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Student Loan Consolidation – Do Those with Private Loans Have an Option?

Bettie Rochon — Wed, 10 Nov 2010 22:00:55 +0000

Most students today are graduating with such a level of debt that student loan consolidation is always at the front of their mind, usually before they get there first job. A consolidation is merely a single new loan that combines all the previous loan balances and gives you one new payment. If you’re up to your eyeballs in debts, this repayment method offers such promise. There are factors that you have to think about before you consolidate.

1. How is your credit rating? Consolidators will look at your credit rating first. Check on your credit score to make sure that it is correct and that it is outstanding, before you contact one. In this economy, a low credit score probably means no deal on a private student loan consolidation. At the very least, if you credit is tough, make sure you have a co-signer with good credit.

2. Whom are your lenders? Ask your lender first if you can consolidate with them, before you go to a different company that will merge your debts. However, if you have multiple private lenders, speak to whichever one you feel most comfortable with first. Most student loan lenders are not doing private student loan consolidations.

3. Will My Rate Be Lower? Generally speaking, the combined rate you get on the new, consolidated loan may or may not be lower. However, the main reason to consolidate from a financial stand point is purely to lower your monthly payment and improve your cash flow. If you haven’t added together all your existing private loan payments and compared them to your new payment, do that now.

4. Why Consolidate? Given the current situation in the credit industry, getting a good low rate is far from guaranteed. It is important to understand that in most private consolidations, any interest savings more than eaten up by the increased time you will have the loan in force. All those additional years cost additional interest. Bottom Line? If you aren’t getting a significant monthly payment savings…don’t consolidate your private student loans.

A federal consolidation is usually a good idea in terms of lowering your payment if you are eligible, merely because the transaction is not credit based and your rate is determined by a government formula that consists of a weighted average of all your existing loans rounded to the nearest eighth.

Don’t get a student consolidation of you federal loans with your private loans because you will lose important federal borrower’s benefits that you can never get back. Once again, never mix private and government loans together in the same consolidation. If you have significant amounts of federal and private loans, consolidate each separately.

Business Working Capital Loans – How The Stimulus Bill Has Helped

admin — Wed, 10 Nov 2010 13:59:01 +0000

Sue B. Malone asked:

For those small business owners who think they were ignored in the new stimulus bill (American Recovery and Reinvestment Act of 2009), think again. While the debate continues to unravel as to “who gets what and whether it is enough”, one thing is certain: more money is coming in the direction of small businesses through the U.S. Small Business Administration (SBA). Remember, this is the agency responsible for the outreach, licensing, and implementation of, you guessed it, money into the pockets of small businesses. This is done through private licensed lenders who have agreed to join the SBA program. In other words, if your local community bank has a commercial loan department, it might very well have a SBA department which makes these loans. They are called SBA loans because the Federal government will reimburse, to a certain percentage, defaulted loans, thereby giving incentive for the private banks to loan more money. Net effect–more loans will be available for small business concerns. This is a continuing article (20 in all) on the subject: Help. Is anyone out there loaning to small businesses anymore?

Before we talk about how much more money is available to the SBA under the stimulus package, let’s look at the current status of one of the popular SBA loan programs. There is a loan program out there and SBA lenders are actually making loans currently: the Community Express Loan Program. This gives unsecured small business loans between $5,000 and $50,000 with very little paperwork, answers typically in two days, interest rates presently at 7.75%, funding and two weeks, and monies wired directly to your business account. There are still lenders participating in this program, although Congress has failed to make the program permanent and still has a 10% cap on the number of loans.
Enter the Obama stimulus bill. Let us look how it affects this program and small business lending as a whole.

So should we be excited by the stimulus package? Isn’t it all too customary in a new spending bill for a government agency to receive more funds? Not at all as to the SBA. During the Bush Administration tenure, they could easily have renamed the agency the ISBA (Ignore Small Business Association). As they were making “sound bite” statements to the press of how they were helping small business, they were arrogantly trying to dismantle it, or when they were in a better mood, just cutting the budget.

The point is we have a new administration that actually likes small businesses. Remember these are additional monies over and above the SBA’s current budget . As we all know, budgets are determined in approximately March of each year (assuming Congress has the good graces to agree) to be used for the next year. The SBA has already received their budget. This is whipped cream placed on the top of that small business cake.

