In What Order Should You Pay Back Loans?: Or, When Do I Pay Back My Car?

If you're like most Americans, you have quite a few bills to pay. A car
loan, credit cards, maybe even a mortgage. If you have extra cash, when you
should pay it back?

Credit Cards First

If you have a lot of loans, the first rule of thumb is to pay back the
higher interest loan first. This means that first of all, you should never
get a payday loan or cash advance on your paycheck. These loans can lead to
exorbitant rates of interest, and should always be repaid first.

However, for many people, the highest-interest debt that they owe is a
credit card debt. This should be paid back before you put any extra money on
your car payments, student debt, or mortgage. Although many people carry a
balance on their credit cards, the best thing to do is to avoid carrying a
balance, or to pay as much as you can each month. This will reduce the
amount of money that you are spending each month on just giving the credit
card companies money.

Car Loans, Personal Loans, Renovation Loans, Student Loans

Once you have paid off your credit card debt, what do you with extra money
now? Again, start with your highest interest debt.
This means comparing the financing rate on your car loan with the interest
rates on your other loans.

Consolidation

If you have a lot of loans, you might be able to consolidate them,
especially if you are a student. Visit
http://www.theguideto-studentloans.com/student_loan_consolidation/
The Guide to Student Loans for information on how to consolidate your loans.
If you consolidate them you put them all at one interest rate and one
monthly payment. Remember: lowering your monthly payment isn't always the
best choice. You want to have the lowest interest rate possible to save you
money in the long term. If you choose to consolidate, the answer becomes
simple, you put the money on the consolidated loan that you have.

Mortgages

Mortgages are one of the least-taxed loans that there are. This means that
there is no rush to pay off your entire mortgage instantly. However,
whenever possible, do put extra money on your mortgage payment. Even if you
only put an extra $500 in the first year, that will save you more than $500
in interest.
Make a goal to overpay your mortgage, but only slightly. Your other,
higher-interest loans are more important to pay off first.

Savings

Although getting all of your loans paid off might seem like a good thing,
you need to remember to save for the future too.
Make monthly payments into a retirement plan (perhaps a 401k), and pay
yourself first. Once you have paid your savings, and then paid your monthly
payments on debts, you will know how much money you have left to spend.

About The Author: Andrew Dillan is the editor of
http://www.theguideto-carloans.com/the_truth_about_0_apr_financing
The Guide to Car Loans. If you are looking for a car loan, this site has
information about getting the lowest rate.

Debt Counselling Is Never Free

On hearing the word free, many people immediately close their ears to what
comes next and jump on the offer made. When you are searching for a way to
get out of a lot of debt, it pays to avoid your old habits and look deeper
into a matter when the word free is uttered. One way to go about this is to
find out exactly what is free in the offer. Those opting for debt
counselling services, for example, should keep in mind that no service is
ever free. Instead, it is some of the aspects of the process that are free.
One example is the idea of the free debt consolidation quote.

These quotes often come about in the process of consumer debt counseling.
One of the first steps in this process is research, and a quick look on the
Internet will demonstrate that there are plenty of companies offering free
quotes. Because of the abundance, it is advisable to apply for a few of
these to make sure that you can find the best deal. Remember that if the
search is registered and forwarded to your credit card that you might
recieve a mark on your credit history, so you will want to apply to discrete
companies and possibly limit the number you apply for if you have a poor
credit history.

IN order to receive the quote you will need to fill in forms that clarify
certain information, including your personal contact infromation such as
phone number and address as well as the amounts of your outstanding debts
and who the money is owed to. Once this information has been submitted, the
company with whom you applied will assess the application and determine if
you should be contacted for a discussion. SOme companies will use this
opportunity to pitch a hard sell as to why you should use their particular
loan; remember that you are still in the decision making process and that
there is no obligation to use the company at this time. The free quote
should give you an idea of which of the comapnies you short listed will fit
in with the plans you have for your financial future.

As far as free debt consolidation goes, there are a number of source
available. THere are many non-profit debt counseling operations that have
websites where they make their information available to the public. Many of
these sites will offer sound advice on avoiding shady lenders who offer
great deals on loans as well as pointing out options beyond taking out a
consolidation loan. Remember to check the website to see if there are any
advertisments, especially from financial institutions who are using the
organization to further their own profits. When free advice is also
sponsored by a certain company, it is a pretty safe bet that the person
checking the advice is being led towards a specific goal that is in the best
interest of the sponsor rather than the client.

