As one of the top five fastest-growing cities in the US, Denver is quickly becoming the place to be. The vibrant city life, the outdoor culture, and the growing economy are attracting numerous people looking to become Denver homeowners.
If you, like many others, have noticed how much this Colorado city has to offer, you might be wondering how home-buying works in Denver. Weâve got you covered. Hereâs what every Denverite or potential Denverite needs to know about becoming a homeowner.
Start With a Budget
Before the hunt for your dream home can begin, youâll need to determine how much you can afford. Get in touch with a lender to talk this through. Your lender will help you determine how much of a down payment youâll need, as well as what kind of monthly payment you can expect.
Once you speak with a lender, youâll know what kind of loan you qualify for, and you can narrow down your search to homes within your budget. Now youâre ready to really get serious about finding your future home.
When looking for a lender, many people start with their bank. Your bank isnât a bad place to start, but donât forget to shop around for the best rate. If you donât check out all the options, you might miss out on deals from companies like Homie Loans. Homie Loans guarantees they can get you the best rate possible. In fact, if you find any lender with a better rate, theyâll give you $500 cash*.
Find the Right Agent
Most people work with an agent while buying a home, but not everyone knows how essential it is to find the right agent to work with. The right agent will be experienced and knowledgeable about the highly competitive Denver market.
Your agent should also understand your goals and interests as a prospective buyer. Theyâll use their knowledge of your goals with their knowledge of different neighborhood vibes to help you find the perfect fit for you. If easy access to the mountains is one of your priorities, your agent will tell you which cities to look at. If downtown living is your thing, your agent can help you find a good deal in a vibrant, Denver neighborhood.
When you have an expert agent on your side throughout the whole home buying experience, youâll never have to stress about missing out on important information or getting the bad end of a deal. There are a lot of pieces to the puzzle when it comes to real estate, but agents are there to make each step along the way easy on you. Thatâs why the sooner you bring an agent in to help, the better.
Check Out the Options
Now itâs time to start looking at homes. For many people, this is the fun part of buying a home. Your agent will help you find homes in the areas youâre interested in. It can be a lot of fun to visit potential neighborhoods and imagine yourself as a resident. If a home really catches your eye, donât be afraid to visit more than once. You want to be sure that itâs the right one for you.
Be sure to be thorough when checking out your options. You donât need to settle for something youâre not happy with. If youâre not looking for the extra work that comes with a fixer-upper, donât skip the home inspection. Some homes have issues that you wouldnât have noticed without an inspection. You want to find a home thatâs in great condition.
When youâve found the perfect home, your agent will help you determine if itâs listed at a fair price. A home could check every box on your wishlist, but if the price isnât right, it may not be the right one for you. One of your agentâs main jobs is to help you negotiate to get a price that works for you. On the other hand, if the price is where youâd like it, your agent will help jump on that home faster than any of the other potential buyers.
Streamline the Process With Homie
Whether youâre a home-buying veteran or this is your first rodeo, Homie will make your experience the best it can be. Searching for your dream home is a breeze when you have our easy-to-use app.
When you work with Homie, you donât only get access to the app, though. Youâll also have your very own, top-ranked licensed agent who will help you every step of the way. Our buyersâ agents are dedicated only to their buyers, so youâll get the best quality service throughout the process.
To get access to amazing homebuying tools and some of the best agents in the state, you might think youâd have to pay top double, but not with Homie. We want to make homeownership accessible to everyone, which is why working with Homie is more affordable than working with any traditional realtor. We offer buyers a refund of up to $2,500 at closing. With those savings and those benefits, buying with Homie is a no-brainer. Click here to start the process.
*Subject to terms and conditions.
Get more tips on buying your Denver home!
5 Tips to Help You Afford Your First Home
Common Home Buying Fears and How To Overcome Them
Can You Buy and Sell a Home at the Same Time?
The post How to Buy a Home in Denver, Colorado appeared first on Homie Blog.
Mia, 35 and her husband Luke, 36, earn a combined $200,000 per year. But after paying their mortgage and rental property loan, as well as car and student loans, child care, and other living expenses, the Los Angeles couple has a difficult time socking away money in savings.
They do have about $10,000 in a rainy day account, which could cover their expenses for about one month. But adding to the account has been proving difficult.
Luke feels confident that if they ever run into a serious financial bind, they could always take advantage of their low-interest home equity line of credit. But Mia isnât comfortable with that route. Sheâd prefer to have more cash on hand.
A bit more background on the couple and where they stand financially:
Luke recently transitioned to a new job as a government attorney, which he loves, but it also meant taking a 50% pay cut. Thatâs impacted their ability to spend and save as comfortably in recent months. It was an unexpected opportunity for which the couple wasnât financially prepared.
Mia and Luke would like an objective look at their finances to discover ways to reduce spending, increase saving and possibly find new revenue streams. âIâd love to figure out a side-hustle, so that I can eventually leave my job and spend more time with the kiddos,â says Mia, who works in marketing. Other goals including affording a new car in a couple of years and remodeling their primary residence.
Hereâs a closer look at their finances:
Combined salaries: $200,000 per year
Net rental income: $6,000 per year
Car and student loan debt. $13,000 combined at 2%
Mortgage at primary residence $845,000 at 3.625%
Mortgage at rental property $537,000 at 3.5%
HELOC on primary residence: $200,000 (have not used any of this credit)
Mia: contributes about $1,000 total each month, including a company match
Luke: contributes about $1,000 total each month, including a company match
Emergency Savings: $10,000
College Savings: The couple has 529 college savings funds for both of their children. They allocate their cash back rewards from credit cards towards these accounts. Currently they have about $10,000 saved for their 4-year old and $5,000 saved for their 1-year old child.
Top Monthly Spending Categories:
Primary residence mortgage: $4,000
Primary residence property tax: $1,100
Childcare: $1,900 (daycare for both children, 3 days per week. Grandmother watches other 2 days per week)
Food (Groceries/Eating Out): $800
Car and student loan payments: $450
From my point of view, I think the biggest hole in Mia and Lukeâs finances is their rainy day savings bucket. Relying on a HELOC to cover an unexpected cost is not really an ideal plan. In theory, the money can be used to cover expenses and the interest rate would probably be far lower than the rate on a credit card. But in reality, tapping a HELOC means falling further into debt. They do have $10,000 saved, which is good. But itâs not great.
If not for an emergency, the savings can allow them to achieve other goals. The couple mentioned wanting to buy a car in a couple years. This will probably require a down payment. Having cash can also assist with renovating their home.
Here are my top three recommendations:
Transfer Rental Income Towards Savings
Their previous residence is now a rental property. It nets them about $500 per month. The couple is using this money to pad their living expenses. Can they, instead, move this into their savings account for the next few years? The way I see it, they should have a proper six month cushion in savings to tide them over in an emergency and/or if they need money to address their goals. This rental income isnât going to get them to this 6-month reserve too quickly, but itâs a start.
Carve Out Another $500 for Savings
While I donât have a detailed breakdown of all of the familyâs monthly expenses, I can bet that they can pare their expenses to save an additional $300 to $500. A few dinners out, some unplanned purchases at the grocery store (because you took the kids) and a couple monthly subscription plans can easily add up to $500 in one month. Whenever I want to save more, I schedule money to transfer out of my checking and into savings at the top of the month. I do this automatically and only spend whatever money I have left. Iâd suggest doing this for the first month and seeing how it feels. Do you really notice the money is gone? If yes, revisit some of your recurring costs and decide on trade-offs. If Lukeâs salary has decreased by 50% then the couple needs to make some modifications to their spending. The math, otherwise, wonât add up.
