Apply For A Credit Card

Be Prepared When You Apply For A Credit Card by Sintilia Miecevole


Getting and having a credit card can be a beneficial thing for most people. You will have a big advantage when you have a credit card. A credit card can be especially useful when you want to purchase items remotely. Think how much easier it is to make purchases online, and reserve plane fare or hotel rooms over the phone when you have a credit card. It can also come in handy when you just don't happen to have cash when you decide to make a purchase. However, there is a flip side to having a credit card! A credit card can cause several problems if you don't watch your spending habits closely. When you get and use a credit card, you should recognize that you have taken on a big responsibility with some very serious consequences. Following the simple tips below can keep you out of trouble when using your credit card and allow you to enjoy all benefits:

1. A charge on your credit card is the same as taking out a mini loan! Keep track and make sure you don't overcharge on your credit card, as you have to be able to pay back all whatever amount you have borrowed.

2. Watch the balance on your credit card and keep a record of the balance from month to month. Keeping track of what you have already spent will help you make the decision of whether you can use your credit card for any additional purchases. Even the small $5 purchases you make here and there can add up on a credit card if you don't watch out...and then the interest will also add to your balance owed.

3. Keep your credit card receipts until the end of the month and compare them to your monthly credit card statement. This practice will allow you to catch any incorrect charges, or sometimes you may catch a purchase you never made! If you do find discrepancies between your receipts and your statement, call your credit card company right away.

4. Neither a lender nor a borrower be! That is a good motto when it comes to your credit card or credit card number. Don't give these out to anyone! Even though you may trust your family and closest friends, you cannot keep track of purchases you are not making.

5. Make it your habit never to charge more than you can pay back. When you do charge more and don't pay it back, it can hurt your credit rating and will affect your future chances of getting credit approval. This can include important purchases you may make in the future, like car loans, home mortgages and other kinds of loans.

6. Pay your bills on time! When you pay on time, you will save on accruing interest and extremely high finance charges for late payments. If you miss a payment, finance charges and interest just keep adding up, making your balance get higher and higher.

7. Try to pay all of your credit card balance in full each and every month. Put credit card payments into your monthly budget, and don't purchase more than that allotment each month.

8. Remember you are responsible for $50 of any unauthorized charges on your credit cards.

9. Keep your credit card for new purchases only. Don't pay off other household bills with your credit card. This will inevitably lead to more charging and higher balances.


About the Author
Sintilia Miecevole has a host of experience regarding credit cards. She has a site http://www.flycreditcard.com to provide you with the information you need to use your credit card wisely. Be sure to visit http://www.flycreditcard.com for an expert resource of features with information for personal and business credit cards.

Credit Repair Report

Credit Repair System by Steven Hall


The Credit Repair System has tools available that helps many debtors find relief. Credit repair system is the steps to recovering from debts, while getting back on your feet again. If you have bad credit, you already know how difficult it is to reestablish a respect in society. Struggling down many roads, I know you have asked over in your mind, "How can I get out of debt?" The truth is we all have had bad times and some of are able to get back on our feet again quicker than others do. Therefore, you are not alone in this fight to reestablish credit. Even rich people have filed bankruptcy, so do not think you are centered out from the rest of the world. In this article, I am going to make it quick and to the point, helping you get out of debt through the process.

Repair System Kit

I will guide you through a process that will lead you step-by-step through credit repair.

1. Get copies of your credit report from TransUnion, Equifax, and Experian.

2. Overview your credit report watching closely for errors (bills you did not accumulate).

3. Dispute any errors on your credit report immediately with the three credit bureaus.

4. Once your report is clear start saving money, but cutting back, increasing your income, and continues disputing other debts that may occur if necessary.

5. Lay out a budget that matches your monthly installments, a separate budget that comes close to your debts as possible, and finally a budget that meets your demands on survival after you have cut back funds.

6. Finally, start paying on your secured loans first, and work through your unsecured loans gradually.

If you follow these steps to the letter, you will eventually see where it pays off. Starting with step one we can see we need to know where we are out before we can get out of our situation. Having a basic overview of your report regularly can prevent your credit scores and ratings from being affected by errors or identity theft.

Step 1 is a basic outline of where you are at, where you are going, and how you will get there.

Step 2 is obvious. If you find errors on your report, the first thing you want to do before paying your debts is to clear up the wrong that has been done to you.

Step 3 is also obviously, since you want to find a solution to repairing your credit. If you save money by cutting back, finding a way to make more money, and budget you will have a guaranteed strategy to getting out of debt.

Step 4 the budges should match your financial situation allowing you to repay your debts and survive in the process. The budgets if carefully developed will allow you additional funds for savings if you plan your strategy right.

Step 5 once you start paying off your credit you will notice almost immediately a result. The result may be a rise in your self-esteem and confidence, but it is a start to a better future.