The Internet is a great tool for exploring the free aspect of debt
reduction, as there are many different sites available both for quotes and
for advice. Remember that shopping carefully is the key, and that you should
compare as many compannies as you can. Further, avoid any companies that
claim to offer a free loan, because these in fact are never free.

About The Author: Kenneth Morris is writing primarily for
http://www.creditenio.com , a web publication on business debt and credit
repair. From his writings such as http://www.creditenio.com/counselling.html
,the author improved his knowledge on information relating to debt
counselling.

Watch Out For Bad Apples Who Offer Consumer Debt Counseling

Some people may wonder about the point of having a non-profit organization
such as those that provide credit counsling. After all, everyone wants
something, it is hard to believe that organization exist in order just to
help people.

If you are skeptical about the altruistic motives behind a company that is
set up to help consumers with credit card debt settlement through methods
such as consumer debt counseling, it might be useful to be informed of the
benefits offered these companies for holding the non-profit title.

First of all, having the non-profit lable exempts these companies from
federal taxes, even though they exist in order to help people settle credit
card debt. In addition, they are usually exempt from several state taxes,
which means that they save thousands of dollars every year just by being
non-profit.
The label also means that many of these companies are eligible to receive
governmental grants and private grants as well each year.

Creditors will also tend to look upon non-profit organizations positively as
this status is mandatory in order to initiate Fair Share contributions.
Finally, non-profit status will also allow companies to avoid consumer
protection laws in some states, which increases their ability to make
profits. It should come as no surprise that major credit counseling
companies proudly display their status as non-profits for all to see. Many
of these companies, however, use this label as a way to trick potential
customers in and accomplish their real goal, which of course is maximizing
their profits.

Although this is true of several credit agencies, it is not the case for all
and there is legitimate help out there for consumers who are seeking to
reduce their debt through these services. One of the first things to look
for when determining whether such a company is legit is to find out if it is
accredited through the National Foundation for Credit Counseling or the
Association of Independent Consumer Credit Counseling Agencies. The Better
Business Bureau is of course another way to determine the kind of services
the company offers, and if they have done so in a consistently honest way.

Good credit counseling agencies are a necessity for debtors, and individuals
must keep this in mind. The agencies help debtors to create debt management
plans and to get their financial house in order before disaster strikes.
They also carry clout with creditors and can therefore help to lower
payments and interest rates, as well as eliminating late fees and finance
charges. Many companies will also help debtors by calling off collection
agencies and other organizations that try to get the money out of the
debtor. Remember when you are looking for a company that can help with debt
management that you have to be very careful in what you settle for.

About The Author: Focusing on the area of consumer counceling, Eric
Slarkowski pens primarily for http://www.creditenio.com .
You can find his writings over at
http://www.creditenio.com/ccsettlement.html and various other sources for
credit card debt settlement tips.

How To Apply For Debt Counselling

Once an individual has determined that he or she is in troube in terms of
debt, that is, the expenditures per month exceed the monthly income, it is
time to go about setting a course of action to right the situation before
disaster results. Most debtors will embark on either an official or
unofficial debt consolidation program that could include any or all of the
following elements: debt counselling, debt management, or consolidation
loans. Individuals should keep in mind that as taking out a loan to pay off
the creditors is just another form of debt, it is the least desirable of
these options. Instead, the first step in a program would be to make a
monthly budget that takes into account expenditures such as food, utilities,
car payments, mortgage payments, and insurance payments. All of these
expenditures have priority as they are essential to life and must be taken
care of first. After determining how much money each month is needed for
these bills, debtors will need to determine how much they can afford to put
towards those outstanding bills. If individuals show enough initiative in
these cases and report their plan to a creditor, the odds are that they may
accept the plan as is and the debtor will not have to resort to more
stringent measures of formal debt consolidation.

Formal debt processes should be avoided for the consumer for the simple fact
that, even if the measure is a relatively burden free process such as debt
counselling, there is a good chance that your creditors will find out that
you have applied for credit repair measures. In order to receive effective
consumer debt counseling, an individual must disclose information about
finances and debts and these reports will cause a negative score on credit,
affecting future applications. Again, though, there are some creditors that
may see the application as a sign of individual initiative in terms of
paying them back and therefore may still be willing to extend an individual
credit once the current situation is resolved.