Can Mia Adjust Her Work Structure?
Mia is interested in a side hustle, too, to bring in extra income (which I highly recommend). Sites like tutor.com, care.com, taskrabbit.com and others can help you find quick work within her preferred time frame. In the meantime, can she and her husband find ways to adjust their work hours or commute, which saves gas, time and money?
Miaâs commute to work is one hour each way. Thatâs ten hours per week stuck in a car. And my guess is that while Miaâs driving, sheâs paying for daycare, for at least some of those hours. Could she work from home one or two days per week to reduce her time in traffic, as well as her child care costs?
Bottom line: When Lukeâs income dropped by 50%, the couple didnât adjust spending. It may help to take pen to paper and imagine they were building their budget for the first time. Take all of their expenses off the table and rebuild the budget and lifestyle to better align with their adjusted income. Start with the absolute needs first: housing, insurance, food. And really scrutinize all other expenditures. Unless itâs an absolute need that they can easily afford it, consider shutting it off until theyâve reached a 6-month savings pad.
The post We Earn $200,000 and Canât Save. Help! appeared first on MintLife Blog.
The average couple has a number of topics to discuss on their to-do list before heading to the altar. The least romantic topics, if they even make the list at all, are probably concerning debt and the possibility of divorce. If you foresee a divorce in your future or are currently going through one, itâs safe to say that you have some burning questions about your finances. Perhaps you and your spouse acquired some debt during the course of your marriage and youâre now wondering who is going to be responsible for what. While itâs important to note that each situation is unique, there are some ground rules in the Divorced with Debt arena. In the below sections, weâll address the usual ways in which debt is divided up between each spouse.
Community Property vs. Common Law Property Rules
If youâre trying to figure out what debts you will be responsible post-divorce, you will first need to know if you live in an equitable distribution state that follows common law or if you live in a community property state. When it comes to debt and the divorce process, most states follow common law for property, meaning that following a divorce, each ex-spouse will be held responsible for the debt that they took on. In a community property state, both spouses, considered to be the âcommunity,â may both end up equally responsible for debt that incurred throughout the marriage, known as âcommunity debt.â The following states are Community Property States:
Most of the time, the banks arenât interested in how the courts decide to split up your debt. Even after a divorce, the original contract or credit card agreement will typically overrule a divorce decree. This means that if the original agreement was set up under your spouseâs name, the banks are going to expect the payments to be as such. As you can imagine, this could potentially cause problems with an ex-spouse who is being asked to pay off debt that is not under their name, or at least under a joint account.
To put it into perspective, letâs imagine that the court orders your ex-spouse to make payments on credit card debt under your name. If your ex neglects to make the payments on time, itâs going to have an effect on your credit report. The good news is that if this happens, you have a right to pursue legal action against your former spouse for not following court orders. However, itâs possible that by the time legal action is taken, your credit score may already be damaged.
Prenuptial agreements will affect these outcomes as well. Depending on yours and your spouseâs marital assets, the debt in question will vary. Here are the typical categories of debt that are affected during divorce proceedings:
Credit Card Debt
Auto Loan Debt
Credit Card Debt
Itâs possible that you could be responsible for your former spouseâs credit card debt, but itâs not likely. If you have a joint account, then the outcomes may vary. Usually, marital debt is considered to be any debt that was created during the time of the marriage. So if you racked up credit card debt under a joint account, expect that both of you will be equally responsible for paying it off.
If both spouses have their names on the mortgage, the easiest way of solving the mortgage debt is to sell the house and divide the earnings between both parties. It might be tempting to keep the home for a multitude of reasons, but at the end of the day, selling the property and splitting the money is usually the least complicated solution for everyone involved.
Once the house is on the market, itâs time to start communicating with your former spouse about who is going to be responsible for what amount. Come up with an agreement on who will pay which portion of the mortgage, so that neither partiesâ credit score is negatively affected.
If selling the home and dividing the earnings isnât a viable option for you and your ex, then one of you will end up fully responsible for the debt. In most cases, mortgage debt following a divorce is assigned to:
The spouse with the higher annual income.
The spouse who gains full custody of the children.
When this happens, one spouse will have to buy out the other spouseâs equity in the property.
Car Loan Debt
When it comes to car loans, things become more complicated. If the car loan has both names on it, here are the two best options:
Refinance the car without your ex.
Propose automatic payments to come directly from your former spouseâs account.
Letâs say one person ends up with the car loan debt, but the other person was also on the loan as a cosigner. Unfortunately, if one spouse is held responsible for picking up the tab on a debt, and they neglect their payments, both parties can suffer those consequences.
Each state has different laws surrounding medical debt and divorce agreements. If you live in a Community Property state, you might have to pay for your former spouseâs medical debt. However, if you live in a state that follows common law, the court will ultimately make the decision about who is responsible for what debt.
Pay off your debt before the divorce is finalized
Â If you and your spouse can find a way to work out the kinks of your debt issues before the divorce is finalized, itâll make things a lot easier in the long run. Work together to figure out who should be responsible for which debt, so that you can lower your chances of having to pay off a debt that isnât yours.
If youâre working with credit card debt, one of you may need to transfer your credit card balance to a separate card. Consolidating your credit card balances is another common option when dividing debts.
Generally, credit card debt is going to be easier to deal with than the big things, like home loans and car loans. In many cases, couples who are going through a divorce will have to consider refinancing their loans under one partyâs name.
Keep in mind that the original loan agreement supercedes the divorce agreement, so if you wait until your divorce is finalized, you might have a harder time moving things around. You can ask your lender to take your name off of an account and have it replaced with your former spouseâs name, but be prepared to provide the divorce decree as evidence. If it doesnât work out this way, then seek legal advice from your divorce attorney about your options. Another common solution is to sell the asset in question and use the earnings to pay off the debt.
How your former spouseâs bankruptcy can affect you
If your ex-spouse isnât able to keep up with the payments on their share of the debt, they might decide to file bankruptcy. This could cause problems for you if you didnât choose to file as well.
Filing for bankruptcy does not erase the debts, instead it erases your ex-spouseâs liability for the debt. In this instance, you could find yourself in a situation where the creditor is now pursuing you for the debt. Itâs also important that you check your credit report. Even if you werenât the one who filed bankruptcy, it could still end up on your credit report.
Be cautious about any joint accounts you may still have open post-divorce. If you leave joint accounts open and your former spouse has access to them, he or she could potentially transfer balances from other accounts onto those ones. Safeguard your credit by paying off any debts you can manage to pay off ahead of time, so that you donât have to worry about it later.
Marital Debt After Divorce: Who is Responsible? is a post from Pocket Your Dollars.
If you have bad credit and need a car loan, there are some challenges when compared to obtaining a standard car loan. However, pick your head up because there are a handful of great lenders that specifically tailor their programs to people with bad credit. We researched the landscape of lenders that can help you get a car loan even if you have a below-average credit score.
Based on our study, OneMain Financial and LightStream are two of the top lenders offering bad credit card loans. This is due to factors including loan options, requirements to qualify, and interest rates offered. Of course, we offer in-depth reviews of all the top lenders who offer bad credit car loans further down in this piece.
