Money – Templo Do Conhecimento Tue, 11 Jan 2022 16:48:26 +0000 en-US hourly 1 Money – Templo Do Conhecimento 32 32 Can You Refinance a Car With Bad Credit? Tue, 11 Jan 2022 15:05:32 +0000

Refinancing a car with bad credit is not impossible, but it can be a challenge for borrowers with lower credit scores. If you’ve taken out a subprime auto loan, your interest rate is likely to be high. Refinancing can lower your interest rate and save you money. Here’s how.

Check the refinancing requirements. To keep the car you love and get a new car loan with new terms, you need to meet the credentials of the lender. This can be your existing lender or a new one.

All lender requirements vary, but in general your credit should be either good (around 670 or better) or better than when you took out your loan. Most refinances are reserved for borrowers with good credit. However, if you initially took out a subprime auto loan with bad credit, your credit has improved, and you’ve kept your loan up to date for at least a year, you may be in the running to save some money. money by refinancing.

Is your car eligible for refinancing? Your vehicle must also meet certain specifications. As a general rule, a car should be in good condition, not be too old, and travel less than 100,000 miles. Most lenders also prefer to refinance auto loans that are neither too recent nor too close to being paid off. Many require that you be up to date on your loan and not in a negative equity position.

Advantages and disadvantages of refinancing. Refinancing replaces your current auto loan with a new one. It has its advantages like keeping your car and saving money on your monthly payments. You could even increase your credit score if you are responsible for your loan.

To save money on your monthly car loan, you can lower your interest rate, extend the term of your loan, or both. To save overall, make sure you’re getting the lowest interest rate possible. If you only extend the term of your loan without lowering your interest rate first, it can cost you more overall.

When you need to refinance your car loan with bad credit but don’t know where to turn, we want to help. Auto Express Credit works with an extensive network of vendors ready to help you with your refinancing needs. Our auto loan refinance application form can put you in touch with a refi lender near you.

Too low a ceiling eliminates access to necessary loans Sun, 09 Jan 2022 07:02:34 +0000

Those calling for a 36% rate cap on most forms of consumer credit here in New Mexico rarely, if ever, cite hard data to support claims that a rate cap will help consumers. Their goal is laudable: to provide greater financial security to all New Mexicans. I also support this goal, but a 36% rate cap is not the way to achieve it.

The point is that a cap rate of 36% would be bad for New Mexicans, especially for low-income households with little or no credit who are more likely to use small credit for daily needs, including car payments, fuel and medical expenses. I saw him every day in the service of my district. According to Experian (, more than a third of all New Mexico consumers have subprime credit scores, which means they likely wouldn’t qualify for a loan below the 36% limit. which would essentially deprive them of safe and reliable access to credit.

Data showed that the 36% cap failed in other states. In states that have imposed interest rate caps, there has been a demonstrable reduction in access to credit, affecting poverty levels and financial stability. In Georgia and North Carolina, which have cap rates, people “wrote more bad checks, complained more about lenders and debt collectors, and filed for Chapter 7 bankruptcy at a higher rate.” “, according to Additionally, the North Carolina Banks Commissioner for Consumer Finance 2018 annual report found access to loans under $ 1,000 (denied) because lenders were pulling out of the market. ( Further, the Federal Reserve has discovered that a 36% rate cap is not applicable to reputable lending institutions and hurts the very people those caps were meant to protect.

So why, given what we know, do some in New Mexico continue to focus on a 36% cap as a solution? Partly because they don’t understand how interest rates work. For loans under $ 2,000, the affordability of the loan is best judged by its duration and the monthly amount owed, not by the interest rate. Rates are a function of time rather than a measure of the cost of a loan. Take the example of a consumer who borrows $ 100 today and pays $ 1 in interest. In case of repayment in one year, the APR is 1%. Repaid in one month, the rate is 12%. Repaid one day after issuance of the loan, the APR is 365%. Same dollar interest, very different APRs. Consumers must be protected from bad actors, but not with policies that ignore their legitimate need for access to credit and endanger their economic security.

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Long-term commercial loan options for small businesses Fri, 07 Jan 2022 22:51:23 +0000

Smart business owners know they can do more with a little extra working capital. And when they don’t have the extra money available, they take out small business loans.