There is nothing more rewarding than being free of financial obligations. When you walk out in the public your friends, family and neighbors will acknowledge a nature high, and ponder on how they too can be like you. If you follow the steps you will not only notice results of relief, you will also notice an increase in your income. In addition, if you have any debts that have not hit the collection agencies, find a solution for getting those bills up to date. You can call your creditors in the first four weeks of late bills and let them know your situation, including your financial status to repay the debt. Often creditors will make arrangements for your to pay each month on your bills. Make sure you meet your creditors' expectations, since they took a chance on you in first place.

This is the ultimate credit repair system that will get you out of debt.

Debt Repair Agencies, Debt Consolidation, and other sources are often out to take advantage of the vulnerable, so relying on your self to get out of debt is the only system guaranteed to work most times.

About the Author
Steve Hall is the owner of http://www.your-official-guide.com , your one-stop location for getting the information you are looking for on a wide ranging and ever-growing list of subjects.


Credit Repair And Avoiding Court by Steven Hall


If you ever entered a courtroom, you know that the stress elevates, even if you are in the room for someone else. Courts are an automatic source for lifting stress. Moreover, to avoid the courts means we have to abide by laws and pay our debts. If you have taking out a home mortgage, car loan, personal loan, or any other type of credit loan in some instances when the loans requirements are not meet you can be subpoenaed to court.

There are several courts that handle cases that involved negligence, starting with small claims court and finally judgment courts. Any courtroom is stressful, and many of the courts will look at both cases objectionable. However, the party involved in negligence is often deemed untrustworthy.

If you want to avoid more stress than what you will endure on bad credit reports, it is important to make wise decisions before spending money you do not have.

To avoid court judgments, liens or lawsuits it is important to meet payments on your monthly installments. If you find an area of your life when you see that it will be difficult to meet demands, you might want to look into some solutions available that can get you out of harms way.

If you are paying mortgage you might want to opt out by selling your home or else searching the marketplace for loans to help you refinance and get lower rates. When you owe money, your debts are sent to collection agencies.

Once you have a list of bad debts it leaves you open to court. Creditors are people you owe and if they send your debts to collection agencies, you might be waddling in quicksand since someone else has control of your life. If you are delinquent on payments creditors, can garnish wages from your paychecks, take hold of all your tax refunds, and send you to court.

The only advantages you have when you have debts are the creditors cannot charge outrageous late fees or interest rates. The creditors cannot take a post-dated check from you and cash it until they notify you first. Creditors cannot cash a postdated check ahead of its date. Creditors cannot ask for postdated checks by frightening you with criminal suits. Creditors are not permitted to send post cards in an effort to ask for payment, nor can creditors label, or place symbols outside of an envelope to press for payments.

There are many areas of legalities and illegal acts to look for if you are in debt and threatened with lawsuits, liens, repossessions, foreclosures, and judgments. Some of the most important areas of illegal acts made by collection agencies include false unlawful authorization forms, or sending out a representative of the collection agency posing as an officer of the law.

Some creditors even harshly threaten debtors by using profanity or harassing family members by imitating government representatives.

Creditors have even tried cashing postdated checks and attempting to charge late fees for insufficient funds.

It is important that you learn your rights when your credit is in jeopardy. If you are taking to court and know your rights, you might see a way out of a bad situation. If your know your rights you might even find a way to avoid court by taking another route to stall payments.

Some collection agencies have even threaten debtors by phoning their home at late hours of the night, calling friends, family and neighbors, and so on. If you suspect you are heading down bad credit path, then it is important to document all communications between collection agencies, lenders, and other sources so that you are prepared when or if you hit the courtroom. If you see that you cannot avoid court then you want to take all the necessary steps to cover your self when you arrive on the door that is taking your control out of your hands. It is important to know that you can trust only you in most cases.

When your faith is in someone else's control the worst possible situation can happen. In most cases, however, there is always a solution to the problem and you have the right to stand up and take back some of your control.


About the Author
Steve Hall is the owner of http://www.your-official-guide.com , your one-stop location for getting the information you are looking for on a wide ranging and ever-growing list of subjects.

Home-Equity Line of Credit

10 Things to Look for in a Home-Equity Line of Credit
by Tim Paul


If you are a homeowner, you've probably received offers to apply for a home equity line of credit (HELOC). Handled with care, home equity credit lines can be an excellent way to improve financial flexibility, provide readily available cash reserves for emergencies, or pay for large expenses (like college tuition or home improvements) that have irregular payment schedules. But be aware that not all home equity credit lines are created equal. If you decide that a HELOC is right for you, what features should you look for? Here are ten things that should be at the top of your list:

1. No application fee (or fee should be refunded at closing) - The HELOC market is very competitive. Some lenders may charge a fee to help cover their costs of processing your HELOC application and to ensure applications are received only from seriously interested homeowners. If your lender assesses an application fee, be certain that it is refundable at closing. Otherwise, look elsewhere for your HELOC.

