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Debt

Can You Borrow Money From Your Life Insurance Policy?

If you’re in a current situation where you need a significant amount of cash, but you don’t want to rely on your credit cards or take out a home equity or payday loan in order to get it, another option that you might want to consider is borrowing money from your life insurance policy. If you weren’t aware of the fact that this is something that you can do, it is, although we definitely recommend that you explore some of the pros and cons with taking out this particular kind of loan before making the decision to do so.

The Pros of a Life Insurance Loan

First, let’s explore some of the benefits that come with taking out a loan on your life insurance policy. One thing that people like most about this particular choice is that most life insurance loans tend of have a lower interest rate than a loan that you would take out with a bank. Plus, there is no pressure to pay the loan back. You will simply receive a statement at the end of the year letting you know how much is owed, including the interest (which tends to be between 5-9 percent). So, as you can see, there are some good things that come with taking out this kind of loan.

April 20, 2013

Debt

Dispelling Credit Myths: The Truth About Credit For Married Couples

While it is true that you will be sharing a name, a house, a bed, a kitchen, and probably the popcorn as you watch Friday night movies, it is not true that you and your spouse will be sharing a credit report. Neither is it true that marriage makes taxes higher. In fact, quite a few credit myths could affect how you handle your finances, especially when you get married. Here, we outline a few.

MYTH #1: Marriage makes you pay more taxes. While not everyone gets to pay less tax when they get married, not everyone has to pay more tax either. To make the picture more concrete, let’s take a look at the cold, hard facts from the Business Insider:

-Couples with disparate income enjoyed an average tax break of $1,300

-51% of married couples paid less in taxes jointly than they would have if they were single

-42% of married couples paid more taxes jointly

Thus, when it comes to taxes and marriage, your mileage may vary. Just hope that you’ll belong to the 51% of couples who paid LESS tax when they got married.

April 12, 2013

Debt

5 Tips For Avoiding An Upside Down Auto Loan

If you are searching or want to apply for a loan to purchase or make payments on a vehicle, the last thing you want is to be upside down on your debt. Being upside down, or “underwater,” simply means that you owe more money to your lender than your car is actually worth. Sometimes if the window to pay back your loan is extended and your car has rapidly depreciated in value, you can find yourself in this situation. In order to avoid being upside down on an outstanding debt to a lender, it is important that you consider a few things and weigh your options even before you apply for the loan.

Here are 5 tips for avoiding an upside down auto loan:

Consider Depreciation Before You Buy

One of the best ways to avoid negative equity or being upside down on an auto loan is to purchase a car model that won’t depreciate to a certain point where it becomes more expensive than it is really worth. Many luxury cars will put you upside down on your auto loan almost immediately after purchasing it. You want to find a dependable car that will last and that you can sell in the worst-case scenario that you can’t pay back your loan.

March 27, 2013

Debt

Top Ways To Save Money On Your Mortgage

Homeowners all share one thing in common – their largest monthly payments go towards their mortgage. Without the shadow of a doubt, the majority of these homeowners would love to be able shorten the lifespan of their loan and cut the huge monthly premiums. Take a look at some of the most helpful and effective ways to save money on your mortgage.

Make An Extra Payment Each Year

This is one of the easiest ways to cut back on the cost of your mortgage – making an extra payment towards your mortgage every year. The great thing is that these payments are taken from your principal and not the interest. So as well as lowering the remaining balances on your mortgage, you also avoid having to pay interest every month.

March 25, 2013

Debt

The Difference Between Debt Settlement And Debt Consolidation

The problem of debt is getting more and more serious in many places all over the world. Here at home, as well as in foreign lands, personal debt in its many forms is becoming increasingly common and a harrowing burden. Thousands of dollars in debt to credit providers, money lenders and other financial institutions are dragging people down every day. In managing a debt burden, two common courses of action are settlement and consolidation. These two processes are not entirely understood by many average people, but knowing about options for debt management can help greatly in reducing the individual’s debt burden.

Debt settlement is an ideal solution for most people living under the shadow of personal debt, but it is not the only option–nor is it the most common one. When an individual settles a debt, they are usually being let out of some portion of the amount owed. An individual who achieves a debt settlement may, for example, come to an arrangement in which half of the outstanding debt is paid off, while the remainder is absorbed by the creditor. These kinds of deals usually require careful negotiation, and may not be an option for all. If creditors stand to lose money on a debt settlement, they will be hesitant and resistant to the option.

February 27, 2013

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