The very last resort for any individual debtor is taking out a loan in order
to conslidate their bills. The worst case scenario is taking out a secured
loan, where the individual puts up collateral such as a house. ALthough a
second mortgage seems appealling due to the fact that individuals receive a
large hunk of cash quickly, the fact is that if an applicant cannot pay
their debts, they stand to lose absolutely everything. Individuals must
really think about how they came to this spot in the first place; is it
really worth a house to pay off the bills that were incured going out to eat
or on home entertainment suystems? If an individual must opt for a loan,
they should make sure it is unsecured.

When ti comes to debt consolidation and alleviation, there are a few main
parts. The first part comes in recognizing that the situation needs a
solution, and looking into options.Next, teh money and means to pay off
creditors must be found. Finally, individuals must make sure that they see
how the sitatuion occurred in the first place and take steps towards
avoiding similar mistakes in the future. Individuals who find themselves in
heavy debt must take the bull by the horns and be prepared for a lengthy
process which requires a lot of commitment in order to re-establish
financial well-being.

About The Author: Charles Parson routinely produces informative papers on
subjects dealing with business debt and credit repair.
His articles on debt counselling can be encountered on
http://www.creditenio.com/counselling.html and also other web pages.

Credit Consolidation Is One Way To Pay Out Creditors

There are many reasons why people find themselves going into debt. An
unexpected and prolonged illness, an injury, the loss of work, divorce, a
sudden death in the family, or the failure of a business can all result in a
financial crunch which ends up with an individual struggling to dig out from
under a burden of debt. No matter what age or income bracket, anyone is
susceptible to financial emergencies. In order to regain their financial
standing and to get rid of the outstanding bills, many people apply for debt
loans.

The strange thing about racking up debt is that as the bills accumulate and
hopelessness begins to set in, individuals give up and begin to spend even
more. The feeling that the debt accrued is just too big to be dealt with is
so prevalent that the situation begins to look impossible. In this
situation, it is hard for people to know where to turn to for help. It is
time to stop avoiding the problem like you avoid the collection agencies on
the phone and to look into options such as consumer debt consolidation.

The key to debt management is to realize that the debt must be managed, not
hidden from. There are several opportunities to savea person from drowning
in their debt, of which debt consolidation is a major component.

For starters, there are lots of counseling services set up to provide people
with strategic plans for managing their debts while avoiding more. Theese
programs often offer credit repair free of charge, working for the
individual debtore rather than the creditors. With this type of service,
monthly payments to creditors can be greatly reduced, sometimes by more than
one half.

Many consumers opt for debt loans. These loans are applied for through
various institutions. The consumer then uses the money to pay off all
outstanding debt to creditors and make lower monthly payments to just one
place.

There are lots of services available on the Internet which offer suggestions
and strategies for getting out of debt. These range from financial
institution websites to discussion forums where debtors can discuss
strategies with other consumers who have been or are in a similar situation.

There are also special clinics designed to assist people in dire financial
straits. Most watchdogs suggest that these clinics be avoided, however, as
many operate outside of the law and some have even been caught stealing the
credit files of clients.

Finally, people looking for options might want to look into getting help
from a certified debt repayment representative.
These professionals know the ins and outs of credit negotiation and also can
assist in getting collection agencies off your back.

About The Author: Focusing on informating about credit consolidation, Eric
Slarkowski pens especially for http://www.creditenio.com . You might find
out more about his publications over at
http://www.creditenio.com/debtconsolidation.html and other sources for
consumer debt consolidation news.

Introduction To Home Equity Loans

Home equity can be a difficult concept to understand if you have
never dealt with home ownership before. Equity is defined as the
monetary value of a property or business beyond any amounts owed
on it in mortgages, claims, liens, etc. In simpler terms, home
equity is how much house you have earned.

Equity is the difference between what your house is worth and
what you owe on it. For example, if your house is worth $120,000
and you owe $100,000, your equity is $20,000. You can get a home
equity loan, depending on your credit rating and a number of
other factors, for the $20,000 that you have built up in equity.

Each lender will have their own set of rules on how much they are
willing to give you for a home equity loan. Regardless of which
lender, you think you would like to take a home equity loan with,
it is imperative that you closely read all of the fine print of
the loan. Some lenders will require a large balloon payment
towards the end of the life of the loan. Other lenders may
include a number of service fees on the loan, which will cause
the overall cost of your loan to be quite high.

