Home Loans
Home ownership has unceasingly been considered the "The American Dream." As of the second quarter of 1999,  66.6% of American households owned their own home as compared with less than 50% in
1900. The economy of the Roaring 20's brought on a home buying boom and the post-World War II era saw a national home ownership explosion, topping 60% in just two decades.
The idea of having a home where you set your own rules from
selecting paint colors to adding on a room has always appealed to the American public.
 There are many practical reasons to own your own home. Very often your monthly payments are close to what you are currently paying to rent. In addition, your
payments are an investment as your home builds equity. This equity can also be borrowed upon to help finance other major purchases if you so choose. Your real estate property taxes and the interest you
pay on your mortgage are tax deductible.
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What can you afford?
As a general rule you can probably afford a house that costs up to two and one half times your gross annual household income (before
taxes). You'll need to take into account how much you have for a down payment and what the closing costs will be. Other factors that
will influence the size of your purchase will be your monthly gross income (before taxes), your debt payment and credit history. Or, you can use our online mortgage calculator.
When you're in the market for a home, it's suggested that you
obtain a copy of your credit report to ensure that there are no
surprises. If errors occur on your report you should have them corrected prior to applying for a loan. Because information may differ between the three major credit bureaus, we suggest a
three-bureau merged report as opposed to a single-bureau report.
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Will I Qualify for a Home Loan???
So, you finally found the perfect home... now all you need is the loan! Buying a home can be one of the most
exciting, yet stressful, decisions you will make in your life. Especially if you are left wondering "will I qualify for a loan?" Lenders take into account several factors before granting you a loan. Such as, your capability and motivation to pay back the loan.
Your capability to repay the loan can be judged by proof of employment and verification of your salary. Your motivation to pay back the loan can be determined by examining your
credit report. If you have a history of repaying your
previous financial commitments on time then a lender can be confident that you will repay your home loan in a similar fashion. It is for that reason that such importance is placed on your credit report. Help to alleviate some of that stress and
check your credit before you apply for a loan. That way, you have the time
to make sure that all the information in your credit file is accurate. See what your future lenders will see and get the piece of mind that you deserve.
Tip: Qualifying for a loan is based on an individual basis. So, if you come up short in one area, strength in another may help you.
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Terminology:
Some terminology you will want to be familiar with when applying for a home loan:
Annual Percentage Rate (APR) – Lenders are legally required to divulge
the APR. This is a combination of the interest rate, points and other related fees you will be paying annually.
Loan Origination Fees – This is the fee a lender charges for their services.
It's usually 1 or 2 points. One point is equal to 1% of the loan amount, 2 points are equal to 2% of the loan amount, etc.
Discount Points – Discount points are charged when a borrower wants a
lower interest rate. The borrower pays more points up front and this is called buying down on the rate.
Title Search – Lenders require a title search. This uncovers any liens,
lawsuits and legal claims involving the property in question.
Title Insurance – This is also required by lenders. It is protection for the buyer and lender if complications with the title arise after the deal has been
made.
Homeowners Insurance – This insures the contents of your home from theft
and insures the structure from most disasters.
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 | A new mortgage usually means a new address. Use CardPal to notify your card issuers of your address change. |
Links for Home Improvement Loans
Sorry, we have no recommended links at this time.
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Tools
Mortgage Calculator
How Much can I Borrow?
In order to determine a possible mortgage for an individual or family, lenders use ratios to establish a mortgage that is reasonably affordable. For conventional loans housing expenses (mortgage principal, interest, taxes and insurance) should not exceed approximately 28%. However, when the ratio takes into account any additional long-term payments (payments that continue for a period of more than 11 months), housing expenses should not exceed 33%. To calculate your realistic mortgage payment not including any additional long-term payments please enter either your annual income or your gross monthly income.
Tip: Don't Forget: When budgeting for a home it is important to remember that housing expenses only include your mortgage principal, interest, taxes and insurance. Any additional expenses such as homeowner's and property insurance, utilities, and maintenance of your home are not included in the above figures. Figuring these expenses into your budget is necessary for a more complete picture of your total housing expense.
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Auto Loans
Auto Loans, Car Loans from 1-800 DRIVE TODAY - Fast, easy, free service. Auto loans for individuals with good and bad credit. Also guaranteed credit cards for people with problem credit.
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Student Loans
So, you finally found the perfect college... now all you need to figure out is how you are going to pay for it! Choosing a university can be one of the most exciting, yet stressful, decisions you will make in your life. Especially if you are left wondering "can I really afford this?"
If you would like to be considered for Federal Financial Aid, step number one is to fill out the Free Application for Federal Student Aid (FAFSA). Once the FAFSA is complete and submitted to the Central Processing System a formula is applied to determine how much your family's contribution should be. Your Expected Family Contribution (EFC) is generally based on the student and parent earnings, information on the value of your assets, the state you reside in, number of persons in your household and number of persons in your household attending college. Next the Cost of Attendance (COA) is determined by taking into consideration tuition and attendance fees, room and board, books and personal expenses. Once the EFC and the COA are determined the amount of financial need can then be decided. The amount of financial need is calculated by subtracting the EFC from the COA (COA- EFC = Financial Need).
