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

FICO, which stands for Fair Isaac Corporation, is a term which describes your personal credit score. That score is used by lenders who will determine if you qualify for a loan and the interest rate you’ll
charged as well as the length of your loan. The higher your score, the more likely you’ll be approved for a consumer loan and receive favorable terms.

In these pressing economic times, not everyone has a good FICO credit score, which can be especially problematic if you need to apply for a consumer loan. Whether seeking a mortgage, a home equity loan/line of credit, car loan, credit card, or some other type of loan, you need to get the highest score possible.

Raise Your FICO Credit Score Step By Step

Fortunately, you can raise your score and see significant results within 2-3 months time. If you plan on applying for a loan some time over the next few months, the following steps can help you improve your FICO credit score:

Shrink those balances: You don’t have to pay off your credit cards, but running big balances is a red flag to creditors. Work on reducing your debt, a step which will gradually raise your credit score.

Don’t apply for too many loans: You may have unwittingly caused your credit score to drop by applying for too many loans in a short period of time. This can happen if you are planning to shop for a new car and are arranging your own financing. By applying to several different lending institutions for the sake of finding the best deal, you’ll be shooting up another warning flag to creditors. Find out the rate first, then apply.

Remedy credit problems: If you’ve been late making payments in the past, then your score will take a hit. Make payments on time and pay more than the minimum amount due each month. Get free copies of your credit reports and check them for errors; notify the credit reporting agencies if you find mistakes. They are required by law to fix mistakes within thirty days or that information must be automatically removed from your credit report.

Keep consumer accounts open: Odd as it may sound, closing a credit card or other consumer account will negatively impact your credit score. Simply tuck your unused credit cards away in a safe place and don’t use them again. You can gradually close them after you secure new credit, especially if you have no plans to borrow again in the near future.

More accounts means a reduced score: Opening more accounts will work against you. Only open up enough consumer accounts as needed.

Consider NOT moving your money around: Consumers have gotten into the habit of shifting outstanding balances from one account to another, but that move can actually reduce your credit score. Consolidating your balances to one account may cause your credit score to drop.

Building a good credit history is an achievable and laudable goal for any consumer. Take care of your credit score and your credit score will take care of  you in the form of favorable lending terms for your next consumer lending opportunity.

Tags: auto loan, car loan, consumer credit, consumer loan, credit card, credit score, FICO, home equity, line of credit, 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