And we are not talking about token amounts here. Here is how the additional monies are broken down:

1. 375 million for temporary fee reductions or elimination on SBA loans and increased SBA loan guarantees, up to 90% for some loans. Translation: When a borrower gets a SBA loan they pay a SBA loan guarantee fee which goes to Washington and used as a war chest to pay banks if there has been a default. That guarantee fee, depending upon the loan, is currently between 50% and 85%. There is a possibility that some loan programs can now be increased to a whopping 90% guarantee. If a borrower no longer pays these fees, the money has to come from somewhere, and in this case it is taxpayers’ money which is subsidizing those fees.

2. 255 million for a new loan program to help small businesses meet existing debt payments. Translation. You have a loan secured by fixed assets or real estate and want to refinance it, either to lower payments or put more money in your pockets for expansion.

3. 30 million for expanding SBA’s Micro Loan Program, with $6 million to help finance new lending and 24 million for technical assistance grants to Micro lenders. . Translation: Under the Microloan program, the Federal government loans blocks of money to the Microloan lenders who then reloan it, at higher rates, to the deserving communities and small businesses and usually collateral is required.

4. 20 million for streamlining the SBA lending and oversight process with new technology. Translation: The streamlining process will make it faster and more efficient to process loans and oversight is to monitor SBA licensed lenders–make sure they are acting for the benefit of small businesses and complying with the program guidelines.

5. 15 million for expanding SBA’s surety bond guarantee program. Translation: If you are a building contractor and have to take out a performance or payment bond on a project, you need substantial assets to secure the bond. This will help getting your hands on that needed bond and be able to secure the contract.

6. 25 million for staffing as to the new programs.

7. 20 million for the Office of Inspector General. Translation: To inspect and audit the licensed SBA lenders.

Although one could make the argument this new law is “too little too late”, we have to give our current administration a chance to do good things with this fresh money. And don’t forget the mindset of the SBA lender. Although they are not as wildly quixotic as stock market speculators, their purses open and close based upon the mood of the country. We want them to be as comfortable as possible when we walk toward them for money.

Student Loan Tax Deduction – What Options Do You Have?

Tom Millner — Fri, 05 Nov 2010 11:20:59 +0000

Some loans can give you a tax credit which lowers the yearly tax you owe and other kinds of loans can give you a tax deduction which lowers your gross taxable income. Just about everyone needs to borrow cash from time to time and it makes sense to do your homework before diving into a big situation involving money. Were you aware that when you borrow money you could actually be reducing the amount of income taxes you have to pay at the end of the year? It turns out that not all loan programs are equal when it comes times to look at your tax situation. Here’s a simple guide to what loans may qualify you for a tax credit, though obviously individual cases will vary.

Student Loans: Did you know that some loans you take out for school could give you a tax advantage? You can, in many cases, you may be entitled to a student loan interest deduction from your income taxes. Not all education loans are eligible for this, but it’s a good way to decrease the taxes you pay, especially if you’re a struggling student with a limited income. The interest you pay on many student loans can only be deducted if you make under a certain amount of money, based on how you file your taxes. Because the government designs the deduction based on a sliding scale of your income, generally speaking the less you make, the less tax you will owe. Keep in mind that as a student you will need to file independently and not be claimed on your parent’s return to claim the benefit of this potential student loan tax deduction. As always, consult with your tax adviser for details regarding this student loan tax credit for further details

Home Mortgages: Most house payment plans are designed so that you can deduct the amount of interest you pay on the loan every year. For many people their home is the biggest purchase they ever make, and paying a mortgage can actually be a good way to reduce the amount of money you owe on your federal taxes each year. Since most home loans are set up to be paid over thirty years, that means that purchasing a home can give you 30 years of potential tax deductions. However, keep in mind that in the early years of a mortgage payoff, your deductions will be much higher due to the fact that a larger portion of each payment goes toward interest than in the middle and later years. Consequently expect much larger deductions in the first 5 to 7 years of your mortgage, and proportionally smaller deductions each year as time goes by.