Apply now with our top pick: OneMain Financial
In this guide we also help you understand the factors that go into selecting the right auto lender, and how to get the best rate you can.
Most Important Factors for Bad Credit Car Loans
If youâre in the market for a bad credit car loan, there are a plethora of factors to consider and compare. Here are the main loan details we looked at in our study, and the ones you should prioritize as you select the best car loan for your needs.
Check your credit score. And understand what is in your credit report.
FICO scores under 579 is considered ‘poor’. But you may need a bad credit loan with a score as high as 669.
Interest rates and fees matter. These can make a huge difference in how much you pay for an auto loan each month.
Compare loan terms. Consider your repayment timeline and compare lenders with this in mind.
Getting prequalified online can help. Some lenders, including ones that made our ranking, let you get prequalified for a loan online without a hard inquiry on your credit report.
Watch out for loan restrictions. Some lenders impose restrictions on what car you can purchase. Keep this in mind to avoid unpleasant surprises later.
The Best Bad Credit Car Loans of 2021
The best bad credit car loans make it easy for consumers to qualify for the financing they need. The following lenders made our list due to their superior loan offerings, excellent customer service, and reputation in this industry.
Car Loan Company
Best for Flexibility
Best Personal Loan Option
Best Loan for Bad Credit and No Credit
Best Loan Comparison Site
Best Big Bank Loan for Bad Credit
Best for Fast Funding
Why Some Lenders Didn’t Make the Cut
While the lenders we are profiling are the best of the best, there are plenty of bad credit car loans that didnât quite make the cut. We didnât include any lenders that only offer auto loan refinancing, for example, since we know many people need a car loan in order to purchase a new or used car or truck. We also stayed away from bad credit car loans that charge outrageous fees for consumers with the lowest credit scores.
Bad Credit Auto Loan Reviews
We listed the top companies we selected in our study above, but we also aim to provide readers with more insights and details on each. The reviews below highlight the highlights of each lender that made our list, plus our take on who they might be best for.
OneMain Financial: Best for Flexibility
OneMain Financial offers personal loans and auto loans with interest rates that range from 18.00% to 35.99%. You can repay your auto loan in 24, 36, 48, or 60 months, and you can use this lender to borrow up to $20,000 for a new or used car. You can apply for your auto loan online and from the comfort of your own home, and itâs possible to get approved within a matter of minutes.
While OneMain Financial doesnât list a minimum credit score requirement, itâs believed they will approve consumers with scores as low as 600. You should also note that auto loans from OneMain Financial come with an origination fee of up to 5% of your loan amount.
Sign Up With OneMain Financial Today
Why This Lender Made Our List: OneMain Financial offers a lot of flexibility in terms of your loan terms, including the option to repay your auto loan over five years. OneMain Financial also has pretty decent reviews from users for a bad credit lender, and they have an A+ rating with the Better Business Bureau.
Potential Downsides to Be Aware Of: OneMain Financial charges some pretty high rates for its bad credit loans, and donât forget that you may need to pay an origination fee that is up to 5% of your loan amount. Their loans are also capped at $20,000, which means this lender wonât work for everyone.
Who Itâs Best For: This lender is best for consumers with really poor credit who need auto financing but canât get approved for a better loan.
Upgrade: Best Personal Loan Option
Upgrade is an online lender that offers personal loans with fixed interest rates, fixed monthly payments, and a fixed repayment timeline. You can borrow up to $50,000 in an unsecured loan, which means you wonât actually use the car you purchase as collateral for the loan.
You can repay the money you borrow over 36 to 60 months, which makes it possible for you to tweak your loan offer to secure a monthly payment you can afford. Upgrade has a minimum credit score requirement of 620 to qualify, although theyâll consider additional factors such as your income and employment history.
Sign Up With Upgrade Today
Why This Lender Made Our List: Upgrade lets you âcheck your rateâ online without a hard inquiry on your credit report. This makes it easy to shop around and compare this loan offer to others without having to fill out a full loan application. Also note that Upgrade has an A+ rating with the BBB.
Potential Downsides to Be Aware Of: Upgrade charges APRs as high as 35.89% for consumers with the worst credit, and an origination fee of up to 6% of your loan amount might also apply.
Who Itâs Best For: Upgrade is best for consumers with decent credit who need to borrow a larger loan amount. This loan is also best for anyone who wants an auto loan that isnât secured by their vehicle.
AutoCreditExpress.com: Best Loan for Bad Credit and No Credit
AutoCreditExpress.com is an online platform that lets consumers with bad credit and even no credit get the financing they need. Once you fill out some basic loan information, youâll be connected with a lender who can offer you financing as well as a dealership in your area. From there, youâll head to the local dealership and pull the pieces of your auto loan together, including the purchase price of the car you want.
Sign Up With Autocreditexpress.com Today
Why This Lender Made Our List: AutoCreditExpress.com has an A+ rating with the Better Business Bureau. This platform also makes it possible for consumers with no credit at all to finance a car, which is a welcome relief for people who are building credit for the first time.
Potential Downsides to Be Aware Of: This website is a loan platform but they donât offer loans directly to consumers. This means you wonât have any idea on rates and terms until you fill out an application and get connected with a lender.
Who Itâs Best For: This loan is best for consumers with no credit or minimal credit history who cannot get approved for a loan elsewhere.
MyAutoLoan.com: Best Loan Comparison Site
MyAutoLoan.com is a loan comparison site that makes it easy to compare up to four auto loan offers in a matter of minutes. You can use this website to apply for a new auto loan, but you can also utilize it to consider refinancing offers for an auto loan you already have. You can also use funds from this platform to purchase a car from a dealer or from a private seller.
Sign Up With MyAutoLoan.com Today
Why This Lender Made Our List: Comparing auto loans in terms of their terms, rates, and fees is the best way to save money and wind up with the best deal. Since MyAutoLoan.com is a loan comparison site, they make it easy to shop around and compare competing offers.
Potential Downsides to Be Aware Of: Loan comparison sites connect you with other lenders who have their own loan terms and minimum requirements for approval. Make sure you know and understand all the details of loans youâre considering before you sign on the dotted line.
Who Itâs Best For: MyAutoLoan.com is best for consumers who want to do all their auto loan shopping with a single website.
Capital One: Best Big Bank Loan for Bad Credit
Capital One offers online auto loan financing in conjunction with a program called Auto NavigatorÂ®. This program lets you get prequalified for an auto loan online, then work with a participating dealer to coordinate a loan for the car you want. Capital One also lets you search available vehicles at participating dealerships before you apply for financing, making it easy to figure out how much you might need to borrow ahead of time.
Sign Up With Capital One Today
Why This Lender Made Our List: Capital One offers the huge benefit of letting you get prequalified online without a hard inquiry to your credit report. Capital One is also a reputable bank with a long history, which should give borrowers some comfort. They have an A+ rating with the BBB and plenty of decent reviews from consumers.
Potential Downsides to Be Aware Of: You should be aware that Capital One auto loans only work at participating dealers, so you may be limited in terms of available cars to choose from.
Who Itâs Best For: Capital One auto loans are best for consumers who find a car they want to buy at one of the participating lenders that works with this program.
LightStream: Best for Fast Funding
LightStream offers online loans for a variety of purposes, including auto financing. Their auto loans for consumers with excellent credit start at just 3.99% with autopay, and even their loans for consumers with lower credit scores only run as high as 16.79% with autopay.
