loan Archive

How To Escape An Upside Down Car Loan

Do you really know how much it costs to own your car? Is your car loan upside down or underwater? Here are some thoughts on the subject.

If you get help today, then you can escape from the car loan. The repayment of the car loan is possible for the people. There are many discussions available with the experts for the repayment of the car loan amount. The checking of the essentials is important for people.

I often wonder what it’s like to drive those fancy new cars. You know, the ones with the flashy paint and the equally flashy price tag. But, I stick with my paid for 1994 BMW 3 series that I bought with cash. It has 177,896 miles on it, some scratches on the paint and a sunroof that needs some TLC. Why? Because I don’t want to be broke.

Upside down on your car loan? From Upside down on your car loan? From Aparatoc

One reason why you could be broke is because of the amount of spending done on expensive high ticket items without a careful analysis about the true costs involved, especially when it comes to a seemingly innocuous asset parked right outside your front door. If you look at those who are hopelessly overextended, there’s more to their plight than just troubled mortgages or maxed-out credit cards.

How Much Do You Spend On Your Car?

When it comes to spending on an automobile, of course, some do it in the name of fuel efficiency and being green, while others do it because they need bigger, faster, or simply newer cars. The notion is that we are what we drive. What a load of BS. According to the US Census Bureau and the Bureau of Labor Statistics, the average American family is spending $8,600 a year on cars.

These surveys let us know that the average middle class American family is spending up to 20% of their take home pay on car payments alone. This doesn’t count what they have to spend on insurance, maintenance, gas, and whatever else tickles their fancy. That’s almost as much as the current guideline on what you should spend on your house!

Car Loans Are A Drag

So is it the price of the vehicles that’s driving this trend, the average length of the financing contract, interest rates or all of the above? Looks like “D-all of the above” is the answer. According to Edmunds.com, over 90% of new car loans and 81% of used car loans are longer than 4 years. I thought that 5 years was the norm, but apparently somewhere in between 5 and 6 years is the average length of a car note. Of course, these longer loans make financing an attractive proposition since the payments are so low, but what many buyers fail to realize is that the amount of interest paid on the loan coupled with the amount of time the buyer spends being upside down in their loans (owing more than the car is worth) makes these loans a costly option.

The second driver in the high cost of vehicle ownership is the number of loans that begin with negative equity. This is what happens when an unpaid car loan is rolled into a new car loan when the old vehicle is traded in. It’s what really happens when the dealership offers to pay off your car no matter how much you owe. This part of the loan is not secured by the new vehicle and can cost as much as double as the rest of the loan. This portion of your loan is also not covered by insurance if your car is stolen or totaled, which can be even more devastating to your bottom line if you have to pay out of pocket.

How To Escape An Upside Down Car Loan

Maybe you’re tired of making car payments. So, what can you do to get yourself out of car loan hell? Believe it or not, you do have options. Let’s take a look at what you can do (some methods are more radical than others):

  1. Sell your car? If the car you own is a big money pit, then you may have to consider unloading it for something that’s much more manageable, financially. If you can actually pay off your car with the proceeds from selling it, plus pay cash for something more affordable, then DO IT. This is the single most effective way to reduce your vehicle costs. Granted, this solution may not be the easiest one to swing.
  2. Refinance your car. So, you’re still upside down on your loan. See if you can refinance the loan. If you have decent credit, this shouldn’t be a big deal. If not, you may not qualify.
  3. Repossession. This is the worst case scenario. Your credit will take a huge hit, plus you’re usually still on the hook for the difference between what you owe and what your car sells for at auction.
  4. Drive your car until you can sell it. This is usually the best option for individuals who are upside down in their loans. Continue making your payments until the loan has reached the point to where the balance can be paid through selling the car.

Auto Loans Have Helped Millions Realize Their Dreams Of Owning A Car

Auto loans like Personal Loans are very handy for purchasing any vehicle if you do not have sufficient savings to make an outright purchase. These can be used to buy new cars or second hand cars. The terms and conditions for loans for new cars are better than those for used cars but a lot depends upon other factors also.