2. No appraisal or closing costs - The market value of your property is key to determining the amount of your credit line. Some lenders are willing to use publicly available tax assessment data in lieu of formal appraisals. Others may absorb appraisal costs to attract customers. Either way, there are enough no-cost options available that you should not have to settle for HELOC lender that charges appraisal costs or any other closing costs.

3. No account maintenance or check-writing fees - Lenders obviously make their money when you write checks (borrow) on the home equity credit line. Most lenders make it as hassle-free as possible with free checks and, sometimes, even debit cards. If your lender charges fees for the privilege of having a HELOC checking account, look elsewhere

4. No "non-usage" fees - The market value of your property is key to determining the amount of your credit line. Some lenders are willing to use publicly available tax assessment data in lieu of formal appraisals. Others may absorb appraisal costs to attract customers. Either way, there are enough no-cost options available that you should not have to settle for HELOC lender that charges appraisal costs or any other closing costs.

5. Variable APR equal to or near the prime rate (adjusted quarterly) - The only cost involved with a good home equity credit line should be interest charged (APR) on the balance borrowed. As with any loan, the borrower's goal is to get the lowest possible APR. Most lenders use the "prime rate" as published in the Wall Street Journal (or other publication) as a base index and charge you an APR equal to prime plus or minus a marginal percentage (e.g. 0.25%). Search for the best rate available, but be aware of low "teaser" rates that may suddenly change after a brief introductory period or be accompanied by special fees. Also, keep in mind that the periodic and lifetime caps on rate changes are as important as the initial rate (see below).

6. Periodic cap on interest rate changes (the amount that the rate can be changed at one time) - Virtually all HELOC's are variable rate loans meaning that the initial interest rate (APR) will change at some point as surely as the weather. A key is to understand how often the rate can adjust and how much the rate can be adjusted at one time. Of course, when rates are falling the larger and faster the change, the better for you. But more important is the upside risk you face when rates are rising. Look for a HELOC that adjusts quarterly (rather than monthly) in increments of 0.5% or less. Note: with expectations of rising interest rates, many lenders appear to be eliminating the periodic rate cap feature and raising lifetime caps to legal limits. If you have an older HELOC that incorporates relatively low rate ceilings (or if you find one), consider yourself fortunate!

7. Lifetime cap on rate increases (the amount that the rate can be adjusted over the loan's life) - A good HELOC is something you'll want to keep for awhile. Although interest rates have been at relatively low levels for a number of years, it wasn't too long ago that a 10% loan was regarded as a bargain! The point is that interest rates over time can rise dramatically. You'll want to find a HELOC with a lifetime rate cap that you can live with. Ask your loan officer to clearly spell out the "worst case" scenario for rate increases for the HELOC you are applying for.

8. Ability to convert to a fixed rate loan - When rates do rise, people often get skittish about their variable-rate debt. A useful feature to look for in a HELOC is the ability to convert the line of credit to a standard fixed-rate, fixed-term home equity loan (HEL). You likely won't get an APR as favorable as a newly issued HEL, but you also won't have appraisal or closing costs to pay if you convert. However, note that many lenders charge a fee for converting to a fixed rate loan.

9. Interest-only payments allowed - It is usually best to make regular principal payments on your HELOC balance. Yet a job loss or other emergency can make it a challenge to keep payments current. In these situations it is nice to have the flexibility to lower your HELOC payment as much as possible without increasing your loan balance or raising red flags at the credit rating agencies.

10. Unrestricted ability to repay principal without penalty - On the other hand, you also want the flexibility to pay down principal on the loan when you choose. You may get a bonus from your job that you want to apply to the loan or you may find a 0% balance transfer offer that is worth taking advantage of. In any case, a key component of a good HELOC is the unfettered ability to repay principal.

Shop around and you will be able to find a home equity line of credit with many (if not all) of these features. Keep in mind that your bank is not the only game in town. Credit card companies, mortgage bankers and brokerage firms have all entered the market and offer competing products. Credit unions typically offer excellent terms and should not be overlooked. Also, there are many reputable on-line sources that have lower overhead costs and may be able to offer better terms than the local bank.



About the Author
Tim Paul has more than 25 years executive financial management experience. His current areas of focus are developing strategies to maximize the benefits of HELOC loans and free college savings programs. His websites are HELOC Loans - Tips for Savvy Users and 529 Plan Rewards - Helping Parents Maximize College Savings


Bad Credit Student Loan
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Personal Finance Planning
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personal bank loan

Hidden Bank Loan Charges That Would Make a Pick-Pocket Envious
by George A. Parker


There can be more to a bank business loan than making interest and principal payments. Your firm may get a great rate on its new credit line or term loan but you may cry on the way home when you discover the hidden fees and charges.

Even seasoned borrowers can be caught off guard. Borrowing costs can be boosted by thousands of dollars and the effective rate on the loan increased by many basis points as a result of these hidden charges.

