have to be prepared to pay higher rates of interest when the rates goes up. These loans add a lot of flexibility to the deal. You do have the option of paying lower introductory rates and additional payments. If you want you can pay off extra as an advance towards the loan.

What’s the difference between fixed and variable home loans?

If you are applying for a mortgage loan you should consider the differences between choosing the fixed and variable home loans. With the fixed loans you are not required to worry about the increase in rates. The rates on the loan taken by you will be locked for the entire loan tenure. It makes budgeting way easier since you are completely sure of what you are repaying. However, one of the biggest problems of fixed home loans is that you are not able to make the most of the lower rates of interest in accordance with a rate drop. Another important factor to note is that you are often not allowed to make additional payments with a fixed rate without a fee or without limitations. As already mentioned above, variable home loans allow you to make extra payments without paying a fee, as well as without limitations. As well, if you are fortunate enough to see a drop in market rates during your own loan tenure you can save up a lot of money in interest.

June 15, 2015

Debt

Five Common Mistakes Most People Make When Applying For Loans

According to the latest statistics of the World Bank, the economic status of the Philippines has a mixed record. On one hand, there has been an overall increase in life expectancy, Gross National Income, per capita income, and IBRD/IDA operations approved over the years. But, there has been a gradual decrease in the overall level of statistical capacity, annual GDP growth, and current account balance. The World Bank also states that the economy of the Philippines is the 39th largest in the world, which is quite an impressive number and in recent years, it has emerged as a market in both the import and export domains.

With a fast-developing market, the cost of living has also increased. Because of this, making loan in the Philippines is very difficult. Whether you are a small business owner or private individual seeking to build a house or buy a car, you will definitely seek major loan at least once in your life. However, applying for a loan isn’t that easy. It takes a lot of comparison, calculation, and pooling up of resources to get it written on paper. It also does not ensure that your loan will be fault free. Therefore, for the benefit of the progressive Filipino, I have listed the top 5 mistakes people made in taking out a loan and some guidelines on how to avoid them.

June 3, 2015

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