Debt-To-Income Ratio

Negotiating on unsecured debt is the surest and fastest way to improve debt-to-income ratio, credit score and peace of mind. The best way to this is to contact a company with experience in the field of negotiations.

Recurring debt has a direct effect on the debt-to-income ratio which is is the percentage of a consumer's monthly gross income that goes toward paying debts. This ratio also known as the back ratio, which indicates the percentage of income that goes toward paying all recurring debt payments, and other debts such as credit card payments, car loan payments, student loan payments, child support payments, alimony payments, and legal judgments.

In simpler terms the debt-to-income ratio directly affects a persons ability to take on new debt. If income is greater than debt then the ability to take on new debt is present. If debt is greater than income then the ability to take on new debt is eliminated. It is that simple to understand. A negative debt-to-income ratio will also have a direct impact on credit score and credit report.

The most effective way to have a healthy debt-to-income ratio is to pay off loans in the time agreed with lenders and creditors. This will allow the luxury to take on new debt. What happens when the terms agreed on for re-payment are not met? Very simple, missed payments bring on collection efforts from creditors and collection agencies and maybe even legal action further on down the road. Credit scores will be reduced and credit reports will show negative marks thus making a person a liability in the eyes of lenders. If in fact a person reaches this situation, one of the best alternatives to bring this debt-to-income ratio back to health is to negotiate on the outstanding debt. The best way to this is to contact a company with experience in the field of negotiations.

Debt negotiation is geared to eliminate large amounts of debt as quickly as possible in the least amount of time which will help improve the debt-to-income ratio. This is a better alternative than having to endure the stigma of bad credit, collection calls and correspondence. In this situation it is advisable to negotiate one or two accounts at a time starting with the account with the least debt. Accounts that can be negotiated for settlements are categorized as unsecured debt. These accounts include but are not limited to credit cards, personal loans, medical bills, repossessions, unsecured student loans, etc.. Secured accounts such as mortgages and car loans cannot be negotiated for settlement.

Once all debt is eliminated it is advisable to begin a credit repair program. Credit repair programs will do just what their name suggests. They will contact the credit reporting bureaus and show proof that all accounts have either been settled or paid in full. Many of these services are inexpensive and credit could be back in good standing in as little as six to twelve months. The ability to take on new debt will then become a reality keeping in mind the mistakes of the past.

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Commercial Finance- The Mortgage Meltdown

This has impacted non-bank lenders such as private commercial finance companies that provide hard money real estate loans, purchase order financing and accounts receivable financing. Most of these firms have raised their prices and their origination standards for safety and soundness of operations.

The bottom line: Bank lending can be replaced by other sources such as commercial finance companies to some degree. Hard money, purchase order financing and accounts receivable financing will help some businesses grow during these difficult times. But for the average borrower, businessman, or business owner these are difficult economic times, caused by the mortgage meltdown, which are here to stay for several years.

Copyright © 2008 Gregg Financial Services

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Debt Consolidation To Improve Credit Ratings, Consider It

The notion of being in debt is almost a lifetime custom for a greater portion of American singles and families. Just under half of American families actually spend more than their annual earnings and as such have averaged and accrued, per household, roughly $10,000 in credit card debt. The averages are stark, but the numbers are real. And being real, raw numbers is actually in favor to those in debt as these debtors benefit from having so much due. "Benefit?" you might ask. Yes, this is so simply because real data can be manipulated, ameliorated and settled over time through various financial actions.

And of the numerous financial actions that prove advantageous for debtors, one in particular stands out for its capability to allow those in debt to take charge of their credit. This one specific option is none other than "Debt Consolidation."

The Process Is A Unifying One

Debt consolidation, in process, is one involving debtors the capability to combine assorted and unsecured debts together into one whole payment. Such debt to be included in the mix is most typically and popularly credit card debt. What does this mean for you, Mr. Or Mrs. credit card debtor? Well, keeping unity in mind, it means less of a hassle when it comes time to pay. Think about it. Through a debt consolidation company, no longer will you have to pay your credit card payments to various creditors on varying dates; rather, they pay your one lump sum payment for you.

The aim here, on part of debt consolidation companies, is to gather your debt, find ways to negotiate it's current bulk and inevitably pay it all down in a timely and methodical manner. More or less, it's a reduction process with intent to be rid an individual of debt for good.

A Reduction Process To Delete

Debt consolidation companies will take your information, analyze all accrued debt and surmise the best way to tackle a negotiation toward your creditors. Generally, the debt consolidation company you select will attempt to talk terms and whittle down your situation. They will negotiate a reduced interest rate and overall balance, not to mention a lower monthly payment. Even better, your debt consolidation company will aim for an elimination of late fees and will surmise a set term in which due debt is said to be paid and satisfied in full. All the previously mentioned actions will in turn most likely save you a great deal of money, speaking in terms of prolonged paying.

The Trick Before Healing That Credit Rating

Eliminating debt is what's being done here. But, before any erasing occurs you must first figure out how much you actually owe, calculating your gathering of various creditors' balances. List all your creditors and their corresponding amounts due. Also, list each monthly payment due for each creditor. By doing this, you will hence be able to ascertain how much you owe in total and can then determine how much of a consolidation loan payment you can afford.

And if consolidating proves advantageous in your financial scenario, it will allow you to manage yourself very well. With one payment on one due date, rather than many payments on spread out due dates, you will be timely and organized. Thus, you will hit your payment due dates, avoiding missing payments. This is essential as it will allow for a debt-free life as well as a strengthening and rebuilding of your credit record leading to a much improved overall credit rating.

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Problematic Issues With Your Mortgage? Don't Shelter Yourself

It's fair to say that many a homeowner at one time or another was unable to make their mortgage payment in full or on time. Financial happenstances occur and they're quite random in nature. Thus, it's almost unpredictable to foresee bumps in the road when it comes time to make those monthly mortgage payments; anything and everything can halt an individual from making their payments.. And it's not as if homeowners who are unable t o pay their mortgages are irresponsible, it's just a matter of poor financial luck.

If you are one of these unlucky individuals you should take note that not all is lost and that there is indeed hope. It's easy to shelter yourself in your home and avoid resolving such an issue with lenders or mortgage servicers, so don't get overwhelmed.

Communicate and Open Your Door, Let Assistance Walk In

Even in the worst case scenario where a mortgage problem may seem unconquerable and too overwhelming - where at end result an eventual foreclosure could occur - know that help is literally at your front door step waiting to speak with you. Simply by talking to your lender or mortgage servicer can do wonders for your dreary situation. By speaking with these individuals you will be able to ascertain and lay out a few alternatives to avoid going through a foreclosure, one of which these mortgage lenders refer to as 'workout programs.'

As the name 'workout program' implies, their purpose is to work out your mortgage problems, and better still, hash issues out while working in tandem with you to resolve the troubles at hand. What's done here could involve a number of things; a temporary suspension of payments, overall structural alterations to make debt for more payable or an actual transfer of the property deed into the lender's hands in place of a standard foreclosure.

Be Willing To Communicate To Benefit, Or Else Suffer

What's key to making the aforementioned workout programs actually begin and work well is to open lines of communication between yourself, as a borrower, and your lenders or mortgage servicers. If communication is only one way, with lenders taking initiative, and you don't contact your lenders back to become more informed of what can be done to better your mortgage payment position you will be isolating yourself from improving your current situation. If communication is initially one-sided and remains so, both the borrower and lender will suffer. The borrower will end up awaiting their eviction notice or foreclosure announcement and the lender will also suffer, directly so through incurred costs on following through with their borrower's eviction and/or foreclosure.

Take Necessary Steps Immediately When Trouble Arises

As most lenders are unable to help those in need because their borrowers are more or less slow and not proactive or responsible with monitoring their mortgages, they are pleading with borrowers to act when they know trouble is looming. It is preferred for borrowers to contact their lenders at the first sign of mortgage payment trouble. Otherwise, after 90 days of a payment's due date, mortgages can move into foreclosure and thus leave a borrower little options. The aforementioned is so because once a borrower receives a foreclosure notice, ameliorative options are few and far between.

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Important Tips for Finding Your First Home Mortgage Loan

Anyone who has gone through the process of buying their first home knows the combination of thrill and terror that can come with the experience. If you've never borrowed money for such a huge investment, feelings of confusion mixed with stress should not be a surprise. If you're a newbie home buyer, one of the most important first steps you should take is to remember that you should approach the entire home buying process with care and do your research before even looking at a house.

Here are a few tips for finding your first home mortgage loan:

Decide early on if you should apply for your mortgage with a direct lender or a brokerage company. If you choose to use a lender you could very well save some bucks since you'll avoid paying commission to brokers. But keep in mind that brokers have the knowledge and resources available to find mortgage lenders that best suit your situation. Brokerage companies will also deal with various administrative details that come with getting a home mortgage. This is usually part of what your fees include.

