A Home Equity Line Of Credit and Borrowing

What Is A Home Equity Line Of Credit
If you are interested in borrowing money against the value in your home you will find that you will be given two separate options. There is the option of a home equity loan or a home equity line of credit. Many people get these two types of loan confused as being the same thing but they are not. They are two totally different types of debt.

When speaking of a home equity loan you will be given the entire lump sum of the loan value at one time. This is perfect for when you are doing a large project such as a home improvement or even purchasing a new vehicle. You will also have a set payment amount to be paid every month until the loan is paid in full.

A home equity line of credit works completely different. Rather than being given a lump sum of money like a home equity loan you are given a line of credit, which is a flexible amount and can be used over a certain period of time. It is very similar to a credit card and you can have access to the funds whenever you need them.

The Advantage Of A Home Equity Line Of Credit
If you are considering obtaining a home equity line of credit you will be happy to know that you will only be required to pay the interest on the funds that you have withdrawn from the credit line. This makes budgeting your money a little more manageable. Another advantage is that most often there are no closing costs associated with this credit line. This will save you money when it comes time to get the loan.

The Disadvantage Of A Home Equity Line Of Credit
With advantages there are also disadvantages. The first disadvantage is that the interest rate associated with this type of line of credit is a variable rate so that it can change and can often make a large difference in your payments. More often than not the interest rate will go up and not down. A second disadvantage is that if you have a home equity line of credit it is possible that you credit history and income amount will be reviewed every so often and it is possible that if your credit score drops that the lender will close your line of credit.

Tax Deduction
The repayment amounts on a home equity line of credit that are made every month as well as the interest that is made could possibly be tax deductible. However there may be limitations to it. You will find that only part of the interest can be deducted and it cannot exceed the value of the collateral on the home. It also has to be less that the amount of $100,000.

Conclusion
Home equity lines of credit may be the perfect solution for you if you want to have access to cash but you do not need it all right away. It might also be possible that this type of loan could be a tax deduction. If you have questions you should contact a financial consultant and they will be able to lead you in the right direction.

Analysis of hard money and purchase money loans

Purchase money loans are the loans that are used by borrowers who want to buy a new home. Hard money loans were not existent in the older days and people used to trade gold and other precious stones for all their transactions. People who have dreamt of buying a new home would be in need of a financial assistance program in order to satisfy their needs. For obtaining a new home, one has to either purchase an old home from a seller or should contact a builder to build a new home. Continue reading

Looking for a loan to run your small business?

Guaranteed Loan Program

The Federal Government runs Small Business Administration (SBA) which provides finance for growing small business operations. The Guaranteed Loan Program or Debt Financing does not provide direct loans for businesses; it sets an eligibility framed by its partners. It ensures repayment of loans by eliminating lending partner risks. If the loan borrower has access to some other financing scheme, the guaranteed loan program may not be provided to such small business. The terms and conditions in providing these loans may change from time to time depending upon the economic status of the government and the priorities may change as well. Continue reading

Tips to Pay Your Insurance Premium on Time

Insurance is a kind of risk management technique used to hedge against risk of unexpected loss. For this risk management, you need to pay certain amount to the insurance company as the insurance coverage known as the premium and if you fail to make insurance payment it may lead to lapse of insurance policy and may also have a black mark on your credit report, so always you need to pay your insurance premium on time and if you are incapable to pay on time due to lacking of money, opt for short term loans such as a paydayloans which you can repay on next payday to secure your insurance policy from lapsing. There are several types of insurance available in the markets such as car, travel, health life, home, business, health, pet and so on, you can choose apt for you based on your need.

Some of the proven tips to PPI claims on time are:

Make use of payment app:
You can use payment app such as PayPal online or you can download in smartphone to pay make your payment from anywhere and anytime. These apps have notification feature which notifies you periodically to make payments. Installation of these app safeguard you from late payments as you can make payment by using your debit or credit card just in a click by just sitting in comfort of your home.

Use automatic payment option:
Many insurance companies provide automatic payment option which can automatically remove the monthly instalment fee from your bank account or debit/credit card. By opting automatic payment deduction option, you can save some money annually on your insurance plan. The most appealing feature of this automatic payment is that you need not to remember to pay your bill, which is sometimes very difficult for most us.

Set up a calendar:
You can set up a calendar for all you payments in by using software like Microsoft Outlook which is good as you can use it for your emails and to set reminders to remind you different events such as premium payment.

Pay by mail:
Some of the insurance companies provide facility to make insurance by mail with help of a credit card authorization form.

Make use of phone:
Many insurance companies provide by phone payment facility by using automated voice response system on calling their toll free number, usually you can make payment of all types of insurance except life and health. You can use your credit or debit card or directly you bank account to make payment on phone

How to Secure Your Payment Using PPI

Payment protection insurance (PPI), it is used to cover your debt or loan repayments where you are unable to make those payment in certain situations. There are several situations where you cannot afford your loan repayments, such as job loss, unemployment, illness or accidents and so on. This plan covers your mortgage loan or auto loan repayment for a certain period of time. Usually this policy is valid for a year but some policies can cover for a longer period.