The financial need of an individual can be met several different ways. Sometimes an individual may qualify for a grant other times for a loan but often times it is met from a combination of both. When applying for a loan lenders look at a variety of factors before granting an individual a loan. It is for that reason that such importance is placed on your
credit report.
Help to alleviate some of that stress and
check your credit before you apply for a loan. That way, you have the time to make sure that all the information in your credit file is accurate. See what your future lenders will see and get the piece of mind that you deserve.
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Tools
How much will college cost???
This is a great tool to use to predict the cost of college for you or your child. The result you receive will tell you the approximate cost of your college education over a period of four years. To calculate your college cost, please enter the yearly cost of college today, including attendance fees, room and board, books and various personal expenses. In the Number of Years Until College Attendance field, please enter the number of years until you or your child will attend in college. The Annual Tuition Increase Rate field is preset to 5% as college expenses increase at a rate of approximately 5% per year.
Business Loans
The word credit itself is derived from a Latin base meaning "faith" or "trust". We've come a long way from the days when the money
supply consisted of metallic coins and when borrowing was undertaken to cover dire emergencies or finance the needs of the ruling class.
Today, the acceptance of debt as a suitable means of financing and
investing is generally taken for granted and a market economy, similar to the one that exists in the United States, could not function without the extensive use of credit.
There is a close relationship in the U.S. between the value of the
Gross National Product (GNP) and the volume of borrowing. Credit facilitates the transfer of money by placing it where it will be used
more efficiently and effectively, thereby increasing its productivity. In today's economy, one of the leading ways expenditures are financed is through lending.
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Is taking a loan a good way to finance my business?
While businesses may obtain funds through the sale of ownership (stocks or direct participation investments), they often prefer to
borrow so as not to dilute control or share profits. They also anticipate that as a result of borrowing, their earning power will be enlarged and they will be able to service the debt from the resulting
higher income.
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What is the difference between short-term and long-term borrowing?
Businesses borrow for different purposes and for different time
periods. Short-term borrowing can be used to cover temporary increases in inventories and other working capital needs. It can also be used to pay taxes or the money can be borrowed with
anticipation of more permanent financing. Long-term borrowing can be used for expansion or renovation or to cover a permanent rise in working capital requirements.
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What type of lending services do banks offer?
Commercial banks offer a wide range of lending services. They primarily lend on short-term commercial credit but also make
long-term loans to businesses. Generally, large city banks make more business loans than the smaller, rural banks, which may lean towards agricultural and consumer loans. Banks will also lend on
account receivables and sometimes purchase receivables outright. This specialization has further expanded the use of credit in the United States.
As an alternative to borrowing from a commercial bank, small
businesses can take advantage of the loan programs offered by the Small Businesses Administration.
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How are loans secured?
The lenders credit standards and the needs of the borrower determine the type of loan and the channels of credit that are used.
A loan may be unsecured or it may be secured using assets as collateral. It can also be secured by collateral along with a guarantee by another party. This party can be a cosigner or government
agency (e.g.: Federal Housing Administration, Veterans Administration or Small Business Administration). See our section on SBA loans.
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How do lenders evaluate a potential borrower?
One of the biggest factors involved in a lender's decision to grant a loan is the risk to the lender. Generally, the greater the risk, the
higher the interest rate. Risk factor can often determine the terms of the loan as well.
Some of the factors taken into account by the lender will be:
Payment history – are bills paid consistently and on time; outstanding debt – is the amount of debt considered reasonable, and credit history.
You may also be asked to provide your personal credit information.
It's a good idea to
get a copy of your credit report from all three major credit reporting agencies before applying for a loan so you
can make sure the information is accurate and consistent. Click here to order a copy of your personal credit report
www.creditreport.com.
If the borrower possesses readily salable commodities or collateral,
this can add to the means of repayment and tends to increase the amount of credit that may be extended.
Lenders sometimes speak of the "C's of credit" when evaluating a
borrower's position. Does the borrower have character, capacity and collateral (or capital)?
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How is the debt repaid?
The manner in which business debt is repaid varies in the U.S. Some businesses pay off their loans, particularly their long-term debt, and
others obtain new loans. In some cases the loan can be repaid before maturity at the option of the borrowers. In other cases, the loan cannot be repaid before maturity. Very often business will have
a line of credit that enables them to renew borrowings up to a certain maximum.
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What kind of terms can I expect?
Terms can vary considerably. Interest may be due semi-monthly or monthly, or it may be due when the loan matures. The repayment of
principal, which is the original amount borrowed, may be due on demand by the lender – considered a "call loan," or as far in the future as 50 years or more – "bonds." The principal can be paid in
periodic partial payments called installment or amortized loans, or it can be paid as a single sum.