Do careful research and find out all about any programs that you may qualify for. If this is your first mortgage you may be able to take advantage of programs such as FHA or VA and other specialized federal loan programs depending on your location. Your mortgage lender will have detailed information on all of these different options available for you. They could be very beneficial to you with first time home buying and should not be ignored.

Another important step in the home buying process is pre-qualifying for your first mortgage. By exploring the pre-qualification process you will know from the get go exactly how much house you can afford and will be able to weed through the different homes on the market at the time. There's nothing worse than falling in love with a house and then finding out that you can't qualify for the money needed to buy it. Lenders both locally and online have free mortgage calculators that enable you to see how much you'll spend each month in payments. Take advantage of this important tool before looking for a home.

Remember, during the mortgage loan application process there's no such thing as a stupid question. If you don't understand a term or any of the jargon involved in real estate, then by all means ask your lender or broker for clarification. You'll need to know the difference in the types of interest rates and the many fees that may be charged. You can possibly avoid paying certain fees by educating yourself and shopping around.

Although buying a home seems like a daunting task, don't forget that it's just like buying anything else in life, only one of the bigger investments you'll make. Go into the process with your eyes wide open. Know what you're getting into. Do your research and you'll get a good deal. Make your first home purchase and finding your first home mortgage loan as enjoyable as possible.

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Negotiate and Reduce Student Debt

Outstanding student loan debt is a severe problem for a great many graduates. Although not an enviable situation, it is possible to negotiate with your creditors and perhaps reduce or even eliminate your student loan debt. If you're uncomfortable with the negotiations yourself, it may be possible to hire a company to negotiate with creditors on your behalf. However, if you are committed to and have the ability to eliminate your debt, it's generally better to liase with your creditors yourself. If you reach the stage point where you can no longer maintain the repayments, it's imperative that you contact your creditors straightaway and explain your position.

It will help your situation greatly if you manage to email your creditors before they come knocking. Professional debt negotiating programs offer you plans, they deal with your creditors on your behalf to debt consolidation services: They negotiate with your creditors provided you have saved the minimum balance to deal with the debt. Before signing on with a debt negotiation or consolidation service, it's important to check and ensure your creditors are willing to work with the agency you plan to choose. Consider using agencies that offer genuine counseling and education, instead of simply enrolling all clients in a debt management program.

Debt negotiation is a process whereby you negotiate with your creditors to pay off your debts at a rock-bottom amount. For example, if your student loan was for $22,000, you can negotiate a payoff of $7,500. Creditors might report accounts that have been reduced, and if reported, it will stay on your credit history for seven years. Note that creditors have no requirement to negotiate with you or someone acting on your behalf and that they will often play "hard ball" at the beginning of the negotiation process.

Notwithstanding the status of your finances, there are positive outcomes for both you and your creditors. Explain to them right up front what your situation is and how you believe that things can be worked out so that everyone will benefit.

The fact that that you have appointed a debt negotiator to act on your behalf is a sign that you are a poor risk. Virtually all creditors will settle for a lump sum, instead of waiting for the balance over the next 9 years or so. Steer clear of debt elimination scams that claim consumers are not under obligation to repay their debts because creditors charge illegal interest rates. This is patently untrue.

By rapidly taking matters into your own hands, your creditors will see that you mean business and are trying to seek remedy. I bet you would not have guessed it but, asking your creditors to simply forgive some of your debt is maybe one option and is a good starting up point when negotiating your student loan. Don't expect your creditors to be push overs, however! But it does make it clear to them them that you expect some action.

Consolidation versus Forgiveness

Debt consolidation is the superior of the two when it comes to influencing your credit score. If you choose a debt consolidation company, your creditors might report delayed payment.

When your monthly bills become too much for you to handle, it makes sense to use debt consolidation or debt negotiation for working out debt and credit challenges. If bills and other heavy payments are getting you down, take action sooner rather than later to find solutions to your situation. Unrelenting financial stress and burden can lay waste to everything in it's path, not to mention the detrimental impact on your credit report. If a student loan is at the heart of the trouble, debt negotiation and/or consolidation can aid in getting you back on track and clear of debt.

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Not Completing Your 1003's? Don't Expect Your Mortgage Cases To Close

People often ask me what I believe is the single biggest hindrance to a new mortgage loan officer's success. I respond without hesitation and say, "For a new mortgage loan officer to succeed they must be willing to change and adapt with the industry. They need to know what their job is and be willing to learn what it takes to succeed." Status quo and doing what they were doing a year ago will certainly doom them in today's mortgage marketplace.

The last 6 months to a year, the mortgage industry is different than it has ever been before. In fact, it is so different; many people don't understand their job anymore. I believe that as an LO, you have to have an understanding of what your actual job is and at least some basic training requirements necessary to succeed in the industry before you can set yourself up to actually be a loan officer.

Before you can hang up a sign that says, "I'm a mortgage broker or I'm a loan officer", ...thinking that because it's easy to get a license and to become a loan officer, you need to realize that in the mortgage industry it's not always easy to know what is required of you, unless you have the proper training.

It used to be straightforward to be a "loan officer" and the industry formerly would support people who didn't have a concept of what they were doing. This was because the mortgage industry simply could not hire enough people to take all of the mortgage applications. There were millions and millions of loans being written and virtually any "warm body" could write them.

The AE's helped the new LO's, their lenders helped them; when they needed help, they had someone that they could call to "bail them out".

Because two-hundred thirty-six lenders have dropped by the wayside in the last year and the market is as tight as it has been in years, most companies cannot afford to pay for AE's or Reps to do the work that the LO's should be doing.

These companies have a fraction of the mortgage activity that they use to have. Consequently, they have underwriters who are completely overwhelmed by the influx of government loans because this seems to be the product more of our lenders are encouraging.

The real problem comes when you couple the emphasis on FHA and VA government loans in the industry with LO's who are trying to submit government loan applications and think they can submit them like they did during the sub-prime era. This is unconditionally no longer the case.

So what you have are people who have no experience submitting government loans that are presenting documents to more than one lender because they may have been denied previously. Quite often the LO needs to restructure and re-submit the loan, basically because the loan officer doesn't really understand how to properly submit the 1003.

They don't understand because they were never forced to learn during the crazy days of the sub-prime marketplace.

History has thrust us into a position where our loan officers now need to know how to originate loans. LO's all over the country are sitting by themselves with a very limited support system, which is made up of fewer "support" people than it ever has had in the past.

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Know Your Rights When Dealing With Collection Agencies

More than a few collection agencies engage in illegal practices when attempting to collect debts. Low-income and non-English speaking debtors are among those most often taken advantage of. Some collectors send fake legal papers and visit debtors pretending to be sheriffs. The collectors tell debtors to pay immediately or threaten to take personal property. Other collectors use vulgarity and profanity to intimidate debtors. Another favorite tactic is to harass the debtor's parents or adult children.

None of these behaviors are allowable under the Fair Debt Collections Practices Act (FDCPA) and you have the right to sue the agency and possibly even the creditor in this circumstance. Such actions give you grounds for a lawsuit, especially if they have been repeated and you have at least one witness. You could even receive punitive damages if the abuse you suffered was particularly bad.

If a collection agent violates the law in any way shape or form, you need to complain loud and clear to the proper authorities. Standing up for your rights in such a situation could result in having your whole debt canceled in exchange for dropping the matter.

There are three avenues in which to pursue a complaint about harassment or otherwise outrageous conduct on the part of collection agencies. They include the original creditor, the Federal Trade Commission, and your state Consumer Protection Agency. Your original creditor might be particularly disturbed to know about unreasonable actions taken in their name, as they can be liable. The FTC and the Consumer Protection Agency are the federal and state governing bodies in these cases.

Start with a simple letter to your creditor clearly stating the violations of the collector. In it, let them know you would be willing to fore-go further actions, including potential legal remedies, in exchange for the forgiveness of your debt and removal of all related negative entries on your credit report. This might be all the action you need to take. Most creditors don't want to risk the embarrassment and potential damage to their reputation if a case goes to court.

If you have been the victim of an overzealous collection agency, you are protected under the law. You need to document repeated violations and preferably have a witness. Sometimes just making a creditor formally aware (in writing) of the abuse, may lead to speedy resolution of your debt as the creditor seeks to make the matter go away.

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With the Cost of College and the Economy, Many Young People are Opting out of College

More and more young people today are finding themselves knee deep in student loan debt. The bad news is, if handled incorrectly, the consequences can be long term and devastating for an individual's credit. The good news, however, is that, if taken care of properly, these loans can help build, or even boost, your credit.

Young people in average to entry-level salary jobs must seek out help when in crisis, before debt piles too high for rectification. Although it may seem contradictory, now some colleges are looking to cut costs for students in above and beyond the usual financial aid recommended. It's a well-known conundrum that for the first time in American history, the student debt is at a higher rate than credit card debt, which is a staggering and unsettling fact.

