Repair Your Credit

By Darren Cason

The term "bad credit" really means a poor credit rating. A credit history that is less than ideal can result in the rejection of an application for a loan, especially with the more conservative lenders such as banks. However, bad credit does not have to be a hindrance any more because there are lenders out there who are willing to offer packages to assist people in financial difficulties. It is possible that you won't even have to offer any security to obtain the loan. If you are in this situation, it may just mean that you have to pay a higher interest rate to offset the risk that the lender is taking with you.

There is a solution to your problems now, even if you are unable to make a payment at some stage. It is possible to repair your credit, but to do this you have to work out what resources you have to assist you in the repayment of the loan. There are some kits available in the market to help you with this dilemma and there are also resources in certain libraries that you can research. You should be able to make photocopies of any relevant information. This information will also assist you with any negotiations you will make with your prospective lender. Most kits will guide you step by step through the process.

Your intial step should be to obtain copies of credit reports from the credit agencies. Clear up any discrepancies or false information as this will be of benefit to you in the future when you are establishing your creditworthiness.

Once you have obtained the reports, carefully examine your credit score and evaluate your financial situation and if you are finding it difficult to meet your minimum payments, consult with your lenders to decide upon a mutually satisfactory solution. Most lenders will be more than happy to work with you as they realize that it is better to have some repayments happening than none at all. Explain your situation in detail; don't try to embellish the truth so you can have honest suggestions on how to improve your credit score.

Once you have made the first difficult step in repairing your credit rating, it is important to maintain your rate of payment to transform a "bad" credit into an "excellent" one.

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There has never been a better time for good financial advice.

By Chris Clare

Why is it that although people have no compunction in seeking advice from doctors, dentists, lawyers, and other such professionals, when it comes to financial advisors, consideration would not appear to be that forthcoming. An IFA, or independent financial advisor is only approached when a savings plan or private pension plan is needed and it always seems to be at the last minute.

So what exactly is an Independent Financial Advisor then? Well, simply put, he or she is a person who works independently of the insurance companies, advising the best ways I which to deal with your individual financial situation. Now while it is true that it is a commission based job, independent means that he or she is not tied to any specific company. An IFA also has to put any advice that is given on record in writing and as such is held responsible for the advice given. With that in mind it is obviously in the IFAs best interest to give unbiased advice which can be clearly seen to be in the best interests of the client.

Financial advisors can generally offer you any financial service available on the market. This will encompass life insurance, savings plans, pensions, mortgages and personal investments. Some can also offer you extras such as inheritance tax planning and will writing.

Now that's all well and good, I hear you say, but can I not get these products by simply taking a stroll down the high street on any given day. Yes you can, but the big difference is that an Independent Financial Advisor does not just sell these products. The companies sell the products, as such. If you require life insurance they will sell you life insurance but an IFA is there to advise you whether you actually require life insurance in the first place.

A financial advisors process will involve sitting down with you for a couple of hours going through all the things you currently have such as the policies that you already pay into. They will asses your attitude to risk which means they will establish how much risk you are prepared to associate with particular areas or you financial planning. They will also establish what you can afford and how much money you are prepared to commit to dealing with any particular need you may have.

They will also find out what you want from your future financial planning, this will include questions such as when do you want to retire how long do you want to pay your mortgage for and do you want to protect yourself in the event of sickness etc.

All these facts lead a good advisor to the point that they are able to accurately advise you on the most appropriate products for your needs and your budget. At which point they are able to design a solution for you and go off and get quotes for the best products to fit your profile.

Once they have done this they are then in a position to sit with you again and go through their proposals for you and if they are acceptable to you they can move it all forward and make applications on your behalf.

Now with an ordinary financial advisor this would usually be the end of the process. The difference with an IFA is that they view it as being an ongoing process. This means that they will maintain contact with you in order to ensure that the plan is constantly working for you to the best financial ends. Remember that your situation will almost never remain constant and the role of an IFA will be to give you advice with regards to your plan and your changing situation.

In conclusion, the role of an IFA is to pick through every aspect of your financial situation, budget and requirements in order to correctly advise you on what financial services would be beneficial to you. They then source and facilitate these services. It is then their job to monitor your situation to ensure that should your finances change, your financial protection will change accordingly where required. In these troubled times, you can see why now is the best time to seek expert help when it comes to controlling, and protecting, our finances.

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Rebuild Your Credit With Credit Cards

By Dan Moskel

You can use a credit card to help rebuild your credit score. This card will help you build a positive payment history and will improve your ratio of available credit to debt; both these factors are heavily weighed in your credit score.

When you have a damaged score you will be faced with a sub prime interest rate. This means you will have an interest rate around 19%.

You should still make efforts to remove derogatory items off your credit report. However it is rumored that once a derogatory item ages four years it will not impact your score as dramatically.

With your card you are going to have to pay an annual fee and around 19% APR. This is called a sub prime credit card because it is designed for individuals with a damaged credit history.

You credit limit will be approximately $300. The other option is to get a secured credit card, however your credit score will not receive the same benefit.

With a secured card you will have to put an initial deposit down and how ever much your deposit is that will be your available credit. The benefit of a secured card is that they approve everyone.

Both these types of cards offer instant approval. Before you apply for any card double check and make sure that they report to all three credit bureaus.

Another tip to help you get the most benefit to your credit is to keep your balance at roughly 10% of your credit limit. For example a credit limit of $300 you will want to keep the monthly balance at $30.

This will help because it shows; you use your credit, and use it responsibly. In addition having available credit will increase your available credit to debt ratio, this shows the bureaus that you are not in over your head.