Sounds simple, doesn’t it? There are actually many types of business loans out there, so finding the one that’s right for you requires doing your homework.

Let’s start this journey by understanding a little more about long term business loans.

What is a long term business loan?

Business loans have different repayment terms. Some must be repaid in a few months. But long-term commercial loans usually have longer repayment periods, sometimes up to 25 years.

The interest rates for these types of loans may be lower than for short term loans, depending on your qualifications and the lender’s approval criteria.

How Do Long Term Business Loans Work?

Once you are approved for a long term loan, you are presented with the loan amount and repayment terms. You will be told the period of time you have to repay the loan. Typically, you are able to pay off the loan sooner, but beware of prepayment penalties as some lenders charge them.

What types of business loans are long term?

Now let’s see what types of loans are considered long term.

Bank loans

Many banks and credit unions offer long-term business loans at low interest rates. To be eligible, your business must have been established for at least two years and have good personal credit scores.

Business line of credit

If you don’t want a large amount of money at the same time, a line of credit is a good option for long-term loans. You pay back what you borrow over the line and can continually borrow and repay over time.

Note that sometimes the line of credit needs to be paid off within a few months, but the line is open indefinitely, so we include it in the long term loan options.

SBA loans

The US Small Business Administration offers many long-term loan programs such as SBA 7 (a), microloans, and 504 loans. Some have repayment periods as long as 25 years.

Commercial real estate

If you need to buy real estate like an office building or commercial property, you should know that a loan won’t need to be repaid anytime soon. This makes getting a loan of, say, $ 1 million more feasible if you have decades to pay it off.

The best financing options for long-term business loans

Now that you have a better idea of ​​what type of loan might be right for you, let’s take a look at some of the commercial lenders that offer great loan options for the best long term business financing.

Intermediate term loan options

If you want a loan of more than a few months but less than 25 years, Kapitus has a five-year medium-term loan of up to $ 5 million. Credibility capital loans up to $ 500,000 with repayment periods of one to five years.

Line of credit options

On the bridge, Fund of funds, and cabbage offer lines of credit.

OnDeck offers lines of credit from $ 6,000 to $ 100,000, with one-year repayment terms.

Fundbox offers financing options up to $ 150,000 with 12 or 24 week repayment terms. You can borrow the funds again after they are repaid.

Kabbage has lines of credit between $ 1,000 and $ 150,000. Each draw must be repaid in six, 12 or 18 months and can be re-borrowed.

Long term loan options

You have a few options in this category including On the bridge and Newtek. With OnDeck, you can borrow from $ 5,000 to $ 250,000 and pay it back over two years. Newtek offers long-term loans of $ 1,000 to $ 15 million, with terms of seven to 25 years.

SBA loan options

Smartbiz is a great option for SBA 7 (a) loans. You can borrow anywhere from $ 500,000 to $ 5 million with a 25 year repayment period.

Long-term or short-term business loans

So, in the long run, is a long term loan better for you?

Here’s something important to note: Long-term loans may have lower interest rates, but you can still pay more interest overall, since you’re paying them over years, not over years. months.

If you’ve borrowed $ 1 million at 3%, with a 25-year repayment, you’ll pay that 3% over the life of the loan. If you borrow $ 10,000 and pay it back within two years at an interest rate of 10%, while the interest rate is higher, you may end up paying less interest overall because it is a much shorter term.

The truth is, if you have bad credit, you cannot qualify for long term bank loans or SBA loans. Your only option may be to take out shorter term loans from other lenders at higher interest rates. Keep in mind that some online lenders charge a set-up fee as well, which can increase your expenses.

Sometimes a shorter period is better, such as when purchasing equipment. Since equipment has a limited lifespan, equipment financing tends to have payback periods of a few years.

If you don’t qualify for a longer repayment period, perhaps because you’re running a new startup and haven’t built your credit yet, consider loans that have a minimum credit score requirement or that take into account other factors, such as your annual income. . You may also be eligible for business credit cards.

Otherwise, you can take the time to build up your credit in order to qualify for long-term business loans with low interest rates.

What is the longest term for a business loan?

Borrowers need to know how long they will have to make their monthly payments before contract a loan. Each type of loan can have different terms. In the short term, you might only have a year to pay off a loan.

