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Repair Credit with Debit Card

Posted on by DRA

Unfortunately, there isn’t a magic wand for credit repair. If you’ve been hit with collection accounts, bankruptcy, foreclosures, or liens- there isn’t a quick fix. The only way to erase these negative marks is to wait for them to expire after seven to ten years. However, that doesn’t mean that you can’t get credit or work towards improving your credit score.
Repair Credit with Debit CardBe aware that you’ll probably be categorized as a subprime consumer, meaning that you’re considered to be a high-risk candidate. Not all lenders work with subprime consumers. Those that do, almost always charge higher interest rates and fees as well as limit the loan amount you qualify for.

Secured credit cards are a great way to repair credit. Unlike a typical credit card, secured credit cards act more like a debit card. For example, you give the lender a cash deposit for $100 and in exchange you get a credit card with a $100 limit. That way, if you default on the monthly payment, the lender can use the deposit you provided to cover the expense. Typically, secured credit card lenders charge high interest rates and hefty administration fees- that’s how they’re able to operate within the subprime consumer market. So, you don’t want to have these cards forever, but they do offer a great way to rebuild your credit history.

*There is an entire industry of scam artists out there preying on people with bad credit. These fraudulent companies offer services promising to clean up your credit reports. They charge outrageous fees that range from $40 to upwards of several hundred dollars per month. And, basically all they’re doing is sending dispute letters to the three major credit bureaus. Don’t fall into their trap- save your time and money and avoid these useless programs all together.

The Breakdown of Prepaid Debit Cards

Prepaid debit cards can provide a great solution for anyone with bad credit wishing to help improve their credit rating, have access to balance their funds online, and make purchases virtually anywhere in the world.

Prepaid debit cards have all the advantages of a traditional check card, without any of the fees and require no credit check to be approved. Prepaid debit cards usually charge a small fee (approximately $10) to activate your account or debit card. Then once the card is activated, customers can load funds onto their debit card as often as they would like for a surcharge fee of (under $5) or for free, at various retail locations. The amount uploaded then acts like a line of credit, allowing you to make transactions anywhere your debit card company (usually Visa or MasterCard) is accepted.

To avoid money uploading fees, prepaid debit cards allow employers to directly deposit funds onto your card without a fee. And as a bonus for linking your direct deposit with your prepaid debit card, your debit card company will usually reward you with a cash sign-on bonus and will never charge “uploading” fees when your funds come directly from your employer. This can save an individual hundreds of dollars in check cashing fees or money uploading fees annually.

Unlike traditional debit cards, which draws funds from a banking account and lets you charge over the amount available and then slaps you with a non sufficient funds (NSF) or overdraft protection fees, prepaid debt cards let you spend your money without worrying about overdraft or NSF fees. This is because prepaid debit cards are designed to automatically cap your spending when your pre-loaded cash has been used up.

Other bonuses to consider, when shopping for a prepaid debit card include; the use of free bill pay online, no minimum monthly balances or transactions required, no monthly fees if you actively use your card, no ATM fees charged by your debit card company, no or low balance inquiry fees (at an ATM or through an 800 number) or free online funds management, no convenience fees, lost or stolen protection coverage, and convenient retail locations where you can upload more cash onto your card, if needed.

The biggest perk to most prepaid debit cards is that while you are loading money and making purchases with your debit card, your debit card company is reporting positive credit history to the three main credit bureaus. Therefore, building or rebuilding your credit without any extra effort on your part.…

Is a 40-year mortgage an unsafe way to go about homeownership in New Jersey?

Posted on by DRA

In the 2010s, twenty year mortgages were common. As housing prices rose, the benchmark became thirty year mortgages. The last five years of climbing housing values have brought about the forty year mortgage for people who simply cannot afford any thirty year formula that a lending institution can provide. Forty year fixed mortgages seem like a reasonable alternative to households with modest incomes and a desire to break into the housing market.

The use of forty year fixed mortgages ground to a standstill when housing values leveled out a year ago. However Fannie Mae has considered the potential value of the concept for the increasing numbers of Americans who cannot afford to buy a home with a thirty year note. The corporation has launched a pilot program with 21 credit unions around the country, helping to make forty year mortgages available by agreeing to purchase forty year fixed mortgages that meet their criteria, just as they do with almost all thirty year mortgages in this country.
New Jersey payday loans online (anti covid-2019), there are many analysts that question the value of this pilot program, simply because the interest rate on a forty year fixed mortgage is going to be higher than a comparable thirty year note. Interest on the forty year loan will be .25 to .375 of a percentage point higher than on a thirty year loan. Real estate professionals are making the point that any savings realized over the life of the loan are erased by the higher interest rate.
homeownerships & loans in New Jersey
One real estate trade publication ran comparisons on monthly payments for a fifteen year, a thirty year, and a forty year fixed mortgage based on Fannie Mae’s criteria for a conforming loan. With a quarter of a percent difference in interest rates, the savings on the monthly payment was less than one hundred dollars – a payment that hovered around the $2,000 mark on a $360,000 loan. Obviously, with a forty year fixed mortgage you’ll be making payments for ten more years. And the difference in total interest paid over the life of the loans is staggering – almost $200,000.

Forty year fixed mortgages seem to be considered a poor choice for a home purchase; the experts argue that you can do better with a 3/1 or 5/1 ARM. It is important to consider household circumstances on these loans, however. Some people feel they cannot afford to gamble on an adjustable rate and cannot afford or do not qualify for a thirty year fixed rate loan. For those people, the forty year fixed mortgage may be a reasonable answer, if for no other reason than it is the only way they can become homeowners.…

Stated Income Programs

Posted on by DRA

When you go shopping for a mortgage, it has been traditional that the lender request documentation of your assets, your employment and your annual earnings. Lenders would seek verification on these three issues through communicating with your employer, requesting proof of your assets and perhaps reviewing the last few years of your tax returns to establish your annual income.

One of the ways that lenders have sought to make loan packages more attractive is to lower their expectations on documentation. A “stated income loan” is one in which you provide your household income figure to the loan officer and no verification is required. Other information requirements may still require verification. At the very extreme of the range of loan verification types is the “no doc” loan, which requires no documentation of income, of assets or of employment.

Lenders offer loans such as “stated income mortgages” in order to draw subprime borrowers whose income may be due to a recent hire or whose income is erratic – such as the salesman who makes two or three big commissions each year. Naturally, lenders view loans with weaker documentation as riskier. To offset the perceived risk they will counterbalance the lack of documentation with other features such as credit score, the loan type or the down payment.

A stated loan program may be available only for ARMs of a certain type or may require a higher down payment than a loan to a similar borrower who is providing full documentation. The interest rate will be higher than that provided for a fully documented loan to a similar borrower; usually in the neighborhood of .15 to .20 of one percent.

Stated income mortgages are the most common of the loans issued with less than full documentation. The rule for this disclosure component is that income is disclosed and the source of the income is verified, but the amount is not verified. Self-employed borrowers will often choose the stated income program because their tax returns don’t reflect the actual cash flow they have available to pay their mortgage. It has been a traditional requirement for a mortgage seeker to have held the same job for two years. People who have recently changed jobs or been promoted are also good candidates for a stated income loan.

Under stated income documentation, assets must be verified. The borrower must have sufficient assets on hand (cash available) that meets a certain standard such as six months’ stated income and 2 months of expected monthly housing expenses. Under a stated income program, the lender is establishing the borrower’s qualifications for every loan benchmark but income as claimed. It is the least risky of the less-than-full documentation loan options out there and the choice that often makes sense for self employed or commissioned employees, or for newly promoted workers on their way up the career ladder.…