Home Equity Loans: You can use a home equity loan for a variety of things, you may be able to get additional tax credits by using the money for home upgrades. If your dwelling is more valuable now than when you bought it then you might be able to take out a home equity loan (sometimes called a HELOC) and deduct the interest you pay on that borrowed money. A home equity loan used to improve your house could eventually increase the value of your house and give you even more equity over time. There are some restrictions about how much of your loan’s interest actually qualifies for a tax deduction. In some case you can even qualify for tax deductions for using the money to improve your home’s structure like replacing doors with more energy efficient types. For many people part of the cost of a HELOC can be offset with home repair tax deductions.

Sometimes taking out the right kind of loan can literally save you thousands of dollars on your income taxes, so it’s worth investing a little bit of time to look into what sort of tax benefits you qualify for. There are, of course, a lot of variables between these loans. Everyone will not be eligible for all the different tax benefits that these loans may offer. Sometimes your age, the amount of money you want to borrow and the reason of the loan will limit the amount of money you can deduct from your taxes in any given year. Before you take out any of these loans you may want to talk with your tax professional to make sure the tax benefits pertain to your individual situation.

Credit Card Debt: The One ‘Student Loan” You Should Avoid

admin — Sat, 16 Oct 2010 23:34:28 +0000

Credit card debt won’t steer clear from any individual whom doesn’t want to steer clear from it. It treats everyone equally whether the particular person is an experienced professional or merely a college student. And so, student unsecured credit card debt isn’t uncommon either. Since the credit restriction on college student credit cards is significantly lesser, unsecured debt can’t increase to the amounts it can for other credit cards.

Nevertheless, student credit card debt is a greater menace simply because many college students are already in financial trouble thanks to the student loans they’ve obtained for their schooling. Should they drop out of school with student unsecured debt, they are going to need to pay back not only the student loan, but in addition, their college student credit card debt.

Since most college students are ignorant in the use of credit cards, they could easily fall prey to what we call as ‘student debt’. In truth, student credit debt is one reason why the credit card companies keep a reduced credit restriction on student credit cards. The answer for preventing college student credit card debt is much like how it is for avoidance of any kind of credit card debt.

So, the very first thing for preventing college student unsecured credit card debt is to understand the idea that credit card is not free money and that anything you spend on utilizing your credit card needs to be paid back to the credit card supplier when your credit card bill arrives in the mail. And so, don’t start treating the credit card separate from hard cash. Avoid over spending, e.g., do not purchase items just because they are for sale, rather, buy only things which you need to have.

An excellent thing to try and do is to create your monthly spending budget and follow it consistently. Yet another really crucial precautionary procedure for preventing college student unsecured credit card debt is to refrain from going for another credit card. Quite a few students have a tendency to opt for several credit cards because the credit limit on student credit cards is very low. However, this is a great formula for getting in a student credit debt. That is how college student credit debt builds up. A single credit card is adequate for any kind of college student.

Student credit card is really meant to be handled like a training ground for understanding more about cards. It should not come to be a tool for credit card debt.

Small Business Loan Programs: Obama Small Business Bill to the Rescue??

admin — Sat, 16 Oct 2010 14:29:16 +0000

At the end of September 2010, Congress handed President Obama a bill ostensibly fashioned to help small business loan programs and small business lending. The bill, which had been enthusiastically contested by Republicans throughout the year, was a drastically pared down version of a proposed bill at the beginning of 2010.

The real question is, does this bill really help small business secure the working capital they need? In theory, the bill nurtures small business lending via the Small Business Administration guaranteed loan programs. Normally, these programs guarantee anywhere from 50-70% of a small business loan against default for the lending institution that makes the loan. The new bill raises this guarantee to 90% in some cases, in theory lowering the risk of default and putting community banks in a better position to take on these loans.

However, whether this helps or not is a matter of heated discussion. The problem is not that banks do not have the capital to lend. With all the government stimulus that has been targted at the banking system, banks are flush with cash. The problem is really one of perception, attitude, and outright hard facts. Whereas three years ago, banks were lending with little regard for risk and making bad loans to business, they have now over-corrected, obviously chastened by the harsh default realities and bank failures of the last few years. It is a classic ‘”standoff” situation, where everyone from large banks, community banks, businesses and consumers are waiting to see who will make the first move in beginning to loosen loan approval requirements and spending habits.

