Business and Finance

Archive for December, 2011

A Debt consolidation loan is a loan used to reimburse several other debts. It is a low cost loan secured on collateral as your home, your vehicle or any expensive asset. DEBT CONSOLIDATION LOANS consolidate all debts incurred through personal loans, overdrafts, or any number of unpaid bills. Debt consolidation gives you a fresh start, making it possible for you to consolidate all of your loans into one, providing you with one easy payment to manage, and that too at a lower rate of interest.

It follows the old proverb that an iron is used to cut iron. The payments, which we build up, are normally the small credits that we take for our personal needs and are not able to pay for them and thus they mount up and finally we avail another personal loan in form of debt consolidation to cut down the payments of earlier loans. Secured debt consolidation loans are easy to indulge in.
Secured debt consolidation [http://www.loans-park.co.uk/SecuredLoans_Debt-Consolidation-loans.html] is the most prudent way of getting rid of multiple creditors, who may be making your life hell with their threatening phone calls. With secured debt consolidation loan, you can enjoy the following benefits:

Low rate of interest: Due to the assurance in the form of collateral attached, the lender keeps the rate of interest low and you, as a borrower have the satisfaction that you will have to pay less.

Manageable loan repayments: Due to low interest rates and long tenure you tend to pay small payments every month and thus they are quite easy to pay and help you move on to a debt free future.

Long tenure of loan: Since some collateral is attached to the loan, the creditor gives out the loan for a long term and thus makes it possible for you to return the payment at your ease with time in hand.
With so many online loan options available, it is quite effortless to get yourself a stable future with no debts.

You are eligible to apply for a credit card if you are 18 years of age and have a standard source of income. In countries like US, the lenders ask the credit bureau for your credit report and run a check through your credit profile to check if you have outstanding bills, loans or mortgage on your account. They make their credit decision after going through your credit file.

In countries like US, a consumer is considered to be low-risk if he or she lives in their own home and/or are in a profession for at least two years. Such a person attracts a low rate of interest for his credit card. A person who has outstanding dues to pay or does not have a fixed source of income may be eligible for a credit card but at a high rate of interest.

However the scenario is different in India, an upcoming economic superpower in Asia. Indian banks have been charging equal rates of interest for credit cardholders regardless of the payment history, economic status or credit profile. However the application of ‘different’ rates of interest based on credit history and source of income is gaining ground in India. In future, it looks that the provisions for application of interest on credit cards will be the same as in US. The average rate of interest on a credit card in the US is 13-14 percent per annum while in India, it is 33-34 percent.

What the card holder should know

According to the Truth in Lending Disclosure, (TILA) implemented by Federal Reserve (US) in 1988, it is important for consumers to know the cost and terms of credit. This means that the information in a credit card agreement should be in a comprehensible, easy to read and easy to compare manner so that consumers can make an informed decision.

It is important for the consumer to go through the terms and conditions of the credit. He or she should also find out the annual fees of the card and do a comparative analysis. There are some credit companies that charge annual fees and there are others that do not.

Every credit card company gives value added features like Billing Dispute Resolution, Purchase Protection, Extended Warranty, Fraud Early Warning, Accident Insurance, and Insurance of loss of luggage and many other features. There are even issuers that provide credit for low promotional rates or even zero percent interest rate. The idea is to promote the card and make the card holder make good use of the card. Till the time of promotion, the credit card holder has to pay meager or no interest on the outstanding balances.

How you can use your credit card to your advantage?

If you are quick on your payments and do not exceed the credit limit, you can call the credit card customer service wing and negotiate for a lower interest rate. If you’ve been a good credit history and relationship with the company, they will definitely oblige.

You can also call up the credit company and ask for a late fee waiver. In case, you are incorrectly charged, you can also get credit as a good will gesture. You can also ask for a credit line increase. Not to mention benefits like value added features, insurance protection, merchandise dispute protection and cash back offers. However all of these are marketing tactics for you to buy the plastic money and use it. However it is important to use your credit card sensibly. Financial experts state that your credit payments should not exceed 15 percent of your net take-home salary.