Student debt around the country is at one trillion dollars and is still on the rise. One has to consider the Student Loan Forgiveness Act that President Obama put into effect fairly recently. One option is consolidating into a Federal Consolidation Loan towards Public Service Loan Forgiveness. This is one way to be eligible for loan forgiveness. Be aware though, consolidation could potentially change any current headway in your loan payment status.

The main worry for a good portion of the population is that many potential students are opting out of higher education altogether because of the cost of most colleges and universities in the United States today. Young adults find themselves in the position of choosing decades of debt or a lower overall income without a degree. Not to say that there is any shame in an occupation that does not require a degree, but there is most definitely something to be said for backing up your street smarts with a little scholarly know how.

Capitalism is dependent on a stable middle class; however, it's difficult to secure such stability with a society that is constantly bludgeoned with loads of debt. Chances are that the focus may need to be shifted towards another area of concern. The problem on a greater scale seems to be that the U.S. economy is tanking and has been for some time now. The question at hand is what our country's leaders can do about the mounting problem. At this point, there has been little in the way of concrete answers and speculation seems to be the only answers available.

Politics aside, it's a frustrating but true statement that many scholarships go untapped each year because students don't know that they exist. Many young adults rely on financial aid and loans alone, barely scraping by because they are unaware that any scholarships apply to them personally, making it crucial that students "do their homework" when it comes to applying for scholarships.

There are countless no-strings-attached funds out there in the form of scholarships that are waiting to be claimed. Students must seek out the scholarships that are often hidden under the surface layer of research, available only to those who are truly dedicated to funding their college education.

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What Happens When a Second Mortgage Forecloses

In most cases of foreclosure, it is the first mortgage company that initiates the process. The second mortgage may file its own foreclosure in order to protect its interest in the property, but even this is somewhat uncommon. The second lender would much rather work with the homeowners to find a solution to avoid foreclosure entirely, if possible. However, if the homeowners are simply too far behind on the second mortgage but up to date on the first, there is a good chance that the second lender will declare foreclosure on the house.

Any lienholder can try to force a sale of the property through foreclosure, but usually only the first mortgage will get paid off through the proceeds of the sale. This is because there usually just are not enough proceeds at all for even the first lien to be paid in full, let alone extra ones after that. It just makes more sense for the second mortgage to try to work with the debtors to find a solution, since they would most likely not get anything from a sheriff sale. Especially with the declining real estate market right now, second mortgages may have loaned tens of thousands of dollars more than the home is currently worth, which guarantees they will not receive anything from a sheriff sale. County foreclosure auctions usually consist of very low bid amounts and few bidders, resulting in properties selling for far less than their current market values.

If a participant at the foreclosure auction placed a bid and won, the proceeds of the sale would be distributed like any other foreclosure, regardless of which mortgage company actually began the foreclosure process in the courts. The property taxes would be paid first, since the bureaucrats need to get their hands on the money as quickly as possible. Then the first mortgage would be paid off with as much of the proceeds as are left. Unfortunately for second mortgage companies and other junior lienholders, the winning bid at auction is usually not even enough to cover the entire first mortgage. In fact, most of the time it is one of the banks that bids on the property to ensure that they will be able to sell it after the foreclosure if there are no other bidders.

After the first mortgage is paid off in full, though, then any other liens, including the second mortgage, would be paid in order of when the lien was filed with the county recorder. If there is enough money to pay all of the second mortgage, then they get all of the rest of the money until their lien is paid in full. Then anything remaining goes to other liens or to the homeowners as their gain from the sheriff sale. If there is not enough to pay off the second mortgage (or even all of the first mortgage), then the second will not be paid off at all or in full. It will be up to the mortgage company to sue afterwards for a deficiency judgment after the foreclosure has ended (an unlikely occurrence).

Thus, just because it is a second mortgage who begins the process of foreclosure, it will not really change the order of how the liens are paid off through the foreclosure auction. Any bidder at sheriff sale, whether the bank or a third party, will still end up with a title that has had the liens on it discharged through the county foreclosure auction. And the homeowners will have to move out of the property at the appropriate time or be faced with the possibility of a forced eviction. No matter which mortgage company initiates the foreclosure, the process will move through the court system in exactly the same way.

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Questions and Answers for Offset Accounts UK Consumers

What are Offset Accounts? UK consumers have been asking this question more and more in recent years.

They combine your mortgage with your current and savings accounts, and sometimes your loans and credit cards. Interest earnt on your deposit accounts is offset against your mortgage interest. Offset accounts are a useful tool for mortgage reduction because they reduce the amount of interest payable on your mortgage. For example, if you had a £100,000 mortgage with savings of £10,000 you'll only have mortgage interest repayments on £90,000 and you don't receive interest payments on the £10,000.

Why don't I receive interest on my deposit accounts?

The interest earnt on your deposit account is immediately offset against your mortgage interest repayments and is not taxed, therefore offsets are tax effective. For example, a £100,000 mortgage with an interest rate of 6% will cost you £6000 per year in interest payments with a standard mortgage. Whereas, with an offset account and savings of £10,000, you'll pay interest on £90,000 and the interest repayments would be £5400. Your £10,000 investment has saved you £600. It would be difficult to find a safe investment for £10,000 which gave you this sort of tax-free return.

Do I need to have a lot of money in savings?

Most experts advise you should have ten to twenty per cent of the mortgage loan in savings to give the best return on offsetting.

I have a significant amount of debt; will this be a problem with Offset Accounts?

Some lenders suggest you can consolidate your debts with the mortgage. However this tends to lengthen the term of the debt and it also becomes a secured loan. Have a look at your spending habits because you will need to make regular repayments and where possible to make overpayments to get the most out of an offset account – otherwise an offset may not be suitable for your circumstances.

How flexible are Offset Accounts?

Not all offset accounts are the same and it is important to research the intricate details of the loan conditions. However, most offsets have the overpayment option without incurring fees. Once a set amount of overpayments have been made, then you can normally make underpayments or have a payment holiday as the need arrives. Offset accounts are a clever way of making your money work harder for you, if your circumstances are appropriate.

How many types of UK Offset Accounts are there?

There are two different types of offset accounts: current account mortgage and offset mortgage.

Do they work in the same way?

They work in slightly different ways. With a current account mortgage, your deposit and mortgage are combined into one account and your salary is paid into the account. You have one net balance for your deposits and debts. An offset account keeps your savings and borrowings in separate accounts. The total of the savings is offset against the total of the borrowing and the interest is calculated on the net figure.

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8 Steps for Getting Out of Debt

The Average American spends a great deal more than they make every year. This results in a financial pitfall to them later in life. If you find yourself digging deeper into the empty wallet there are ten steps that you can use as a crutch to help free you of the overwhelming financial burden of debt.

1. Create and follow a budget - Creating a monthly budget will help you to track where your monthly income is going. In order to do this, you should add up how much your expenses will be for the month and then add up your monthly income. Once you have calculated how the money should be spent you should have some money left over for emergencies. 2. Stop spending what you don't have - When you spend what you don't have your debt is only climbing higher. If your monthly budget disables you from making a purchase, then the purchase should wait until the money is within your reach. 3. Learn to distinguish between wants and needs - In a world filled with televisions, computer games, luxury cars and other costly trinkets, our perspective on wants and needs at times becomes distorted. A need is something that is essential to your survival. Although sometimes we think that we will not be able to function without that big screen TV, waiting until the money is in the bank and paying cash for large purchases is a better option. 4. Spend less than you earn - After you have covered all of your monthly expenses there should be a little money left over. If not, adjust your monthly budget. You never know when an emergency may arise. 5. Track your spending - Many people who are in debt are unaware of where their money goes during the month. If you carry a notebook around and write down every penny that you spend when you make a purchase, you will be able to see where your money is going. 6. Pay yourself - Building up your savings monthly will only ensure that you do not fall into debt again. It is always good to have a little extra money stashed away. 7. Use a credit card responsibly-Credit cards are convenient for record keeping and budgeting, but can be dangerous if used improperly. You should not make purchases that you can not pay off at the end of the month. 8. Use a debit card - Debit cards will not allow you to spend more than you have in your account because it draws directly from your bank account. This way you cannot spend what you do not have.

Remember that the key to escaping debt is spending less than you earn.

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Compare Fixed Mortgage Rates - How to Get the Best Rate from Your Lender

When getting quotes from competing lenders it's always hard to know who's telling the truth and who is giving the real interest rate when they quote you. To be completely sure you really do need to ask several lenders to quote you to be sure you are getting the best deal. The first thing to understand when comparing fixed mortgage rates is that interest rates never change and are always constant.