In contrast, some loans can be repaid over 25 years. These are usually larger loans, such as real estate or SBA loans.

How To Qualify For Long Term Business Loans

Before you begin the application process, find out about the requirements of a lender to approve you for a loan. Is there a business or personal credit score requirement? Do you need a certain amount of annual income? How long have you been in business?

Established businesses that have a proven track record of financial stability may find it easier to secure lower interest rates, so examine your qualifications to understand what type of rate you might qualify for.

Before applying, see what documents you will need to provide. Bank and SBA loans may require more financial information, such as tax returns, financial statements, and bank statements. They can also review your credit history, so take a look for yourself before you apply to see what you’re working with.

How to choose the right long-term business loan

The type of financing your business needs is unique and like no other. If you are looking for long term financing, explore options with traditional banks, credit unions, and online lenders.

Before you apply, have a plan on how you will use the loan proceeds. Are you looking to grow your business or just maintain a stable cash flow? Can you afford to make repayments every month? How will the money help you grow your business?

Small business owners need to keep an eye on the future of their business, and long-term business loans are a great tool to help them.

This article was originally written on January 7, 2022.

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How to get a car loan with bad credit Wed, 05 Jan 2022 22:19:53 +0000

If you need a car to get to work or school, choosing a used vehicle is a great way to save money. However, used cars are still a big investment. The average used car costs over $ 27,000 in November 2021, therefore, you may need to take out a loan to finance your purchase.

Lenders generally want borrowers to have a credit score of 661 or higher. If your score is lower than that, they consider you to be an unsecured, subprime, or deep subprime borrower, making it more difficult, but not impossible, to obtain a loan. Here is what you need to know.

Key points to remember

  • Your credit score is an important factor in determining whether you qualify for a car loan.
  • Auto lenders typically look for borrowers with a credit score of 661 or greater.
  • People with scores below 661 may be eligible for funding, but will likely pay much higher interest rates.
  • Some lenders specialize in loans to people with average or poor credit.
  • You may qualify for a loan and potentially get a lower rate by making a larger down payment or adding a co-signer to your loan application.

5 ways to get a car loan with bad credit

Here are five things you can do to improve your chances of getting a car loan if your credit is bad or fair.

1. Improve your credit first

Before you go out and buy a car, focus on improving your credit as much as possible. For example:

  • Pay your bills on their due dates. Your payment history represents 35% of your credit score. By making all of your payments on time each month, you can increase your credit score.
  • Reduce your account balances. Your credit usage, or the amount of your available credit you are using at any given time, is 30% of your credit score. You can improve your credit by paying off your credit card or loan balance.
  • Ask for higher credit limits. Call your credit card companies and ask for a higher credit limit. If you are approved for a higher limit, your credit usage will improve.
  • Dispute errors on your credit reports. Mistakes, such as payments you made on time but were flagged as overdue and fraudulent accounts opened in your name, can damage your credit. View your free credit reports at and dispute any inaccurate information with the credit bureaus. The three major credit bureaus (Equifax, Experian, and TransUnion) explain how to do this on their websites.

By following these steps, you could increase your credit score in as little as 30 days.

2. Save for a down payment

The lower your credit score, the less likely you are to get a loan that is large enough to finance the full price of a car (assuming you can get a loan). So it makes sense to save for a substantial down payment.

Auto industry experts often recommend a down payment equal to 20% of the car’s purchase price, although many buyers pay less than that. However, putting in even more money can help you get a loan and a lower monthly payment.

3. Look for a cheap vehicle

While you might dream of a spacious SUV with all of the latest features, it can be difficult to get a loan to pay off if your credit is low.

Instead, focus on cheap vehicles that are more modest but still reliable. Opting for a smaller entry-level vehicle rather than a larger or more luxurious vehicle increases your chances of being eligible for auto financing.

4. Take the tour

Auto loan rates can vary widely, so it’s a good idea to compare several lenders before applying for a loan.

Dealers are often happy to find financing for you because they take a commission on top of the lender’s rate, sometimes up to 4%.

If possible, avoid requesting financing from the dealership. If you have bad to fair credit, you are probably better off getting a car loan on your own by shopping around and comparing loan terms.