You can apply for your LightStream loan online and get approved in a matter of minutes. This lender can also send your funds as soon as the same business day you apply.
A minimum credit score of 660 is required for loan approval, although other factors like your work history and income are considered.
Sign Up With LightStream Today
Why This Lender Made Our List: LightStream offers auto loans with exceptional terms, and thatâs even true for consumers with less than perfect credit. You can also get your loan funded as soon as the same business day you apply, which is crucial if you need auto financing so you can get back on the road.
Potential Downsides to Be Aware Of: With a minimum credit score requirement of 660, these loans wonât work for consumers with the lowest credit scores.
Who Itâs Best For: LightStream is best for people with decent credit who need to get auto loan financing as quickly as possible.
What You Need To Know When Applying For A Car Loan With Bad Credit
Interest rates and fees matter.
If you think your interest rate and loan fees wonât make a big difference in your monthly payment, think again. The reality is that rates and fees can make a huge difference in how much you pay for an auto loan each month. Consider this: A $10,000 loan with an APR of 35.89% will require you to pay $361 per month for five years. The same loan amount at 21.99% APR will only set you back $276 per month. At 9.99%, you would pay only $212 per month for five years. The bottom line: Make sure to compare auto loans for bad credit so you wind up with the lowest possible APR you can qualify for.
Take steps to improve your credit score before you apply.
Itâs not always possible to wait to apply for a car loan, but you may be able to secure a lower interest rate and better loan terms if you can improve your credit score before you borrow money. The most important steps you can take to improve your score include paying all your bills early or on time, as well as paying down debt in order to decrease your credit utilization. You should also refrain from opening or closing too many credit card accounts in order to avoid new inquiries on your credit report and maintain the longest average length of your credit history possible.
Compare loan terms.
Some lenders let you borrow money for up to 84 months, while others let you repay your loan over 36 or 60 months at most. If you need to repay your loan over a longer timeline in order to secure an affordable monthly payment, make sure to compare lenders based on this factor. If youâre having trouble figuring out how much can you can afford, gauging affordability based on the monthly payments you can handle can also help in that effort.
Getting prequalified online can help.
Some lenders, including ones that made our ranking, let you get prequalified for a loan online without a hard inquiry on your credit report. This makes it considerably easier to compare rates and shop around without formally applying for an auto loan. Getting prequalified with more than one lender can also help you determine which one might offer the lowest rate without having to fill out a full loan application.
Watch out for loan restrictions.
As you compare the lenders on this list, keep in mind that not all lenders extend loans for any car you want. Some only let you finance cars with participating lenders in their network, which can drastically limit your options and make it impossible to purchase a car from a private seller. If you hope to purchase a car from someone you know or a website like craigslist.org, you may want to consider reaching out to your personal bank or a credit union you have a relationship with.
Bad credit car loans donât have to be forever.
Finally, you should know that a car loan for bad credit doesnât have to last forever. You may need to borrow money for a car right now regardless of the interest rate and terms you can qualify for, but it may be possible to refinance your loan into a better loan product later on. This is especially true if you focus on improving your credit score right away, and if you use your auto loan as an opportunity to prove your creditworthiness.
How to Get the Best Rate
1. Check your credit score.
Your credit score is one of the most important defining factors that dictate loan costs. Before you apply for an auto loan, it can help you check your credit score to see where you stand. Your score may not be as bad as you realize, but it could also be worse than you ever imagined. Either way, it helps to know this important information before you start shopping for an auto loan.
2. Improve your credit over time.
If your credit score needs work, youâll want to take steps to start improving it right away. The most important steps you can take to boost your credit score include paying all your bills early or on time and paying down debt to decrease your credit utilization. Also, make sure youâre not opening or closing too many credit accounts within a short amount of time.
3. Check your credit reports.
Use the website AnnualCreditReport.com to get a free copy of your credit reports from all three credit bureaus. Once you have this information, check over your credit reports for errors. If you find false information that might be hurting your score, take the steps to have the incorrect information removed.
4. Compare loan offers from at least three lenders.
A crucial step to get the best rate involves shopping around and comparing loan offers from at least three different lenders. This is important since lenders with different criteria might offer a lower APR or better terms than others.
5. Be flexible with repayment terms.
Also consider a few different loan terms provided you can afford the monthly payment with each. Some auto lenders offer better rates for shorter terms, which can help you save money if you can afford to repay your loan over 24 or 36 months instead of 60+.
How We Chose the Best Auto Loans
The lenders on our list werenât plucked out of thin air. In fact, the team behind this guide spent hours comparing auto lenders based on a wide range of criteria. Hereâs everything we considered when comparing the best bad credit car loans of 2021:
Interest Rates and Loan Terms: Our team looked for loans that offer reasonable rates and terms for consumers with poor credit. While higher APRs are typically charged to consumers with a low credit score, we only considered lenders that offer sensible rates that donât seem out of line for the auto loan market.
Ratings and Reviews: We gave preference to lenders who have decent reviews online, either through Consumer Affairs, Trustpilot, or another third party website. We also gave higher marks to lenders who have a positive rating with the Better Business Bureau (BBB).
Online Availability: Lenders who offer full loan details online were definitely given top priority in our ranking, and lenders who let you get prequalified online without a hard inquiry on your credit report were given the most points in this category. But since not everyone wants to apply for a loan online, we also included some lenders that let you apply over the phone.
Approval Requirements: Finally, we looked for lenders that extend credit to consumers with low credit scores in the first place. Not all lenders offer specific information on approval requirements, but we did our best to sort out lenders that only accept borrowers with good or excellent credit.
Summary: Best Bad Credit Card Loans of 2021
Best for Flexibility: OneMain Financial
Best Personal Loan Option: Upgrade
Best Loan for Bad Credit and No credit: AutoCreditExpress.com
Best Loan Comparison Site: MyAutoLoan.com
Best Big Bank Loan for Bad Credit: CapitalOne
Best for Fast Funding: LightStream
The post What Are the Best Car Loans When You Have Bad Credit? appeared first on Good Financial CentsÂ®.
Since the National Consumer Assistance Plan went into effect in 2017, public records must meet strict requirements in order to appear on consumer credit reports. Civil judgments and tax liens do not meet these new requirements, so they were removed from credit reports. At this point, the only derogatory public record that should appear on your credit report is bankruptcy. If a tax lien or civil judgment still appears on your credit report, you should dispute that record with the credit reporting agencies.
How Much Do Public Records Affect Credit Scores?
Bankruptcy can cause a FICO score to drop by 200 points or more. A filing may lower credit scores for seven to 10 years and be difficult to remove from a credit report unless any information is inaccurate.
The decision to exclude other public records slightly increased FICO scores for many consumers and resulted in increases of 20 to 40 points in some cases.
Bankruptcies and Your Credit Report
Bankruptcies are the one public record that are still included on your credit report. In most cases, they will remain on your report for seven to 10 years.
You can dispute an inaccurate report of bankruptcy or one being reported beyond the statute of limitations. Review your report for any inaccuracies and contact the credit bureaus to dispute inaccuracies if need be. If a credit bureau claims to have court verification of a bankruptcy, you should send a procedural letter to determine how they verified the public record on credit report. Follow up with the courts to determine whether the bankruptcy was actually verified.
âªÂ Learn more about when and why you should file bankruptcy and how doing so will affect your credit.
