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Archive for February, 2011

For those students who have loans, there is a clear difference between the arrangements for repayments. For many, there will be a need to make payments as they go along through school and budgeting will be vital to keep ahead. For others, deferred student loans are ideal in that they only need to be cleared once school is finished.

For many this will be the method of choice to finance college, though it also means there will be a need to start paying when you get out. Closure might well be more difficult, with other responsibilities requiring financing as your life and career progresses.

Keeping Up With Payments

Clearly, for a standard type of loan, making regular payments is important and falling behind is probably not too clever an idea. Once you start sliding down that slippery slope, you are truly likely to hit big problems. There are ways to refinance this situation, but the likelihood is that you will face interest rate penalties – and then again, you are in a difficult position and that might be your best – indeed only option.

For those in the easier position with deferred student loans (like the Stafford Loan), not only are there no repayments while in school, but there is usually a period between graduating and repayments starting – often of up to six months. This is a real bonus, as you get the opportunity to start earning and settling into work before you start paying off those debts from your college years.

Following The Stafford Loans Rules

It’s also worth bearing in mind with a Stafford Loan that you have certain requirements to keep up if you want to maintain that preferred status. For instance, if you drop out of school, the loan will need to be repaid. If you have to, it’s better to drop down to part-time and keep in school, as this usually enables you to hang on to the preferential status of the deferred student loan – a real benefit to your financial health and cashflow!

With a Stafford Loan, there are a couple of possibilities for you to consider when you are looking for one. In some cases funding can be arranged through private funding and on other occasions you will be able to get one of this type of deferred student loan through your school. Both of these are Stafford Loans and have the benefit of later repayment.

Then There’s The Perkins Loan

In some cases, for those students who are less attractive to the lenders of a Stafford Loan, a Perkins Loan might be available through the school. These are quite difficult to get, as there is only a certain amount of governmental funding available. But if you feel that you might have a challenge to get a standard Stafford Loan, then this might be worth considering.

Whichever type of loan you choose (maybe is chosen for you), the time of retribution will come along. For those who prefer regular payments and little or no debt at the end, the hard work will have to be carried out around your college study timetable. For those who wish for a bit of financial space whilst in school, deferred student loans will be the option to choose, with later repayment a burden when you get out into the real world.

The housing crisis, which started 13 months ago, has recently gotten substantially worse. The states hit the hardest with this crisis are California, Florida, Nevada, and Arizona. Mountain House, California is the most ‘underwater’ community in the United States. Almost 90% of the people who live in this community owe more on their home mortgages than their houses are worth. The first homes in this area were sold in 2003, and since then the average homeowner who lives in Mountain House is in debt by approximately $122,000. In some cases, houses are being valued at less than 50% of their original value. It is impossible for many of these residents to even imagine being able to pay off their mortgages. Already, banks have taken over 101 properties in the Mountain House community. The housing crisis is causing these people with “underwater” homes to cut back on spending, which in turn is causing a setback in the economy. Everyone in this area is being forced to make cutbacks in order to pay their mortgages. They can no longer afford to partake in certain luxuries such as getting their nails done, going to the movies, or going out to eat. This is negatively affecting the business of local companies. The owner of a local furniture store stated that his business was down by 50%. Stores that have already gone bankrupt in this area are: Soccer World, Linens ‘n Things, and Fashion Bug.

The subprime mortgage crisis was triggered by the failure of mortgage companies, investment firms, and government sponsored enterprises who had invested in subprime mortgages. Subprime mortgages, specifically, are mortgages with higher interest rates, made to borrowers with low credit scores who do not qualify for prime loans. These loans are frequently used by people who want to increase their current credit rating. The subprime mortgage crisis started in 2000 when the Fed lowered interest rates to prevent a possible recession. This allowed for more people to buy houses, causing the demand and value of homes to increase. Lately, due to the current mortgage situation, the issue of subprime loans is controversial and can be identified by examining the impact on business, government, and society.