Here are some of the fees and charges that can increase your firm’s costs on bank loans:

Commitment fees

Many banks charge commitment fees of ½% - 1% or more to issue a commitment to lend money. The fee is calculated on the available credit amount. Commitment fees significantly increase the effective rate on outstanding loans.

These fees can be negotiated. If your firm has a strong credit profile or if the competition among banks in your area is fierce, ask for a lower commitment fee or ask to have it waived.

Non-use fees

These fees may be charged in lieu of or in addition to commitment fees. Non-use fees usually range from ¼% to ½% of the unused credit facility. Although these fees are less onerous than commitment fees, they also increase the effective borrowing rate.

As with a commitment fee, you may be able to get the non-use fee reduced or waived if your firm has a strong credit profile or if the banking environment is very competitive.

Restructuring fees

When your firm has reason to restructure an existing loan, you can expect your bank to charge a restructuring fee for the privilege. For example, if your company has reason to convert a short-term loan into a long-term one, it will probably be charged for this restructure.

These fees can range from ½% to 2% or more plus any bank legal fees or out-of-pocket expenses. If your firm has been a long-term bank customer in good standing, you may be able to negotiate or eliminate the fee. But don’t expect to eliminate the bank’s attorney fees and out-of-pocket expenses.

Bank attorney fees

Attorney fees usually come into play when the bank uses an outside law firm. Making matters worst, many outside bank attorneys require a borrower to hire an outside attorney to issue an opinion letter covering the transaction.

Usually, only the strongest borrowers in very competitive banking situations can totally eliminate paying bank attorney fees. However, if your firm is a valued customer, your bank may be willing to have these fees capped or reduced. Often banks have some leverage with their law firms to get a discount.

Appraisal/environmental evaluation fees

These fees are charged on many asset-backed loans. They usually involve bringing in an outside expert to evaluate equipment or real estate. These fees can be significant, depending on the type of appraisal or environment issue.

Like attorney fees, appraisal or environment evaluation fees are almost always for the account of the borrower. Perhaps the best result one can expect is to have these fees capped or have the lender split the amount in some way.

Unanticipated audit expense

Many banks reserve the right to audit borrowers or to send bank personnel in for inspections. An audit may be required to review accounting procedures or to monitor collections, inventory or another aspect of your firm’s operation. Also, some banks require outside audits by CPA firms in connection with extending credit. Any of these scenarios can create significant expense and involve a substantial time commitment for your firm.

Before signing, review your loan agreement carefully to identify any audit or bank inspection requirement. If your bank requires an audit or inspection that you did not anticipate, try to get it eliminated or try to negotiate limits. You may be able to get a less-stringent requirement or to negotiate a less-expensive alternative to the audit or inspection required by your bank.

If all else fails, try to get audit or inspection fees capped.

Late charges

Charges for making late payments to your bank are generally in your control. These charges can be onerous and can add significantly to your firm’s borrowing cost. It is not unusual to see banks tack 300 basis points onto a customer’s borrowing rate for delinquent payments.

While it is worthwhile during the negotiating stage of the loan to ask for a lower late- payment charge, the best solution is to try to avoid these charges. If you can, try to get the late-payment rate knocked down to 75 to 150 basis points above your borrowing rate.

Expiry of or Failure to Get a Rate-lock

In a stable rate environment, many banks are willing to lock the rate on fixed-rate credit transactions. Rate-locks protect the borrower from adverse rate movements prior to closing. In most cases, rates can be held up to 60 days. Rate-locks are not uncommon in real estate loans and equipment installment loans.

If your firm is negotiating a fixed-rate loan, try to negotiate a rate-lock. You may pay loan interest that is a tad higher, but a locked rate can eliminate an unpleasant interest rate swing.

Once you have locked the rate, try to stay within the holding period for closing the transaction. Most banks will eagerly and aggressively pass on rate hikes in a rising rate market, if you fail to comply.

Many hidden bank fees and charges can be reduced or eliminated if you plan ahead and are prepared to negotiate. You are in your strongest negotiating position before your bank issues a commitment letter and before you sign the credit agreement. Always read commitment letters and loan agreements carefully. Look for hidden fees, hidden charges and unexpected requirements. You can also ask your bank to prepare a separate list highlighting all potential fees and charges.


About the Author
George Parker is a Director and Executive Vice President of Leasing Technologies International, Inc. (“LTI”). Headquartered in Wilton, CT, LTI is a leasing firm specializing nationally in equipment financing programs for emerging growth and later-stage, venture capital backed companies. More information about LTI is available at: www.ltileasing.com.



Bad Credit Home Loan
Home-Equity Line of Credit

Bad Credit Home Loan

Tips For Getting A Low Downpayment
by Jamie Madison


Most people dream of the day when they can finally buy their own home. Homeownership remains one of the highest goals for many people because it includes many benefits. When you're home, you enjoy a sense of security and belonging that simply cannot be found with renting. For many people, buying a home represents personal and financial success.