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What kind of interest rates can I expect?
Interest rates will also vary. However their pattern reflects the different risks, the time period, and the expense of servicing and
collecting on the loans. Generally, the average rate charged on large loans is lower than that charged on smaller commercial loans. Changes in the condition of the money market and changes in the
national economy will also create a variance in the rate levels and the differentials.
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About SBA Loans:
There are approximately twenty-three million small businesses in the United States.
The largest single financial supporter of small businesses in the
nation is the U.S. Small Business Administration (SBA) which offers a variety of loan programs. One of its main programs is the 7(a) Loan Guaranty. It provides loans to small businesses that cannot
obtain reasonable financing through normal lending channels. The loans are guaranteed by the SBA but are provided through private sector lenders.
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What businesses are eligible for a SBA loan?
Four factors determine the general eligibility for a SBA loan. They are the size of business, type of business, use of loan funds and any
special circumstances.
While some businesses are not eligible for SBA financial assistance,
many businesses are. It must be a business that is for-profit; is in the United States or plans to do business in the United States or its
possessions; the owner has equity to invest; and alternative financial resources including personal assets are used first.
An eligible small business is defined by The Small Business Act as
one that is independently owned and operated and not dominant in its field. The Act also states that the definition of a small business will vary in order to reflect differences in industries.
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Which businesses are ineligible for a SBA loan?
Businesses that are not eligible for SBA financial support include charitable, religious and certain other nonprofit institutions. Other
businesses which are ineligible include those engaged in real estate investment, speculative activities, lending functions, or pyramid sales plans.
Businesses involved in gambling cannot qualify unless the business
obtains less than one-third of its annual gross income from the sale of official state lottery tickets under a state license or is engaged in
legal gambling activities licensed and supervised by a state authority. Any business involved in illegal activities is also ineligible.
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What can SBA loan proceeds be used for?
SBA loan proceeds can be used for most business purposes including the purchase of real estate for the business operation;
construction or renovation as well as leasehold improvements; acquiring machinery, equipment, furniture, or fixtures; inventory purchase; and working capital.
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What SBA loan proceeds cannot be used for:
The proceeds cannot be used for such things as the financing of floor plans; real estate that will be held primarily for investment
purposes; to pay delinquent withholding taxes or make payments to owners. In addition, proceeds cannot be used to pay existing debt unless it's demonstrated that not only will the business benefit, but
that the need to refinance is not due to incautious management.
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What is the interest rate on a SBA loan?
Interest rates for SBA loans may be fixed or variable and are negotiated between the borrower and the lender. The rates are
subject to SBA maximums that are tied to the Prime Rate.
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What fees are associated with a SBA loan?
The SBA charges the lender a guaranty fee and a servicing fee for each approved loan. Once the lender has paid the fee, it can be
passed on to the borrower. The fee charges are determined by the loan guaranty amount.
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How much of a guaranty does the SBA give on a loan?
The SBA can guaranty up to eighty percent on loans of $100,000 and less, and up to seventy-five percent on loans above $100,000
(generally up to $750,000) for qualified small business applicants.
– The Economic Expansion Initiative offers monetary incentives and discounts for businesses looking for loans and other financing services through
their large base of participating lenders.
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Personal Loans & Other Type of Loans
Money lending is as old as the earliest known civilizations. Five thousand years ago, Sumerian priests were accepting deposits and
making loans. During the Roman republic, loans were made on the basis of verbal contracts, and in the 10th Century, certain religious orders created flourishing businesses by lending money.
When banking began in the United States in the 18th Century,
individuals, merchants and colonial governments were already in the process of loaning money to one another. By 1990, loans accounted for 62% of bank assets with 18% of this figure consisting of
consumer loans.
Consumer credit is used for personal consumption as distinguished from  business credit, which is used for productive purposes. The
evolution of consumer credit is largely an outgrowth of American urbanization, the rise of the working class, and the increased purchase of durable goods. In 1997,
personal loans totaled $350 billion in the United States.
Some of the reasons to take out a personal
loan might include the purchase of a major appliance or furniture, or to pay for a vacation, wedding or graduation. A personal loan may enable the borrower to take
advantage of discounts on "big ticket" items.
 A personal loan is not usually secured by collateral and can carry a higher rate of interest. With unsecured credit, the loan is granted based on your payment history and
income stability rather than on security pledged for the loan. It's a good idea to
get a copy of
your credit report from all three credit reporting agencies before applying for a loan so you can make sure the information is accurate and consistent.
Interest rates are commonly higher on a personal loan because the
lender is depending only on your assurance to pay which creates a greater risk. However, a bank may be able to seize funds from your checking or savings account if you default on the payments.
Personal loans are generally made in lump sums and have a monthly repayment schedule for a fixed period of time.
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Books on Loans
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