There are so many productive ways to spend our money: saving for retirement, paying off the house, paying down consumer debt, and don’t forget about reasonable spending to make life more enjoyable. So what should take priority? Here are some things to consider.

401(k)

First, determine whether your employer’s 401(k) has a match. For instance, many 401(k)s match your contributions dollar-for-dollar up to 4% of your salary. A match like this is simply too beneficial to resist. Think of it this way — we hope to obtain a rate of return of 8 to 10 percent on our investment portfolio, but if our employer offers the match described above, we are guaranteeing ourselves an immediate 100% return on our investment.

However, depending on circumstances, it may or may not be wise to contribute more to your 401(k) than your employer will match, and if your employer offers no match, there are other factors that need to be considered.

Consumer Debt

I frequently see individuals with credit card debt with interest rates between 20 and 30 percent. If we are not getting an additional match from an employer on retirement savings, does it make sense to invest in the market where we hope to obtain a 10 percent return when we can essentially guarantee ourselves a rate of return of 20 to 30 percent by paying off these debts? One would be better off paying down debt with these high interest rates before investing elsewhere. (more…)

So you have filed all of your papers with a bankruptcy lawyer and learned that the bankruptcy will stay on your credit record for at least the next ten years and you are feeling a little depressed. Everything in your financial life has been affected including your chances in the near future of getting a mortgage or car with a low interest rate. What do you do now? As odd as it sounds to some people many banks and companies out there want to do business with you, which in turn can help you start your financial life over. Increasing your credit score is not always easy, it is going to take some planning, will power, and even a little hard work. The good news is that it can be done.

Credit cards may be what put you into bankruptcy in the first place, but now it is your chance to use them to help you rebuild your credit history. I have a close friend who in 2006 declared bankruptcy, but she has worked hard to build up her credit and now has a very good standing with all three of the credit bureaus. Amazingly enough her credit score last time I talked to her is averaging around 730 for Transunion, Equifax, and Experian, which she thought would never be possible this soon after filing. It is true that she will have the bankruptcy on her permanent record for many more years, but at least she has a chance to get a home, car, or other asset at a decent price sometime in the future. (more…)

Some of the new tax laws still allow for deductions on some of the interest you pay each month for your debts. So it is important to manage your debt wisely. Here are some tips for you as to which debt interest can benefit you when it comes to taxes.

Home-Mortgage Interest

You may deduct interest of up to $1 million worth of mortgages used to acquire or improve your main personal residence or one additional home. However, any mortgage interest on a third home is non-deductible. Also if you earn high income there are restrictions to mortgage-interest deductions and there could be a reduction of deduction allowed. For example for 2009 if your adjusted gross income is more than $166,800 you may have to reduce your mortgage interest deduction by about 25%. (more…)

Refinancing your mortgage now, even if you have bad credit is something you should look into now. Why? Interest rates have dropped over the last year. Depending on your current rate, it may pay to refinance your loan.

There are several reasons besides a lower rate to refinance now. Let’s say you have an adjustable rate mortgage. Perhaps you had to take an adjustable mortgage because that would have been the only way for you to purchase a home. If you’re due for your adjustment date, see what it will adjust to. I’ll bet it’s higher than when you first got it. And even worse it may even go up next year. If the economy starts to turn around like experts predict it will, you will be facing ever higher costs. Since you do have bad credit, dealing with higher interest costs will be an increased burden on your finances. Now would be the time to start repairing your credit and save money too. (more…)

In today’s economic environment its difficult for commercial mortgage lenders to find a good commercial mortgage broker. Given the economic recession and the reduced commercial mortgage activity in the real estate capital markets, commercial mortgage brokers are under pressure to generate commission income and may not be advising their client as objectively as in the go-go days. Furthermore, it is typically taking 3 to 4 times as long to close a transaction as compared to before the recession began. These characteristics of today’s commercial loan market make it important for a borrower to do their homework prior to engaging a broker.

Commercial lenders rely on skilled brokers to carefully analyzes the transaction and surveys the capital markets for a mortgage or financing that best meets the client’s needs, and processes and closes the deal. Both commercial mortgage lenders as well as business owners can have a mortgage broker identify which lenders are active in the market, and desired loan product, and negotiate on the lenders and borrowers behalf. (more…)

The mortgage meltdown and ensuing global financial crisis, in the fall of 2008, still reverberates today. The New York Times reported on the essentials of the credit crisis and pointed out the breadth and depth origins of this crisis and likened these times to the Great Depression.