The current mortgage crisis is affecting US business both positively and negatively. Although the positive affects are more narrow and harder to determine, it is positively affecting the renting industry. People are finding it more favorable to rent homes and apartments instead of buying. This is because prospecting homeowners do not want to become involved in this crisis and risk having their home go “underwater”. As expected, this issue has more negative affects on US business that positive. The most major affect that subprime loans are having on the economy, is obviously its affect on the mortgage market. People are no longer able to pay the mortgages on their houses, because they owe more than their houses were originally worth. In a lot of cases, the value of entire neighborhoods is decreasing due to foreclosures and delinquencies. Another negative effect that is that businesses are closing and companies are pulling in less business. This is happening because since many people owe more on their home mortgages than their houses are worth, they are starting to cut back on things that aren’t necessities such as eating out, going to movies, shopping, and more. In turn, this is having a negative affect on many businesses in the United States. Since less people are buying goods and services, less goods and services are being produced. Many businesses in the US are cutting down on their number of workers or closing altogether.

In addition to business, the subprime mortgage crisis is also affecting the US government. The government is helping the companies who sold the mortgages but is doing very little to help individual homeowners. The government is involuntarily being forced to bailout certain Wall Street firms. For example, there was the $85 billion bailout of American International Group Inc. and the bailout of both Fannie Mae and Freddie Mac. While this might be viewed as a negative affect to the government itself, it can also be seen as a positive affect in a certain aspect, because if all of these financial services and insurance firms went bankrupt the economy would be even more of a disaster right now. The government is being negatively affected by this crisis indirectly because homeowners who are involved are falling behind on their tax bills which is hurting state and local governments. The government is being viewed harshly by many Americans because government officials have said that they will not help victims of the subprime mortgage crisis because these victims should not be rewarded for making bad decisions.

This crisis is also having an affect on members of the US society. Although there aren’t many positive affects this crisis is having on society, right now housing prices are lower for those people and families who are looking to buy homes. This is especially helpful for first time buyers who aren’t trying to sell their current house in order to move into a new house. Housing prices are so low right now, that this is the prefect time for people contemplating becoming first time homeowners to buy. Adversely, this crisis is having many negative affects on society. People are no longer able to do the things they are used to, due to increasing prices. Most people affected by this crisis are cutting back and limiting their spending to only necessities. This is preventing people from doing things that they were used to doing before the housing crisis, such as tanning, getting their nails done, shopping, golfing, and going to the movies. Society is also being negatively affected by this crisis, because people who want to sell their homes are having a tremendous amount of trouble doing so. Some homeowners are even declaring bankruptcy and are willing to have their credit ratings ruined in order to get out of their current mortgage situation. Another affect on society is that neighborhoods with foreclosed homes are also experiencing a large increase in crime.

If you are a college student, acquiring a college or student credit card is the easiest way to build a good credit history. Perhaps you have seen applications displayed around campus. The application process is very simple, and most people are approved. Although obtaining a credit card is perfect for proving credit worthiness, it is essential to responsibly manage credit.

Advantages of a Student Cards

Aside from the obvious advantage of establishing credit history, student cards are ideal for basic purchases. For the most part, college students are strapped for cash. Hence, a college credit card may be used wisely to purchase semester books and pay for other unexpected expenses that arise. Furthermore, some college students obtain a student card to purchase an inexpensive used vehicle.

On average, student cards have a low limit. Average credit limits are about $1,000. Card companies recognize that first time credit card users may become overly excited with seemingly “free money,” thus, the limits are kept low. Low credit limits make student credit cards easier to manage. As you build credit, the credit card company will gradually increase your spending limit.

How to Use Credit Wisely

To avoid accumulating excessive debts, college students must resist the urge to buy whatever they want. In some instances, a college cc company will approve students for a large credit limit. This is dangerous. Do not purchase items you cannot afford. By doing so, you will likely join millions of other people who are drowning in debt. Rule of thumb: payoff balances each month. This contributes to you remaining debt free.

How to Apply for a Student Credit Card

To get approved college students must be employed. The application will request employer, income, school, and personal information. Moreover, the creditor will review your credit report. Prior to completing the application, you should read the terms of agreement. What is the card’s introductory rate? What will the rate be after the six month introductory period? Furthermore, what are the late fees, and is there an annual fee?

When an accident occurs, it is critical that you do certain things and make the best out of the situation. Acting quickly after an accident can help out out your auto insurance claim, save lives or keep you in the nice sights of the law. Here are 8 critical things to do immediately after an auto accident.

Keep your Head
Not going bonkers is very important. There might be people who are wounded and who require your help.So you need to think straight. If your car involved in the mishap is still working, drive it off the road. Switch off your engine and turn on your hazard lights.