Civil Judgments and Your Credit Report
Civil judgments result when a creditor sues you for an outstanding debt and wins. That creditor then has more avenues for pursuing payment: they may now satisfy delinquent or outstanding debt through wage garnishment or by seizing funds from checking or savings accounts.
Judgments are no longer factored into credit scores, though they are still public record and can still impact your ability to qualify for credit or loans. Lenders may still check to see whether any outstanding judgments against a potential borrower exist. You should pay legitimate judgments and dispute inaccurate judgments to ensure these do not affect your finances unduly.
âªÂ Learn more about how to deal with civil judgments.
If a civil judgment is still on your credit report, file a dispute with the appropriate credit reporting agencies to have it removed.
Tax Liens and Your Credit Report
Tax liens are filed by the IRS when you donât pay your taxes. A lien is automatically filed when you owe more than $10,000. When the IRS files a tax lien against you, it essentially gives the agency first dibs on any payment you receive from selling or liquidating your assets to pay your debts.
While tax liens are no longer reported on credit reports, they can significantly impact your financial situation in ways that indirectly affect your credit score.
âªÂ Learn more about tax liens.
If a tax lien is being reported on your credit report, file a dispute.
How to Deal with Derogatory Public Records
Although judgments and tax liens are no longer filed on credit reports or factored into credit scores, these penalties can undermine your financial standing. If a derogatory public record is filed against youâ you should monitor the effects on your credit and ensure that information pertaining to your filing is accurate.
Check your reports regularly to ensure they are fair, accurate and up-to-date. You can watch for changes by getting your free Credit Report Card and credit score monitoring from Credit.com.
âªSign up now!
The post What Does Having a Derogatory Public Record on My Credit Report Mean appeared first on Credit.com.
In a recession itâs common for many people to rely on credit cards and loans to balance their finances. Itâs the ultimate catch-22 since, during a recession, these financial products can be even harder to qualify for.
This holds true, according to historical data from the Federal Reserve Bank of St. Louis. It found that during the 2007 recession, loan growth at traditional banks decreased and remained deflated over the next four years.Â
Credit can be a powerful tool to help you make ends meet and keep moving forward financially. Hereâs what you can do if youâre struggling to access credit during a weak economy.
Lending becomes riskier in a weak economy. Does this mean youâre completely out of luck if you have bad credit? Not necessarily, but you might need to take the time to understand all of your alternatives.
How Does a Financial Downturn Affect Lending?
Giving someone a loan or approving them for a credit card carries a certain amount of risk for a lender. After all, thereâs a chance you could stop making payments and the lender could lose all the funds you borrowed, especially with unsecured loans.
For lenders, this concept is called, âdelinquencyâ. Theyâre constantly trying to get their delinquency rate lower; in a booming economy, the delinquency rate at commercial banks is usually under 2%.
Lending becomes riskier in a weak economy. There are all sorts of reasons a person might stop paying their loan or credit card bills. You might lose your job, or unexpected medical bills might demand more of your budget. Because lenders know the chances of anyone becoming delinquent are much higher in a weak economy, they tend to restrict their lending criteria so theyâre only serving the lowest-risk borrowers. That can leave people with poor credit in a tough financial position.
Before approving you for a loan, lenders typically look at criteria such as:
Co-signers, if applicable
Down payment size (for loans, like a mortgage)
Does this mean youâre completely out of luck if you have bad credit? Not necessarily, but you might need to take the time to understand all of your alternatives.
5 Ways to Help Get Your Credit Application Approved
Although every lender has different approval criteria, these strategies speak to typical commonalities across most lenders.
1. Pay Off Debt
Paying off some of your debt might feel bold, but it can be helpful when it comes to an application for credit. Repaying your debt reduces your debt-to-income ratio, typically an important metric lenders look at for loans such as a mortgage. Also, paying off debt could help improve your credit utilization ratio, which is a measure of how much available credit youâre currently using right now. If youâre using most of the credit thatâs available to you, that could indicate you donât have enough cash on hand.
Not sure what debt-to-income ratio to aim for? The Consumer Financial Protection Bureau suggests keeping yours no higher than 43%.
For those with poor credit, a trusted cosigner can make the difference between getting approved for credit or starting back at square one.
When someone cosigns for your loan theyâll need to provide information on their income, employment and credit score â as if they were applying for the loan on their own. Ideally, their credit score and income should be higher than yours. This gives your lender enough confidence to write the loan knowing that, if you canât make your payments, your cosigner is liable for the bill.
Since your cosigner is legally responsible for your debt, their credit is negatively impacted if you stop making payments. For this reason, many people are wary of cosigning.
In a recession, it might be difficult to find someone with enough financial stability to cosign for you. If you go this route, have a candid conversation with your prospective cosigner in advance about expectations in the worst-case scenario.
3. Raise Your Credit Score
If your credit score just isnât high enough to qualify for conventional credit you could take some time to focus on improving it. Raising your credit score might sound daunting, but itâs definitely possible.Â
Here are some strategies you can pursue:
Report your rent payments. Rent payments arenât typically included as part of the equation when calculating your credit score, but they can be. Some companies, like Rental Kharma, will report your timely rent payments to credit reporting agencies. Showing a history of positive payment can help improve your credit score.Â
Make sure your credit report is updated. Itâs not uncommon for your credit report to have mistakes in it that can artificially deflate your credit score. Request a free copy of your credit report every year, which you can do online through Experian Free Credit Report. If you find inaccuracies, disputing them could help improve your credit score.Â
Bring all of your payments current. If youâve fallen behind on any payments, bringing everything current is an important part of improving your credit score. If your lender or credit card company is reporting late payments a long history of this can damage your credit score. When possible speak to your creditor to work out a solution, before you anticipate being late on a payment.
Use a credit repair agency. If tackling your credit score is overwhelming you could opt to work with a reputable credit repair agency to help you get back on track. Be sure to compare credit repair agencies before moving forward with one. Companies that offer a free consultation and have a strong track record are ideal to work with.
Raising your credit isnât an immediate solution â itâs not going to help you get a loan or qualify for a credit card tomorrow. However, making these changes now can start to add up over time.
4. Find an Online Lender or Credit Union
Although traditional banks can be strict with their lending policies, some smaller lenders or credit unions offer some flexibility. For example, credit unions are authorized to provide Payday Loan Alternatives (PALs). These are small-dollar, short-term loans available to borrowers whoâve been a member of qualifying credit unions for at least a month.
Some online lenders might also have more relaxed criteria for writing loans in a weak economy. However, you should remember that if you have bad credit youâre likely considered a riskier applicant, which means a higher interest rate. Before signing for a line of credit, compare several lenders on the basis of your quoted APR â which includes any fees like an origination fee, your loanâs term, and any additional fees, such as late fees.
If youâre trying to apply for a mortgage or auto loan, increasing your down payment could help if youâre having a tough time getting approved.
When you increase your down payment, you essentially decrease the size of your loan, and lower the lenderâs risk. If you donât have enough cash on hand to increase your down payment, this might mean opting for a less expensive car or home so that the lump sum down payment that you have covers a greater proportion of the purchase cost.
Loans vs. Credit Cards: Differences in Credit Approval
Not all types of credit are created equal. Personal loans are considered installment credit and are repaid in fixed payments over a set period of time. Credit cards are considered revolving credit, you can keep borrowing to your approved limit as long as you make your minimum payments.
When it comes to credit approvals, one benefit loans have over credit cards is that you might be able to get a secured loan. A secured loan means the lender has some piece of collateral they can recover from you should you stop making payments.
