Archives for March 2017

Getting Car Finance With An IVA

When you’re struggling with problem debt, taking on more credit is probably the last thing you want, and yet sometimes circumstances demand it. There are around 45 million drivers in the UK, using their vehicles for commuting, family matters, travel, leisure and much more. Cars are an essential part of our lives, but not cheap – so what do we do if we need to get a new vehicle but have an IVA.

An Individual Voluntary Agreement is an agreement arranged by an insolvency practitioner, between someone who owes debt and their creditors. It allows them to pay some or all of their debt via monthly payments, the scale of which must be agreed by at least 75% (in value) of creditors. This arrangement is legally binding, and formulated based upon the person’s financial status including income and outgoings.

An IVA affects your credit rating, and as such might normally lessen your chances of purchasing anything on finance. However, insolvency practitioners (and creditors) recognise that a car is mandatory for many, as without a means of transport many of us will not be able to get to work, and therefore won’t be able to pay our IVA. Therefore, you should be able to find a vehicle that is reliable and practical enough to allow you to live your life and continue to work off the debts.

The probable route is this; let’s assume that you have had an IVA for six months, and need a car. Your first port of call could be your insolvency practitioner, who will assess your current arrangements and see if there is scope for you to apply for finance and perhaps, just as importantly, the amount of money you could realistically spend per month.

Alternatively, you might first contact a car finance company that specialises in those with bad credit and IVAs, to see what is realistic for their circumstances. It’s then a case of marrying up the two parts of the puzzle, and finding a solution. There are tens of thousands of cars available nationwide for those who have IVAs, so the applicant should not feel unique or embarrassed.

IVA agreements are there to allow you, where possible, to free up your debt and keep your home, while also salvaging some of the money that you owe your debtors. There is a level of strictness involved, so it would not pay to try to get finance without adhering to the conditions.

If you need a car and do not possess the immediate funds to purchase one, getting support from your insolvency practitioner could be the next best step in both securing the vehicle but also continuing to pay off your debts – and eventually enjoy life debt-free.

5 Questions to Ask Yourself Before Taking Out a Mortgage

By Frugaling 1 Comment

When it comes to buying a home, one of the most important things to consider is your mortgage. Not only do the rate and amount matter immensely, but prudent homebuyers will look deeper than the surface. This includes investigating personal financial factors that may impact your mortgage, as well as making sure you’re ready to take on this new investment.

Oftentimes, new homebuyers will get caught up in the excitement of the process and forget to look at the bigger picture. This hastiness may lead to complications with your home and finances in the future, and could have negative consequences if not thoroughly considered. Whether in terms of employment status, rates and payments, or anything in between, asking yourself key questions will greatly reduce the potential risks of taking out a mortgage.

Here are some of the most important things to consider:

How Will My Credit Score Impact My Mortgage Rates?

Perhaps the most important and influential factor that determines your mortgage rate is your credit score. Just like any other loan, those with higher credit scores are more likely to get lower interest rates when taking out a mortgage. One thing all prospective homebuyers should consider is where their credit score currently is, and whether it’s worth it to hold off on buying until you can increase it.

Specifically, those with scores of 740 or higher will qualify for the most competitive rates, while those with scores below 620 will get much higher rates. If you know your credit score and want to estimate the rates you could qualify for, using online loan calculators can give you an understanding of what to expect.

Is My Employment Status Stable Enough?

Just because your tax records and employment verification make you eligible for a mortgage, doesn’t always mean that it’s a good idea. Before taking out a mortgage, all potential buyers should think about their current employment: How long have you been with the company? How long do you plan on staying? What factors may lead to job instability in the future? Make sure you’re at the right place in your career, and that you feel comfortable with the security of the company or industry, before diving headfirst into a mortgage.

Have I Covered the Requirements Needed for a Mortgage?

Before even beginning the process, save yourself time by considering and covering any requirements that come with applying for a mortgage. Although each lender is different in what they require of borrowers, there are certain guidelines that are general across the board.

Having a debt-to-income ratio of less than 43 percent is required for most lenders, as well as having a 10 percent down payment if your credit score falls below 580. Before you’re able to fully close on your new home, most banks will also require you to compare homeowners insurance quotes and provide proof of a policy in case of any incurred damages. Keep in mind that there are other non-essential “requirements” that will greatly increase your chance of low mortgage rates if fulfilled.

Have I Saved Enough for the Down Payment?

Given your credit score is above 580 and the 10 percent down payment isn’t necessarily required, it should be noted that a higher down payment often means lower interest rates. Putting a 20 percent down payment on the home will not only get you a better mortgage package, but will also save you money on mortgage insurance. Those who put less than that amount are required to purchase either a PMI (Private Mortgage Insurance), or purchasing through the FHA.

Can I Afford a Mortgage Right Now?

This last question is perhaps the most significant, and requires honesty and discipline to answer. Sure, the prospect of buying a home is exhilarating, but it is vital to take a step back from the excitement and consider your financial situation. Are there any potential instabilities in the long-run? Are you positive that your income will not only remain the same, but increase in the future? Being completely honest with yourself when considering this can make the difference between a prosperous investment and a hasty one that proves detrimental in the years to come.

The questions above provide a general overview of things to consider before taking out a mortgage. However, they are just a starting point. Buying a home is a big, long-term investment, and therefore has a lot of components that go into it. Take the time to calculate your risk carefully, and make sure that you’re ready to take on a new challenge. That way, you can keep yourself away from complications, and buy a home at the most optimal time for you.