There's also a lot of personal satisfaction in living in a home that you own. Real estate is still considered a valued investment which can have many financial advantages and tax benefits. The amount of interest you pay on a home loan and the real estate taxes you pay on your home are among the few major federal tax deductions. Owning a home is the primary way most people build wealth.

Despite the many benefits of owning a home, there are still countless people for whom this goal remains slightly out of reach. For more and more families, saving the money for a down payment is the biggest obstacle to homeownership. Many people mistakenly believe that you have to come up with a down payment equal to 20 percent of the price of a home.

Traditionally, lenders have required that home buyers be able to make a down payment of at least 20% of a home's purchase price to get a home loan or mortgage. However, mortgage lenders will grant home loans to qualifying home buyers with a down payment of as little as 3 to 5 percent of the purchase price, if the mortgage is insured.

In fact, home loans with down payments of less than 20% are increasingly popular. They are called "low down payment mortgages." HUD homes are usually available with low down payments and attractive financing. This is good news for the millions of home buyers who are finding it difficult to save a large down payment, especially for their first house.

There are few ways to make a low down payment possible. Simply put, mortgage insurance protects the mortgage lender against financial loss if a homeowner stops making mortgage payments. Lenders usually require insurance on low down payment loans for protection in the event that the homeowner fails to make his or her payments.

When a homeowner does not make mortgage payments, a default occurs and the home goes into foreclosure. Both the homeowner and the mortgage insurer lose in a foreclosure. The homeowner loses the house and all of the money put into it. The mortgage insurer will then have to pay the lender's claim on the defaulted loan.

For this reason, it is crucial that the family buying the home can really afford it -- not only when they buy, but throughout the time period of the loan. Although the cost of the mortgage insurance is paid by the home buyer, or borrower, the mortgage insurer works directly with the lender. Mortgage insurance is available to commercial banks, mortgage bankers, and savings & loans, and all of which offer mortgage loans to home buyers.

The minimum effective down payment required by FHA is less than 3 percent. For single-family homes, there is a limit on the loan amount that varies according to geographic area. Anyone can apply for FHA insurance despite common myths. However, there are sales prices limits, so check with your lender. The VA program is limited to qualified, eligible veterans and reservists. The USDA Rural Housing Service insures loans for the construction and purchase of homes in rural communities. This program is very specialized, so contact your lender for the details.

With the wide variety of loans available, home buyers have the freedom to choose the type of loan that best suits their needs. Early on in the home-buying process, it is a good idea to meet with several lenders to compare the types of mortgages they offer and shop for the best price and terms. Best of all, working with a mortgage insurer can be very easy -- whether your loan is insured by the FHA or a private mortgage insurer -- because your lender handles all of the arrangements. By making lending money to home buyers safer, mortgage insurance helps more families get into homes of their own.


About the Author
Learn all the details about getting a home. Perfect for first time homebuyers and investments property. FREE Foreclosure Listings are also available here: http://www.michellegreene.com/hud.htm


Bad Credit Home Loan
Apply Online and Keep Your Credit Score as High as Possible
by Carrie Reeder


If you have a poor or bad credit history with something in your past like a bankruptcy or a foreclosure, you know how difficult it can be when you try to get financing for a home mortgage purchase, refinance, home equity or second mortgage loan. Its important to be persistant in looking because there are home mortgage loans out there for people with bad credit.

There are many articles online that will tell you to be wary of subprime lenders, those lenders who specialize in doing hard to approve loans. There are many things to be careful of with subprime lenders, who can charge interest rates that are far too high and have unreasonable pre-payment penalties. However, if you shop around and talk to many different mortgage brokers, you should be able to find a lender that can get you approved and with an interest rate and terms that are fair.

The best way to make sure you are getting the lowest interest rate and terms possible, if you are looking to get approved for a mortgage loan after a bankruptcy or foreclosure, is to apply with as many different lenders as you can. You will want to compare as many mortgage loan quotes as possible to make sure you are choosing the best one.

When you have a low credit score and are applying with sub prime lenders, the main thing you need to be careful of is to make sure that your credit report is not pulled until you have pretty much decided which lender you are going to want to work with.

Every time your credit is pulled by a mortgage lender, your credit score will drop just a tiny bit. That is why you need to be careful. Sometimes even as little as a 5 point drop in your credit score can be the difference between getting approved or turned down for a mortgage loan. Most mortgage lenders, especially those that specialize in hard-to-approve home loans need a credit score of 585 - 600 or higher in order to do 100% financing with no money down on your home loan. The bottom line is, you will need that score to be as high as possible.

