Posts Tagged ‘Interest Rate’

Tips For Saving Money on Your Home Loan

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Posted 06 Jan 2011 — by Admin
Category Saving news

The application process for a home loan can be complex and hectic. When borrowers get caught up in the moment, they often forget to angle for better deals.

Tips For Saving Money on Your Home Loan

The best way to save money on your home loan is to get the interest rate reduced. Cutting the interest rate by even a quarter point can save tens of thousands of pounds in interest payments over the life of the loan. Unfortunately, lenders are very resistant to cutting interest rates. The only bullet you really have in your arsenal is to bluntly state that you will take your business elsewhere if they do not cut the rates. Since the real estate market is cooling off, lenders are becoming more receptive to these suggestions since they no longer have loans just pouring through the doors. If the market heats back up, you can forget about the viability of this position.

If you are going to try to get the interest rate knocked down, information is your friend. You will have far more success if you can show the lender a better interest rate being offered by another lender. Look for marketing pieces by other lenders on the same or similar loans.

There is really only one definite way to cut down the interest rate on the loan. It has to do with points. If you have a pool of cash at the time of application, you can attempt to buy down the interest rate by paying more points at the outset. While lenders are receptive to this approach, most people do not have large piles of cash lying around. Scraping enough together for the down payment is usually a sufficient problem. Still, there are other ways to save money on your mortgage.

If a lender is charging you points on your home loan, they are highly negotiable. Lenders view points in a more flexible manner. The higher the value of the home you purchase, the more a reduction in points can save you money. If nothing else, you have nothing to lose by asking for a quarter or half point reduction.

Cutting the best deal possible at the time you apply for a mortgage is critical. Even small concessions by the lender can save you tens of thousands of pounds over the life of the loan.

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Big Savings With a Low Intro Card, If You Can

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Posted 18 Mar 2010 — by Admin
Category Saving news

Big Savings With a Low Intro Card, If You Can Follow The Rules. All of Them.

A common term you might hear in commercials or read in a print ad is ‘low intro.’ Those two words mean that a particular credit card has a lower interest rate when you first get it than it will after some time passes. The most commonly advertised low intro feature, in my experience, is something along the lines of this: ‘and this fantastic credit card is not only guaranteed to make you more attractive, but IT HAS A 0% APR FOR THE FIRST 12 MONTHS!!’ You’ve heard the latter part of that hundreds of times, I guarantee it. All it means is that, if your credit is delightful, you get a year of no interest on whatever your unpaid balance is. It’s shocking how few people know that.

Low intro is more of a feature a credit card can have rather than an actual category of cards, as the majority of available credit cards have a low intro interest rate. Of course it sounds good, and is good if you can get approved for it, but you might be asking just what exactly is the point. Is it just a marketing term that could save you a few pounds but mostly just dazzles the uninformed? Sometimes. Are people impressed by it without knowing what it means or even if they can get it? Usually, yeah. Does it have any actual benefit? Yes, potentially quite a bit.

A very beneficial side of a card with a low intro interest rate is that, if it’s rate covers balance transfers, as a few do, you can shift all of your debt to this one card that temporarily has very little or no interest, instead of on your other cards that are about to cost you a limb and two vital organs each. For each hundred pounds shifted to a low introductory rate card you can save around 12.50 a month. Nothing special until you multiply the 12.50 by 40 to cover the balance on your recent redecorating efforts then multiply by the number of months the intro rate continues. Now we are talking serious savings.

Low intro cards without balance transfers can help as well if you have a lot of spending sprees coming up and you want to only make the minimum payments on them. Be cautious, though, because that is a pretty bad habit to start. If you don’t get back to heavier payments when the low intro period ends, you might find yourself in a soup kitchen wearing your tee-ball jersey from first grade and a newspaper for underwear. Or you might just get charged a hundred pounds or so more than you’d like. Either way, avoid reckless payment-making after the intro period ends by paying down the balance each month.

Another tip; don’t get a low intro card because a telemarketer or letter or popup ad tells you it has 0% APR. Shop around for a reputable bank issuing a quality card. These will likely have easier terms to adhere to during the intro period. As with everything involving credit, low intro cards should only be acquired if you’ve done your research and read the fine print.

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Balancing A Budget And Saving Money

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Posted 11 Mar 2010 — by Admin
Category Saving news

Your finances are your business. But unfortunately it seems like you need an accountant to help you understand and decode the mysteries of balancing a budget or saving money. At some point you might need to get a loan. When that day comes, this article can help you understand which is the right one to get.

An unsecured loan is simply a loan you get based on your good name and your credit rating. Often the interest rates are higher on an unsecured loan than on a secured loan because the risk is higher to the lending institution. If, for some reason, you are unable to pay back the loan and the lending institution does not get any money back. However, your good name and your credit rating are potentially ruined.

On the other hand, a secured load is a low you get when you put up some assets. The advantage of a secured loan is that you often get more money at a lower interest rate for longer repayment period that you would with an unsecured loan. This is because you have some assets to backup your loan. The lending institution prefers this kind of loan because if you find yourself unable to make payments, they can see your assets as an alternative form of payment. Because the risk to them is diminished they are able to provide you with more attractive loans at a better rate.

You might think of a mortgage as a secured loan. The bank lends you money to buy a home and they use the home as a way to back up the loan. If you do not make your mortgage payments, the bank can seize your house.

Or you can think of a secured loan as a pawn shop that lends you the money you want but lets you still use the goods you pawned!

So which one is the right one for you? Its a tough decision to make. In most cases, a secured loan will get you a better rate, so you just might prefer that.

However, perhaps you dont have any assets available, or you dont want to risk the seizure of certain assets if you are unable to make payments. In this case, you just might not mind paying a little more for the benefit of having an unsecured loan.

Both unsecured and secured loans are good options to have when you are doing your financial planning. You can use them to consolidate your outstanding bills, leverage your home investments, or get the things you need and want. And, with the choices between unsecured and secured loans, you have the benefit of being in total control of your financial destiny!

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