In addition to potentially finding better rates than in dealerships, obtaining financing yourself opens the door to private sales and auto auctions. With a variety of sales aggregation sites such as,, or, buyers can find people who can have better prices on vehicles without the overhead costs of a dealership. Facebook Marketplace has also become an automotive sales platform, especially for private sales.

There are several types of lenders to consider:

  • Credit unions. As nonprofits, credit unions often have better rates and less stringent requirements for borrowers.
  • Banks. If you have a relationship with a local bank, you may be more likely to qualify for a loan than with another lender.
  • Online lenders. Many online lenders specialize in auto loans for people with less than perfect credit.
  • Buy here, pay resellers here. If you’re having trouble getting loan approval elsewhere, a “Buy Here, Pay Here” dealer may be ready to work with you. However, expect higher interest rates on these types of loans than those from other lenders.

5. Ask a co-signer to apply with you

You can increase your chances of getting a loan by adding a co-signer to your application. You can ask a relative, relative or friend to co-sign your car loan. If they have good credit and a reliable income, you should qualify for a loan with a lower interest rate than you would find on your own. Keep in mind, however, that you will be putting them and their credit scores at risk if you are unable to make the payments.

Repay, refinance your car loan

If a lender approves you for a loan despite having a bad credit rating, try to develop a repayment plan to minimize interest charges. Check your loan agreement to see if prepayment is an option. By making additional payments, you can reduce the amount of accrued interest, save money, and pay off debt faster.

Making regular, on-time payments on a car loan can help boost your credit score. As your credit rating improves, you may also want to consider refinancing your car loan for a lower interest rate. With a higher credit score, you will find more attractive rates available.

Auto credit score and loan faqs

Can I get a car with a credit score of less than 500?

Yes, but it can take some work. There are lenders that cater for people with bad or no credit, but they offer extremely high interest rates and fees. A “second chance” car loan, also known as a subprime car loan, might be your best option. These lenders specialize in those with extremely low credit scores, bankruptcies, or repossessions on their credit report.

Many established banks offer second chance loans, which can result in higher interest rates. You can also find subprime auto loans at “Buy Here, Pay Here” dealerships, where payments are made directly at the dealership.

Can you create credit by financing a car?

Yes and no. Financing a car can increase your credit over time, but it can initially reduce your credit because you have incurred that new debt. The way to build credit when you finance a car is to make your payments on time. If you can’t, financing a car will hurt your credit.

Can you finance a car if you don’t have credit?

Having no credit will present the potential buyer with many of the same challenges as someone with poor credit. Your best options are to find a co-signer with established credit, increase your down payment, or see if you qualify for special loan programs.

Will dealers limit my car selection if I have bad credit?

Very probably. According to used car dealership, it’s not uncommon to hear stories of people with bad credit being shown a different selection of cars than other buyers. Ask the dealership in advance if you will have any vehicle restrictions and what type of car you can expect.

The bottom line

A suboptimal credit score will certainly make it more difficult, but not impossible, to obtain a car loan. The steps to obtain financing for this purchase are similar to those for any other purchase. Calculate your budget. Do the work to find out your credit score. If there are any errors on your score, correct them. Make the biggest down payment you can manage. This benefits you in two ways: It can help convince lenders that you are committed to paying on time. This larger down payment also means a smaller loan amount, which means less interest on the loan. Choose an affordable car. Apply to multiple lenders.

Typically, lenders want borrowers to have a credit score of 661 or higher. If your score is lower than that, you are considered a non-prime, subprime, or deep subprime borrower, and you will need to work more diligently to build credit and secure the loan.

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How to buy a house with bad credit Mon, 03 Jan 2022 22:36:39 +0000

Buying a home is very possible with bad credit, but it’s more difficult and more expensive than buying a home with great credit. Before you begin the home buying process, you need to ask yourself why you want to own a home. Homeownership comes with many unforeseen and significant costs that can be difficult to cover if your financial situation is unstable. Continuing to rent indefinitely or until your credit improves may be the best financial choice for you.

Key points to remember

  • Try to improve your credit score as much as possible before shopping
  • Consider all of the upfront and long-term costs of an FHA loan before taking out one.
  • Try to improve your overall financial situation as much as possible in order to improve your chances of getting approved for a conventional loan.