Likewise, businesses are waiting to see when consumers will feel confident enough to purchase the goods and services that their businesses have to offer. Consumers are waiting to see when there employment situation will stabilize enough to begin their spending. So in the meantime, everybody continues to wait, and the uncertainty drags on. Unfortunately, no ’small business” bill that can completely address this perception.

Making it easier to utilize small business loan programs and making it less risky for banks to lend is one thing, but the government cannot force banks to make loans to business. Added to this fact is that banks are more fearful of ever over tight oversight that has been imposed since the financial crisis began, worried that even a small uptick in defaults will result in federal regulators sitting in their offices for months on end, sifting through every detail of operations in effort to find wrongdoing or bad management.

The bill also provides a series of targeted tax breaks for small businesses, specifically directed at abating payroll taxes for bringing on new workers,the ability for Alternative Minimum Tax businesses to claim the R &D tax credit, and tax cuts for restaurant owners and other small businesses who chose to renovate or construct new facilities. Certainly tax cuts are always welcome, but in this case they only really apply if a business is planning to spend additional money on hiring, expanding or doing R &D.

Small Business Loan programs are not in short supply. What is in short supply is the proper number of customers to make approval for such programs a reality for small business seeking working capital. Until the perception of risk changes for consumers, this problem will be a difficult one to eliminate, no matter how many pieces of legislation are passed.

http://businessworkingcapitalloans.com

Credit Cards: The Unrevealed Secrets of Debt Consolidation

Itunnu Abraham — Thu, 14 Oct 2010 19:59:00 +0000

Here are some great tips on credit card consolidation to help you manage your debts more efficiently.

1) Draw up a financial allowance. Yes I realize it is boring but you will never be in a position to get out of debt until you know exactly how much you earn and what you spend your cash on. In order to get an honest picture you need to keep a spending schedule for a month. Write down every cent that you spend. This is the only way you will be in a position to find those holes in your spending that ought to be plugged. It will also highlight areas that you may reduce in order to release money to pay towards reducing the money you owe.

2) You need to make an index of all of your creditors stating their name, your account number, the whole amount you owe, the least monthly payment and the interest you currently pay.

3) Now you have your available funds and the checklist of your debts, you can see how much extra a month can pay for to start paying to eliminate your debt. While you are completing this exercise you ought to keep your minimum payments going.

4) If your accounts are up to date and you have a fantastic record with these credit card businesses, ring them up and ask them if they are able to do you a special deal on the interest you are paying. You might be pleasantly surprised when they say yes. The low the interest rate, the more of your money will go to reducing your debts. They might expect you to move your other debts to their card in return for a a lot. This may be the foremost way to accomplish credit card consolidation but don’t start anything just yet.

Ask them to confirm the trade in writing guaranteeing that they confirm the amount paid and the percentage least monthly repayment you will be expected to make. You may then review these offers and pick the best one for you. Don’t always opt for the lowest interest rate. 0% over 6 months is great but 2% over 24 months is better if your financial allowance has indicated this is how long it may need to clear the money you owe.

5) If your present creditors won’t help, don’t be influenced to pull out a loan secured on your property to repay these debts. This is one of the last solutions you want to do as effectively you are giving your creditors more protective cover and yourself less. The best bet before you enter into any form of consolidation is to speak to a qualified advisor first. Don’t pay for this advice as plenty of charities will provide it for free. Remember you are on a mission to cut your spending as a way to get out of debt.

I trust that these 5 tips on charge card consolidation will help you to repay your finances faster.

Bankruptcy: 5 Things You Need To Know

Connor Sullivan — Sat, 02 Oct 2010 10:28:33 +0000

More often then not when people go to file for an inability to pay their debts a lot of mistakes occur and any kind of opportunity they had regarding discharging debts and hanging onto exempted property are gone. Seeking experienced counsel such as a bankruptcy attorney regarding these types of issues could end up conserving you lots of money in the end. However, just before you seek out a bankruptcy lawyer, consider looking at these five errors to make sure your filing runs smoothly.