There is one other option that we strongly discourage and that is a shopping or catalog card. This is a credit card that is only able to make purchases through a catalog or a website online. We discourage this option because there is often a large down payment required and the card typically only reports to one credit bureau.

A prepaid card is another option. This is a good choice if you are unable to open a checking account because this card will work just like a bank account.

In sum we suggest a sub prime unsecured credit card to help rebuild your credit score. It will create a positive payment history and build positive credit.

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We suggest the Tribute Credit Card an unsecured credit card or you can see a review of the Orchard Bank MasterCard a secured card by visiting us.

Thrifty Spending

By William Blake

In order to live a thrifty life, you need to know more than just that you need to save money. It is also essential that you spend your money wisely. Consider the following ideas about what a frugal person can do with the money that they have worked hard to save.

Start out by making a list of the things that you need, want, and desire related to your money. Number the things you list in order of how important they are to you and try to estimate how much they would cost. Once you have your thoughts mapped out, you can go about making them a reality.

Paying more than the minimum payment on your mortgage each month or even just making one additional payment each year could mean that your mortgage gets paid off in half the time that it would if you always paid the minimum. Doing so will also save you lots of money in interest. When you make such additional payments, make sure that the money is being deducted from you loan's principal. Once you have the mortgage paid off, you can use the money you were accustomed to spending on that on whatever else you want.

Money you have been saving can be spent on home repairs and projects that you have long wanted to do. Some such projects might be simple, do-it-yourself jobs while others will require that you hire a professional. Money spent on making your home more beautiful will certainly be well spent.

Buy a newer pre-owned car. Even if your current vehicle is in good condition, you can get a newer pre-owned one. Your old car can be donated to a church, charity, or friend. Remember, though, that a newer car will be charged more in insurance payments.

Take that dream trip that you've always said you would take. By traveling during the shoulder or off season you will be able to stretch your money into even more of a vacation experience.

Even though been frugal does mean saving money in case of unexpected costs, it also important to enjoy the benefits that come from working hard to save your money. Thrifty people should also save some money with the intention of using it to enjoy themselves in some special way.

Using the money that you have saved to congratulate yourself will be a great boost to keep on saving and living frugally.

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Wondering how you could be negotiating lower payments on your credit card? You'll get plenty of helpful tips & advice on the Debtopedia website at http://www.debtopedia.com

Is throwing money at the mortgage market the solution?

By Chris Clare

You may have noticed over the last month many countries have past bills in their governments to inject substantial amounts of cash into their banking system. They have done this on the understanding that all the bad loans also known as toxic debt is weakening the institutions and rendering us unable to borrow money so leaving us all worse off as a result.

But the big question on everyone's lips is, will this have the effect of kick starting the institutions lending again, and if it does, what how will it affect the individual and the public in general. The analysis off this problem will be based on the UK as that is where my financial experience stems. The situation within the UK may bare similarities with that of other countries but I am not in the position to comment on whether the outcomes would be similar or not because I would not be as au fait as to how their markets tend to function.

Now the general consensus would be that due to the credit crunch the various financial institutions involved in the lending of money are not at liberty to do so, through a lack of it. So it would then follow on that the way to solve the problem is to supply them with the necessary means, i.e. more money. But this approach does not begin to scratch the surface with regards to the underlying problem. The reality is that the banks have been badly hit by the credit crunch and so are quite unwilling to continue on with lending as if nothing had happened.

House prices are the most important element of the current financial situation, and the prices are dropping fast and are showing no sign of stopping any time soon. Because of this drop in value, lenders are having to be extra vigilant when it comes to lending money from now on. This is particularly relevant when it comes to loan to value (LTV), which is the amount lent in relation to the value of the property. For example, in 2007, lenders were giving 95%, 100% and even 125% of the value of properties.

Now in a healthy market there is nothing wrong with this type of lending. For example, if you give a 125% loan on a house valued at 100,000 then the resulting loan would work out at 125,000. With a buoyant market the house prices may increase at an average of 10% per annum over the next three years. The resulting LTV would equate to 93%. So mathematically we can see that there would be nothing wrong with the initial 125% loan in that there would be negligible risk involved.

But the problem that we face is that house prices are going in the opposite direction. The decline is at least 10% and analysts figure that it could get worse. So, if 100,000 was lent on an 85,000 property then in the same three year time span the loan could have actually increased to 118% LTV. Now I am sure you would agree that in this present climate that this sort of loaning is both irresponsible and detrimental to all involved.

So what does the future hold for the market and will the bailout be the solution to the problem. Well I can only give my own personal professional opinion and nothing is set in stone but realistically I would perceive the bailout as having very little effect. They simply cannot lend at the high loan to values even though they have been committed in 2009 to lend at the levels reached in 2007. You see the majority of loans being agreed at present are dealing with people coming out of rates that had been pre-arranged over the last 5 years. Due to the downward spiral of house prices these people are going to be pushing the LTV up.

Another thing to consider is the high amount of self certification mortgages that have been arranged over the last 5 years. These types of mortgages will definitely be a rarity because they are seen as to high a risk and the institutions don?t want to know. And even if they are available the LTV will be far lower so what are the consequences in that scenario?

So whilst I do welcome the money that is being injected into the finance market I sadly think that whilst property continues to fall and lenders fail to have the pre 2008 appetite for lending it is more than likely just going to be stockpiled. This will have a domino effect as house prices will continue to fall because of the lack of lending at the right LTV with the right lending criteria which again will make lenders even less willing to lend. I have to say this is quite a quandary and I honestly don't see how it can be stopped until someone has the bravery to just lend knowing the calculated risk it represents I think it is fondly known as taking a punt!.

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Mortgage Route offers information help and mortgage advice from fully trained mortgage brokers coupled with free mortgage calculators and sourcing tools.