The collateral could be your home, car or other valuable asset, like jewelry or equipment. Having that security might give the lender more flexibility in some situations because they know that, in the worst case scenario, they could sell the collateral item to recover their loss.
The Bottom Line
Borrowing during a financial downturn can be difficult and it might not always be the answer to your situation. Adding to your debt load in a weak economy is a risk. For example, you could unexpectedly lose your job and not be able to pay your bills. Having an added monthly debt payment in your budget can add another challenge to your financial situation.
However, if you can afford to borrow funds during an economic recession, reduced interest rates in these situations can lessen the overall cost of borrowing.
These tips can help tidy your finances so youâre a more attractive borrower to lenders. Thereâs no guarantee your application will be accepted, but improving your finances now gives you a greater borrowing advantage in the future.
The path to owning my own business started around 10 years ago. I graduated from high school and went on to college for business. I graduated, got a job as a financial analyst, and then around five years ago, completed my MBA with an emphasis in Finance.
It seemed like a logical path – graduate from high school, go to college, get a job in that field, and then get my MBA to further my career opportunities.
It was the path I fell into, and I never really gave it a second thought. For my MBA, I figured I needed it in order to be successful in the corporate finance world.
However, I’m now a full-time blogger.
One of the questions I’m often asked is if I regret going to school for so many college degrees (3). After all, it took a lot of time and led to a significant amount of debt.
I definitely did not learn a thing about blogging back in college, and an MBA isn’t 100% focused on the topic of starting your own specific business, especially a niche one. Plus, I did not get my MBA thinking that I would be starting my own business. I went for it to better my career opportunities.
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According to the U.S. Small Business Administration, there are 28.8 million small businesses in the United States, which make up 99.7% of all U.S. businesses. And, a huge number of the population are starting their own business and working for themselves.
But, does that mean they all need or have an MBA?
Remember, an MBA is not required when starting your own business. But, does that mean that those without an MBA do better or worse?
I researched to see what the value of an MBA is, and I was able to find a great chart from the U.S. Bureau of Labor Statistics about unemployment rates and earnings by educational attainment for 2016.
This data shows earnings for full-time wage and salary workers, but it doesn’t specify those who have started their own business. However, it does show that there is some value in a Master’s degree.
According to this chart, the unemployment rate is much lower for those with one or multiple college degrees. The median usual weekly earnings tends to increase as well.
However, according to a report released by the Harvard Business Review, most of the top business leaders in the world actually do NOT have MBAs. In fact, only 29 of the 100 best companies had executives with MBAs, and less than half of those received their MBA from an elite business school (think Harvard, Stanford, etc.).
Here’s a short list from Business Insider’s Top 100 Entrepreneurs Who Made Millions Without A College Degree:
Walt Disney, founder of the Walt Disney Company, dropped out of high school at 16.
Richard Branson, billionaire founder of Virgin Records, Virgin Atlantic Airways, Virgin Mobile, and more. He also dropped out of high school at 16.
Rachael Ray, Food Network cooking show star, food industry entrepreneur, with no formal culinary arts training. She never attended college.
Michael Dell, billionaire founder of Dell Computers, started his business out of his college dorm room, but he later dropped out of college.
Larry Ellison, billionaire co-founder of Oracle software company. Ellison actually dropped out of two different colleges.
However, there are also many successful people who do have MBAs, such as Elon Musk, Michael Bloomberg, Sheryl Sandberg, and Dr. Oz.
So, should you get an MBA if you want to start your own business?
MBAs can be expensive.
An MBA can cost anywhere from $5,000 to well over $100,000 depending on what college you attend.
And, according to Poetsandquants.com, the cost of obtaining your MBA continues to rise.
New York University’s Stern School of Business costs over $200,000, Harvard Business School has a total two-year cost to $204,640, and Stanford University’s Graduate School of Business costs $210,838.
That is a TON of money in order to get your MBA.
I went to a moderately priced state university and received my MBA, and I think that it was a great value. However, if I had to pay over $200,000 to receive my MBA, I don’t know if it would be worthwhile. That’s a lot of money for not much real world experience that can be applied to a specific business idea.
And, let’s not forget about the amount of time it can take to receive your MBA.
For some students, they focus on their MBA full-time, which means that they aren’t bringing in an income, or they are bringing in significantly less than needed to sustain most living expenses. Some MBA students do work full-time, but they usually take a smaller course load.
I worked on my MBA full-time and worked full-time, which meant that I didn’t have time for pretty much anything else in life.
Plus, if you know that you want to start a business, the time it takes to get an MBA can make that goal that much farther away.
An MBA surrounds you with other determined people.
By earning your MBA, you’ll most likely be surrounded by a network full of people who are wanting to succeed in the business world.
This can help you build your future business idea, gain contacts that may help you and your business later on, and more.
I always say that networking is extremely important, and an MBA can definitely help you in that area.
An MBA won’t specifically teach you about the business you want to start.
An MBA will give you a pretty well rounded background on business in general. However, it won’t teach you everything you need to know about starting and sustaining your specific business plan.
This means that you will probably have to learn how to start your specific business elsewhere, such as researching your ideas and business plans outside of your MBA program.
For example, if you want to start a blogging business, you most likely won’t learn anything about a blogging while earning your MBA. The same goes for many other business ideas as most MBAs aren’t really focused on specific markets.
What they do offer is a good background on the actual “business” side of starting your own business, as discussed below.
You do learn about business, though.
While earning an MBA is more about business theory, it still offers you a lot of background information that can help you create your own business.
Through my MBA and the career I had as an analyst, I learned about business accounting, business law, managing a business, economics, business finances, marketing, advertising, and more. These are all things you should know about when running your own business. Sure, you can outsource a lot of these tasks, but for most start-ups, you may personally have to take on many of these tasks, especially in the beginning.
My analyst position also taught me a lot about running a profitable business, since I dealt with successful business owners every day.
There are a lot of times that my education and work experience have helped me run my own business. And, I am extremely grateful because it has helped me run my business extremely well.
According to Investopedia, around 30% of new businesses fail during the first two years of being open, 50% during the first five years, and 66% during the first 10 years.
Some of the reasons for failure that are cited in the above article include:
Business owners not investigating the market.
Business owners have problems with their business plan.
A bad location, bad internet presence, and bad marketing for the business.
These are all things that are taught, in general, when working on your MBA, which can be great background knowledge for someone wanting to start their own business.
What about real experience?
I believe that real experience is the best. However, with an MBA, you can receive a well rounded education that can help you to launch a successful business.
You can learn how to manage a team, understand business specific finances, research the best business plan, and more.
When put together with real experience, I think that an MBA can be a great learning tool.
Does that mean that everyone should get their MBA?
No. Everyone is different, but I do believe that my MBA has helped me manage my own business.
What do you think? Should a person who wants to start a business get their MBA? If you’re already a business owner, do you have one? Why or why not?
The post Should you get an MBA if you want to start your own business? appeared first on Making Sense Of Cents.
Deia Schlosberg had been working as an environmental educator, teaching students about issues concerning conservation and sustainability. While she loved teaching, she wanted to reach people on a larger scale about the importance of protecting the environment. So she decided to follow her dream of becoming a filmmakerâa dream that would require her to return to school for a graduate degree. She had no idea at the time that it would lead to becoming an award-winning documentarian.