FHA Loans — Your Bad Credit Loan Option

Federal Housing Administration (FHA) loans are FHA insured loans, but are actually issued by any FHA approved lender. FHA loans were created to help low and moderate income borrowers become homeowners. If individuals cannot get approved for conventional mortgages, FHA loans are the remaining option for hopeful homebuyers with bad credit.

FHA loan requirements

  • Credit score as low as 500 with 10% decline or as low as 580 with 3.5% decline.
  • Debt-to-income ratio of 43% or less
  • Verifiable income for more than 2 years

Improve Your Credit Score

Taking a few steps to improve your credit score before making any home purchases will improve your home buying experience exponentially. In today’s buzzing real estate market, many home sellers are less likely to choose deals with low down payments that will force them through the rigorous FHA appraisal process. Improving your credit score can allow you to secure a conventional mortgage and make stronger offers on homes that are more likely to be accepted.

  1. Take your credit report to see why your credit is low and check for errors. This is free once a year with Experian, Equifax and TransUnion at
  2. Pay off all revolving lines of credit to improve your credit utilization percentage. This usually results in an immediate jump in the score.
  3. Get all errors removed from your credit report, especially late payments
  4. Consider consulting a credit repair service to see if your score can be improved enough to save you the cost of their fees in terms of reduced mortgage rates.

Why You Should Improve Your Credit Score Before You Buy

Even improving your credit score a few points before you buy can still save you thousands of dollars. If increasing your score allows you to be approved for a conventional mortgage instead of an FHA loan, you will save the initial mortgage insurance premium of 1.75% of the loan amount. Additionally, conventional loans tend to have lower closing costs and interest rates than FHA loans.

While FHA loans and conventional loans will require monthly mortgage insurance if you put less than 20%, an FHA loan includes monthly mortgage insurance for the life of the loan which you can only get rid of by refinancing and paying the fees. closing on a new loan. For a conventional mortgage loan, private mortgage insurance ends as soon as your loan balance equals 80% of the value of the property.

Optimize the rest of your borrower profile

Your credit score is not the only factor that goes into approving a loan. You can increase your chances of being approved for a loan on favorable terms even with bad credit by optimizing other parts of your borrower profile.

Putting more money on your mortgage essentially means putting more of your own collateral into the loan and the lender sees you as less likely to default and a low risk borrower. If you’re struggling to find the money for your down payment, there are many unique ways to increase your funds. Some regions even have down payment assistance programs.

Improving your debt-to-income ratio (DTI) can also help you get approved for a mortgage with bad credit. If you can pay off or get rid of some of your monthly debt, like a car loan, your DTI will improve. Increasing your income by finding a second job will also improve your DTI. The easiest way to improve your DTI is to buy homes at the lower end of your budget. If you determine that you can afford a home up to $ 300,000, but your credit score is still lower than you would like, you can increase your chances of being approved for a mortgage if you choose a home. which costs $ 250,000.

Loan options for unique populations

If you meet certain criteria, you may be eligible for a VA loan or a USDA loan. Both of these loan types allow you to put 0% down without paying private mortgage insurance and do not require a minimum credit score, making them a much cheaper option than FHA loans.

VA loans

You generally must be a veteran who served for certain periods or under specific circumstances, or be the surviving spouse of a veteran in specific circumstances. VA loans are issued by private lenders but backed by the VA. You must have a certificate of eligibility from the VA to get a VA loan.

USDA loans

These loans are typically made in areas designated as rural by the USDA, and borrowers must meet income eligibility limits based on their county’s median income and household size.

Is it harder to get a mortgage with bad credit?

Yes. Bad credit makes it harder to get a mortgage. Fewer lenders offer FHA loans than conventional lenders.

Can I get a conventional mortgage if I don’t have a 20% down payment?

Yes. You can get a conventional mortgage with as little as 3% down, as long as you meet the lender’s other credit rating, income history, and debt-to-income ratio requirements.

Do I have to pay for credit repair before shopping at home?

Try to get an estimate from the credit repair service of how many points they can improve your score and how much their service will cost in total. If they can improve your score enough to qualify for a non-FHA mortgage, you’ll save 1.75% on initial mortgage insurance premiums ($ 1,750 per $ 100,000 of home), which will likely offset the cost. of credit repair service. You may be able to improve your credit score on your own, so do your due diligence.

