For those who are not aware, there is a new Regulation E that requires you to either opt in or opt out for courtesy pay on your debit card. If you are not familiar with the new law, click here to watch an online video to learn about the changes.
Many people have asked me if they should opt in or opt out. And my response: It is up to you! Here are some things to consider when making your decision:
#How frequently do you overdraft your account?
#Do you live paycheck to paycheck?
#Are you ok with being told you are declined in front of your friends or maybe business partners?
Courtesy pay is there to make sure that if you attempt to make a purchase with your debit card and you do not have the available funds in your account, then the bank will go ahead and allow the transaction to clear your account with a service of around $30.
If you have any questions regarding Reg E, feel free to email me here.
Tuesday, July 27, 2010
Sunday, July 25, 2010
Article on Savings Rates
So I was browsing articles on personal finance and came across this article. It spotlights several different families and shows their personal savings rate. They do things from limiting their frivolous spending, not eating out, side jobs, to swapping toys with neighbors.
One thing I noticed is that each family or person they spotlighted had well paying jobs and no challenges like chronically sick kids or disabilities. I would rather have seen an article to help people like the single mom working at McDonalds, they couple with three kids working at Wal-Mart, or similar. These are the people who really need to learn good savings habits and also learn ways to increase their income with education or training.
One thing I noticed is that each family or person they spotlighted had well paying jobs and no challenges like chronically sick kids or disabilities. I would rather have seen an article to help people like the single mom working at McDonalds, they couple with three kids working at Wal-Mart, or similar. These are the people who really need to learn good savings habits and also learn ways to increase their income with education or training.
Saturday, July 24, 2010
Looking For a Loan?
If you live in the Houston area and are looking for a loan, I can help you! I am a branch manager at a local credit union. I help people each and every day with all types of consumer loans including auto, personal, lines of credit, RV, Boat, Motorcycles, and even credit cards.
There is no cost to apply. Just click below to send me your name, phone number, and type of loan you are looking for and I will contact you within 24 hours to personally help you! Haven't found the right car? I can help you! With multiple dealer relationships, I can help you find the right car at the right price.
When doing business with me, you are going to get a higher level of personalized service and be dealt with in a fair and honest manner.
Click here to get started!
There is no cost to apply. Just click below to send me your name, phone number, and type of loan you are looking for and I will contact you within 24 hours to personally help you! Haven't found the right car? I can help you! With multiple dealer relationships, I can help you find the right car at the right price.
When doing business with me, you are going to get a higher level of personalized service and be dealt with in a fair and honest manner.
Click here to get started!
Friday, July 23, 2010
Seven Questions You Need to Ask Your Loan Officer
Most consumers who get loans rarely ask any questions. They walk in, sign the documents and start making payments. There are things that consumers need to know in order to understand what exactly they are signing. A great number of consumers with loans cannot tell you what their interest rate is or the term of the loan. This is an unfortunate situation that costs many consumers thousands of dollars each year. Here are seven questions that every consumer needs to ask about their loan before signing the dotted line.
What is the interest rate?
Some consumers do not care what the interest rate is as long as they like the monthly payment amount. This is a common mistake made by many consumers each day. Often times, you can get a shorter term and lower interest rate if you are willing to pay a little bit more each month. It may slightly raise your monthly payment, but you could be saving yourself some serious money.
Are there any discounts I can receive on the interest rate?
In this fast pace world, loan officers sometimes forget to apply available discounts to loans. Many financial institutions offer discounts on the interest rate if you have other relationships with them like a checking or savings account, direct deposit, or sign up for automatic payments.
Does this include any add-ons or additional products?
There could be add-ons including extended warranties that will cover the vehicle mechanically for a set period or GAP protection which covers the difference between your loan balance and what the insurance company pays you in a total loss situation. These add-ons sometimes can be beneficial, but you should weigh the costs with the benefits. Just make sure to find out how much each one costs before agreeing to it.
If I pay more than the minimum payment each month, does it go towards principal?
It is good to know that if you want to pay extra each month that it goes towards principle and not against your next payment due. Some lending institutions have default settings that will only reduce your next payment due instead of having the difference automatically apply to principal. This is because as you pay down the principal, you are saving interest. As you save interest, they make less money. So make sure to ask the bank this important question. If the extra cash you throw in each month does not reduce your principal, you should probably put that extra cash towards your credit cards or to loans that any additional payments actually reduce your principal.
Is there any pre-payment penalty?
Sometimes deals can seem too good to be true. This is the case with pre-payment penalties. Pre-payment penalties are fees imposed by the lender if the consumer pays off a loan before a certain time has been reached. This is in place to ensure that lending institutions that have costs associated with making loans get some type of payback on that investment. These kind of fees are especially common if the lender covers your closing costs or in another words if you have a zero-closing-cost loan. Prepayment penalties are good for lenders, but bad for unwitting consumers who try to pay off loans early. If you are faced with getting a loan with a pre-payment penalty, make sure to ask when the provision expires and to explore all other options before signing.
What options do I have if I cannot make one of my payments by the end of the grace period?
It is always good to know how financial institutions handle this situation. The grace period is the period starting when your payment is due and ends the last day you can make a payment without a late fee. Some institutions have generous grace periods and even options on skipping payments if you had some unexpected bills come up. There usually is a small fee, but it beats being late. Be sure to know all the options you have and who to talk to if the need arises.
Do you report information to the credit bureaus?
For credit conscious consumers, it is important to know that your payment history will be reported to all three credit bureaus. It is common for some loan products to skip the whole credit reporting process. It would be a shame to make years of on time payments and not have anything to show for it. If it is not being reported, it never really happened.