This policy can be paid for with credit card repayments, different credit card companies sell this policy to the borrower at the time of signing a new credit card, this policy helps in paying some amount of your outstanding balance until the claim period is valid. They even pay the minimum balance every month on your behalf up to a certain period. But once the claim period has terminated you will have to pay the remaining balance on your credit card.

What features you need to consider before buying PPI:
Before buying PPI you must be aware of certain facts, like PPI is not mandatory when you sign for a loan, so depending on your financial status you must make the appropriate decision. Always read policy information before you make a purchase. Here are a few things to consider:

  • Overall cost of the policy
  • Check whether the policy covers you, if you are self employed
  • Make sure the policy is not mis-sold to you
  • Find out the types of limits your policy states
  • How long the policy covers your repayments
  • Check for the eligibility criteria, as to whether you are applicable for this payment insurance or not
  • Ensure how long it takes to make a claim

Where you can get PPI and how to apply:
PPI can be purchased from banks, private financing institutions, insurance providers, or even credit card providers. Although there are many ways to get PPI, you must consider the price before purchasing it. It is good to research or shop around and compare different quotes offered by the different PPI providers. In order to get PPI cover you need to satisfy the common eligibility criteria imposed by most insurance providers, such as:

  • You are aged between 18 and 65
  • You are employed and have been working for the last 6 months
  • You are a resident of the state you’re applying in
  • Work at least 16 hours per week
  • Do not have any pre-existing medical conditions

When you want to reclaim your PPI on your loans during any job loss or financial crisis, you should consider the best PPI claims firms to make this process much easier.

Kick Start Your New Business with the Latest Financial Apps

Did you know that your smartphone is not just smart in games, but is a wonderful business tool? Yes, this is true! It has been noticed that most business women and men have adopted the latest technology to kick start their new business with the newest financial apps that are available on the market.Work is getting accelerated to such an extent that a few clicks operate multiple tasks. This ease has allowed people to afford even the costliest app as it possesses satisfying features.

The main reason behind this increased purchase of smart phones and the expensive apps is because of their efficiency and has been done mostly with the support of payday loans. These short term loans are so instant in providing loan amounts that people hardly face any difficulties in meeting their financial requirements. Here are some of the best financial apps that keep your business progress on top.

FreshBooks
It is an app that is chosen by the entrepreneurs who would like to manage their business finances online. The app is known to stream line the process of invoices while accounting the business economy. Accelerated speed provided by the app makes it quick to create expense reports and invoices electronically.It is appreciated and used by many users.

Expensify
The pain involved in keeping track of expenses and carrying receipts while abroad can be reduced with this app. This free app offers multiple task conditions where one can log mileage, upload receipts and file expense reports with the help of the smartphone’s camera.

Roambi
Do you want to impress clients with a presentation? And there is no time to make it look impressive? Then here you are with the innovative app that makes work look creative. This colourful app is capable of transforming boring data into attractive graphs and charts that grab user attention.

Mint
This app is an effective tool if you want to keep track of your business finances. As it is user-friendly, there are many fans of this app as it shows quick results where expenses are detailed. Setting goals and confining to a budget is possible with the app including recurring bills. Alerts can be modified that will intimate the user immediately regarding every small change in the economy.

Box
It is one of the plenty social business tools that can be used by business owners. Box app allows viewing and sharing of files on the go without any delay. The free version offers a limited storage that can be extended by purchasing a premium version that costs less compared to the storage facility offered by it.

Although there are various financial apps available on the market that help in running a business efficiently, picking the right one completely relies on the kind of management tools you require that are cost efficient and reduce human effort.

STUDENT LOANS FOR HIGHER EDUCATION

Student loans were introduced to fulfil the needs of students going for their  higher education. These help to cover the payment process for booking, tuition, living and other expenses. The interest rate varies from one country to another. Higher education is also known by other names such as tertiary, post-secondary or third level which are the state of learning from universities, colleges and institutes of technology. Bachelors, master’s, associates, education specialist degrees or Ph. D (Doctor of Philosophy) degrees are gained through higher education.

Importance of student loans:

  • It’s only because of these loans the students are able to complete their higher education easily
  • It helps the students to afford their expenses
  • These allow the student to meet their university fee as well as other expenses
  • Students can repay the borrowed amount when earning a set amount with a job after the completion of their studies

Types of student loans:

Before you borrow money get a basic idea of the different types of loans available in the market.

Student loans company is a part of a government scheme to manage the student’s expenses while going for higher education.

  • Secured loans:

ü  These are low interest rate loans which are allotted by the financial institutes.

ü  It helps the students to manage  their expenses for buying books, paying their tuition fee or any other living costs.

ü  These loans are issued against some collateral such as a property, car or any assets.