The bottom line

While it is possible to buy a home with bad credit, it might not be the best choice. FHA loans are a great tool for borrowers, but changes to the program after the subprime mortgage crisis make it a very expensive loan product. Prospective borrowers should do some math to see how improving their credit and having more money to put aside could save them before rushing through the home buying process. .

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Payday Progress In Atlanta Bad Credit? You are prompted to use Sat, 01 Jan 2022 02:22:13 +0000 Payday Progress In Atlanta Bad Credit? You are prompted to use

Less than perfect credit? You may be prompted to use!

We have used the services of mortgage service providers who only run loans which is actually comfortable. This means that you will see a much greater possibility of affirmation with us.

By using this almost immediate affirmation payday loan, you only have to click on the publish button, complete associated with sort of getting income in 60 fold!

You really don’t need to feel fooled by the person who guarantees full approval for bad credit loans. It is not feasible. But we fully make sure that you get the ideal odds that are possible for our practice lenders. Even if you actually make less income.

Payday Loans Are Easy To Get Short-Term Debt payday loans in Wisconsin for each scenario and each scenario. You no longer need most of the circumstances to lock in your loan except proof of profit because when you get that payday loan you are more likely to settle it with your next salary.

Bad credit? Do not worry. What is needed for payday loans also helps to get this loan when you have bad credit without a bank account. The best thing to do to get started should be to resort to the change and complete the sort.

How To Get On Time Financing Without A Bank Account In Atlanta, Georgia?

Your money can buy which online, there is no need to have a checking account. You will find that direct financial institutions with no credit score make sure that they accept prepaid debit cards and secured credit cards.

Again, it is easy to complete an application for a community payday loan in Oklahoma if you actually have a bank account.

  • Go directly to the application leader of this website and click on the change afterwards.
  • Fill in around the type with your personal and financial information.
  • Send the best performances and provide the facts.

Consider that in order to have the affirmation it is certainly instantaneous all realities should be truly legitimate. You can get a quick cash advance at the same time you use it once you manage almost everything at your best. And sometimes even after the trip to various.

What are the needs that may be eligible for an unsecured guarantor mortgage in Atlanta, Georgia?

illinois bad credit personal loans

The criteria for cash loan become particularly varied for each lender, but generally they have a full offer, which is certainly excellent to preserve. This is why you will discover here the fundamentals that you must try to get a payday loan:

  • You want to be at least 18 years old to use
  • Have in fact in fact have proof of income
  • Have a real financial bank account or prepaid debit account / card
  • Really really have a cell phone number to get phone calls or / and communications

By far the most money that you have access to on this payday loan is really Atlanta, Georgia, is actually $ 2,500 with some limits, as well as the next sentence certainly the greatest certainly possibly. not given. Funding charges and / or interest charges (APRs) if indicated can be around 10 cents (). But understand that it is really a label which is a small funding and a small income. Would definitely be able to repay these using the paycheck definitely then.

exactly exactly what credit score is important for a monetary payday loan that is really Atlanta, Georgia?

In the event that the credit history could be the correct reason there is only one not generating mortgage application, fear not! Your credit application is certainly perfect for an unsecured online secured loan, as many financial institutions never do additional credit scoring to try and find their customers. The only thing they are concerned about is proof of income, as advance loans are short term installment loans.

The remedy which is indeed short, you will find an unsecured guarantor loan with a high credit score. As we said before, practice banking institutions, unlike financial institutions, do not do credit rating checks. Payroll debts tend to be fully secured because of the paychecks.

Can I Make an Online Money Loan in Atlanta, Georgia With Really Worse Credit?

We will continue to achieve this one more time: yes, you can get a faster payday loan further with a credit score that is really worse, no matter what the reduction in your credit rating is.

In order for banking establishments to be available, please mention our entire directory below. I encourage online use through our types. Because of this, you have access to instant affirmation and make sure you get finance faster.

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3 reasons not to pay off your mortgage sooner Fri, 31 Dec 2021 12:47:00 +0000

Prepaying a mortgage loan can free up cash and save a lot of money on interest payments. But investors shouldn’t be looking at their mortgages in a vacuum. Putting extra money into a mortgage can be seen as part of an overall investment plan.