Firstly, loans for cars are usually secured loans which mean that you will have to offer collateral as security against payment. The collateral can be the car or your house. This is done to protect the interest of the lender. You can even take a homeowner’s loan to purchase the car.

A certain amount of down payment is expected when you go for an auto loan. In some cases, the down payment expected may be of a larger proportion than normal. Although it may appear difficult to cough up a substantial amount of down payment, in the long run, it actually works out for the best. This is because then your monthly repayments become considerably low putting less pressure on you. Also, if you do not make a down payment, the interest charged will be very high.

Other than secured loans, unsecured loans can also be got but, again, here the rate of interest will be very high. Unsecured loans do not require collateral and are usually available in the form of personal loans.

People with bad credit need not despair as bad credit auto loan is also readily available nowadays. Earlier, it was difficult to get loans if you had a history of bad credit but since the car consumption has increased by leaps and bounds, it is in the lender’s interest also to make bad credit car loans easily accessible.

The catch here will be large rates of interest unless you manage to give a good amount of down payment or are in a position to offer collateral. In severe cases, lenders may require co-signers in order to extend the loan. Getting co-signers too is not a bad idea especially for students as they can get their parents to be co-signers.

You can also get your auto loan refinanced if you are unhappy with the current rate of interest. Many lenders are willing to be a part of refinancing. The interest on the new loan will be cheaper than on the existing auto loan. The internet is a good place to make comparisons of all types of auto loans and is a much faster and less tedious method of getting information about the loans.

Auto loans have helped millions of people realize their dreams of owning a car and are certainly very popular and useful.

A certain amount of down payment is expected when you go for an auto loan. In some cases, the down payment expected may be of a larger proportion than normal. Although it may appear difficult to cough up a substantial amount of down payment, in the long run, it actually works out for the best. This is because then your monthly repayments become considerably low putting less pressure on you. Also, if you do not make a down payment, the interest charged will be very high.

Credits can likewise be depicted as spinning or term. A rotating credit can be spent, reimbursed, and spent once more, while a term advance alludes to an advance paid off in equivalent regularly scheduled payments over a set period. A charge card is an unstable, spinning advance, while a home value credit extension (HELOC) is a made sure about, rotating advance. Interestingly, a vehicle advance is a made sure about, term advance, and a mark credit is an unstable, term advance.

10 Tips To Minimize Your Student Loan – Learn The Tips

It’s a little scary when you first think of it, the fact that you have to begin your educational journey with debt. But college is a must today if you’re looking to achieve success in your professional and personal life. Almost every employer demands a degree, and even if you’re planning to go into business for yourself, college offers you four years of experience that you cannot afford to miss. But you need money for a degree, and unless you have access to a scholarship or a fund that your parents have set up for you, you need to take out a loan.

The downside to a loan is that you have to pay it back, and this puts pressure on you to find a job that pays well as soon as you leave college. So if you’re smart, you’ll try to keep your student to a minimum so that your future financial burden does not become too heavy a cross to bear. Here are a few tips to help you do this:

With the use of the correct tips, you can get a car loan from Title Loans site. You should get the amount either in the cash or bank balance. The repaying of the loan is within the specified time. The collection of the right information will offer the benefits to the individuals.

  • Apply for scholarships:

Even if you don’t secure one in your first year, you do have opportunities in your second and third years if your grades are good. The key is to keep looking and applying.

  • Start saving:

It’s not an easy thing to do, but if you’re the kind who plans ahead, you could start saving for college while still in school. Your savings may not amount to much, but money is still money, especially when it means you reduce your future burden of debt.

  • Take a year off to earn money:

If you’re able to get a job even without a degree, you could use a year after high school to save up for college instead of taking out a loan.

  • Study online:

It’s a cheaper way to earn a degree and one option that allows you to continue working as well. So you are saved the hassle of borrowing to finance your education.