1. The Transferring of Credit Card Amounts: Do not transfer a large amount of credit card debt (over $1500) from one credit card to another, especially if declaring an inability to repay financial obligations within sixty days. It could caution a red flag and make the transaction appear deceptive.

2. Settling Personal Loans to Family Members: It’s against the law to pick and choose which of your creditors are paid off first. Bankruptcy code says that all lenders must be treated equally. If any repayments are made just prior to filing for no money to make payments, then the inability to pay your debts trustee has the right to pursue part of the funds which were paid out. This is also in the case of repaying family members. Should you make a loan repayment of say two or three thousand dollars, this cash may be sought after the filing as all funds must be paid back equally to creditors. All financial obligations must be detailed and on the assumption that no objections are made by family members, your debt will be wiped out and paying the loans back will be at your sole discretion.

3. The Transferring of Assets and Property: Every state has different exemptions with regard to not being able to pay debts concerning property which are in position to shield all your possessions or part of them, making it unnecessary to transfer any property to others ahead of an inability to pay the money you owe filing. Consequently, it is not a good idea to transfer assets to family members simply due to the trustee could ‘avoid the transfer’, which means you’re not only right back where you began before the transfer, you could potentially lose most chances of having your assets shielded under the inability to pay debts law.

4. Don’t Disregard Lawsuits: If you have not yet completed filing for the inability to pay your debts, but are sent a lawsuit, it is usually beneficial to attend the court hearing, because this provides the ability to file for relief. If you have already filed but still get a summons for court speak to your counsel because they can usually have the case dismissed.

5. Be Sure You Incorporate All Debts On Your File: Although you may want to retain some of the debt, it’s a requirement that all debts be listed. Sometimes a person’s home or vehicle may be something they want to keep, in this instance, a reaffirmation agreement might be signed that would leave out those particular debts from your file. This agreement essentially “reaffirms” the particular debt that you have wished to exclude, thus leaving it out of the bankruptcy. Ensuring you seek correct counsel and following some simple rules before the idea of filing for any relief of repaying debts, can make a big difference in the filing procedure as well as end result.

Student Loan Consolidation- Private Student Loan Consolidation

Dave Xavier — Thu, 30 Sep 2010 20:26:23 +0000

College education is becoming a problem to most parents nowadays. Many students may not be able to go college because of the high tuition fees and other expenses. Applying for student loans could just be the answer that you are looking for.

Loans for college students aim to help the students pay for the cost of their college education. However, when you?ve made several loans and due dates are close to each other, you will start to feel stressed out because handling all of them at the same time will not be easy. When this happens, you will start experiencing a lot of hassles. If you want to simplify everything, you can apply for a private student consolidation loan.

If you have several college loans, you will realize sooner or later that keeping various records and papers is a big headache. Moreover, it wouldn’t be easy to meet multiple deadlines in a month. When you consolidate your loans, you will only be responsible for one payment each month because all of your loans will be combined. As a result, you will only have one loan to manage. This will save you from a lot of hassles and you will have some peace of mind as well.

You will only be dealing now with one company. The consolidation loan company you?ve chosen will take care of all the payments for you. On the other hand, all you need to take care of is paying your obligation on time.

If you have qualified for a federal loan but you need an addition to it, you can apply for a private student consolidation loan after graduating from college. The competitive rates may just be as attractive as the ones you?ll get from a federal loan.

Consolidation loans for college students lower the interest rate of your debts up to 50%. A fixed rate can be negotiated and you can even stretch your payment period for 10 to 20 more years. This is an option that you should carefully consider because although it means lower amount to pay each month, you will have to face higher interest rates.

Different lenders offer different deals on private student consolidation loan. Before you decide which among those deals you?d like to take, make sure that you will examine each of them in every aspect. Some lenders may offer lower interest rates; however, there are hidden charges that you might have failed to notice when you first heard about the offer.

It?s easy to find reputable companies that offer private student consolidation loans. If you have an internet connection at home, you can simply search for lending sites. You can also get customized quotes and apply for the loan online. Such sites also have loan calculators that will allow you to compute the total amount of your repayment.

Read more detailed information on private student consolidation loan.

