The news lately has been chock full of reports about Fannie Mae and Freddie Mac being taken over by the federal government while Merrill Lynch, Lehman Brothers, AIG, WaMu, and other investment banks and financial institutions battle for survival too. For the consumer who needs to borrow money,
wondering who will approve their loan and at what rate has some concerned.

Fortunately, the financial market is much bigger than these entities with some financial institutions in much better shape than others. Clearly, shopping around for a consumer loans these days involves checking on the health of the lender as much as finding someone who can approve your loan at a fair rate.

Before you submit your application there are four areas where you’ll want to educate yourself:

1. Understand Your Options — Should you borrow now or should you wait? How much money do you need? How long of a loan term do you want? What interest rate are you willing to pay?
2. Select Best Product – Should you take out a home equity loan or seek an equity line of credit? If an auto loan, will you get your loan through a bank, the financing arm belonging to the automaker, your credit union, or some other source?
3. Learn to Negotiate the Best Deal — What fees are involved with applying for a loan? Or, will fees be waived or included in your loan? Will you do better with a fixed rate loan or an adjustable loan? Will you be penalized for paying off the loan early? Does the interest rate on the loan reflect your good credit?
4. Save Money and Hassles — Do you want to deal with someone locally or would you consider finding a lender online? Do you want to mail payments off monthly or have the convenience of sending payments off via the internet? Are automated payments right for you?

Consumers should take their time looking for the right financing product, comparing offers to find the best deal available today. Banks, credit unions, savings & loans, and other financial institutions want your business, but not every lender is worthy of your business.

If you’re in the position to borrow money, then you’re in the drivers seat. Negotiate from a position of strength by doing your research before applying for any type of consumer lending option. Reject any offer that isn’t favorable for you or ask the lender for terms which are more favorable to you.

Tags: auto loan, banks, consumer loans, credit union, equity loan, lending, line of credit, money, mortgage broker, mortgages, savings and loan associations, second mortgage

Professionals who understand home values will often say that there are two areas in a home which are most important to people: kitchens and bathrooms. This is made known when a home is being put up for sale as these rooms in the house are often the deciding factor whether someone will purchase a home or not.

That is also why when you consider making any kind of home renovation, you take a hard look at your kitchens and baths to see if these areas could use a complete overhaul or a minor refreshening. If you are looking specifically at your bathrooms for what you can do there.

When considering a bathroom renovation, you’ll need to keep the following in mind:

How extensive of a project are you looking at? Do you want to do a complete gutting down to the studs and floorboards or are you looking at replacing a counter top, a light fixture, and an exhaust fan? Of course, the more complicated the job, the more time it will take and the more money you will have to expend.

DIY or contractor? Will it be a do-it-yourself project or will you need to hire a contractor? Assess your skills, the time needed to complete the work, and your willingness to tackle the project. You may be able to handle replacing a vanity, toilet, or a shower stall, but making structural changes involving electricity, plumbing, and moving walls could be beyond your skill sets.

Out of pocket or bank financing? Do you have the funds available to do the work or will you need to take out an equity loan or secure a line of credit to finance the renovation. With the latter, you could gain an important tax deduction and a low rate on funds borrowed. You will, however, take on some debt. Fortunately, bathroom (and kitchen) renovations usually allow you to recoup your investment. Work on a budget to see what you can afford.

If you’re looking simple for a fresh look consider putting in a bath/shower liner, swapping out the wall paper, replacing a mirror, and changing a closet door. These can be especially good things to do if you plan on selling your new home in the future — you’ve brightened up the bathroom without expending a whole lot of money.

Tags: bathroom, counter tops, electrician, equity loan, flooring, home exhaust, Home Improvement, home renovation, joists, kitchen, line of credit, mirrors, plumbing, sconces, shower, sink, tile, toilet, tub, vanity, walls

If you’re considering refinancing your home, you’re not alone. Some homeowners are scrambling to beat a pending mortgage reset while others are simply wanting to find a better deal. A third group is even looking to consolidate some debt and are thinking of a new mortgage, an equity loan, or a equity line of credit to wipe out other expenses.

Tempting as it is to make a quick decision about home refinancing, it is always best to do your homework and weigh your options first. That mailing from a national mortgage lender, the email from a local broker, or the pop-up you got when visiting a personal finance site may be enticing, but better deals could be available to you.

Two key components should be considered when evaluating any refinance offer:

• What will your costs be to refinance?

• How much will you save each month by refinancing?

Some homeowners have been shocked to learn just prior to closing that they are responsible for thousands of dollars in closing fees, money that could be best used for reducing their debt.

If you can refinance for free, then the first question doesn’t apply. However, “free” may exclude some charges including title insurance, application fee, and related expenses.

Other things to consider when calculating your costs are:

• How big is your current mortgage? If you can’t handle the higher costs of a mortgage reset, then refinancing is the way to go.

• How long do you plan on staying in your home? If for just a year or two, then refinancing may not make sense. However, if you see yourself living in your home for at least the next five years, then you should recoup the costs related to refinancing.

Keep in mind that rolling your personal debt into a loan could be helpful, but it will add to the cost of your mortgage and add in an additional monthly expense in the form of an equity loan/line of credit payment.

Finally, keep tabs on the current financing trends. If rates are trending downwards, waiting to refinance could save you additional monies, perhaps enough cash to help you tackle your other debts separately.

Tags: equity line of credit, equity loan, home refinancing, mortgage, mortgage reset, refinance, second mortage