Should you consider a PayDayLoan or a Title Loan?

Everyone needs some cash at times, whether it’s for emergencies or just to have some fun. If you don’t have a good credit score though, most banks won’t give you the time of day. If this applies to you, consider a title loan on your car.

A Title Loan Is…

Many people have heard of a title loan, but don’t know what it really is. With a title loan, you are getting a loan using your car as collateral. You might point out that you need your car, but that is not a problem. Working with Texas auto title loans, you get to keep your car, as long as you pay off your loan. The car is just collateral in the rare case that you don’t make your payments.

My favorite thing about eTitleLoan is their mobile loan agents. Sure, you might need money, but driving to a loan store, doing the paperwork, etc., takes time, and often more time than you have on a lunch break. This is even more important in the case of an emergency need for cash.

With eTitleLoan though, you just give them a call, and they send their loan agents to you. Not only that, but they will tell you right on the phone everything that you need to have with you to process the loan. None of this garbage where you think you’re getting the loan, but end up not having all the paperwork they need so they just send you on your way, still broke.

Obviously no one wants to need emergency cash, but if that day comes, definitely consider giving eTitleLoan a call. Their whole business model, with their mobile loan agents, makes the process as easy as possible, and gets you the cash you need quickly. I highly recommend it.

John In Houston

(Note: Of course, if you don’t keep up payments on your title loan, you may risk losing your car! Now that might be even more inconvenient than not having a little cash! And don’t forget to check the interest rates! Some of these loans have high interest rates, much higher than typical bank loans.)

Check your mortgage rates: a handy calculator

Needing a little help calculating your mortgage payments? Try this calculator. It may not be 100% accurate because of all the possible variations, charges, etc.., but with declining mortgage rates over the past few months, it will help you to do back-of-the-napkin type calculations to check your mortgage isn’t being grossly overcharged.

I noticed in my own bank statements how quickly the local bank was to raise rates in the past two years, but I am still waiting for a commensurate fall in the rates. I could very well be using this when I go to the bank to update the passbook.

Calculator is provided by Mortgage Calculator.

This article is guest written by Adam Hefner, and examines the different kinds of mortgage rates you may end up paying. I hope you find this useful.

How to calculate a mortgage payment is one of your most important decisions when purchasing a home. Rather than be a mathematician, you will just need to learn a little bit about the process and what it is all about. You will have many choices when it comes to figuring out what your payment will be. Key to the process is what your credit is and what you will want to borrow.

What kind of mortgage do you want? Whether you choose an adjusted rate mortgage (ARM), a fixed, or a balloon type payment will depend mainly on how much money you make and what your credit score is. These variations will cost you dearly if you are not well informed about their differences!

If you get a balloon mortgage you will have to pay it off or refinance it every 5 or 7 years generally. Interest rates can change daily and so will your ARM. Your rates could start as low as 5% and go up passed 8% in a short period. The rates don’t stop there either; they could go very high, with no cap. Don’t make the mistake of comparing a low ARM rate to a higher fixed rate, the fixed rate won’t change but the ARM will. With a fixed rate of 7% what you start with is what you will end your mortgage rate with.

Do you have a large or small income? When a loan agent reviews your loan they will look at you using between one fourth and less than one half of what you make monthly or yearly. The best bet is not to spend more than a third of the money you make each month on your house payment. Basically you can look at it like this, if you are bringing home $1200.00, you will want your house payment around $400.

Are you aware of your credit score? The four basic categories for credit scoring are poor, fair, good and excellent. If you have good or excellent credit, the interest rate that you are offered is usually going to be lower. If your credit is in the low ranges, you can expect to see higher interest rates. Most mortgage loans are based on simple interest.

One type of simple interest loan, the amount of interest is added each day. If your payment on the first day is $360, the next day would be $370 and so on. Each day your interest is added until you pay for that month. When you have made your payment, your principle will go down (the base loan amount), and interest will be added to that smaller amount. So you will be saving money each time you do this by paying less interest.

Mainstream mortgages are usually calculated as monthly simple interest. Regardless of what day you pay your mortgage it will not change what you owe because the interest is charged monthly, as long as you pay on time. When using a mortgage calculator it is important to know which type of interest you are going to go with, daily or monthly.

