Thinking about taking out a payday advance loan but worried about falling into a debt trap? Read this real-world scenario of how one person navigated the maze of payday advance loans to stay out of debt.
Ever wonder how some people manage to take out expensive payday advance loans and still come out on top financially? It’s not easy, but it is certainly possible. This is the story of Emily, one person who used a payday advance loan to dig herself out of a financial rut.
Emily’s charge card, car payment, cellular phone bill, and rent were all due in three days, $1,500 total. Emily had $500 in the bank. Her monthly pay check wouldn’t come for ten more days, and her boss said no to a payday advance. Loans were out of the question, she thought. She needed the money in three days, and a bank loan would take that long just to mail her the paperwork.
If Emily was late paying her $300 credit card bill, she would incur a $35 late fee which would make her balance exceed her credit limit, earning her a $50 over-the-limit fee. She couldn’t afford to be late on her car loan, cellular phone or rent, even though there were no late fees. Having paid each of those bills late a few times in the past, she’d be skating on thin ice if she did it again.
Cash Advance Payday Loans: Emily’s Salvation?
Emily decided to apply for a cash advance payday loan. She knew it would be foolish simply to trust a lender of these loans for information. Searching on the internet, she found a website that did not belong to a payday advance loan lender, but instead reviewed the payday loan lenders.
She visited the website of online payday advance loan lender that was rated particularly well. Emily knows there are a lot of cheats on the web, so she was careful. Here’s what she looked for:
• The loan company’s website had a link to the Better Business Bureau. Clicking on the link, Emily saw the company’s record: member in good standing with no unresolved complaints.
• The loan company’s application clearly stated what the fees were, and what the annual percentage rate (APR) was. It also stated what penalties Emily would have to pay if she did not pay back the loan on time.
• Looking at a few other websites, Emily saw that the original loan company’s loan terms, fees, and interest rates were competitive.
• She double-checked that her upcoming paycheck would be enough to cover all her outstanding bills.
• She then checked into all the bills she would have to pay in between her upcoming paycheck and the one after that. After all, with her next paycheck going to repay the payday advance loan, she would need to make sure there was enough money left over to pay her remaining bills. She didn’t want to have to take out another loan after that.
• Emily figured out that she would have $300 left over after she paid all the bills between now and the next month’s paycheck. Living for 40 days on only $300 would be a challenge. But she decided she could do it if she economized. She would bring her lunch to work rather than buy it in the cafeteria, and give up going out at night--including un-inviting herself from a co-worker’s upcoming birthday party at the neighborhood bar.
• She posted notes on her refrigerator, steering wheel, and wallet, reminding herself not to make too many car trips, waste food, or splurge. She made herself the goal of reading several books she’d always wanted to read, rather than going out. She got them free from the library.
Did Emily’s Payday Advance Loan Plan Succeed?
Fully prepared, Emily took a $1000 cash advance from the ABC Loan Company and repaid it on the 15th along with a $50 fee. She saved $85 in credit card penalty fees. She also stayed on the good side of her landlord, car loan lender, bank, and cellular phone provider.
The experience also brought home to Emily that she was living too close to the limits of her paycheck. She realized that she would be better off moving out of her studio apartment, into a room in an apartment of a few friends. She’d also save money on gas by moving closer to work.
Today, Emily is grateful to the payday lender for saving her from financial disaster. She’s also proud of herself for being able to stay out of the debt trap so many other payday cash advance borrowers get into. She recommends to all her friends that if they ever get a payday loan, they do their homework, just like she did.
About the author:
Joel Walsh is a regular contributor to Payday Advance Loans : http://www.payday-loan--online.comGo to Payday Advance Loans for more tips on avoiding high fees on payday loans online.
Thursday, September 4, 2008
Get an Auto Loan the Smart Way
Did you know that most people pay hundreds or thousands of dollars more on auto loans than they have to? Get an auto loan the smart way. Read on.
Most people really get taken for a ride on their auto loan. Did you know that differences in the total cost of different auto loans can run into a thousand dollars or more? Here’s how you can get the lowest rate:
*
Make a list of different auto loan lenders and their interest rates and terms, before you go to the dealer (the web is usually the easiest way to do that). Did you know dealers get a commission on the loans they refer? If you’re not careful, that extra bit of money for the lender could mean you pay a higher rate than you would if you got the loan yourself.
*
Get a credit report and figure out your FICO scores. Removing any incorrect negative information from your report will help you get a better deal. Knowing exactly what your score is will help you figure out what interest rate you can realistically get.