What Are the Alternatives to Short Term Loans?

By Frugaling 1 Comment

Some people prefer to go down the road of applying for a short-term loan when they are dealing with financial difficulties. Here at www.creditpoor.co.uk, we aim to provide you with the required financial guidance in order to determine whether you should apply for a loan or look for other alternatives.

A short-term loan can be a great option if you need to get over a financial ordeal or simply make a certain purchase. However, some people prefer not to do so and look for other solutions. Interest rates of short-term loans can be sometimes high, depending on how long you intend to repay the borrowed amount. Here at www.creditpoor.co.uk, we review each specific case and access our massive lenders’ database to find you the best deal possible. We are merely a broker that caters for the need of our clients, and we look for the best deals with the lowest interest rate possible.

However, if you are certain that you would like to look for alternatives to short-term loans, here are some tips that you might find feasible.

Contact the Company You Owe:

It is always better to start with contacting the company you owe money for. Most companies are quite tolerable when you have the intention to pay back their money. They would like their money back, of course, and they would not risk your declaration of bankruptcy. www.creditpoor.co.uk advises you to contact the company first and explain your situation. They should arrange a plan for your repayment that works for the well being of both of you. But remember, you should not make any vain promises that you would not keep.

Contact Family Members and Loved Ones:

If you have not done that already, you should start contacting you family members and friends. It is the best alternative to short-term loans, as you would not have to deal with the interest rate of lending services. However, you should also consider the financial situation of others. You do not want to fix you problems by inflicting hardships on others.

Contact Your Employer:

If you are employed, you should consider contacting your employer for an advance in pay. If you plan to work there, it would not be a problem to take an advance on the wages you are eventually going to receive. However, try to manage and assess your situation properly; as you would not be getting a salary for the month you are requesting an advance from. www.creditpoor.co.uk usually deals with clients who happen to manage their finances poorly. Try to take smart decision concerning this step, as it might hurt your financial situation even more.

Withdraw from Your Savings Account:

Some people create a savings account to be able to accomplish future goals or have some money to rely on when times are tough. Well, now might be the time to make a withdrawal from your savings account. Try to be reasonable with your withdrawal, and do not make a habit out of it. Once you are debt free and all the stress of your financial difficulties subside, you should return the amount you withdrew from your savings account as soon as possible.

We hope that you find these alternatives to short-term loans have helped you figure out a way to overcome your financial ordeal. With proper knowledge of management and financial arrangements, you should find your situation stable for quite some time. Remember that www.creditpoor.co.uk is always here to help you out when the times are tough. If you plan to apply for a short-term loan, make sure to contact us and leave the rest for us.

Best Ways to Boost Savings in 2017

By Frugaling 1 Comment

If adding to your rainy day fund was placed squarely at the top of your financial to-do list, you are in good company. According to a GOBankingRates survey, nearly 69% of all Americans have a dismal savings account balance, meaning $1,000 or less. When faced with a financial emergency that requires quick affordable cash on hand, you do have options available to you, such as this auto title loan service in Los Angeles. However, even a grand or two may not be enough to get you through until the next payday. Building up savings is an admirable goal, but it can be difficult to know the best route to take to boost your savings power this year. Don’t worry; the savings tips below will help you build a savings account you can be proud of.

Get on the Tech Train

Technology can be your best friend when you’re attempting to reach a financial goal. Several mobile and desktop apps exist that put you in the driver’s seat of your saving, and spending. Budget apps like Mint offer easy methods for analyzing your daily and monthly buying habits and suggest how you might curtail your spending so that you have more to save. Automated savings apps like Digit and Qapital put saving in the forefront of your mind through behind-the-scenes transfers and savings rules based on your tendencies and budget. One or a combination of these digital tools can street you in the right direction while you work to increase your savings account balance this year.

Seek out a Higher Yield

A simple method to boost a savings account balance is to give your money a chance to work harder for you. This can be done by transitioning some or all of your current savings to a high-yield account. Some financial institutions, mostly those found online with no branch location, offer a higher interest rate on traditional savings accounts than brick-and-mortar location. Without the added expense of overhead, online banks pass savings down to banking customers by way of higher rates on savings, certificates of deposit, and money market accounts. Before making the switch, be sure to check for any account fees, minimums, or other restrictions on the new savings account that might damper progress toward your goal.

Set a Realistic Goal

It’s fairly common knowledge that establishing a goal of any kind takes some forethought. It’s even more important when it comes to financial goals, as they often involve several aspects of your day-to-day life. If you’ve already set a savings goal for yourself, spot check the dollar amount you are aiming for to ensure it is attainable. That may require a review of your budget to ensure the funds are each month or pay period, or it may require an analysis of your timeline for reaching said goal. If you have yet to set a dollar amount for your savings goal or a timeline for hitting the mark, start there. The only way to know if you’re making progress is to know what you’re trying to achieve in the first place!

Automate It

One of the best moves you can make toward reaching a savings goal is to pay yourself first. Everyone has bills to pay to utility companies, landlords or lenders, and insurance companies each and every month – why not add yourself to the list of people owed? Setting aside funds for your financial stability should take place automatically each time you get paid. If you’re nervous about setting up a scheduled transfer into savings, start small with an amount you know you can easily afford. As time goes on, you’ll forget that “bill” is paid each pay period. That’s the perfect time to increase the amount and start the cycle again.

Beefing up your savings this year doesn’t have to be a point of contention. Instead, grab hold of one or more of the tips listed above to kick start your savings habit, and ultimately, work toward reaching your near- or long-term savings goal.