While Schlosberg’s choice may have paid off, learning how to pay for grad school as a working adult can be a challenge. There are various benefits to getting an advanced degree: You can learn more, you can earn more, you can further advance in your current job or prepare for a career change. However, you might also find yourself stressed by the expense and resulting debt of it all, especially if you have kids, a home or other financial commitments. So a big question on your mind could be, “How much should I save for grad school?”
Below are some lessons on how to financially prepare for grad school to help you determine if and when you should go back to school. If you haven’t yet decided if graduate school is right for you, see section 1 for tips on how to decide. If you already know you want to go back to school, skip to section 2.
1. Decide if going back to school is right for you
Getting an advanced degree may seem like a ticket to success, but depending on your chosen area of study, the outcome may vary. For Schlosberg, it was a bit of a risk. It can be difficult to get a break in the film industry, and going to grad school could mean carrying around debt for a long time. Is this the type of outcome you would be willing to accept?
According to Emma Johnson, best-selling author, career consultant and founder of Wealthysinglemommy.com, there are a few things you can do to help you decide whether or not going back to school is right for you:
Do your homework. When considering how to pay for grad school as a working adult, research your degree options and the jobs to which they might lead. Compare cost and compatibilityâfor instance, will classes for the program align with your work schedule? Once you’ve determined what kind of occupation you may pursue after grad school, search online for information about that occupation’s average earnings.
Solidify your goals. You may find clarity in writing out your goals for going back to school. Some benefits are tangible, like earning more money, building a professional network and gaining skills. Others might be less tangible, such as finding personal fulfillment. Once you know your goals, it will be easier to determine if a graduate degree makes personal and professional sense.
“Your savings should not only depend on tuition but also what the degree isâi.e., how easy it will be to repay once you are working in the desired field.”
Give your degree program a test run. Consider taking classes that relate to the degree you are interested in getting in grad school. These classes can give you a taste of the subject matter you’ll be studying and help you meet people involved in the field. Also, if prerequisites are required for your advanced degree, they often cost less online or at a community college, which is important to remember when thinking about how to prepare your finances before grad school. Make sure the course credits will be accepted at the graduate school you plan to attend.
Take a hands-on approach. To level up in your existing career or find out what it’s like in a new field before making the change, get some work-related experience first. For instance, to learn more about moving up in your own field, get out and meet those higher level professionals by attending conferences and networking events. The same tactic applies if you want to change careers.
2. Know how much you need to save
How to pay for grad school as a working adult can be complicated, but you’ve decided you’re ready for it. Plus, hitting the books at a time when saving for retirement or your child’s education could be at the forefront makes the task of how to prepare your finances before grad school even more critical.
Figuring out how much to save for grad school begins with determining the cost of attendance. Here are a couple ways to do that, according to Johnson:
Do the research. Once you have found a school and degree that you like, visit the school’s web site. Some schools may provide the cost of tuition, fees and estimated costs for books, supplies and transportation. Costs can vary tremendously, depending on various factors: whether you attend full or part time, whether you attend a public or private school, whether you are an in-state or out-of-state resident and the time it takes to get your degree.
Determine your budget. Once you have a handle on the school-related costs, build a spreadsheet that accounts for these costs and projects monthly income and living expenses. Working through a savings plan beforehand can help you financially prepare for grad school by showing just how much you’ll need to budget for monthly on tuition plus living expenses. Once you determine these factors, you’ll get a better idea of what you need to save up.
Create a savings buffer. After you determine your monthly costs, pad that number. “Your savings should not only depend on tuition but also what the degree isâi.e., how easy it will be to repay once you are working in the desired field,” Schlosberg says. She saved a little more than she estimated, giving herself an extra cushion to cover some of the potential risk to her finances.
“You may have to downscale your career and current lifestyle to go back to school, which may be a worthwhile investment of time and resources.”
3. Allow yourself a flexible timeline
One key factor in planning the timeline for earning your graduate degree: Don’t be in a rush. If you need to, create the time to save. It may not be necessary to go back to school full time or finish on a particular schedule, Johnson says. She mentions these possible paths to earning your degree when planning how to pay for grad school as a working adult:
Consider a side hustle. One option is to go to school full time and take on a side hustle. You may not make as much as you did as a full-time employee, but the income can complement your savings. It may also allow you to concentrate more on your degree and finish faster.
Attend part time. Go to school part time (nights and weekends) while working. It will take longer, but it will also minimize your debt, which could be better in the long run.
Take it slowly. Only sign up for a class or twoâwhatever you can affordâand continue to work. This part-time “lite” approach may take even longer, but could help you avoid overextending yourself financially or sliding into debt.
Take online classes. Consider online programs that could lower the cost of tuition and allow you to continue working full time.
4. Take advantage of potential cost-saving benefits
So you’ve done your research on how much you need to save while determining how to prepare your finances before grad school. But there are ways to potentially cut or eliminate some of those costs. What comes next are some solutions that may help pay your grad school bills:
Consider loans, financial aid and scholarships. “I took out some student loans for living expenses, but I tried to pay off my tuition as I went by working through school,” Schlosberg says. Graduate students may also be eligible for different types of scholarships and grants, which is aid that does not need to be paid back. Depending on your area of study, scholarships and grants can also be obtained through federal and state organizations, private foundations, public companies and professional organizations.
Ask your employer to pay the tuition. One way to financially prepare for grad school is to talk to your manager or human resources representative to find out if your current employer would help pay for, or fully fund, your degree through tuition reimbursement. This is most likely if you plan to move up the ladder and use your new skills on behalf of the company.
Take advantage of in-state tuition. Some people move to the same state as their desired school to try to get a break on tuition. “I moved to Montana and worked a couple jobs for a year before applying so I could get in-state tuition,” says Schlosberg. Whether you are already a resident or you move to a new state, be sure to determine how long you need to be a resident to qualify for in-state tuition at your desired university.
Cut back on discretionary expenses. Seemingly small things like adjusting your lifestyle to lower your monthly costs, which could mean fewer lattes and dinners out, might go a long way in resolving how to prepare your finances before grad school. “You may have to downscale your career and current lifestyle to go back to school, which may be a worthwhile investment of time and resources,” Johnson says.
Financially prepare for grad school and get a new start
Answering the question of how to pay for grad school as a working adult requires significant research and preparation, but some say it’s worth it, including Schlosberg. It not only gave her a whole new start, but a wealth of knowledge going forward to nurture her future endeavors. “Getting a graduate degree gave me the confidence to jump into a new career. I met an amazing network of people,” Schlosberg says.
But an advanced degree may not be a necessity. While it could look impressive on a resume, for many employers, a master’s degree is not a requirement. “Whatever you do, don’t go back to school just for the sake of getting a degree,” Johnson says. When thinking about how to financially prepare for graduate school, make sure it fits into your financial picture and that you’re able to âweigh your sacrifices against future gains,” she says.
The post Hitting the Books Again? Here’s How to Financially Prepare for Grad School appeared first on Discover Bank – Banking Topics Blog.
Credit cards, interest rates, loans, even where you liveâthese all depend on your credit score. If you have a good credit score, youâre more likely to get better financial offers. But if you have a low or nonexistent score, the chances of getting prime financial offers are pretty slim.
If you have low or nonexistent credit, improving your credit can seem almost impossible. Because you donât qualify for the best financial offers, you canât get the opportunities you need to bump up your credit. Plus, youâll probably find yourself paying a lot more interest than youâd like.