What's that you say? Rates change daily don't they? Not really, a 5% rate on a 30 year fixed mortgage has always been available regardless of the market. What changes is the cost of that rate to the retailer (Mortgage Company) and eventually the borrower, these are called points. What we are seeking from the mortgage company is the par rate; this is the lowest interest rate that does not require us to pay points.

Everything revolves around the "Par rate". The par rate has no cost to you and no profit for the lender. Very rarely will a lender quote this rate unless they are trying to "low-ball" you in hopes of raising it later. When a lender sells a rate above "par" she makes a profit. When she sells a rate below par it represents a cost to the lender that she usually passes along to the borrower in the form of points. These are the interest rates that are usually advertised on mortgage web sites, and that is why you are usually told you can't have that rate.

Most borrowers are aware that the mortgage company needs to make a profit and to stay in business, after all they aren't philanthropist. The intelligent shopper will seek to manage the amount of profit in the deal as opposed to having to argue about rates and closing costs. Most mortgage companies buy their money from the same sources, meaning their rates should almost be identical. Therefore, if you are reasonably sure you have the "par rate" then you have effectively narrowed the discussion down to the closing costs. Once you have the lender negotiating their profit you have the upper hand!

So how do we find this magical "par rate" from the lenders? It's simple, you ask them. This is where having 3-5 lenders to work with pays off. When you speak with experienced lenders they are going to ask you a series of questions to pre-qualify you to a rate. Rates have add-ons so to speak. The lender begins with a par rate and then adds and subtracts from that rate depending on your specific loan situation. It will be a little tedious going over the same questions with 3-5 lenders but the payoff is worth it. Once the lender feels comfortable that she knows your situation she will usually quote you an interest rate.

Rest assured this rate will NOT be a par interest rate. You should respond to her verbal quote "is that the par rate?" She will probably be taken back that you know to ask this question. What you want to convey to the lender at this time is your willingness to pay higher closing costs to get the lowest rate. It should be sort of like this "I realize my closing costs may be a little higher but can you quote me the lowest rate that is available without having to pay points?" The lender should volunteer the information, if not, next!

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3 Easy Steps To Getting A Mortgage

Step 3: Apply for a Loan

The application process is the easy part - provided you've gathered the documents necessary to prove claims you make on the application.

The application will ask for information about your job tenure, employment stability, income, your assets (property, cars, bank accounts and investments) and your liabilities (auto loans, installment loans, mortgages, credit-card debt, household expenses and others).

The lender will run a credit check to determine your credit status, but you'll have to supply additional documentation including paycheck stubs, bank account statements, tax returns, investment earnings reports, rental agreements, divorce decrees, proof of insurance and other documentation. A lender that deems you creditworthy will likely hire a professional appraiser to make sure the value of the home you are about to buy is truly worth your loan amount.

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Hope For Delinquent Homeowners: FHA Secure Mortgage Refinancing

With the recent popularity of Adjustable Rate Mortgages and Interest Only mortgages followed by a rise in rates we have seen epidemic amounts of foreclosures as home owners try to cope with higher payments. Many homeowners are delinquent on their mortgage and fear that because of the damage to their credit scores they will not be able to refinance. A new FHA program may be the answer to their problems.

The Federal Housing Administration (FHA) provides mortgage insurance on loans made by FHA-approved lenders throughout the United States and its territories. FHA insures mortgages on single family, multifamily, manufactured homes and healthcare facilities. FHA-insured mortgages do not come with prepayment penalties, have no teaser rates nor balloon payments. They are offered at market rate with terms up to 30 years and are fully amortized, meaning that you pay towards principal and interest every month.

How can FHA help homeowners keep from losing their homes?

FHASecure gives homeowners with non-FHA adjustable rate mortgages (ARMs), whether current or delinquent and regardless of reset status, the ability to refinance into an FHA-insured mortgage. With the new FHASecure program, the lender will not automatically disqualify you because you are delinquent on your loan, and the lender may offer you a second mortgage to make up the difference between the value of your property and what you owe.

This program is available whether your current or delinquent on your mortgage payments. In fact, FHA encourages homeowners facing reset to refinance before they fall behind. But even if you do fall behind, you may be eligible. There isn't a limit on how far behind you can be on your mortgage or how many payments you've missed. Whether you're current, one month behind or multiple payments behind, the amount you can refinance will depend on the value of your property and how much you owe and if the lender, or another eligible source, is willing to take back a second mortgage to help bridge the gap between what is owed and your home's value.

Interest-only mortgages are also eligible for the FHASecure program. If you are current on your mortgage, you are eligible for an FHASecure refinance; and if you are delinquent, the default must have been due to the payment shock of an interest rate reset or, in the case of an Option ARM, the "recasting" of the mortgage to fully amortizing.

If your current mortgage has a prepayment penalty you will need to take a look at the equity you have in your home. If you do not have sufficient equity in your home that would allow you to include the prepayment penalty and/or other refinancing costs into your new FHA mortgage, then you should ask your lender to consider a second mortgage to pay the difference or negotiate a short payoff on your existing loan. Offering either of these options is at the discretion of the lender.

Facing Foreclosure?

It is possible that FHASecure may help homeowners already in foreclosure but each situation is unique and depends upon the value of your home and how much you owe, and if the lender is willing to offer a second mortgage. Homeowners facing foreclosure are strongly encouraged to talk with their lenders, possibly with the assistance of a HUD-approved housing counseling agency, to determine the best course of action. To find a HUD-approved housing counselor, please call 1-800-569-4287 or search online at www.fha.gov/fhasecure.

FHA does have maximum loan limits that are vary by location. FHA's geographical loan limits and how much it can insure are established by law. Although the FHA-insured mortgage cannot exceed those loan limits, when a lender is willing to combine a first and second mortgage, the amount of the second could exceed the maximum loan limit for your area.

If the value of your home is now less than what you still owe the mortgage lender considering the refinance would have to be willing to accept a short payoff on the existing loan OR to hold a second mortgage to make up the difference needed to pay off the existing mortgage and the home's value.

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Debt Counseling: Sailing Turbulent, Debt-Infested Waters

Sailing on financial seas is a metaphorical yet, daily routine for us all, whether we're law-abiding seamen or self-renowned swashbuckling pirates. Typically, law-abiding seamen follow the financial rules, taking loans and advantage of credit opportunities, yet pay them off, on time and in full. Swashbuckling pirates on the other hand are more irresponsible financial sea-goers, using credit to get ahead and not paying off due debt in a timely or complete manner, if ever.

Pirate or Non-Pirate, We're All Affected

In either instance, financial seas are rough and can prove overly turbulent at times. Thus, it is a likely case that many a man and woman, pirate or non-pirate, will fall overboard when navigating and sailing through such debt-infested waters. Let's face it, sailing and braving financial seas -taking out loans, using credit, relying on borrowing- are necessary things, yet ones most hazardous. But even just merely walking on the deck can sometimes be a slippery financial mess, too, especially if one is not cautious. And most individuals out at sea are slapdash and will assuredly cause a way to slip, end up being taken off balance or, worst case, get swept off deck by crashing waves, all left to swim the debt-infested waters overboard. And being such an individual left to tread water alone, feeling almost helpless against circling debts is not a comfortable, nor dry and cozy feeling.

Inner Tube Thrown...Floating With Debt Counseling

But, have no fear for you won't have to tread water on your own for too long. Thanks to the financial assistance - in the form of a thrown over and well-needed inner tube - Debt Counseling has much to offer individuals in need of a means to float and not exhaustingly tread through tumultuous financial times.

The inner tube thrown here is a useful financial service called Debt or Credit Counseling. And if one isn't overboard already, debt or credit counseling can be that blaring lighthouse in the distance in the midst of an overbearing storm whilst out on open debt-filled waters. But, assuming you're already overboard and currently swimming in debt, debt counseling can be an absolute lifesaver, no pun intended.

Thrown For Support and To Aid Floating, Aiming To Save

Financial counseling aims to make individuals feel more authoritative and in control of their financial situations, both presently and in terms of looking ahead. Not only this, but debt counseling also attempts to better arm individuals with "financial floaties," if you will, to be more prepared to float in upcoming financial ventures. Such services aim to devise plans to help overboard individuals float instead of endlessly tread debt- imbued waters; the objective here is to map out a most efficient, sure fire and uncomplicated way to pay off all debt completely, starting with keeping individuals afloat and, at debt's end, positioning individuals to climb back on the boat.

Thrown out as support, debt and credit counseling services act as midways between you and your creditors. Negotiations are handled by counselors, working their tactics to secure lower payments and even attain reduced or removed interest rates while in the length of counseling services. Help is here individualistic, which is characteristic to debt counseling as no two borrowers or their scenarios are the same.

Just know if financial trouble is raging and roaring at sea and you end up off the boat, left to drift and tread, there's a way to stay afloat and even get dry once again. Seek the inner tube offering debt and credit counseling services have to offer, it's a safe, dry and buoyant bet.