Now you do not need to wait in line,for days on end, for your credit card application, to be approved. You can apply for a credit card online too. Some of the best deals in online credit cards are available with major players like:

Please note that the credit card brands given below are all exceptional and popular in their own right. The brands given below are not ranked in order of importance.As a prospective customer, you can click on the links and make a cost-comparative evaluation to decide which one offers the best terms of credit that is tailored to your interest. The listings of credit card brands is just to make your life simple and make it easy for y0u to check, compare and apply for credit card online from one place rather than go to different websites.

In the investment world, there are two words we hear more than any others–stocks and bonds. While each can offer their own advantages and disadvantages, both should be included in your portfolio. As a general rule, stocks have outperformed bonds since 1926; returning 10.4 percent against government bonds’ 5.4 percent showing.

However, when stocks go bad–and they will–bonds will always be there for you. Over short periods of time (like the bear market of 2000 to 2002) bonds easily outpaced the growth of stocks. However the world of bonds can be a confusing one, so let’s learn a little more about them.

Why to get fond of bonds

The first word in smart investing is “diversification”. That means you own a good mix of volatile stocks and steady bonds in your portfolio. When one takes a hit, the other will usually hold steady.

Whereas stocks will only give you liquid results when you sell, bonds pay interest regularly, making them an attractive investment choice for retirees looking for regular income.

Bonds are also some of the some of the safest investment choices you can make, second only to cash. U.S. Treasuries offer a risk-free vehicle of stashing funds for a limited amount of time, and you’ll usually see modest gains while you’re at it.

Also, many bonds provide income that’s tax-free. That’s a good thing, even though most of these pay a lower yield than what you might get from taxable bonds.

Bonds at work

When you purchase a bond, you’re basically lending money to a corporation or the government so they can go about their everyday business or complete certain projects. In return, they pay you interest annually and then give back what you’ve invested once the bond “matures”, meaning its term ends.

Now for a little lingo. A bond’s “par value” is the price paid for it when it was new. A “coupon”, is what the bond pays annually in interest. For example, a $10,000 bond paying 8 percent a year would have a coupon of $800. If you don’t buy a bond new, you’ll be purchasing from another person in the “secondary” market, and you’ll pay the current market price on the bond (which fluctuates daily) though still receiving the same coupon. A bond’s “total return” is all the money you will earn off of the bond. That includes the annual interest along with its loss or gain in the market.

Bountiful Bonds

There are a ton of bonds to choose from, but the safest choice is a U.S. Treasury. Interest and payments on these are guaranteed by the “full faith and credit” of the United States Government.

Within Treasuries, there are several bonds to choose from, all requiring different investment commitments, terms, and interest rates.

You can also choose from mortgage-backed bonds, which can yield around 1 percent more than Treasury bonds with a typical $25,000 investment. Then there are corporate bonds. Most of these are issued in $1,000 denominations and have terms ranging form one to 20 years, or even a few weeks to 100 years. The values of corporate bonds depend on the credit of the company you’re bonding. Like everything else, it’s a risk-reward proposition when selecting a corporate bond.

Finally, you can also purchase municipal bonds in state and local governments and agencies. These are usually available in denominations starting at $5,000, with terms of 30 to 40 years. The great thing about municipal bonds is that your interest returns are typically exempt from most federal, state, and local taxes.

Risk-Reward

Though bonds are typically less volatile than stocks, there are still risks. Interest payments can be worn by inflation. If interest rates rise, bond prices will fall. Also, some bond issuers reserve the right to “call” back bonds before term. If this happens, you’ll only get “par value” on the buy back, though “callable” bonds offer higher interest returns than noncallable bonds. Also, if a corporation you have bonded goes belly-up, say goodbye to your money. Finally, bonds, as with most investments, are at the mercy of the ups and downs of the everyday market. Just remember, the longer before your bond matures, the more unpredictable it becomes.

Getting the perfect gift for a college student is easy. College is a time when students are scraping for cash. Each semester can be really harsh on their wallets. Classes can get in the way of them having a simple part-time job. As the saying goes, generally college students are always broke. There is no getting around it. So what would be the perfect gift for a college student?

Well, being a college graduate I know how to answer this question. I remember the days of being broke. I felt like all I did was eat and study, study and eat. I could not wait to come home to get a complete meal and the comfort of bathing without having to wear shower shoes to protect myself from strangers’ germs. When my family members would ask me what I wanted for my birthday or a holiday gift, I gave them the same answer every time for 4 years straight: Money! It was what I wanted and needed, all at the same time. Now, some family members would still go off-script and buy me things that I never used, but for the most part I looked forward to receiving greeting cards because I knew what was inside – cash. Even though my college days were some time ago, the concept of college students needing money has not changed. The way money is given, though, is entering a new era. Giving cash is kind of “old school” to a college student these days. Prepaid cards are the new way to give money.