When you decide on how to calculate a mortgage payment, make sure you are familiar with all of the terms associated with your loan. You will have a choice of simple or advanced models. You will get a bigger financial picture when you use the more advanced mortgage calculators.

Save time and learn the best way to calculate a mortgage payment from your own home. For more, visit where you’ll find this and plenty more on your mortgage loan needs.

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Selling a house: Would you take a 100% profit?

This recent story on the Guardian Newspaper website caught my eye about negative equity. Virginia Wallis responds to a Q&A from ‘KJ’ who writes about her worries about negative equity, and unfortunately underlines the problems that house purchasers face in a bullish market that turns negative. Unfortunately the writer’s response isn’t that helpful or accurate…

Go and read the story, since I can’t repost it here. In summary… KJ bought a house very near the peak of the market in 2007 for £154,000. Obviously she’s worried now that prices are falling, and is thinking of selling up. The respondent unfortunately seems to have poor math in the article, missing out on £2000 in the calculations. … She put £8000 down in the first place, and the other 95% was a mortgage.

Where did she get the 10%?

In sum, here’s a lady who bought near the top of the market. With the terms she employs in the article, like ‘invested’, and ‘valued at £185,000’. Now she’s panicking over a 10% variable rate (I have no idea why or how she came up with 10% pa). Top rates these days in the U.K. are about 6.5% to a little over 7.2%. It would be quite a jump to 10% (unless she’s saying something I don’t know). Australian rates are another story though.

She ‘believes’ her flat was worth £185,000 in February, but has no independent way to verify this assumption. All such ‘values’ are only theoretical until someone ACTUALLY puts down the cash. However, the current offer she’s got is £167,000. In such a difficult market as this, she’s actually lucky. She’d actually be sitting on a gross profit of nearly £21,000. Of course, early redemption fees would eat some of that, as would transaction fees. Still she’d make a reasonable profit on her ‘investment’.

Is this a place to live?

It seems though that we have what we might term a ‘weak’ card. I don’t see how if she were actually living on this property she would be thinking like this. It seems that she may really have ‘invested’ in the property as a buy-to-let, and may be unable to rent it out at the moment. With the threat of higher interest rates, lacklustre rentals, and a likely profit, she may be willing to cash out. If she were the owner, would she be thinking like this?

Why does she have to remortgage?

She writes “I have to remortgage in January 2010 and am panicking over the possibility of negative equity”. I would guess that she’s is currently struggling to make the mortgage payments at the moment, if she is living there. She is naturally concerned that rates are rising (they are), and they could go much higher (remember that rates have been at historical lows in MANY countries), and her mortgage is an ARM with favorable upfront terms (likely and common scenario) due to reset in 2010 at much higher rates than a year and a half ago. It seems unlikely she may be able to meet THOSE payments, never mind the payments that might result from additional rate rises between now and then.

From the tone of the letter, it seems that this ‘house-owner’ was seeking to make some kind of profit in the short-term while taking a longer term gamble that would allow her an exit strategy before the three years were up. It seems she has been wrong-footed by the market, and is now seeking an early exit. But will she succeed in taking a profit?… Let’s see.

100% profit, that ain’t bad?

Why? There are early redemption fees (approx. 3% of the mortgage amount), a likely stamp tax of 1% on the amount of the property, ie. approx. £1,670. It’s difficult to assess other fees on transaction costs, but they could easily range from £2500~£6500 plus fees of £500 for lawyer fees. Then you have removal fees, too, and other sundry costs of setting up a new home. Suddenly that fat profit of £21000 is looking a lot smaller! You could be paying out £13,000 or more in expenses, fees, and taxes. You’d still have a net £8,000 on your initial investment of £8,000. Which would be a return of 100% on a year and a half. Not too shabby. But certainly a lot less than KJ was hoping for when she gambled on the market.

That calculation only includes exit costs. To assess the true profit, you’d have to include the transaction fees, duties, and other costs that she incurred to get into the transaction in the first place. I wouldn’t be surprised if she spent a similar amount on the set up costs of the property transaction as she does getting out of it. Goodbye 100% profit!

What would you do? How would you get out of this mess?