Most lending institutions will not want to pull your credit report initially, until they are sure you are serious about getting approved. It costs the lender money to pull your credit, so it is in their best interest to wait until they know you are serious before they pull your credit report. So, make sure when you apply for a mortgage loan, that your credit is not being pulled with your initial application. When applying for a mortgage loan online, here are some ways to know that your credit is most likely not being pulled.

1. Did they ask you to describe your credit? If they asked you to describe your credit, that is because they are probably not going to pull your credit initially.

2. Did they ask for your social security number? If they don't have your social security number, they can't pull your credit.

3. Search their website to see if they tell you whether or not they will pull your credit report initially. It may be listed under their frequently asked questions.

To view our list of recommended lenders who do purchase financing or refinancing
for people with bad credit or less than perfect credit, visit this page:
ABC Loan Guide. It is an informational loan website with informative articles and the latest finance news.

Adverse Credit Personal Finances

Adverse debt levels blight UK consumers personal finances
by Richard Green


Debt levels are at an all time high in the UK. The younger generation tend to be feeling the pinch the most, but parents are increasingly being required to bail them out, often at great expense to their own limited mortgage or retirement savings.

It has become almost accepted as a fact of life that graduates will begin their careers with a considerable level of personal debt. The Association of Investment Trust Companies found that on average students expected to graduate with £7,208 of debt, while parents believed it would be nearer to £9,741, however the real average was found to be currently running at £13,501. Graduates then need to service credit cards, take out a mortgage, then cover the payments, repay university loans, not to mention the pressure to start saving earlier, and save more, for their retirement, whilst the basic state pension increasingly becomes inadequate. The government revealed in June that student debt for 2003-04 was seven times higher than they were in 1994-95 and the Student Loans Company has shown that debts owed to them has risen to more than £13bn.

It is not only students who face financial difficulties early in life. Consumer Credit Counselling Services - Scotland, has indicated that young adults in general, under the age of 25, now account for more than 10 per cent of the estimated 32,000 people who have fallen into severe arrears on non-mortgage debts of more than £1 billion.

Malcolm Hurlston, Chairman of the Consumer Credit Counselling Services (CCCS) said, "It is noticeable that young people are accounting for an increasing proportion and the number of them seeking assistance has risen by about 25 per cent over the past two years or so."

Analysts have been bracing themselves for news of a sharp increase in adverse debt levels from the major high street banks following report figures of a 21 per cent increase in bad debts levels at Lloyds TSB. City analysts expect HBOS and Royal Bank of Scotland to declare that bad debt charges have risen by around 20% in their personal banking businesses, and Barclays, HSBC and Alliance & Leicester are all expected to tell a similar tale of rising loan defaults. Citigroup analysts are expecting bad debt charges from its retail banking division to rise about 24% in the first half of this year to £230m, while last year HBOS’s provisions for bad debt rose from £1bn to £1.2bn.

Keith Stevens, of the chartered accountants firm Wilkins Kennedy, said: "Creditors profit by lending money to people and collecting interest, and the longer they can keep that cycle going the better for them. Unless borrowers own property of significant value, it’s often not in creditors’ interest to call in their debts." He also continued that he believed some creditors were increasingly taking a hands-off approach, allowing debtors to pile up large amounts of debt, and then collecting interest and penalty charges for as long as borrowers were able to continue paying. This has lead to an increase in the number of borrowers filing for bankruptcy themselves when previously they would have been forced into it earlier by their lenders.

House repossessions have also significantly increased over the past year, with the Council of Mortgage Lenders announcing 4,640 home repossessions during the first half of 2005, compared with 3,070 for the last half of 2004. Government figures show that there has also been an increase in the number of homeowners being taken to court for mortgage arrears.

Some of the major banks and financial service providers have taken the initiative and started to help police the growing adverse debt problems with HSBC announcing that it will share their full credit record, of both positive and negative information, on its personal customers with other regulated financial services companies through the Experian, Equifax and CallCredit credit reference agencies, in efforts to keep tabs on its consumers' debt.

Michael Geoghegan, Chief Executive of HSBC said: "It is no more in the interests of a customer to borrow more money than they can afford than it is for a bank to lend them the money." The move has been widely heralded by analysts, as Michael Geoghegan added, "It is the only way to ensure that lenders properly understand the full financial exposure of customers before they let them sign up to debt that some simply can't afford."

This all comes amidst media pressure for financial firms to become more responsible. One case widely featured in the news concerns a couple who took out the £5,740 loan at 34.9% APR for house improvements, but they were already in arrears on two prior mortgages, and became unable to keep up the loan repayments. Over the course of the 15 year loan term the amount repayable had escalated to £384,000. Attempts by the loan company to still enforce the huge debt, eventually had to be fought off by the couple through the law courts.

The couple urged others considering taking out a loan to seek advice and to, "obviously read the small print and ask the questions that perhaps you don't think about at the time, and just make sure you know exactly what the consequences are should anything go wrong".