The Relation Between Bankruptcy And Taxes

Popescu Ion — Wed, 29 Sep 2010 09:35:10 +0000

When it comes to bankruptcy as well as taxation, there might be a number of things that you are going to take into consideration. If you tend to be going to declare bankruptcy, you want to make sure that you are performing everything you can in order to save yourself from trouble, money, as well as time as you can.

You should know that any kind of tax financial obligations may be eligible for becoming taken care of below Chapter 7 or chapter 13. If you are willing to file for bankruptcy, this really is one of five methods that you can get out of tax owed.

Nevertheless, you should remember that in order to get your taxes released through filing with regard to bankruptcy, you are going to possess to fulfill particular requirements, so you should make sure you meet them before you declare bankruptcy to get out of tax debt.

If you file for Chapter 7, you tend to be going to end up being able to get fully discharged of the actual financial obligations that are permitted. With Chapter 13, you will see a payment plan that is required therefore that you can repay some of your financial obligations, and also the sleep will be discharged.

Remember that not really all of the actual tax owed that you might possess is going to be discharged if you declare bankruptcy. You possess to fulfill 5 criteria in order to get your taxation taken care of.

These five criteria that you need to fulfill in order to get your tax debt discharged when you file for bankruptcy are essential. The foremost is that the actual date that the taxes return was at least 3 years ago. The second is that the actual taxes return had been submitted at least 2 yrs back. The third is that the taxes assessment is at least 240 times old. The fourth is actually that the taxes return cannot happen to be deceptive. And the fifth is that you are not really guild of taxes evasion. If you can fulfill all of these types of requirements, you tend to be going to end up being able to most likely get your tax owed discharged when you file for bankruptcy.

Pay attention that filing with regard to bankruptcy carries its own consequences, especially on your credit. You should not really file for bankruptcy just to be able to get out of having to pay your tax owed, simply because it’s going to perform a lot more harm than good in the long run when this comes to the harm done to your credit.

Debt Consolidation- Tips and Solutions

Mike Pettigrew — Sat, 25 Sep 2010 14:17:49 +0000

Whatever the case may be, you’ve found yourself in debt. Now, you’re trying to get rid of it as fast as you can. However, you’re finding that getting out of debt is not as easy as plowing yourself into it. While the road may seem difficult there are debt management solutions that can help you find a way out of a bad financial situation. Read on for some important financial health tips.

Sit down with your list of expenses. This means writing down everything you spend on a monthly basis. Food, rent, gas, and anything else you spend money on has to be on this list. Now, take a close look at everything you’ve listed. What is really a necessity and what can you live without? Since you’re trying to get out of debt its imperative to cut your costs.

Your priority when trying to get out of debt is getting rid of toxic debts first. This means that any loans you may have with high interest have got to go. There is a debate on which way is the best way to get rid of debt. One theory states that people should pay off their highest interest credit card debt first and work their way down the list of other cards. The other theory states that a person needs to get rid of their smallest balances first and work their way up. Choose the method you think will work best for you.

Whenever you’re trying to get out of debt, make sure you stop using your credit cards and rely only on cash. This means that you pay for your purchases with cash only. Leave your credit cards at home, and better yet only leave one credit card available in case of emergencies. When you deal with cash you’re much less likely to overspend than you would with a credit card.

Whenever possible create a direct deposit for your paycheck. This means that your employer will deposit your salary directly into your checking out. Have a separate savings account ready so you can deposit at least some portion of your salary into savings.

Become a savvy shopper. There are several things you can do to save money even when you have to spend it. For instance, if you’re planning on making a purchase, the key word is plan. Avoid impulse spending because that usually leads to overspending and buying things you don’t even need.

When you’re getting out of debt, it’s very important to earn more money in addition to saving money. There are a number of ways to earn more income that will help you reduce the debt you have. Think about a part-time job, freelance work, over-time, get creative and think of new ways to generate additional income that will help you reduce the debt you’re in.

If you aren’t able to get out of debt on your own, there is help. There are several legitimate agencies that specialize in debt management solutions that help people like you get out of debt. Whatever agency you decide to work with, make sure you are dealing with a reputable agency in order to prevent any unpleasant surprises.