It is also very important to review all the terms to see what
kind of charges would be incurred if you are late on a payment.
It is best to have your home equity loan paperwork reviewed by a
trusted friend or financial advisor that deals with these type of
financial transactions on a regular basis, to make sure that you
are getting what you expect in the loan terms.

A home equity loan is a closed-end loan that can have a fixed
term, a fixed rate, and fixed monthly payments or it can carry an
adjustable finance charge rate that fluctuates with a federal
interest rate. The amount of the loan is usually made available
in a lump sum. This is quite different from a home equity line of
credit (HELOC).

A home equity line of credit is a good option if you need a
smaller amount of money available for a shorter period of time. A
HELOC gives you the option to withdraw funds from an equity
account when you need them. If you repay the amounts that you are
borrowing in a reasonable period of time you will pay lower
interest and fewer fees than you would with a home equity loan.
You can use this revolving credit at any time and make payments
only when there is a balance due. You will have a lower finance
rate and a great emergency source of funds. Your house serves as
security collateral for both a home equity loan and a HELOC.

If you need a very large amount of money to pay a big expense, as
in the examples below, then a home equity loan is probably the
best choice. If you simply need some extra funds each month, or
an emergency source of money, then a HELOC might be your best
choice.

Once you have found a good home equity loan there are a number of
items for which you can use this loan. Many people these days are
finding themselves in credit card debt, due to credit card
companies offering more credit than people can really afford. It
is very easy for someone to get credit cards and to charge things
on them; it is much harder to pay them off. Credit cards also
charge a large amount of interest and high fees for late
payments. If you find yourself with credit card debt and never
seem to get ahead on paying off the balance then a home equity
loan might be the solution that you have been looking for. With a
home equity loan you will know what your monthly expenses are and
have a plan to pay down your debt at a fixed interest rate.

A home equity loan can also be used for paying for college
expenses. College is very expensive these days and a home equity
loan can help people that are on tight budgets be able to afford
the expenses of college. Many people find themselves in the trap
of making just enough so that their children do not qualify for
financial aid, but they really do not have the extra income to
pay for tuition.

A home equity loan can also be used for paying for needed home
improvement projects. Home improvement projects can be quite
costly and paying for them can be quite difficult. A home equity
loan that offers good interest rates can help to pay for a new
roof or a room addition.

No matter what you decide to use your homes' equity for, make
sure that you go with a trusted lender that has a good
reputation. Be sure to check the credentials and history of the
company that you are getting your loans with to make sure you are
dealing with a quality organization.

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Ethan Deville is a finance writer.
He writes for Pen Circles.com and PersonalHomeLoanMortgages.com,
who offers services to help customers find leading national and
(http://www.personalhomeloanmortgages.com/mortgage_brokers.asp)
local mortgage brokers, calculate monthly home loan payments
(http://www.personalhomeloanmortgages.com/mortgage_rates.asp),
view local mortgage rates and understand the various lending
products and services available in the market. Ask our Home Loan
Mortgage Specialists: http://www.PersonalHomeLoanMortgages.com

Getting Easy Home Equity Loans

When it comes to home equity loans, it can seem like a daunting task to get
it done. After all, you have to undergo a credit check, fill out paperwork,
and deal with the anxiety of whether or not you will actually qualify. The
good news, though, is that it is becoming easier and easier to get home
equity loans. The key is to understand about what you qualify for
beforehand, and to take steps to find a lender with a loan program that
works well for you.

Good credit

One of the ways it is easy to get home equity loans is to have good credit.
If you have good credit, it is easier for you to qualify for home equity
loans, and you are more likely to get a better interest rate. Additionally,
there is less hassle and less maneuvering to get you a loan when you have
good credit.
You can cultivate good credit by making sure that you are on time with
paying your bills, and not skipping payments. Keeping your credit card debt
to a minimum can also help you cultivate good credit.

Special programs for bad credit

While easy home equity loans aren't quite as prevalent for people with poor
credit, there are many brokers and lenders who work with people who have bad
credit. Look for a broker who can help you fill out the necessary paperwork,
and who is experienced at helping people with bad credit find home equity
loans that work in their specific situations. You will, however, have to
accept the fact that you will have to pay a higher interest rate. You might
even have to pay more up front in closing costs and in points. However, if
you want an easy home equity loan when you have bad credit, it is important
to realize that you will probably have to pay more.