Check for Injuries
Check if you are injured. If you have passengers, check to see if they have sustained injuries. Make sure no other parties involved in the accident is wounded. If anyone is badly injured, call an ambulance straight away.

Call the Police
Even if nobody was badly injured, the police should still be called in, if only to take a statement. They will also want to know about the accident and what caused it. This is for legal purposes; or it will simply become your word against the other driver in the case of a dispute of fault. This could easily turn ugly, if not straightened out quickly.

Get Info from Other Drivers
This is why it’s always vital to keep your insurance information in your car. It is important to exchange details with other parties involved in the traffic mishap. Basic contact information includes: full name, residential address, phone number, license plate number, driver’s license number, and insurance company and policy number. Even if you are a victim, you should still exchange information with other victims.

Tell Your Insurance Company
After you have obtained everyone’s insurance information, make sure you call your own insurance company and let them know what has happened. Relate the accident with as much detail as possible.

Do not worry about higher rates. State laws usually protect victims from higher insurance rates unless they are truly at fault. Even if it was not your fault, it should still be reported to your insurance company.

Take Pictures
Verify the accident scene with pictures if you have a camera. It always helps to keep a handy camera in the pigeon hole of your car. You never know when you might need it or help somebody out.

Medical Checkup
Some injuries may not be felt right away. Be sure to go to a doctor to get an assessment as soon as possible. Never take anything for granted. It could have grave consequences later.

Call a Lawyer
This may not be needed, but it’s always best to have expert legal advice available. If someone is upset, uptight and aggressive after an accident, do your best to stay out of harm’s way. Do not get into a shout match, which can clearly escalate into something more serious. Do not blame somebody, including yourself, when the police come to take a statement.

Get a professional view before signing any sort of documents or settlement papers, even if they are from your own insurance company. Never sign anything if you are not satisfied with the repair job. You should not leave any doubts in your mind about what sort of coverage you possess. If you have questions, keep calling your insurance agent until you have a clear answer explaining how you are protected.

The US government under Obama’s leadership have produced a stimulus package for mortgage refinancing programs designed to assist people who are facing foreclosure on their homes. The loan modifications incentive is primarily geared towards people who are struggling with mortgages on their homes and is not really intended to help out people who have houses sitting empty.

There are 2 options available, providing the criteria for qualifying for the packages are met.

Mortgage Refinancing

This is where an existing mortgage that is owned or guaranteed by one of the two large lending agencies Fannie Mae (Federal National Mortgage Association or Freddie Mac (Federal Home Mortgage Corporation)can be refinanced to take advantage of lower rates of interest. The qualifying criteria: -

The loan is not more than 125% of the house valuation You are up to date with your repayments Your circumstances have not changed to the extent you will not be able to afford the lower payments e.g. you still have an income that is enough to meet the payments

Loan Modifications

This is where you change the terms of your current loan (mortgage) through your existing mortgage company providing that they are participating in the program and that you meet the qualifying criteria: -

Your total payment that includes interest, taxes and insurance is more than 31% of your gross income. The mortgage must be on your principal family home where you are currently living Your mortgage balance is not greater than $729,750 for a single unit but the amount can be up to $1,403,400 for the maximum 4 units You got your mortgage before the beginning of 2009 i.e. not on or after the 1st January 2009. You will also be required to make the modified payments over a trial period of 3 months to prove you can finance the new deal

When you are a student, managing your money becomes important. You might find that you don’t always have enough, so you need to make the most of deals where you find them. First time student credit cards are often a great way to do this, if you pick one that’s right for you and offers a number of related benefits.

Before you apply for your first credit card you need to compare all of the deals currently available. There may be companies that try to lure you in with a cash bonus or other free gifts, but you should try to consider the benefits of the student credit card over the course of time you will be studying. Also be careful to read the terms and conditions carefully – what is the APR? Does it have a fixed rate? Are there fees for missed payments? By researching these questions you can be sure that you are getting a card that best meets your needs.

If you are a student then it becomes easy to get into financial trouble. There are always seemingly great offers being thrown at you all the time, and before you know it you could be thousands of dollars in debt. When you get your credit card you must understand that the best way to keep a good credit score is simply to make your repayments each and every month, on time. This can be a great chance to build your credit score, proving your financial reliability in the future.

First time student credit cards can come with a number of benefits. They may allow you to collect loyalty points, or even give you a student discounts in certain shops or restaurants. Take some time to look around for the best deal before settling for any offer.