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A Magnetic Procedure To Unite All Your Debts

What Kind Of Loan Should You Look Into And What To Expect?

Debt management agencies can offer two types of simplification loans. One of these is Home equity offered to the individual who recently became unemployed or underwent a divorce. The interest rate can run between 9-12%. Even though it sounds like a pretty good deal, your 2 story home can suddenly turn into a 4 sided box carton considering that your home is posted as collateral. Ouch! Not a comfort zone when the weather turns ugly. Then there are Personal Lending Loans which come along with higher interest rates running between 12-15% due to the fact that banks are taking a huge risk because you have not provided and collateral.

Do Some Homework Before Walking Into An Agency

Sometimes the overwhelming aspirin addicted debtor seeks help in dead end streets finding no alternatives to his debt misery. He ends up with some sceemy preposition promising definite answers to handling his debt. Unfortunately the debtor ends up more confused and growing in debt by the minute. There are misleading companies who only offer fibs and immerse you in your debt hole. It is important to seek professionals who are truthfully willing to ensure you and your family recuperate your glorious shopping days.

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First, Consider A Few Factors Before Choosing to Refinance

Before deciding whether or not to refinance your mortgage there are a few details you should take note of. Foremost, timing is absolutely everything. Yet, at the same time, timing is also a thing most uncertain and more so, not completely reliable, especially on home refinancing territory. It will be essential to know your current mortgage information though, as being aware of it will allow you to mull around and decide if refinancing now, and not a few months or years down the line, is in fact the right and viable thing to do. Knowing your current mortgage details will also prove beneficial when it comes time to decide on a new mortgage deal through refinancing.

Choose, Sooner Than Later

Keeping timeliness in mind, there are a few factors in which you should take keen notice of as to best position yourself when deciding to refinance now or later on, or, on the other hand, ever.

It's Best to Know Your Loan Balance and Interest Rate

Knowing - or finding out what – your loan balance is is something anyone should be aware of or, on the other hand, can become aware of quite easily. If you're not already logging the history of your mortgage payments, you probably should. But, going with the assumption that you have not been keeping track, you need to contact your lender, where upon doing so will simply reveal your loan balance. Why know the loan balance? Silly you should ask. It's simply because by knowing the base amount the loan currently exists as, you will be better able to price out hopeful and prospective monthly amounts on a new mortgage.

As well as your overall loan balance, it's crucial for you to know which rate your loan is working on. Locating your interest rate is easy as, well, cake; although it might not be as delicious. Mull through your loan documents and official paperwork to target your interest rate. If can't locate it yourself, contact your lender immediately as this figure is essential to know for comparing with rates on potential, new mortgages.

Term Knowledge, Prepayment Penalties and Equity Quality

Being knowledgeable about your term is all too important. It will either be a fixed rate or an adjustable rate. If your term is one on an adjustable mortgage, a rate increase could very well be on the horizon, which is something to take into consideration. Yet, if you have a fixed rate mortgage, take in the fact that your rate will be set in stone and unchanged before an act of refinancing occurs.

Certain lenders are known to add on a prepayment penalty as to prevent particular borrowers to refinance a mortgage loan. These typically involve some sort of set fee or an actual raw percentage payment that imposed is a refinance is conducted. If this applies to you, since you have one, then it will be key for you to do some math on your own to determine if a refinance option would is favorable to your wallet.

Also, factor in the amount of equity you possess on your home. If you have lower equity then you might be better off opting for a refinancing approach. If you're unsure of what your equity (value of your home) is, then it would be wise to hire and consult a well-renowned appraiser to perform an appraisal on your home.

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Foreclosures and How Banks Make them Worse

I have seen many clients who use their life savings trying to pay the mortgage on a home they can no longer afford, because of an adjustable rate mortgage. In the past these homes could just be sold and the owners could walk away, but now they are upside down from a 100% mortgage and a market that seems to be getting worse every day. Our company is generally successful helping victims refinance or sell, but we also work with lenders to help them establish a loan modification or workout program to keep them in the existing loan. Once we get involved, lenders are very cooperative, but only a small portion of foreclosure victims actually find us before it is too late. Lenders and servicing companies need to work with their clients without the need for professionals to get involved. Unfortunately, these lenders are suffering, too, so they are forced to hire low cost customer service reps that are overworked and underpaid.

This creates a whole new problem; the customer service rep does not care if the loan is profitable or not. They only want to make it through the day and eliminate as many cases as possible, with the least amount of work. They seem to love it when we contact them on behalf of a client, because they know we are going to do most of their work for them. Maybe this is why we are so successful, but still, homeowners should not be forced to hire someone to speak with their lender on their behalf.

If you are a homeowner facing foreclosure, then I recommend contacting your lender first and finding out what options they have available. If they are not helpful, or do not offer any viable solutions, then you need to immediately contact a professional who can help you either find a new lender or make arrangements with your existing lender to begin a loan modification. Companies like mine, who offer all of these services from one source are your best options, because you will not be "sold" on one solution, you will be evaluated and provided with all possible options to stop foreclosure. Ultimately, you need to find a company or person that has experience and is someone you can trust, so feel free to interview companies until you find someone who fits your exact needs. Just be careful, because many of the companies offering foreclosure help do not have experience and should not be trusted.

Eventually, lenders and servicers will figure out that it is more profitable to offer viable solutions, but for now, if you are a homeowner, you better plan on helping yourself out of foreclosure or finding someone to do it for you.

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When It Comes to Student Loans, Forget Everything You Knew

As you get your children ready for the college admissions process, you may be wondering what all the financial aid fuss is about. After all, when you attended school, you don't remember student loans being such a big deal. Well, if your last encounter with financial aid was when you graduated from college yourself, here are two words of advice: Brace yourself.

Parents of prospective college students will soon find that health care reform and student loans have a lot in common, at least legislatively speaking. The health care reform package passed earlier this year contained plenty of major changes to the way the federal government distributes and manages government-issued student loans.

In addition, earlier legislation from the past three years aims to bring more transparency to college costs and to make student loans easier to repay. New provisions designed to help families decipher the true cost of a college education will put more information in the hands of college consumers.

All of these factors mean the upcoming financial aid season will have plenty of new twists and turns in store for students and their families.

>> The Revamping of Student Loans

So what's new on the student loan horizon? One of the biggest changes involves the way the federal government doles out student loans.

The Obama administration's health care reform package contained within it the Student Aid and Fiscal Responsibility Act (SAFRA), which brought about arguably the most sweeping and extensive changes to the federal student loan program in over a decade, completely eliminating the third-party lender system that had been in place since 1965.

Under the third-party lender system, known as FFELP (Federal Family Education Loan Program), banks and other private lenders, acting as a middleman, played a major role in distributing and managing federally guaranteed student loans, originating 78 percent of all new federal college loans. But as of July 1, 2010, FFELP has ceased to exist, and private lenders may no longer issue federal parent or student loans on behalf of the government. Instead, students will go directly to the Education Department for all federal student loans, parent loans, and graduate loans.

Private lenders can still issue private student loans, however, which aren't guaranteed by the federal government and which can carry higher interest rates than their government-backed counterparts, particularly for those student borrowers who have weak or less-established credit. Students are cautioned to exhaust all their federal financial aid options first before seeking out private student loans.

>> Making Student Loans Easier to Repay

SAFRA and other recent legislation has also made it easier for borrowers to repay their federal college loans.

The College Cost Reduction and Access Act of 2007 created a new student loan repayment plan, income-based repayment, which became available on July 1, 2009. Borrowers who qualify for income-based repayment have their student loan payments capped at 15 percent of their discretionary income.

Additionally, borrowers who make payments on their student loans under the income-based repayment plan for 25 years will have any remaining student loan balances forgiven. This forgiveness period is only 10 years for any borrowers who are in the military or who work in the public service sector.

SAFRA expands the benefits of the income-based repayment program, lowering the cap on monthly student loan payments from 15 percent to 10 percent of a borrower's discretionary income and allowing remaining student loan balances to be forgiven after 20 years instead of 25. These updates to the income-based repayment plan become effective in 2014.

>> Federal Grants and the Cost of College

Another new twist? Under SAFRA, the federal Pell Grant program has been remodeled and updated to provide more grant aid to lower-income students. Beginning in 2013, the new-and-improved Pell Grants will be tied to the cost of living, so that award amounts keep pace with inflation. The maximum Pell Grant award is $5,550 for the current 2010–11 academic year and will rise to $5,975 by 2017.

Families who have had a difficult time figuring out exactly how much college will cost are about to get a break -- and quite possibly a big shock. The Higher Education Opportunity Act of 2008, which reauthorized the original Higher Education Act of 1965, contained new provisions that take effect in 2011, requiring colleges and universities to disclose their full cost of attendance, not merely tuition costs. Institutions must also estimate the amount of financial aid, including grants, college loans, and other financial resources, an applicant would need to receive to pay for one of their college degrees.