*
Have bad credit? Try going to your credit union, bank or another institution where you have a relationship. Lenders like to help out established customers. If your bank still won’t help, online "bad credit auto loan" lenders usually offer better less expensive loans than dealers who advertise their great deals for people with poor credit.
*
Use a vehicle loan calculator. It will tell you what your loan will cost each month. It saves you the time of looking at vehicles you can’t afford, makes you aware of what information you’ll need to apply for a loan, and is a "reality check" of your financial condition.
*
Comparison shop, comparison shop, comparison shop. You don’t get the least expensive car by choosing a dealer at random, and you won’t get the least expensive auto loan that way, either.
Start researching your options now:
Get credit reports and FICO scores here:
Use this vehicle loan calculator:
Comparison shop among these lenders:
About the author:
Joel Walsh is a regular contributor to Auto Loan :http://www.cars-auto-loans.com, a website with information on car loan lenders, vehicle loan calculators, and other auto loan tools
Most people really get taken for a ride on their auto loan. Did you know that differences in the total cost of different auto loans can run into a thousand dollars or more? Here’s how you can get the lowest rate:
*
Make a list of different auto loan lenders and their interest rates and terms, before you go to the dealer (the web is usually the easiest way to do that). Did you know dealers get a commission on the loans they refer? If you’re not careful, that extra bit of money for the lender could mean you pay a higher rate than you would if you got the loan yourself.
*
Get a credit report and figure out your FICO scores. Removing any incorrect negative information from your report will help you get a better deal. Knowing exactly what your score is will help you figure out what interest rate you can realistically get.
*
Have bad credit? Try going to your credit union, bank or another institution where you have a relationship. Lenders like to help out established customers. If your bank still won’t help, online "bad credit auto loan" lenders usually offer better less expensive loans than dealers who advertise their great deals for people with poor credit.
*
Use a vehicle loan calculator. It will tell you what your loan will cost each month. It saves you the time of looking at vehicles you can’t afford, makes you aware of what information you’ll need to apply for a loan, and is a "reality check" of your financial condition.
*
Comparison shop, comparison shop, comparison shop. You don’t get the least expensive car by choosing a dealer at random, and you won’t get the least expensive auto loan that way, either.
Start researching your options now:
Get credit reports and FICO scores here:
Use this vehicle loan calculator:
Comparison shop among these lenders:
About the author:
Joel Walsh is a regular contributor to Auto Loan :http://www.cars-auto-loans.com, a website with information on car loan lenders, vehicle loan calculators, and other auto loan tools
Auto Loans: Don’t Dig a Money Pit in Your Garage
Choose the wrong auto loan and you might drastically increase the chances of defaulting and losing your car. Find out step-by-step how to avoid a money pit.
Car loans are certainly less costly than home mortgages, student loans, or other kinds of loans. So why do so many people end up defaulting and losing their cars? Find out these hidden dangers:
Biggest Hidden Car Loan Danger: The Inherent Money Pit
Unlike home mortgages, student loans or other big-ticket loans, car loans are inherently money pits. A house can build equity; higher education can increase earning potential; even jewelry can sometimes be re-sold for as much as was paid for it. If you borrow to buy one of those things, you may eventually get a return on investment. But every single car loses significant value and keeps losing it as time goes by.
Solution: spend as little on your car as possible.
Of course, in order to spend as little as possible over the life of the vehicle, you need to get a well-made, fuel-efficient car, rather than the one with the lowest price on the windshield.
But a pickup truck, SUV, sports car, or "luxury" model is a guaranteed money-loser. Don’t worry about what other people will think. Think about it: when was the last time you saw an expensive automobile and thought, "I really like and respect whoever owns that!"
The best buy? Many economists actually recommend buying a used car that's a year or two old. That way you can actually benefit from the fact that cars only drop in value. Even a car that’s just six months old may offer you a substantial savings. Just have it inspected thoroughly so you don't lose what you've saved on maintenance payments.
Hidden Car Loans Danger: Dangerously High Monthly Payments
Unfortunately, most people never figure out the total cost before signing on the dotted line. They end up staying up late at night trying to figure out how to make ends meet. They live in smaller houses. They skip going out at night. They don’t go on vacation.
All that sacrifice to have a brand-new SUV in the driveway!
Take a hard look at your finances, and figure out how much you can pay total each month for your car. Be sure to take into account insurance, tax, maintenance, and fuel. Usually, when people actually do calculate the total monthly cost of the car they’re considering buying, they’re amazed by how high it is.