I have previously reported on the financial crisis in The Economy of Bankruptcy; while The National Association of Consumer Bankruptcy Attorneys [NACBA] has been following SB61 since its inception. SB61 essentially will allow bankruptcy judges to modify the terms of a mortgage. Recently, NACBA Director, John Rao testified on the matter in October, before the Senate Judiciary Committee’s Subcommittee on Administrative Oversight and the Courts. (more…)

Going from making pretty decent money to not even being able to pay the bills sucks. And I should know as right now I am not even sure how I am going to come up with the money to pay the mortgage. How does stuff like this happen? How in the world can you explain to your kids that now you do not have enough money to even pay for their dance lessons?

As heartbreaking as it is, this is a fact of life for many of us here in America. Unemployment is climbing past 10% as we speak. And I am not sure where it will end up. This is affecting thousands of families. Many have lost their jobs and many more are losing their homes.

So, what can you do? Where can you turn? Well, if you are reaching total collapse financially and are unable to even afford the simple things, then turning to government grants for unemployment can help lesson some of the burden many of us face. Now don’t get me wrong. This type of federal help is not going to help you pay for that mansion on the hill, but they will keep you from living on the streets or your kids going to bed hungry. (more…)

Let’s face it, no one takes a mortgage because they like its features…..

We get a mortgage so we can own our home and pay as little as possible for the privilege.

Mortgage lenders don’t sell you a loan… They help you get a home, and the mortgage just helps make it happen.

Well, you own your home now, complete with the big mortgage. Now what?

Given you just want a home, the mortgage is like a wart on your nose. It might be part of you, but you’d definitely prefer it was gone. So how about getting rid of it.

You’ll find lots of good ideas on the net (I wrote some of them) on ways to reduce your loan more quickly and ways to find savings in your loan. All these are designed to shave some years off your loan. Many of these are terrific ideas. A 5 year saving on your loan term might not seem much at the beginning of the loan, but when you get towards the end, you’ll be glad they are gone. (more…)

Imagine holding a magical card that you carry around which has the power to open any door for you all over the world. You can pretty much get whatever you wish for with this card. If that is really true then you would want to guard this card very carefully now wouldn’t you? Well your credit score is a little like that. Having good credit is the way to a lot of financial opportunities. On the other hand, a poor credit score can be a hard obstacle you can actually use an Ontario mortgage to re-establish your credit. Maybe you are regarded a “high risk” borrower if you have maximized your credit cards, short-term loans, or line of credit and in addition to your regular mortgage payments. You are managing to pay off your payments each month and your overall payment history is passing. You are still at a risk to the bank institution though because your debt charge is heavy. What you should do is you consolidate your debts into a new mortgage so that you can better manage those debts while also restoring your credit rating. (more…)

Mums and dads are prepared to withdraw cash from their saving accounts to help their grown-up children purchase their first home, a new study indicates. Significant numbers of parents are withdrawing money from their saving accounts in order to help their children get on the housing market, new research shows.

Figures released by Lloyds TSB reveal that some seven out of ten mums and dads with grown-up offspring believe that now is the perfect time for them to buy their first home.

As such, 23 per cent of these people are prepared to take out cash from their UK account in order to fund their children with such a purchase.

At present, less than one-tenth (eight per cent) believe that they already have enough money to help each of their children buy their first home.

However, 14 per cent claim that they will need to carry on making contributions into a saving account in order to do this.

Research from the firm also indicates that around half of those questioned claim they are more likely to provide financial assistance to their children if they could secure a mortgage which would allowed their savings to be returned to them with interest.

Such figures come as Lloyds TSB points to research from the Council of Mortgage Lenders which reveals there were 19,200 first-time buyers purchasing homes in August, up from the 8,600 buying at the start of the year.

Stephen Noakes, commercial director of mortgages for the bank, states: “The current housing market presents a real opportunity for first-time buyers, as long as they are ready to buy with a deposit. Housing affordability is back to the level it was in 2003, so many parents with grown-up children want to help them take advantage by using their savings.”

However those looking to help their children were advised against emptying their ISA as doing so will see them lose out on the tax-free saving benefits attached to such accounts. Instead, people should look to take out money from accounts which do not charge for withdrawals.

The news comes as recent figures from Nationwide revealed 39 per cent of people questioned in September believed it was a good time to make a major purchase such a house or car. This was up from the 33 per cent who felt this way in August.

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