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4 Useful Tips To Help You Shop For A Mortgage

4 Useful Tips To Help You Shop For A Mortgage

Shopping for mortgage is a serious business. Individuals have to remember that once they avail of a mortgage, they will be bound to it for the next ten years or so. Hence, it’s crucial to find an offer that a person would be comfortable in. That being said, following are 4 useful tips to help you shop for a mortgage.

Know the Current Interest Rate

Individuals should first find out exactly how much the market interest rate is. This will serve as the basis for browsing through different lenders and talking with them to allow the possibility of a decreased rate. This can be done by browsing through the internet or perhaps checking out the newspapers. Ideally, homeowners should find out the interest rate for different lengths of loan such as 15 years, 20 years or even 30 years.

Know the Down Payment

Most lenders today ask for about 20% of the home’s value for down payment so make sure to find out how much it would cost exactly. The good news is that 20% is not fixed so shoppers have the option of lowering it down or perhaps looking for other providers for their loan. Of course, the cost of the down payment also varies depending on the length of the loan so it is always a good idea to ask this from the lender.

Browse AND Compare

The great thing about shopping for mortgage nowadays is that it can be done using the internet. Take advantage of this fact and start sending inquiries to different lenders, asking from a specific loan type and the length of the payment. Individuals have the option of going for a fixed or variable interest rate. A fixed one means that the individual would be paying the same amount every month while a variable type means the payment may go up or down depending on the market. Ideally, borrowers should obtain as many quotes as they can, at least 10 would be a good starting point. From there, a thorough comparison should be made between the mortgages before slowly dwindling down the list to match the person’s requirements

Always Negotiate

This is probably the most important. Lenders can be very flexible when approached properly. Hence, borrowers should make sure that they try to at least introduce their ideas on to the table and see if the lenders would be willing to adjust to their needs. This is why having a basis or browsing as many lenders as possible is important. This lets the borrower know how low they can negotiate to their chosen lender. At the same time, they will know exactly how much the highest interest rate is and therefore be informed if the lender is asking too much from them.

Of course, there aren’t just 4 useful tips to help you shop for a mortgage. There are other strategies out there that individuals can use to finally get the home they want without having to rob the bank for it.…

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Are 0 Interest Credit Cards Really For You?

Are 0 Interest Credit Cards Really For You?

I personally don’t own a credit card. I plan never to do so because my parents told me about how the interest can kill you. They always warned me to pay in cash and only use any type of plastic when it’s absolutely, life-or-death necessary to do so. I guess they had what one would call a “really bad experience” when it came to this that left them one string short of being traumatized when it comes to credit cards. My mother keeps repeating that “interest can kill you”, and of course she meant that figuratively. The lowest interest rate I’ve heard of, if I remember correctly, is 2.5% from this call center vendor on the phone. I passed that call to my dad and he promptly pushed the off button on that wireless handset. He assured me that Americans do that all the time and the call center agent will be fine.

Ever since then, I never even considered getting a credit card. Aside from interest, I also learned the term “hidden charges” that print the additional charges in very tiny fine print in a supposed “no extra charge” offer. I also learned about “penalty fees” from banks that charge you insane amounts of money for being late for a payment. Cards have both of these, and being a major cost-cutter, I kept away from owning any type of rectangle piece of plastic that to me, had “debt” written all over it.

When I learned about 0 interest credit cards, alarms in my mind went off and I was very skeptical. There is, of course, no such thing. I was taught that the bank makes its money from interests, hidden charges and penalty fees. So this either had to be a scam or a very well thought of ploy to entice those scared to death by interest, like myself, to avail of a card. A little research already affirmed my suspicion; if the bank didn’t charge you interest up front, it will with the products you buy with it.

Assuming you availed of this certain 0 interest credit card, and you buy a fridge with it. As you pay by card, this means you pay in installments, and they charge you monthly for that fridge. The bank doesn’t charge you interest since you got 0 interest credit cards, but taking a closer look at how much you’re paying for with that 0 interest credit card and adding up how much money you’ll lose by the end of this transaction, you actually pay more. Why is that? The product itself has interests to pay for, and some if not all of it goes to the bank. If you pay in cash, however, you stick with the original price of the product, without any extra. So if you pay by card, that 12,000 fridge will then be about 14,000 or 15,000 in the long run. Just add up how much they charge per month and you’ll find that paying in cash is indeed a better deal than paying with a card.

Credit cards are for the absolutely necessary items that you need. If your fridge is absolutely whacked and you don’t have enough cash on you to buy that fridge in cash and not paying with your 0 interest credit cards for it will mean that you have to live without a fridge for a couple of months, by all means do use your credit card. But given the option, and if you do have the means, it’s advisable that you pay in cash rather than with your card. Even if it does indicate that it is a 0 interest credit card, and by now you know that it has hidden charges that go up the roof, living with a fridge for that long is just bordering on insane.…