Whatever the specific changes that may affect you and your college-bound children, one thing is certain: Mounting student loan debts and the unabated rise in the cost of a college education are having an effect on the way the federal government distributes student financial aid. And the best way to navigate the changed financial aid landscape is to talk to your school's financial aid office, research your financial aid options, and be sure to apply for federal financial aid, regardless of your income or financial situation. You never know what grants and college loans you and your children may qualify for.

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Credit Rating Recovery After Debt Consolidation

When your finances have got out of hand and you've decided to restructure them with a debt consolidation loan, it's usually recommended that you subsequently cancel all of your paid-off credit cards and close off your other lines of credit that have been repaid as part of the consolidation process. The reasoning behind this is that you need to remove the temptation to build up new unsecured debts on top of your new consolidation loan, leaving you in a worse position than ever.

This is indeed good advice in general, but you may be surprised to hear that in certain circumstances this might not be the ideal way to proceed. If, before consolidation, your finances were in such a state that your credit record became littered with missed and late payments, then closing off your credit lines will actually increase the length of time it takes to recover your previously high level of creditworthiness.

The reason for this is simple: under the UK credit reference system, whenever you close an account, its details are frozen on your file for a period of six years before being deleted. This means that the damage done by your late payments will still impact on your credit rating for all that time, even though you've completely satisfied the debt and seemingly put things right.

In contrast, open accounts record their data on a rolling system, where entries which reach the age of three years drop off your file, It's plain to see that keeping your account open will halve the time it takes for your adverse credit information to be removed from your record, and so your credit rating will be restored correspondingly more rapidly than if you'd followed conventional wisdom and closed off your unused credit lines.

Of course, as with all things financial, things aren't as simple as that. If your credit file shows that you already have access to a large amount of unused credit, this is in itself usually taken as a warning sign by potential lenders, and may reduce your ability to get credit - for example, you might find it more difficult to negotiate a new mortgage at a good rate during the three years it takes to restore your rating fully.

It really is a balancing act, but if you're happy to sit out the three year period, this is the quickest way to restore your credit rating, so long as all defaults have been satisfied and other black marks removed whenever possible.

In any event, the spirit of the conventional advice still holds: there's little point in going through the debt consolidation process if you then immediately start racking up new debts on your old cards and overdrafts etcetera. Even if you decide to keep your accounts open in the interests of speedier credit repair, then at least make it as difficult as possible for you to succumb to temptation. Physically destroy your credit cards so that you can't use them, and store your account details in a safe place where it will take some effort to retrieve them so that you can't use them on impulse without at least taking a moment's pause for thought.

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College Loan Deferment

This article is going to look at college loan deferment in general as well as key types of deferment available for federally supported student loans. For private student loans it might be possible to obtain a deferment, but that choice is at the discretion of the lender. A private loan borrower doesn't have right to a deferment as they do with a government loan program, and that is an additional legitimate reason to stay clear of private student loans if at all possible.

For government loans the loan originator can't deny a deferment if you meet the qualifying criteria. You will naturally need to finish all the appropriate paperwork. When you've got a subsidized loan product the U.S. government is going to make the loan interest payments during deferment, but if your loan isn't subsidized the actual interest will be combined with the borrowed funds balance, or capitalized. You are permitted to make repayments on a loan that is in deferment and not relinquish deferment status. If at all possible it is definitely advisable to make at least interest installments on non-subsidized government loans during deferment so as to maintain the loan balance at the amount it had been. In the event that borrowers let their loan balance get too large they might find it hard to ever get out from underneath their student loans.

In School Deferments

If you are enrolled at least half-time with an accredited institution of higher learning you can qualify to receive an in school deferment. Obviously you will need to complete all of the mandatory documents and also inform your loan company. There is no time limit for an in school deferment so long as you stay in school. If you take a semester off or perhaps transfer schools you must tell your loan company.

Unemployment Deferment

Should you be working under thirty hours weekly you are considered to be substantially unemployed, and you can meet the criteria to get an unemployment deferment. You can get this type of deferment by qualifying to get state unemployment benefits or simply registering through an employment agency along with looking for regular work. For the first six months there's no requirement to document precisely what you did for a work search, however to obtain an extension beyond that you need to prove you applied to at least six organizations within six months. Unemployment deferments may be prolonged up to three years for federal student loans granted by 1993 and afterward. They will just be prolonged for 24 months for federal student loans written prior to 1993. These types of deferments are available for people who have Perkins loans, Stafford loans, and Direct loans, and for parent borrowers with PLUS loans when the parent is actually jobless.

Economic Hardship Deferment

This kind of deferment is actually for people who are not eligible for the unemployment deferment. You are eligible if your full-time monthly income doesn't exceed the larger of the federal minimum wage or 150% of the poverty level for your size of family from the state you are living. You also meet the requirements if you have already received an economic hardship deferment through a different federal program for instance a Perkins loan, or perhaps when you are receiving state or government assistance, including food stamps, or if you're in the Peace Corps. You'll need to maintain pay stubs, tax information as well as financial records pertaining to funds you have received, because you are going to be required to document all earnings along with other assistance obtained to qualify for this particular deferment.

Military Deferment

A person having a government student loan who is called to active duty could qualify for this kind of deferment. This deferment can also be readily available for students who go into the military on active duty and who want to come back to school after concluding military service. This deferment finishes 13 months after the active duty service is concluded or when the student re-enters college, whatever comes first. Make sure you consult with your loan adviser to complete the mandatory documents for this deferment.

Graduate Fellowship Deferments

This kind of deferment is for people doing graduate studies that are outside the classroom, for instance carrying out research, independent study or training. You need to possess a bachelor's degree as well as be certified through a member of the program. These deferments are accessible for people with Perkins loans, Stafford loans, and Direct loans, as well as for parent borrowers with PLUS loans taken out earlier than 1993.

Perkins Loan Deferments

Perkins loans, which are awarded to students with exceptional monetary need, have their very own deferments. Many of these types of loans might qualify for loan forgiveness if for example the borrower takes part in a public services kind of career. For those who have attained a Perkins loan ensure that you connect with your loan guidance counselor from your school as well as understand what these kinds of public service professions are, so you'll know if you would possibly qualify for a college loan deferment or perhaps even loan forgiveness.

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Will Chapter 7 Bankruptcy Debt Forgiveness End My Consumer Debt?

Having too much debt is an impetus for seeking debt forgiveness through chapter 7 bankruptcy. But, can this "fresh start" decimate all of your consumer debt? Depending on your financial situation, this get out of debt solution can keep you out in the cold. You may be better off exploring other options.

Technically, speaking chapter 7 bankruptcy legally prohibits most creditors from attempting to collect what you owe. But, the keyword is "most." There is no guarantee it will rid you of all financial obligations. Debts that you may not be able to discharge include:

· Debts for most taxes and debts incurred to pay non discharged taxes

If you have federal and states income taxes, capital gains taxes, property taxes, and payroll taxes, or even if you incurred new debts to pay off non discharged taxes, all of these debts are generally not discharged.

· Debts for domestic support obligations

Beware if you're a dead-beat dad. Under the bankruptcy law, there is no debt forgiveness for domestic support obligations. This means you won't be off the hook on child support or alimony or debts that are in the nature of child support, maintenance, or alimony, which are established by a court order or authorized by law.

· Student loans

Even if you owe too much on student loans or educational loans, chapter 7 may not get you out of debt. The only way to have a student loan discharged is if you apply for a hardship discharge before a discharge of your other debts is granted, and if the bankruptcy court finds that paying off the student loan would create an "undue hardship" for you and/or your family. Generally, to demonstrate an undue hardship, you must show your inability to make the student loan payments at the time the bankruptcy is filed and in the future.

· Debts for which you gave up your discharge protections by signing a reaffirmation agreement

The United States Bankruptcy Code states that in order for you to retain possession of a secured consumer debt that should be discharged, such as your home, car, or other asset, you have to reach a voluntary reaffirmation agreement with the secured creditor. Caution: The reaffirmation agreement will require you to continue repaying such debts. And if you don't, the creditor can impose a valid lien, such as a mortgage or security interest, against your property.

· Debts incurred under a DUI (Driving Under Intoxication)

If you are responsible for any debts for personal injuries or death from driving while under the influence of drugs or alcohol, chapter 7 won't offer you any debt forgiveness. And this includes your operation of a motor vehicle, vessel, or aircraft while intoxicated.

Additionally, chapter 7 won't get you out of debt on any of the following:

· Debts that you owe to a pension, profit sharing, stock bonus, or other retirement plan, or to a Thrift savings Plan for federal employees.

· Debts that you owe for most fines, penalties, forfeitures, or criminal restitution obligations.

· A consumer debt that you did not properly list in the chapter 7 filing

· Debts that the bankruptcy court specifically decided or will decide in your bankruptcy case as non discharged.