There are many private banks or lenders available to provide these student loans. Most parents choose for secured loans as it poses many benefits. For instance, if your holding bad credit history, it doesn’t impact on your loan approval because the approval of your loan will be sanctioned based on your collateral submitted. Another advantage in this is; the repayment period can be extended up to thirty years with low monthly payments when compared with other student loans.

  • Unsecured loans:

These are student loans offered by state, federal or any financial institute in order to fulfil their payments on books, tuitions and living expenses.

ü   The approval for these loans is purely based on overviews into the financial background and credit history

ü  Once the student obtains an employment, it’s the prime time for student to repay all the payments with interests

Unsecured student loans provide number of benefits to parents and student. The advantage of the loan is that, this can be assigned to be utilised for any other expenses excluding educational purpose. It doesn’t require any co-sign in the place of witness and collateral isn’t necessary for the approval.

  • Student Tuition Fees:

These are allotted only for students who are the residence of U.K and who is eligible for higher education.

ü  Student tuition loans are allotted by student Finance Direct, which is a service running under the student loan company

ü  These are issued directly to colleges or  university with the help of the government authorities

ü  The student is required to check for eligibility criteria of the loan before selecting the course

  • Student Maintenance:

This is other student loans of U.K residence for their educational as well as other expenses.

ü  This helps to cover day-to-day expenses such as accommodation, travelling expenses, food, stationary etc.

ü  These are approved by the student Finance Direct where the amount is deposited into students’ accounts on the start of every new semester

ü  The amount borrowed varies depending on students’ maintenance and for an academic time period of the course

Therefore, above mentioned are the forms of loans available for students for higher educations. Students can even approach for payday loans under sudden crises of funding. These are instant loans available with less processing time and can be repay by the next paycheque.

ELIMINATE AMOUNT OF RISK WITH CAPITAL BUDGETING TECHNIQUES

Whenever we invest in any project, there is risk involved regarding whether cost will be recovered or not? With the help of capital budgeting process, you can easily determine the time period in which you will cover the cost of investment. Capital budgeting is basically used to determine the acceptance or rejection of any project. Many formal methods are used to evaluate the capital budgeting proposals, including the techniques such as-

Accounting rate of return (ARR): This average rate of return is that financial ratio, which calculates the return from the net income. The accounting rate of return is completely based on the cash flow, and it is the rate arrived at by expressing the average annual cash flows after tax (CFAT).

Payback period: It is the period that measures the length of time for the return or recovery of the investment. The concept of recovery is easy to understand and apply; every decision maker is familiar with the concept. It is the time saving method in respect of recovery of cash flow.

Net present value (NPV): The net present value means the present value of the cash inflows subtracted from the present value of the cash outflows. We can simply says that the benefits from the present value minus the current value of the costs. If the value indicates the positive sign, then it is balanced between the costs of financial projects, assets and a rate of return. In the negative situation, the project must be in terminal or rejection point. The zero indication means there is no profit no loss situation. But, in a future situation might be in hand.

Profitability index (PI): Profitability index is the ratio of pay-off of cost of the investment. It results into a ratio of net inflows with outflows. It is calculated by dividing net present value of inflows with the net present value of outflows. It also assists in getting confirmed about the project acceptance or rejection. The acceptance and rejection of investment project is based on the value of PI. If the value of PI is less than one then accept the proposal or vice versa.

Internal Rate of Return (IRR): It is the amount expected from the earnings of the investment. Internal rate of return provides the basic understanding about the positive result of the project. This process is dependent on imaginary information or postulations. There is the acceptance of the project if internal value of the return is more than the project’s least rate of return.

Modified Internal Rate of Return (MIRR): The method of MIRR helps in calculating the cash outflow and inflow of the present and future amount respectively. This will helps to get to the bottom of the discount rate; this will automatically equates the present and future benefits.

For any company, Capital Budgeting is a significant aspect of financial organization. Capital assets usually comprise as these are of long-term nature. Even a single mistake in its capital budgeting process the company has to suffer with it for a long period of time.

How Refinancing Mortgage Proves Beneficial?

There can be many reasons for refinancing. Most of the people want to enjoy a low rate of interest while other wish refinancing to change the type of loan from variable to fixed one.

Refinancing a mortgage is advantageous when the market is prevailing with low rate of interest. When you are repaying the loan amount at a higher rate of interest then refinancing could be an appropriate decision at that time. This will decrease the amount of monthly installment. This will help you in saving enormous money for your future so that you will be able to meet all kinds of responsibilities and everyday expenditure.

In refinancing, the loan amount will not be reduced; rather your loan is transformed into a new loan with somewhat different terms and conditions. Refinancing can also be done if you wish to have fixed monthly installment.

You can obtain refinancing mortgage loan from credit unions, banks, mortgage banks and other financial institutions. Financial institutions will examine your application closely to check your employment and income details so as to determine whether you are able to repay a loan or not. You can visit any financial adviser or search on the internet to get the best deal.