While there are reasons why prepaying your mortgage makes sense in some cases, many investors are better off paying the minimum each month. Here are three reasons why.

Image source: Getty Images.

1. Real interest rates are negative right now

Inflation pushed prices up almost 7% year-on-year last month, and it may still be some time before inflation returns to the Federal Reserve’s target of around 2% . Several economists believe that inflation will remain above 3% throughout 2022. Even Fed policymakers have raised their forecasts to 2.6% inflation in 2022.

At the same time, average mortgage rates over 30 years remain close to 3%. Those who have good credit or are willing to redeem the rate can get a loan for less than 3%.

With high inflation and mortgage interest rates nearing record lows, the real interest rate for the next few years could very well remain negative. It’s a bit like getting paid to go into debt. Every dollar you borrow against your home can increase your purchasing power if the inflation rate stays higher than the loan interest rate.

When real interest rates are negative, you should take on as much long-term, low-interest debt as possible (up to your comfort level).

2. You can get better long-term returns elsewhere

When you pay off your mortgage, you actually get a return on your investment roughly equal to the interest rate on the loan. Paying off your mortgage early means that you are effectively using cash that you could have invested elsewhere for the remaining term of the mortgage, up to 30 years. With rates so low, you should be able to find better long-term returns with other investments.

The stock market, for example, is expected to produce returns in the range of 7% to 8% over the long term. Morningstar analysts expect a well-diversified equity portfolio to produce an average annual return of 8% going forward.

But above all, this return is accompanied by greater volatility. The standard deviation of Morningstar’s forecast is 17%, which means that annual returns will vary between -9% and 25% about two-thirds of the time. Over the long term, however, investors should expect their investment portfolio to exceed their mortgage rate.

The counter-argument here is that most investors would not borrow against their home in order to raise investment capital. This is suboptimal from an economist’s point of view, but it may be optimal from a “I like to sleep at night” point of view. In today’s environment of high real estate values ​​and low mortgage rates, capital is readily available for those looking to take on more debt, but it can be found outside your personal comfort zone.

3. Paying off early means increased streak of return risk

Paying off your mortgage sooner means giving up adding more to your investment portfolio today. The effect is that most of your investments are compressed into a shorter time frame – the post-mortgage repayment – which increases your exposure to return streak risk.

Return sequence risk is the potential for a few years in the stock market to have a disproportionate impact on your investment portfolio. If the stock market has had a few bad years in a row after you’ve invested most of your money, the impact is significant. Likewise, if the market collapses for a few years and you have hardly invested anything, you will have missed out on a significant portion of the returns offered by the market.

Since stocks are more volatile than other assets, the real advantage of the asset class – higher expected returns – is often seen over long periods of time. But if you have a shorter investment horizon, you could face several years of poor performance at the most inopportune time. This risk is mitigated with more time invested in the stock market, which means spreading your investments over as much time as possible.

Debt can be good

Some people are very averse to debt, but some debt can improve your financial well-being and provide additional flexibility while lowering the risks posed by inflation and volatile stock market returns. A real estate mortgage is a prime example of this type of debt, and the decision to pay it off sooner should take into account the three considerations above.

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7 Best Auto Refinancing Companies of January 2022 | Personal finance Wed, 29 Dec 2021 20:49:51 +0000

When can I refinance my car?

You should refinance a car loan if it saves you money, if you have a good credit rating, or if your rating has improved. Refinancing your car loan with better credit can earn you better interest rates and help you negotiate a shorter loan term.

You shouldn’t consider refinancing your car loan if you are financially stressed or if your loan value is under water, which means the loan is worth more than your car. This type of loan will impact your loan-to-value ratio and significantly reduce the chances of obtaining favorable loan terms for refinancing.

Can I get a loan with bad credit?

You can get a car loan with bad credit, but it will be more difficult. Lenders use credit scores to gauge a borrower’s risk, so the best auto refinance rates tend to go to those with good to excellent credit. People with poor credit will have higher rates than those with good or excellent credit. Some lenders specialize in lending to customers with medium to low credit, such as MonPrê and Auto Credit Express.

How often can you refinance a car?