There are currently many sources of information to help consumers make decisions regarding their finances and debt levels. Financial comparison sites like Moneynet can provide impartial information on loans, mortgages, adverse credit, etc, to find the best product for individual circumstances. Consumer help sites like the National Debtline provide free confidential and independent advice on how to deal with debt problems, and the Citizens Advice Bureau are there with trained volunteers to help with legal, monetary and other problems, through a free, independent and confidential advice service.

The more help and information that is available to consumers and the more responsible the lending agencies become, the safer finance will be for the most vulnerable who are looking to borrow money, to prevent them getting into un-repayable levels of debt, however these services can only be of help if people actually use them.

Malcolm Hurlston of CCCS said, "We are advising about 4,000 people in Scotland and I would estimate that our figures represent only about one in eight of those who need help".

Financial education is something needs to be provided at an early stage to make people realise the importance of taking on the accountability for their own finances, as well as highlighting where to access help for when it is required. Budgeting is a subject many school leavers have little practical knowledge of, but one which they desperately need to be made aware of before they start to control their own finances.

Where there is existing advice or help, this must be made available and known to all in order to prevent more people getting too deeply into debt, or falling prey to loan sharks like the recent case of Mark Washington Johnson who has been jailed in Birmingham for nearly four years. Mr Johnson was found guilty of charging up to 8,000 per cent interest on loans, taking Social Security benefit books or National Insurance numbers as "security" for the unauthorised loans and then piling on default charges for missed payments. If we are to prevent this sort of abuse occurring to the weakest members of society then public awareness needs to be raised and the most vulnerable people given the assistance best suited to understand and control their own money.




About the Author
Richard lives in Edinburgh working for bigmouthmedia, occasionally writing for the personal finance blog Cashzilla, and considering the possibility of there being intelligent life on Earth.

Tips for Home Buying

Tips for First Time Home Buyers
by Jeffrey Ragan


Tips for First Time Home Buyers

When looking at tips for first time home buyers, you've come to the right place. Many people are looking all over the Internet for reliable information. There's over 761,940 websites (as of March 05) with information or online forms urging you to fill them out for more details.


While I certainly agree the Internet is a great place for obtaining tips for first time home buyers, it can also become a real information overload as well. So I want to give you some tips that can help in your search.

Tips for First Time Home Buyers #1

Don't be too quick!

Avoid giving out your personal information like Social Security number, date of birth etc. at every website that asks for it. This is the single biggest mistake I've seen made. Some first time home buyers in their zeal to get started do this.

The problem is this, many sites will require this information before they'll give you any details.

They start out with a simple, name and address screen, then lead into screens that ask for more personal details.

At all costs, hold off giving out this private information. You will have to at some point in time. Not until you've learned about the mortgage process should you do this.

What happens when you fill in the forms online? Your e-mail box will be flooded with loan offers. Many places tout they'll have 4 lenders or even more give you quotes.

Guess what? Nearly every one of these lenders are going to run a credit report. If you have numerous inquires in your credit in one month, this can affect your credit score.

Another reason to be careful here is that most of these websites are lead generators. The company or webmaster will sell your information to one or perhaps even more sources and then we have a BIG problem.

It can costs you in your credit score. The lower your credit score, the higher your interest rate will be. The higher your credit score the lower your interest rate.

Tips for First Time Home Buyers #2

Work with someone you trust.

How can you determine if that person is honest and trustworthy?

Listen to them closely. Are they trying to hurry you along to get your personal information?

Or are they taking the time to explain things and help you to understand exactly what you're about to get into?

Buying a home is the single biggest investment most people make in their lifetime. Then afterwards, managing that debt is important also.

You want to work with someone who will help you do this. They should be interested in a long term relationship with you.

Over your lifetime you'll get more than 1 mortgage. I know, it's hard to imagine that now, but statistic's show that on average people move or get a new home loan about every 7 years.

Having someone you trust, that has your best interest is what you need. I look at it this way, if I do a good job for you, you might tell 1-2 of your friends. If I did a bad job for you, you'll tell 100 of your friends.

I build my mortgage business 1 loan at a time. I love referrals so I take a personal interest in each and every borrower. My customers talk about me to their friends!!

Tips for First Time Home Buyers #3

Choose your Loan Officer wisely.

Now because of the Internet, home lending has become a big business. Mortgage Brokers and Lenders have popped up everywhere. Many have also fallen by the roadside at the same time. The money business is HUGE!

Did you know that over 1.3 TRILLION dollars changes hands around the globe everyday?? When you start to think about it, it staggers your mind.

Your First Time Home Buyers loan is just a very small part of daily business.

There's a big difference between a lender and a broker. Brokers are middle men between you and the lender. They get paid for brokering your loan. They also can help you get loan offers from many lenders.

Since the mortgage broker gets wholesale pricing, this can be good if it's done without running your credit every time. That's why I say choose your Loan Officer wisely.