How Much Car Debt Can You Afford?
1) Make a list of your average monthly non-car expenses, and subtract them from your earnings.
-___your monthly after-income-tax income
-___any other taxes
-___housing (including any fees and property taxes, and utilities)
-___food
-___health insurance or HMO
-___life insurance
-___debt payments
-___401 (k), IRA, or other long-term savings
-___short-term savings
-___telephone, cellular phone, cable, internet, etc.
-___entertainment and fun stuff (be honest!)
-___cost of yearly vacation(s) divided by 12
-___other expenses
= ____what you can spend on a car
2) Subtract your monthly car-related expenses from the amount you have left over from your other expenses.
___What you can spend on a car (from above)
-___Amount you’re spending per month on gas (raise or lower this figure depending on whether you are getting a car with higher or lower gas mileage).
-___Monthly maintenance (remember: your new car won’t stay new long, so maintenance will be an issue).
-___Monthly insurance (remember that for a new car, your insurance premiums may go up).
-___Tax.
= ____ Maximum monthly loan payment.
Now plug the number above into a vehicle loan rate calculator to figure out big of a car loan, and how much interest you can afford.
Final Hidden Auto Loan Danger: Unnecessarily High Rates
If you simply take the first loan the dealer offers you, you are probably paying too much. Do some comparison shopping on the internet, and bring a list of the best loans with you when you negotiate loan terms with the dealer.
Don’t let the dealer cheat you by shifting the cost from the car loan to the car price to the deal on your trade-in. Make sure you get a good deal overall.
Congratulations! You now are far better prepared to stay out of an auto loan money pit than the vast majority of car buyers.
About the author:
Joel Walsh is a regular contributor to Auto Loans :http://cars-auto-loans.com, where he writes about how you can get the best car loan
Car loans are certainly less costly than home mortgages, student loans, or other kinds of loans. So why do so many people end up defaulting and losing their cars? Find out these hidden dangers:
Biggest Hidden Car Loan Danger: The Inherent Money Pit
Unlike home mortgages, student loans or other big-ticket loans, car loans are inherently money pits. A house can build equity; higher education can increase earning potential; even jewelry can sometimes be re-sold for as much as was paid for it. If you borrow to buy one of those things, you may eventually get a return on investment. But every single car loses significant value and keeps losing it as time goes by.
Solution: spend as little on your car as possible.
Of course, in order to spend as little as possible over the life of the vehicle, you need to get a well-made, fuel-efficient car, rather than the one with the lowest price on the windshield.
But a pickup truck, SUV, sports car, or "luxury" model is a guaranteed money-loser. Don’t worry about what other people will think. Think about it: when was the last time you saw an expensive automobile and thought, "I really like and respect whoever owns that!"
The best buy? Many economists actually recommend buying a used car that's a year or two old. That way you can actually benefit from the fact that cars only drop in value. Even a car that’s just six months old may offer you a substantial savings. Just have it inspected thoroughly so you don't lose what you've saved on maintenance payments.
Hidden Car Loans Danger: Dangerously High Monthly Payments
Unfortunately, most people never figure out the total cost before signing on the dotted line. They end up staying up late at night trying to figure out how to make ends meet. They live in smaller houses. They skip going out at night. They don’t go on vacation.
All that sacrifice to have a brand-new SUV in the driveway!
Take a hard look at your finances, and figure out how much you can pay total each month for your car. Be sure to take into account insurance, tax, maintenance, and fuel. Usually, when people actually do calculate the total monthly cost of the car they’re considering buying, they’re amazed by how high it is.
How Much Car Debt Can You Afford?
1) Make a list of your average monthly non-car expenses, and subtract them from your earnings.
-___your monthly after-income-tax income
-___any other taxes
-___housing (including any fees and property taxes, and utilities)
-___food
-___health insurance or HMO
-___life insurance
-___debt payments
-___401 (k), IRA, or other long-term savings
-___short-term savings
-___telephone, cellular phone, cable, internet, etc.
-___entertainment and fun stuff (be honest!)
-___cost of yearly vacation(s) divided by 12
-___other expenses
= ____what you can spend on a car
2) Subtract your monthly car-related expenses from the amount you have left over from your other expenses.
___What you can spend on a car (from above)
-___Amount you’re spending per month on gas (raise or lower this figure depending on whether you are getting a car with higher or lower gas mileage).
-___Monthly maintenance (remember: your new car won’t stay new long, so maintenance will be an issue).