This might feel like a no-win situation. But thereâs good newsâthere are alternatives to building credit besides credit cards. Those with poor or nonexistent credit can have the opportunity to build up their scores. Learn about good credit scores and how you can work to get your rating in that range.
What Is a Good Credit Score?
If youâre completely unfamiliar with credit, itâs time to learn where your credit score stands. Hereâs the breakdownâcredit scores range between 300 and 850. According to Experian, an average credit score for Americans is around 675.
Credit scores are ranked as bad, poor, fair, good or excellent. Experianâs numbers are based on a model called VantageScore. The VantageScore model is broken down to the following:
FICO scores are based on a slightly different model with a range of 300 to 850. The average FICO score in 2018 was 704. For FICO ratings, a good or excellent score is above 740. Hereâs the breakdown of FICO Score ratings:
Very good: 740-799
Very Poor: 300-579
How to Build Low or Nonexistent Credit
It is possible to get a credit card for bad credit. But youâll find that theyâll either have no rewards, higher interest rates or both. These are worth looking into, but you might want to consider other methods before you commit to a credit card. Here are some great options for building your credit scoreâthat arenât getting a credit card.
1. Get a CreditStrong Account
In a frustrating turn of events, building or rebuilding credit often requires that you have some credit to begin with. Thatâs where credit builder loans, such as the ones provided by CreditStrong, come in handy. Credit builder loans allow you to take out a loan without a hard credit pull. The money is placed in a locked savings account to secure the loan.
Once you make the required payments, the savings account is unlocked and you gain access to the funds. In the meantime, you get up to 24 months of positive payment reports to the credit bureaus, helping to build your score.
Each loan payment you make will be reported to all three credit bureaus each month, which will help build your credit history. Because 35% of your credit score is based on payment history, making on-time payments towards a CreditStrong account can improve your score.
2. Try Experian Boost
You already know that payment history makes up 35% of your credit score. Experian knows that, too. Thatâs why they launched Experian Boost earlier this year. This program allows you to include both your cell phone and utility payments in the calculation of your credit score.
Worried that youâll miss a payment or two? Missed payments will typically harm your credit score, but Experian only counts the payments youâve made on time. That means that any bill you donât pay on time wonât harm your score. While you should try to pay your bills on time, this is a life-saver if you accidentally slip up on a payment or two.
3. Improve Your Credit with Rent Track
When you have a low credit score, any payment you continually make on time helps. RentTrack is a great rent reporting tool that will track your rent payments, therefore helping you build your score. RentTrack is often used by property management companies, letting their tenants pay rent online.
How does this help your credit score? When you pay your rent, RentTrack offers to report your payments to all three major credit bureaus. If you choose to do, every payment you make will show up on your credit report. Make your payments on time, and youâll watch your credit score increase over time.
The post 3 Ways to Build Credit if You Can’t Get a Credit Card appeared first on Credit.com.
If the kitchen is the heart of the home, what does it say when yours is falling apart? Outdated fixtures, old appliances, or a dysfunctional layout might have you daydreaming about a full kitchen renovationâbut how much will it cost to remodel your kitchen?
Before you begin your kitchen remodel, you might want to consider why youâre remodeling, how much work it will require, when youâll schedule the renovations, and how youâre going to pay for it all, not to mention the obvious: if, ultimately, it will add value to your home.
Why Should I Remodel My Kitchen?
Zillow Housing Aspirations Report , 76 percent of Americans said theyâd prefer to spend on upgrading their home rather than using the money as a down payment for a new home.
Homeowners remodel for different reasons, but itâs important to consider the cost, have discussions with your spouse or partner around the kitchen table, and evaluate what the average return on the kitchen remodel will be before diving into plans or spending a large portion of your overall home renovation budget.
Do you plan to live in your place a few more years and enjoy your new kitchen, or strategically upgrade for a more appealing home sale in the near future? The answer will probably influence where and how you spend money on your kitchen.
What is the Average Return on a Kitchen Remodel?
The truth is you may have a difficult time recouping the total cost of a kitchen remodel in a home sale. When it comes to making money off of a kitchen remodel, the best bang for your buck may be less costly but visually impactful minor renovations: things like replacing the fronts of cabinets, upgrading countertops, replacing fixtures like faucets or lights, repainting, or putting in new flooring.
According to Remodeling Magazineâs Cost vs. Value Report 2020 , the national average return on investment (ROI) for that work is approximately 78%. An upscale remodel, on the other hand, yields a 53.9 percent ROI on average.
If youâre looking at a kitchen renovation solely to add value to your home in a sale, you might want to consider other upgrades that are higher in return and lower in cost, as well. In a Zillow survey , 58 percent of buyers said having their preferred style of kitchen was âextremely or very important to their home-buying decision.â Thus, if youâre considering selling your home in the near future, small, strategic updates instead of a full-blown kitchen remodel could potentially help the sale of the home.
How Much Should I Spend on a Kitchen Remodel?
The budget for your remodel will vary widely based on the amount of work you want done and the quality and cost of the materials you choose. On average, homeowners spend between around $22,000 for a minor kitchen remodel up to $116,000 for an upscale kitchen remodel. With such a wide range to consider, it might be wise to think about what your budget is before calling in contractors.
Consider what overall changes you want to make to your space. Will the kitchen remodel be a simple update of appliances, or do you want to change the entire layout and design?
Once you have an idea of what you want in mind, consider how to budget for it. What items or updates are must-haves in your kitchen remodel? What could be removed if the tally for your overall kitchen renovation ends up being too pricey? A prioritized list of updates or changes with the estimated cost for each project attached can be a helpful guide when trying to stay on budget within a certain price range.
Deciding how much you want to spend on your remodel is entirely up to you. If youâre looking for guidelines, HGTV recommends spending between 6 and 10 percent of the value of your home to get the best ROI.
But even the best planned budgets might go awry, so including a line item in your budget for unexpected expenses can help down the line. Use our Home Improvement Cost Calculator to get an idea of how much your kitchen remodel will cost.
Where Can I Cut Costs Remodeling My Kitchen?
If youâre trying to keep costs down on your kitchen remodel, keep in mind that certain design choices are likely to drive the budget up. In a full-scale kitchen remodel, new kitchen cabinets are typically the biggest expense, generally accounting for 20 to 40 percent of the project budget. If youâre looking to cut expenses in your kitchen remodel, you might consider trying to refinish or reface your existing cabinets, as well as adding new hardware for a more modern look.
10 to 12 weeks ; however, note thatâs simply an expectation. The reality could be very different, and the time of year will also come into play.
A recent kitchen remodel can be a big selling point for potential buyers if you intend to sell your house in the next few years. Renovating your kitchen also can be a way to add functionality to a home you plan to live in for years to come.
When beginning the process of plotting out your kitchen remodel, set a budget and prioritize what facets are most important to you. Look at the average return on a kitchen remodel investment and also consider how much of the work you potentially can attempt yourself versus what youâll need to hire a contractor to do.
While cabinet finishes, new appliances, and fresh countertops can be exciting, setting aside a budget often is not. If it looks like your ambitions could outspend your budget, you might consider taking out a personal loan.
Personal loans from SoFi have low interest rates available for those who qualify, and offer fixed monthly payments. These 100% fee-free unsecured loans might be just the recipe to getting your perfect kitchen.
Find out more about using a SoFi personal loan to update your kitchen.
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