The United States Bankruptcy Code also lists other non-exempt property that you may be obligated to forfeit pursuant to a chapter 7 filing. If you owe too much on non exempt property, sorry Charlie! This property can include luxury items, a second car, truck, or home, a vacation home, high value musical instruments, collections of stamps and coins, family heirlooms, cash, savings in bank accounts, stocks, bonds, and other investments.

The above is a partial list of debts normally excluded. However, you should consult with an attorney to determine how the bankruptcy law applies to your specific situation.

In summary, you may not be able to wipe out all of your consumer debt through bankruptcy. So, if you owe too much debt, carefully weigh your bankruptcy, including debt consolidation, credit counseling, and debt settlement. Weighing the risks, always look for another way to get out of debt without bankruptcy.

Vic Chevalier is a financial coach and author. His mission is to help people transition from debt into financial prosperity. You can read more of his debt relief and credit restoration tips at

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Can Credit Cards Help you Establish Credit After Bankruptcy?

The short and simple answer is yes and no. The detailed answer is that it depends on how you use the credit card and which credit card you choose to use. If your credit card is over two years old this article may not apply to you. Most credit card companies will issue fair credit - credit cards to people outside of bankruptcy for more than two years. You may want to avoid applying to the same companies you included in your bankruptcy though.

If you are trying to establish credit after bankruptcy within two years a credit card can be a great way to begin. Before we talk about specifics let's begin with a general understanding about your situation. You have just recently filed bankruptcy on a number of creditors, and in any new creditor's eyes your represent a high credit risk. For this reason, it's logical to expect that you will have to pay the highest interest rates. So our goal should be to re-build our credit with the least amount of cost out of our pocket.

There are unsecured credit cards available that will issue you credit almost immediately after a bankruptcy. In my opinion these types of credit cards are a rip-off and probably a poor step to better credit after bankruptcy. Most of these cards will only start you off with a $300 credit limit and charge you $150 worth of fees on it with your first bill. You are well of 35% of your credit limit on your first bill! You might as well have applied for a secured credit card with a third of the fees.

In my opinion a secured credit card is the way to go. I know you have to send in $300 bucks to get started but the benefits far out-weigh the unsecured cards. Secured credit cards like the Bank of America Secured Visa® Platinum Card offer low annual fees and full credit card benefits from day one. The only downside is that you do have to send in your credit limit. Keep in mind, our goal is to re-build our credit with the least amount of money and this card is the answer.

One common misconception is that you have to make charges and on your new credit card and pay them off to build up your credit. This simply is not true. Credit bureaus actually devalue your credit score once you exceed 35% of your credit limit. When future creditors look at your credit bureau they will see how long you have had the card, your credit balance and if you have been late. The credit bureau does not reference your charges in the past, only your current balance. For this reason I suggest that you open up the credit card after bankruptcy and leave it alone.

Another advantage secured credit cards after bankruptcy is the ability to raise your limit by making additional deposits. When creditors see a credit card balance of $300 bucks it's pretty apparent what kind of credit card it is. Other than that they have no idea that it is a secured credit card. So if you treat your secured credit card as a savings account and send funds in to raise your credit limit you can accomplish a number of goals.

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FHA Mortgage - A Better Deal

I have several web sites that allow readers to submit questions about mortgage guidelines and loan options. I received this question from Donald in Toledo, OH., Sunday morning.

"What would happen if someone else used my social security number for a utility bill and I never lived at that address? This happened about five years ago when I found out about it. Will this hurt the underwriting of the house I am trying to buy"?

During our conversations it turned out that this "utility bill" turned into a collection. Fortunately it was five years old. I also learned that his credit scores are: 615, 625, and 652.

Answer:

The first thing you want to do when you find out something like this is dispute it with all the credit bureaus: Equifax, Trans Union, and Experian. This process is much easier than it use to be years ago thanks to the Internet. Each of these company's have a web site full of information you should understand about your credit, credit scores, and how to improve them. You can file your dispute on line from their web site.

The Government mandated a few years ago that every person be entitled to one free credit report each year, ...from each bureau. This is a wonderful thing because years ago you were not allowed to even look at your report. You were really up that well known creek and just guess who had the paddles. Get your report once a year from each company and take the time to review it. There is only one web site you can get these reports from and that is annualcreditreport.com.

If your credit scores are high enough this 5 year old, small collection should not prevent a loan from being approved. Since most underwriting is now performed on an automated system you may be required to provide an explanation and supportive documentation or you may even be required to pay the collection.

In this particular case the credit scores are not really bad but they are not really good either. These scores are actually a little low compared to the average. This is a very good example as to why you should monitor your full credit report every single year. Don't wait to check your credit untill you are applying for a loan.

I don't have a clue what Donald's employment history is or what his debt to income ratio is or how much he is putting down. These factors all play a part in loan approval and could be considered compensating factors if all three are very strong.

However, knowing what I do know, my recommendation would be that a conventional loan with a high loan to value (small down payment) would be difficult and the interest rate, if it were approved, would reflect the low scores. I would recommend an FHA loan. The interest rates are excellent and require only a small down payment. Again, this is assuming the other factors are in line.

FHA mortgages are wonderful. They are very forgiving about credit, require a low down payment, and they have some of the best rates on the market. I might add one thing here about the interest rate. At this point in time the par rate is equal to or lower than a conventional loan (depending on the lender) so if the company you are working with is charging you a much higher rate they may be taking advantage of your situation thinking you don't know any better. Please, shop interest rates.

Fannie Mae has just announced additional pricing tiers based on credit scores and loan to values. This pricing is effective June 1, 2008.

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Take your Lender's Help and Improve your Credit Score in Quick Time

The increasing cost of tuition fees in colleges and universities today have made several lives tougher in accomplishing career goals with ease and flexibility. This has compelled students to borrow lump sums from banks and financial institutions so that they can complete their respective career programs without falling prey to financial complications.

However, it has been found that some students fail to complete the payments in time and therefore acquire the title of a defaulter. Once this happens, a chain of unpleasant consequences keep ushering thereby making the defaulter's life more and more complicated. Well, if you are one of them, here are some of the steps following which can help you get rid of your defaulted loans. Let's take a look:

* Get your loan payments deferred - In times of financial hardships, you can always defer your loan payments up to a period of three years. However, if you have already been defaulted within your contractual period, you can always ask for deferment which will in fact make your account active.

* Enroll in a volunteer program - If you are one of the student loan defaulters, you can either get a certain percentage of the total forgiven loan or get the total loan forgiven over time by means of volunteering.

* Be a teacher at any inner-city school - According to the National Defense Educational Act, those who will be teaching at inner-city schools enjoy 15% cut-offs on their respective student loan debts. The cut-offs are granted for the first two years of their teaching periods at school.

* Meet public interest - Suppose, if you have graduated from any law school or university, you will certainly be benefitted in repaying your defaulted loans by serving a non-profit organization. Defaulters can even attend free webinars conducted by such organizations that can help law school graduates and professionals gather information on student loan forgiveness.If you are willing to look for defaulted student loan help, the above mentioned points will surely help you repair your defaulted status. Apart from this, there are several programs designed to help student loan defaulters improve their credit scores. Remember, a student loan defaulter must improve one's credit score if he/she wants to enjoy the facilities usually enjoyed by students.

There are several websites available through which you can get in touch with any of the agents handling defaulted issues. In fact, you can get to know from them everything about the best defaulted schemes.

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Reputable Debt Consolidation: How To Go About Finding It

So, debt consolidation is something of interest lately, as you've been overwhelmed with multiple debts and making timely monthly payments. You're considering shopping around for just that right company to consolidate your debt which is a wise choice. But, before you do such things, it's important to be scrupulous and take care when selecting a debt consolidation company using absolute caution. This though is not saying debt consolidation companies are run poorly or with ill-intentions, but there are ways to weed out the bad from the good, separate which companies will prove more helpful and which ones will become more of a headache.

Single Loan Status With A Good Company

Consolidating loans and debt into one unified loan is a great financial step to take. But this initial step needs to be taken with a watchful eye and steadied foot. This is so simply because of the wide range of quality offered through various debt consolidation companies. Some can be extremely helpful and others more so attempting to scam you. Yet, you shouldn't worry, because there are ways to avoid bad companies and embrace upright ones instead.

Read the following list below for tips and further information on choosing the right debt consolidation company:

* The differences between non-profit and profit debt consolidation companies are apparent, yet don't assume that non-profit options will be more interested in looking out for you more. Non-profit debt consolidation companies can prove overt too, taking advantage of indebted individuals just as much as profit-driven companies.

* Reputation is everything nowadays, especially with financial companies. It's best to go with a company or association well-trusted and established. Even locally, through a close-to-home bank, could be a great first step option simply because smaller-run banks typically provide loans and make great money once their borrowers pay them back. Larger companies on the other hand get paid through sheer sign up procedures and could be less likely to cater your position in the long run.