  • Seek help from loved ones:

Very often, monetary gifts from loved ones go a long way in helping to keep your debt down. Tell your friends and family that you are saving up for college and ask them to contribute what they can towards your endeavor.

  • Reduce your expenditure:

Keep your expenses down in college – remember that every dollar that you don’t spend today is one that you don’t have to repay with interest in the future.

  • Get a job:

It may be hard to manage a job and your studies, but a part time job helps you earn money for your expenses instead of having to use your loan money for the same.

  • Minimize usage of your credit card:

It may seem like easy money, but when it’s time for the bill to be paid, you’re going to find yourself in a quandary. And the longer you defer paying your balance, the higher the amount becomes. So the best thing to do is to use your credit card only in emergencies and then pay off your bill at the earliest.

  • Don’t borrow or lend money:

They may be your best friends, but when it comes to money, it’s each to his/her own. So don’t borrow money or lend any to anyone, even if it’s just a few dollars. Money has a way of ruining relationships like nothing else, and if you become a habitual borrower, you know there is no end to it.

  • Maintain good grades:

One way to ensure that you get a good job on graduation or even before that is to maintain good grades. Employers are always on the lookout for successful achievers in the academic and extracurricular departments.

Get Approved for Your NEXT Home Loan Application

Why me? Many people applying for a home loan are rejected. The following are some tips to make your home loan application process more successful. Initially what happens if you are rejected for a home loan application is this. You receive a turn-down notice from the lender explaining what the reason for the decision and in most cases you will be contacted by the bank, credit union or broker personally. You should then ask for any and all personal and financial documents you had provided for the application. The financial institution is required to keep a copy of what information was used for the credit decision but all originals are required to be returned to the applicant.

Tip # 1 – Understand your credit score and what it means:

In today’s world your credit score is your buying power and this means if you have a credit score below a good rating which is around the 720 mark you have a much better chance of getting approved for a mortgage loan. Also you should as a concerned consumer be periodically checking where your credit scores is to make sure all transactions and additions are correct. There are many site out there like, yourmoneycounts.com, www.myfico.com, www.equifax.com. These sites will allow you to view your credit and help you make an educated decision on how should proceed.

Tip # 2 – Check your income:

This is missed more times than you would think. Most people think that they can pay rent and all their bills and their credit score is over the magic 720 or 740 depending on who you talk to, so they should be able to buy a house. Here is the formula you should use. Gross income – all debt on credit bureau + rent if renting = DTIR (debt to income ratio). Keeping this at 36% or less is optimal. If you are over 50% in most cases no matter how good your credit and reserves are you will get turned-down. Different online lenders are available for green loans which are stealing the money of the person. Proper survey should be done at the official site promogreenloansvip2.com to reduce the chances of money loss. The amount available in the reserves and credit should be turned down to stop the stealing of money. 

Tip # 3 – Cash reserves and down payment:

Depending on the type of loan you are applying for weather it is an FHA, conventional mortgage, VA, you will need to show cash reserves and down payment money that can be sourced. This means there has to be a paper trail to prove you didn’t just have it in the home safe or you didn’t take out a loan to get the money. Good sources are gifts from parents to cover your down payment, 401k, stocks for reserves, also checking and savings accounts in your name.

Tip # 4 – Paying for everything with cash, not a good credit decision:

If you are old school and think that keeping your bank roll at home because you don’t trust the bank, you are in for a wake-up call when applying for a loan. You will find out that you do not have a credit score let alone any credit history. This will automatically be a rejection. Get a small consumer loan or a credit card and pay it off every month to get the ball rolling.

Tip # 5 – Due your due diligence up front:

Sit down with a banker or mortgage broker and get a free consultation. They will do this for you because they know if they are able to get you pre-approved for a mortgage loan you will trust them when you are ready to make the move to the application. You will then know where you stand with everything, credit score, purchase amount, down payment, everything that is involved. This proactive move gives you an educated outlook on what you are attempting to do and also what to expect throughout the process.