Legally, you can refinance a car as many times as you want if you find a lender who is willing to give you a new loan. Auto lenders may be apprehensive about refinancing if they see multiple past refinancings on your vehicle and even if you get approved there are other financial risks to consider. Repeated refinancing and loan term extensions increase the risk that your loan will be “turned upside down”. You can also end up paying more than the original loan amount, just in interest rate.

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Vietnam says 2022 monetary policy will support recovery, contemplates bad debts Tue, 28 Dec 2021 03:47:00 +0000

HANOI, Dec.28 (Reuters) – Vietnam’s monetary policies in 2022 will aim to contain inflation, while supporting the country’s economic recovery, the central bank said on Tuesday, as a deputy governor warned of the risk of a further increase in productive non-loans.

The Southeast Asian country’s economic growth has traditionally relied heavily on increased credit, although authorities have attempted to reduce this dependence.

Total bank loans to Vietnam as of December 22 increased 12.68 percent from the end of 2020, according to a statement from the State Bank of Vietnam.

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Credit growth in Vietnam next year is expected to reach around 14%, deputy central bank governor Dao Minh Tu said at a press conference.

Tu said inflation this year will be well below the 4% target, adding that the country’s foreign exchange reserves are now over $ 100 billion.

Tu said the ratio of non-performing loans in the banking system is increasing due to the coronavirus pandemic and could increase further.

“The ratio of loans potentially classified as bad debt is around 8.2%, and this could even increase further if the pandemic lasts longer,” Tu said.

The government has official economic growth targets of 6.5% for this year and into 2022, but some analysts have warned that due to the pandemic, growth this year could be 3% or less.

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Editing by Ed Davies

Our standards: Thomson Reuters Trust Principles.

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3 signs you’ll regret refinancing your mortgage Sun, 26 Dec 2021 12:32:19 +0000

Don’t rush to refinance mindlessly.

There’s a reason so many homeowners have refinanced their mortgages this year. Refinancing rates have been at attractive levels since mid-2020, and if you swap your existing home loan for a new one at a lower interest rate, you could significantly reduce your monthly housing payments.

In addition, this year, homes have gained a lot of value across the board. This means that borrowers have more equity in their home that can be used to refinance with cash.

With withdrawal refinancing, you borrow more than your remaining mortgage balance and use the extra money you get for all intents and purposes. Since the interest rates are so low, it’s an affordable way to borrow money, especially for things like home renovations.

Refinancing your mortgage is a decision that could help you. But if these things apply to you, it’s a gesture you might regret, too.

1. You apply after a drop in your credit rating

The purpose of refinancing is to secure a mortgage loan on more favorable terms. Often times, this means lowering the interest rate on your loan.

But to get a low interest rate, you will need a strong credit rating. And if your credit has recently taken a hit, it’s best to wait for the refinancing until you are able to increase it.

You may have recently missed a loan repayment or been several months late in paying a minimum credit card payment. Unfortunately, even a single late payment can result in a significant drop in your credit score. If this is the situation you find yourself in, it’s probably a bad time to refinance.

2. Your plans for staying in your home are uncertain.

When you refinance a mortgage, you are charged closing costs to finalize that loan. These costs vary depending on the lender and can be as high as 5% of your loan amount. You will need to make sure that you intend to stay in your house long enough to collect them and come out on top. If you refinance when you are unsure of your long term plans, you could lose money.

Suppose you are charged $ 6,000 in closing costs to refinance. This could result in mortgage payments that would cost you $ 200 less per month. However, it will take 30 months for you to break even after paying these fees. And if you’re not sure you want to stay in your neighborhood, or if you think you might move out for a job within the next couple of years, then refinancing is a move you might regret after the fact.

3. You have not yet made your decision on the renovations

If you are doing renovations, cash refinancing could be a great way to pay them off. But if you haven’t yet priced these renovations or defined a specific plan, you might regret refinancing your home loan.

Imagine you decide to do a cash refinance that puts $ 20,000 in your pocket to finish your basement. If, a month later, you decide to redo your master bathroom as well, you may not have enough money from that withdrawal to cover your costs. A better bet is to settle your home improvement plans before applying for a new mortgage.

Refinancing can be beneficial to you in many ways. Just make sure that the time is right before you apply, and that you’ve really thought about things if you are borrowing more in the process.

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