-___Monthly insurance (remember that for a new car, your insurance premiums may go up).
-___Tax.
= ____ Maximum monthly loan payment.
Now plug the number above into a vehicle loan rate calculator to figure out big of a car loan, and how much interest you can afford.
Final Hidden Auto Loan Danger: Unnecessarily High Rates
If you simply take the first loan the dealer offers you, you are probably paying too much. Do some comparison shopping on the internet, and bring a list of the best loans with you when you negotiate loan terms with the dealer.
Don’t let the dealer cheat you by shifting the cost from the car loan to the car price to the deal on your trade-in. Make sure you get a good deal overall.
Congratulations! You now are far better prepared to stay out of an auto loan money pit than the vast majority of car buyers.
About the author:
Joel Walsh is a regular contributor to Auto Loans :http://cars-auto-loans.com, where he writes about how you can get the best car loan
Tuesday, September 2, 2008
Long-Term Care Insurers Agree to Reconsider Denied Claims
Idaho Department of Insurance Director Bill Deal wants residents to be
aware of a multistate settlement involving Conseco Senior Health Insurance Co. and
Bankers Life and Casualty Insurance Co. that may affect past claims.
Idahoans with long-term care insurance policies from these two companies who filed
claims from January 1, 2005, through December 31, 2007, that were later denied, may
have their claims reviewed for possible adjustments.
Following a multistate market conduct examination of the two companies that found
problems with their claims handling practices, a corrective action plan to address
concerns for the benefit of current and former policyholders was developed.
Long-term care claims that were initially denied will be reviewed a second time. Insureds
may be asked to provide further documentation to support the claim. The companies must
notify affected policyholders by letter that their claim is being reviewed.
Under the settlement, the insurance companies are required to review their claims and
complaint handling practices to ensure that all claims are handled in a timely and
appropriate way that is compliant with applicable state laws.
Conseco Senior and Bankers Life policyholders can call Conseco’s multistate toll-free
information line at 866-452-6589 with questions about how to refile claims or
complaints.
The Consumer Affairs office of the Department of Insurance can help Idahoans with
these or other problems with their insurance. Call 334-4250 in Boise, 800-721-3272
statewide or visit the website, www.doi.idaho.gov.
aware of a multistate settlement involving Conseco Senior Health Insurance Co. and
Bankers Life and Casualty Insurance Co. that may affect past claims.
Idahoans with long-term care insurance policies from these two companies who filed
claims from January 1, 2005, through December 31, 2007, that were later denied, may
have their claims reviewed for possible adjustments.
Following a multistate market conduct examination of the two companies that found
problems with their claims handling practices, a corrective action plan to address
concerns for the benefit of current and former policyholders was developed.
Long-term care claims that were initially denied will be reviewed a second time. Insureds
may be asked to provide further documentation to support the claim. The companies must
notify affected policyholders by letter that their claim is being reviewed.
Under the settlement, the insurance companies are required to review their claims and
complaint handling practices to ensure that all claims are handled in a timely and
appropriate way that is compliant with applicable state laws.
Conseco Senior and Bankers Life policyholders can call Conseco’s multistate toll-free
information line at 866-452-6589 with questions about how to refile claims or
complaints.
The Consumer Affairs office of the Department of Insurance can help Idahoans with
these or other problems with their insurance. Call 334-4250 in Boise, 800-721-3272
statewide or visit the website, www.doi.idaho.gov.
Monday, September 1, 2008
STUDENT LOANS A Great Istrument For Cost Recovery In The Next Educations
Governments and universities have trouble reconciling the goal of keeping higher education widely accessible with the need to retrieve some of its costs from students. Student loans offer a plausible solution to the problem. But loan programs turn out in practice to have been a disappointing instrument of cost recovery: analysis of twenty-three programs found that students repay only a small portion of the value of the original loan. Subsidies, high default rates, and high administrative costs have eroded the value of repayments. Sometimes loan programs have proved as expensive as outright grants.
This article argues that most loan programs could be reformed to improve financial effectiveness—through targeting, charging positive real interest rates, designing repayment plans to take account of the likely pattern of graduate earnings, and ensuring that the oversight institutions can and will collect. Or governments could explore alternative devices for cost recovery, such as a graduate tax. This approach levies a higher income tax rate on beneficiaries of government-subsidized higher education and thus preserves the idea, implicit in loan programs, of paying for education with future earnings. As part of an effective tax system, a graduate tax could bring in significantly more revenue than traditional loan programs.
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