Applying online

Another way you can make it easier to get a home equity loan is to apply
online. There are plenty of accommodating lenders online who specialize in
helping people get easy home equity loans. Usually the paperwork is easier
to fill out, as there is an easy guide through the forms. Additionally, in
many cases you will find out fairly quickly whether or not you qualify, and
how much you are eligible for.

About The Author: Visit http://www.homeequitywise.com to find an Easy Home
Equity Loan.

Loans For Every Occasion: Home Loans, Payday Loans, Student Loans And More...

At some point in life, it is almost guaranteed that you will be applying for
a loan of some sort. Paying cash for products and services is not only
becoming obsolete, it's terribly inconvenient. Today, credit is a way of
life, and as more and more people begin to shop online, plastic is the
currency accepted everywhere.

The most basic of loans is of course, the credit card.
Companies that issue credit cards make money every month that you carry a
balance, and they are betting on the fact that you won't pay off the balance
every month.

Some loans actually make good business sense. Why would anyone want to shell
out $300,000 for a new home when they could get a Home Loan and pay
$1,000.00 a month, and then deduct the interest paid from their income
taxes? That three hundred grand could be put to work in other investments,
and could conceivably earn more for you than you are actually paying for the
house!
And all that time, if you time it right, your house becomes more and more
valuable.

There are also times when for many people things just aren't going well
financially. An unexpected expense occurs and you find yourself just coming
up short on your living expenses.
Many types of loans exist for this type of situation, both secured and
unsecured.

Maybe you just need some quick cash to get through the holidays, and intend
to pay the loan off within the next few pay periods. Companies offering
short term Payday Loans abound both on the Internet and off. Some with no
credit check will transfer up to $1,500 into your bank account within 24
hours.

Student loans, auto loans, small business loans, personal loans, home loans,
second mortgages, payday loans, government loans, bad credit loans, loans to
consolidate other loans - there is a loan for just about any occasion out
there.

The question is how much are you going to pay for your loan?
And the answer to that depends in most cases on your credit history.

Your Credit History: Weather or not you get the loan, and how much it will
cost you.

It is never too early to start establishing credit, and the best way to do
this is with a credit card. If you are finding it difficult to obtain a
credit card because you have no history, you can always buy your history by
applying for a secured credit card or line of credit. Put down $500 or
$1,000 and borrow against it. Make sure the institution you are applying to
reports to the major credit bureaus, use the line of credit and pay your
bills on time, and voila - you have a credit history! There is nothing wrong
with carrying a balance over, just pay the minimum or a bit more, and pay it
on time!
Creditors like to think they will be making some money off of you.

What Lenders are Looking For

While different institutions have different criteria, there are some
generalizations one can make about how they determine the creditworthiness
of an applicant. Make no mistake about it; creditors are in the business of
making money. If your credit is less than perfect, it doesn't necessarily
mean you won't get the loan, but you will be paying more for it!

After receiving your application, a lender will then acquire a credit report
from one of the three major credit bureaus, Equifax, Trans Union, or
Experian. This is your credit history.
Taking into account such factors as your income, the balances in your
checking and savings accounts, the assets you own, the length of time you
have been at your current job and place of residence, the amount you owe
other creditors, and how promptly you pay your bills, the potential lender
will then make a determination on if you will get the loan, and how much
they will charge you for it.

Frequent late payments, bankruptcy, repossessions, legal judgment liens, or
accounts being turned over to collection agencies do not bode well for
obtaining a loan. That being said, most creditors realize that life happens,
and such legitimate circumstances like an unexpected illness, injury, or the
loss of your job do not necessarily reflect negatively on your
creditworthiness.

When Things Take a Turn for the Worse

If you are in the process of paying on a loan or loans and one of these
unforeseen circumstances befall you, talk to your loan officer. Most loan
institutions find it in their best interest to work with the lendee, and
will often make the necessary arrangements to make it easier for you to make
your payments.
Just remember, they want their money, and the last thing they want is for
you to default on your loan, or heaven forbid, declare bankruptcy!

About The Author: Michael Talbert is an author that writes on a variety of
topics. Visit The Loan Station at http://www.Loan-Station.net for more
information.