The main benefit to prepaid cards is that they can be purchased very simply and can be used virtually anywhere credit cards are accepted – including online and the campus bookstore. The best part is that because there is a set limit, there will be no over-the-limit purchases or over-the-limit fees related to the card. The college student in your life will be able to make purchases and learn how to budget at the same time.

Another benefit of prepaid cards is that gift recipients can purchase anything they’d like and they are not confined to making purchases from a single store. College-aged students have ever-changing preferences so it is wise to let them be in control of what they buy. They can put money toward books and supplies. They can spend it on dorm room necessities. They can buy groceries, clothing, music, or spend it on an endless number of items. No matter how you slice it, getting a prepaid card is the perfect gift for a college student. And remember, as a parent you can get a double benefit – give the perfect gift, and use it as an opportunity to teach them about making wise financial decisions while on a budget. Budgeting is definitely a lesson that all students need learn before they get out in the “real world”.

L. Waters
Writer, LowRateSearch

Applying for a prepaid gas card may have lesser hassle compared to applying for a gas credit card. However, there are a few considerations that you have to keep in mind before initiating a prepaid gas card application. The following can act as your checklist when considering whether to sign up for a gas card which is prepaid in nature.

Rewards and Prizes

Most people sign up for a prepaid gas card to get free gas. However, companies issuing the gas cards offer some other form of rewards and prizes apart from just free gas. They can be car accessories, gift certificates, household appliances and much more.

If your purpose of signing for the card is to get free gas or cheaper gas, inquire whether the card will offer rewards such as discounted gas, gift certificates for gas purchase or even free gas for your next purchase. Do keep in mind also that loyalty will be rewarded as well. Thus, by holding a prepaid gas card for a longer period, the rewards will become very significant.

Gas Purchase Rebates

Some prepaid gas cards offer on the spot gas rebates, which is equivalent to discounted gas. Different stations and different prepaid gas cards may be offering rebates at different rates. However, there might be a fine print on minimum spending before you can qualify of such rebates.

Terms and Conditions

There are some prepaid gas cards which might have terms and conditions that require your attention prior to application. Some cards have requirements such as minimum monthly spending, commitment fees, application fees and whether the card can be used by anyone else.

Not reading the terms and conditions properly might lead to overspending on gas instead of savings. Also, you risk getting your card canceled if you fail to abide their terms and conditions that you have agreed to.

FHA home loans have quickly become the mortgages of choice for cash out refinancing and new home purchase financing. Raising capital with a home mortgage was definitely more easy in past years. As many consumers have found out the hard way, home equity loans have practically become extinct. Unless you have perfect credit and are able to provide full income documentation to the lending underwriter, you don’t have a shot. Did I mention you also need to be under eighty percent loan to value as well? Just last year no equity was required to get cash out with 1st or 2nd mortgage refinancing. After record breaking number of foreclosures every month, most lenders wised up and cut off the home equity loan product line.

In 2008, the thirty year fixed rate mortgage remains competitive and historically pretty low averaging in the mid six percent range all year. For the first time, FHA mortgage loans actually dropped below the conventional interest rate levels. FHA home loans typically carry a little bit of a higher rate because of the increased risk factor that goes along with no equity and lower credit score requirements.

Home financing analysts anticipate that mortgage rates should steadily increase in 2009 and 2010 in an effort to prevent more inflation. Over the last few years, most homeowners have refinanced to an interest rate they are very comfortable with.

With all of the foreclosure scares and loan modifications being offered by lenders, its a wonder that anyone is refinancing these days. Believe it or not, if you get outside of California, it’s business as usual in most parts of the country. Areas like North Carolina, South Carolina, Texas and Oklahoma have actually reported slight increases in home values in certain counties.

With the market changing, it is important for homeowners to understand how FHA home loans work. These are government insured loans that have mortgage insurance requirements each month. The mortgage insurance is tax deductible and borrowers can do a streamline refinance at any time with no pre-payment penalties.