Many times when working with a broker, you may not know who your lender is until the day of closing. Again, this is still alright if your loan is locked, you know all the details of the loan product and so forth.

What's important is that the Loan Officer has revealed all the correct information. Is it a fixed rate loan? Is it an ARM? Is the interest rate what he quoted you in the beginning??

I can't tell you how many times I've heard horror story's about last minute changes.

The buyer finds out that their closing costs are more, the interest rate is higher etc. When you're at the closing table, the buyer's there, the seller and the realtors. What are you going to do??

If you go ahead and close because the pressures on, it's going to cost you thousands of dollars over the years.

Many ruthless loan officers have done this to first time home buyers and just don't care. They may never see your face anyway. You're just a paycheck to them.

Working with someone you trust can help avoid this problem and save you money. Dealing with a loan officer who is on your side will protect you.

Nevertheless if you've been taken advantage of, this is a RESPA violation and they should be reported.

About the Author
Jeff Ragan is a loan officer interested in helping people understand the mortgage process.

Too many people have been taken advantage of by unscrupulous loan officers. His website has dozens of informative pages to help first time home buyers save time, money and mistakes. Feel free to visit to learn more.

Buy a home through your home computer by Kris Grant


If you're thinking about buying or selling a
home, a good place to start your search is on
your home computer.

A recent study by the California Association
of Realtors (C.A.R.) finds that Internet
homebuyers are twice as satisfied with the home
buying experience than traditional buyers.

The C.A.R., which conducted the landmark study
entitled "Internet vs. Traditional Buyers" in
fourth quarter 2000, found that Internet home
buyers typically find their Realtors online,
while traditional buyers usually find a Realtor
through happenstance - the Realtor 'farms'
their neighborhood or they call to get
information on a "For Sale" sign.

According to the study, traditional homebuyers
looked at 15.1 homes with a Realtor before
making a purchase, while Internet home buyers
looked at only 7.9 homes with a Realtor prior
to buying.

The reason, says Gary Thomas, C.A.R. president,
is that Internet buyers spend more time doing
their "homework" on the Internet. Internet
buyers spent 6.3 weeks researching the real
estate market vs. traditional buyers who spent
just 2.2 weeks prior to contacting a Realtor.

"By the time Internet buyers contact a Realtor,
they have a good understanding of what they
want -they know where they want to live.
They've investigated neighborhoods and they
know how much they can afford and what their
mortgage options are," Thomas said. The C.A.R.
study found that, overall, Internet homebuyers
are "completely satisfied" with the home buying
process (96%) vs. traditional home buyers (44%).

Internet homebuyers are also more "completely
satisfied" with their Realtors (73%) than
traditional buyers (34%).
Internet buyers typically purchased a more
expensive home ($403,752) than did traditional
buyers ($321,950). And, not surprisingly,
Internet buyers achieved a higher level of
education than traditional buyers.
Internet buyers contacted an average 4.6 Web
sites (excluding mortgage Web sites) as part
of their home-buying process.

The most popular real estate portals are
Realtor.com and HomeAdvisor.com. These sites
provide valuable information on the home buying
and selling process, along with all the homes
listed on the national Multiple Listing Service
(MLS). Internet buyers can view homes in any
community they wish online, 24 hours a day.
They can remain anonymous and not feel
pressured by a real estate agent. But if they
want a home's address, that's another matter.
That's the main drawback to the national sites:
addresses of homes in San Diego (or elsewhere)
are not provided. The Internet homebuyer will
have to contact a real estate agent to obtain them.

One real estate portal that does provide
addresses of all San Diego County homes on the
MLS is www.HouseRebate.com. In addition, the
site provides information on the home buying
and selling process as well as discounts to
homebuyers and sellers in the form of cash rebates.

Homebuyers can also find additional listings
that aren't on the MLS by perusing large
national sites such as Century21.com,
ColdwellBanker.com and Prudential.com. These
sites show their own listings including
addresses, but not other broker's addresses.
Through the power of the Internet, the
knowledge base has switched to the consumer,
and with that knowledge comes power: the power
to demand discounts on real estate commissions.
Previously, this knowledge base was only
available to licensed Realtors. Now, homebuyers
can expect to be rewarded for their online time
spent researching potential properties.
At the HouseRebate.com site, for example,
buyers simply register and then they can view
addresses of every home, condominium and
residential income property in the San Diego
area on their computer screen. They'll see all
the specs previously available only to licensed
Realtors, along with photos and asking prices.
Homebuyers can specify the city, Zip code,
price range, number of bedrooms and baths, size
of garage, square footage of house and square
footage of lot. They can also check off as many
options as they would like such as pool, den,
bonus room or storage. After the buyer submits
a request, they can view a list of homes online
with complete information, including
photographs, that meet their criteria. They'll
also receive daily automatic e-mail
notification of new listings that meet their
criteria. They can drive by and inspect from
the street any property without the pesky