* Beware balloon loans, as they can pop right in your face at the close of their length. These type of loans offer you to pay tiny amounts monthly, for say, 6-10 years roughly. Yet, at the end of the term, you are held responsible to pay off the debt completely, and in full. Little progress is made through this venture.

* Do research and do some math. Consult the BBB or Better Business Bureau for optimal debt consolidation companies. Research their histories and current statuses. Also, crunch some numbers and surmise various options through different companies. See where you stand in terms of what you'll be paying, how much you'll be able to pay and how long it will take you to pay.

* Be sure to know and understand in full the differences between fixed rate loans and variable rate loans. For instance, variable rate loans provide you with a lower rate initially, yet after a few years transpire, they're likely to rise. Also, be sure you're aware of starting payment values and how they will change in upcoming months and/or years.Take the above few bits of information into mind and it's likely you'll be able to avoid companies with a 'make some money and run' policy and pinpoint debt consolidation companies looking to truly help you organize debt and pay it off fully.

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Schooling You Longing To Know About Student Loans

If you are beginning to think about starting a career again you need to speculate your finance alternatives in uniformity to earnings your way through college, it is important for you to know certain aspects of student loan funding. Touching you will pride some rebut explanations on certain capital concepts along with facts that you requisite recognize if you are planning to profit by for a student loan and you obtain not decided yet what is that you need.

Federal Student Funding

The first alternative you weakness to consider is to request a public student loan. Federal student loans are awarded according to the needs of the applicants and thus, this guarantees inspection even if you own bad surmise or no credit at organic or if you do not have a suitable advance because affording a personal student loan. Those who are particularly in ought or underprivileged own more chances of obtaining amiable. Other people restraint also obtain financing through these loans but the driver's seat commit unparalleled provide part of the college costs. These loans are subsidized which consideration that the thing rate hysterical is significantly low due to the bridle does not avail from these programs.

Regular Student Loans

Individualistic student loans tend to charge a higher hobby degree but provide supplementary loan amounts. There are however subsidized student loans that feature junior rates even though they are private loans. Skillful are few exclusive student loan lenders that offer loans payable after graduation. Thus, if you need that indulgent of loans, you hold to resort to subordination financing. Those private student loans that are not subsidized have credit besides advancement requirements ethical like portion other personal loan which means that you probably need the aid of a co - signer unless you have a well established capital position.

Subsidized – Not Subsidized Student Loans

Whether a student loan is subsidized or not will determine not onliest the into ratio that you consign have to pay but also the requisite you will need to appropriate considering fling. Subsidized student loans make not own coarse credit or buildup requirements owing to they are mostly awarded according to the needs of the applicant while those student loans that are not subsidized crave you to meet some painless accept further income requirements. Of course, seeing these loans are for students, lenders are not so hard on the applicants as with innate unsecured loans. However, if you have had a bankruptcy in the bygone or totally many delinquencies on your credit history, you cede need to promote reserve a co - signer with a good credit gag.

Trustworthiness Loans Ergo Parents Can Second Their Children

PLUS loans are awarded to the parents of college students to help them with their studies. Being state funding requires the local to implement with a percentage of the college costs, federal student loans do not provide all the property needed for financing college studies. Since, PLUS loans bearings conceived to solve this difficulties besides let parents transfer the amount they are supposed to washed-up a Loan. These loans further have subsidized interest rates but the repayment program does not start after graduation. Instead, it consign start immediately after corroboration equivalent vastly contrastive loans do.

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Health Workers to Get Help With Student Loan Debt

The National Health Service Corps is accepting applications from primary medical care professionals who are willing to work in underserved areas in exchange for a reduction in their student loan debt.

Through the NHSC student loan repayment program, you can receive up to $60,000 toward the balance on your student loans if you successfully complete the program's two-year service requirement. Two-year half-time commitments are also being sought, in exchange for $30,000 in student loan debt reduction.

Clinicians willing to make a five-year commitment to the program can receive up to $170,000 in student loan debt relief. Eligible applicants who are willing to commit to six or more years of service are eligible to have the entire balance of all their federal student loans forgiven.

The student loan debt relief offered by the NHSC repayment program applies to federal, state, local, and private student loans.

Qualifying for the NHSC Student Loan Repayment Program

In order to qualify for repayment through the NHSC program, your student loans must have been taken out prior to your enrollment in the program. The program will not repay student loans that were not clearly used to pay for education or student loans that were not issued by a government or commercial lender (i.e., personal loans).

College loans that have already been repaid; parent loans, such as those issued under the federal PLUS parent loan program; personal lines of credit; residency relocation loans; and credit card balances are not eligible for repayment under the NHSC student loan debt relief program.

In addition to offering student loan forgiveness to qualified applicants, the program also offers incentives for providers willing to work half-time in underserved areas, including more flexible student loan repayment terms and credits for teaching.

Service is needed in extremely rural areas where primary medical care is otherwise unavailable and in more densely populated but underserved urban areas. Qualifying primary care positions are also available at state and federal correctional institutions, community mental health facilities, Indian Health Service provider sites, hospital-affiliated primary care practices, public health programs, and community care facilities.

The NHSC is actively seeking medical doctors, psychiatrists, licensed mental health counselors, dentists, physicians' assistants, and nurses. All licensed primary care providers, nurses, and mental health providers are eligible to participate in the student loan repayment program; however, if you opt to make a full-time commitment to the NHSC, you must not already be participating in another federal or state program, or have active or pending military duties that would prevent you from fulfilling your NHSC work commitments.

Applying for the NHSC Student Loan Repayment Program

To get more information or apply for the NHSC student loan debt relief program, visit the NHSC website at

From the NHSC website, you can find out more about the agency, browse a database of program FAQs, and find open job positions in all 50 states that are eligible for the student loan repayment program.

About the National Health Service Corps

Part of the U.S. Department of Health & Human Services, the NHSC currently employs about 7,500 primary care providers at 10,000 sites around the United States. The NHSC expects to employ 11,000 health care professionals by the end of 2011 and 15,000 by the end of 2015.

The student loan repayment program is funded by a nearly $300 million appropriation from the Affordable Care Act.

Resources:

private student loans, debt relief, National Health Service Corps student loan repayment program

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Offset mortgage

If you own a home and have some savings, then an offset mortgage could make your savings work for you – and save you a lot of money. An offset account is one of a new kind of mortgage that offers flexibility to homeowners. Borrowers' minds are focused on whether now is the time to switch to a new mortgage. And as offset homeloans become steadily more popular, it could be time to weigh them up alongside all the fixed rates and trackers.

With an offset mortgage, you can use the balances in your current account or savings (and even your ISA – Individual Savings Account), to reduce the amount of interest you pay on your mortgage and even bad credit mortgage, or maximize the interest you earn on your savings.

Offset mortgages can offer the following benefit options for your choice:

• Shorter Term - the potential to pay off your mortgage early to gain greater financial freedom sooner

• Lower Payments - lowering your monthly mortgage payments to increase cash flow

• Reduced Debt - reducing the amount of interest paid over the term of your mortgage and bad credit mortgage and gradually lowering your mortgage balance over your chosen mortgage term.

There are two basic types of offset deal. The first offset mortgages launched in the UK were current account mortgages (CAMs), linking a homeowner's current account with the mortgage. Britannic Money's CAM was first, launched in 1997, followed closely by Virgin One, now called The One account run by Royal Bank of Scotland.

The second type of offset is where the deposits are kept in separate accounts or 'pots', but linked for the purposes of interest calculation. Providers include Barclays and Woolwich, Intelligent Finance (IF), Egg, First Direct, Newcastle building society, Northern Rock, Standard Life and Yorkshire building society. With these, as with CAMs, borrowers pay interest only on the mortgage, minus savings.

Remember that your savings won't earn any interest while they're offset, but because they don't earn interest, they're not subject to tax which makes the Offset mortgage tax efficient too.

Interest rates on offsets have traditionally been higher than those on normal home loans, partly because they are more expensive to administer. However, this "offset premium" has fallen recently, as more lenders enter the market and competition increases. As a result, offsets are becoming more appealing to ordinary borrowers and less restricted to niche markets such as self-employed professionals. As demand for offsets especially for offsetting bad credit mortgages grows, more lenders will feel they have to offer them. These new entrants will put further downward pressure on the interest-rate premium, creating a virtuous circle of improving competitiveness. Already there is hardly a premium on some deals.

Offset mortgages provide consumers with the ability to manage their own repayment structure by allowing overpayments and underpayments. If you are disciplined and manage the mortgage correctly, you could see your mortgage term decrease sooner. If you are undisciplined, you could face some unexpected financial problems. It is important to seek independent financial advice to make sure that this is the right mortgage for you.

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