Keep these seven things in mind when you go to close on your loan. Asking the right questions will save you some serious money!
What is the interest rate?
Some consumers do not care what the interest rate is as long as they like the monthly payment amount. This is a common mistake made by many consumers each day. Often times, you can get a shorter term and lower interest rate if you are willing to pay a little bit more each month. It may slightly raise your monthly payment, but you could be saving yourself some serious money.
Are there any discounts I can receive on the interest rate?
In this fast pace world, loan officers sometimes forget to apply available discounts to loans. Many financial institutions offer discounts on the interest rate if you have other relationships with them like a checking or savings account, direct deposit, or sign up for automatic payments.
Does this include any add-ons or additional products?
There could be add-ons including extended warranties that will cover the vehicle mechanically for a set period or GAP protection which covers the difference between your loan balance and what the insurance company pays you in a total loss situation. These add-ons sometimes can be beneficial, but you should weigh the costs with the benefits. Just make sure to find out how much each one costs before agreeing to it.
If I pay more than the minimum payment each month, does it go towards principal?
It is good to know that if you want to pay extra each month that it goes towards principle and not against your next payment due. Some lending institutions have default settings that will only reduce your next payment due instead of having the difference automatically apply to principal. This is because as you pay down the principal, you are saving interest. As you save interest, they make less money. So make sure to ask the bank this important question. If the extra cash you throw in each month does not reduce your principal, you should probably put that extra cash towards your credit cards or to loans that any additional payments actually reduce your principal.
Is there any pre-payment penalty?
Sometimes deals can seem too good to be true. This is the case with pre-payment penalties. Pre-payment penalties are fees imposed by the lender if the consumer pays off a loan before a certain time has been reached. This is in place to ensure that lending institutions that have costs associated with making loans get some type of payback on that investment. These kind of fees are especially common if the lender covers your closing costs or in another words if you have a zero-closing-cost loan. Prepayment penalties are good for lenders, but bad for unwitting consumers who try to pay off loans early. If you are faced with getting a loan with a pre-payment penalty, make sure to ask when the provision expires and to explore all other options before signing.
What options do I have if I cannot make one of my payments by the end of the grace period?
It is always good to know how financial institutions handle this situation. The grace period is the period starting when your payment is due and ends the last day you can make a payment without a late fee. Some institutions have generous grace periods and even options on skipping payments if you had some unexpected bills come up. There usually is a small fee, but it beats being late. Be sure to know all the options you have and who to talk to if the need arises.
Do you report information to the credit bureaus?
For credit conscious consumers, it is important to know that your payment history will be reported to all three credit bureaus. It is common for some loan products to skip the whole credit reporting process. It would be a shame to make years of on time payments and not have anything to show for it. If it is not being reported, it never really happened.
Keep these seven things in mind when you go to close on your loan. Asking the right questions will save you some serious money!
Thursday, July 22, 2010
Dave Ramsey
Dave Ramsey has been helping people manage their personal finances and get out of debt for years. Sometimes this involves "tough love", but it is an effective program. I would suggest this book to anyone who wishes to get out of debt.
Tuesday, July 20, 2010
Quick Tip on Paying Down Credit Card Debt
Paying just the minimum payments on all your credit cards means that it will take you years to pay off the balance....5, 10, sometimes 20 years! If you look at your monthly credit card statements, it will tell you how long it will take to pay off the debt just making minimum payments. For those of you trying to pay down your credit card debt, here are some quick helpful tips to help you pay them off as quickly as possible.
First, you need to write down your balances on each card along with the interest rate being charged on each debt. This will allow you to come up with a plan of attack to pay your credit cards off quicker.
Now, instead of paying cards randomly, you need to start paying just the minimum payments on your lowest interest rate debt and apply the most money you can to the debt with the highest interest rate. This will help you tackle your debt faster because you are paying down the most expensive debt first.
After you pay that debt off, move to the next highest debt and repeat until your debt is paid off completely.
First, you need to write down your balances on each card along with the interest rate being charged on each debt. This will allow you to come up with a plan of attack to pay your credit cards off quicker.
Now, instead of paying cards randomly, you need to start paying just the minimum payments on your lowest interest rate debt and apply the most money you can to the debt with the highest interest rate. This will help you tackle your debt faster because you are paying down the most expensive debt first.
After you pay that debt off, move to the next highest debt and repeat until your debt is paid off completely.
Sunday, July 18, 2010
The Three Credit Bureaus
When it comes to personal credit in the United States, there are three companies that make up the credit reporting bureaus: Equifax, Experian, and Transunion. These three companies issue scores based on your credit information. Now, I will not go into the details on each company, but your score with each company will be different. This has to do with the differences in the information about you that is reported to each bureau.
I recommend obtaining a complete copy of your credit report from all three bureaus once a year. The best place to go is www.annualcreditreport.com which was established by the credit reporting companies in accordance with the Fair and Accurate Credit Transactions Act or FACT Act. Here is a tip! Since the information reported to each credit bureau is similar, request one free report every four months. That way you are spreading it out over the year and more likely to catch any discrepancies quicker.
Check out my Credit Score Power eTips which is a list of specific actions I have used to help hundreds of people increase their credit score immediately and for the long term!
I recommend obtaining a complete copy of your credit report from all three bureaus once a year. The best place to go is www.annualcreditreport.com which was established by the credit reporting companies in accordance with the Fair and Accurate Credit Transactions Act or FACT Act. Here is a tip! Since the information reported to each credit bureau is similar, request one free report every four months. That way you are spreading it out over the year and more likely to catch any discrepancies quicker.
Check out my Credit Score Power eTips which is a list of specific actions I have used to help hundreds of people increase their credit score immediately and for the long term!
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