How To Use Your Homes Equity To Consolidate Debt

If you've got a wallet full of credit cards, and monthly payments on them that total more than 25% of your monthly income, chances are that youve considered debt consolidation loans or some other means of taming your credit card debt. But did you know that a home equity loan is another way to get the money that you need to pay off your creditors, reduce your monthly payments, and get out from under the weight of all those monthly payments?

A home equity loan is essentially a second mortgage taken out with your house as the collateral. Because the loan is secured, youll have a much more favorable interest rate. And those lower rates will translate to a lower monthly payment overall. Youll wind up with one creditor, one monthly payment, and more money in your pocket each month.

There are some definite advantages to taking out a home equity loan or line of credit to get out of debt, and one very big danger. By trading your unsecured loans (your credit card debts) for a secured loan, you are putting your house on the line. Why? Because if you dont make the payments, the lender has the right to take your home from you and sell it in order to collect on the loan. But if youve got at least 20% equity in your house, and are certain that youll be able to meet the monthly payments, then taking out a home equity loan to pay off your debts may be a good choice for you.

Once youve decided that a home equity loan is an acceptable risk for you, youll have a few other decisions to make.

All home equity loans are not created equal! There are two types of loans, and youll need to decide which one is right for you.

A flat home equity loan is a standard loan for a fixed amount. The amount will be limited by the amount of equity youve invested in your house. If you use up the entire amount of your loan and need more money, youll have to apply for another loan.

A home equity line-of-credit is usually the better choice. With this type of loan, you will be able to write checks against the amount of the line-of-credit, which may be as much as 125% of the value of your home. For example, if you obtain a $10,000 line of credit secured by the equity in your home, and use $2,000 of it to pay off an outstanding credit card balance, youve essentially only borrowed $2,000, and thats the amount on which youll pay interest.

When looking for your loan, its essential that you shop around--not only for the best interest rates and terms, but for a company that you can trust. Ask for referrals from your bank, friends and coworkers. In addition, you can check them out on the Internet.

You will need to determine the value of your home so will know how much money you will able to borrow against it. Its a good idea to get a current appraisal of your home, and always smart to have it appraised by several different companies.

Finally, in order for you to get the most out of your home equity loan, you will need to choose the lender that offers you the best interest rates. Remember that fees and other charges can vary widely from company to company, so make sure you do some comparisons.

Once youve been approved, you can use all or part of your home equity loan to pay off your current unsecured debt. Keep in mind that youll only STAY out of debt if you avoid the temptation to run those credit card balances up again!



To see a list of recommended home equity loan companies online, visit this page: http://www.abcloanguide.com/homeequityloan.shtml - Carrie Reeder is the owner of ABC Loan Guide, an informational website with articles and more about various types of loans.

(http://equity-loan-information.com)

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Best Tips on how to buy a term life insurance policy

Term Life Insurance is by far the least expensive form or type of life insurance that you can currently purchase. Over the last few years rates on this type of policy have drastically reduced due to better carrier efficiencies and extended mortality rates and tables. Even Financial guru Dave Ramsey preaches how Term Life Insurance is the most cost effective plan to purchase.

So how do you buy a term life insurance policy? I’m talking about the absolute best priced, best carrier with the best plan options. The best place to start is definitely with a really good and experienced broker or agent. Lets clarify the difference, a broker is typically an agent who represents multiple carriers. An agent can be a broker or work for one company specifically like New York Life or Northwestern Mutual. So be careful ask whoever you are working with if they can write with multiple carriers. This is critical and a huge advantage for you to be able to find and buy the cheapest most affordable rates.

Now that you have a good broker and he has quoted you multiple carriers have him sift through typically the top five for the cheapest rates. This is the time for you start asking your broker some questions.

* First, who has the best ratings? This is extremely important you want a carrier that you know will be there when it is time to pay a death claim. Especially since you have seen the meltdown of some of the nations largest insurers like AIG.

* Second who has the best underwriting, not all carriers are the same. Just because xyz company has the cheapest rates you may never get them because they are so stingy in underwriting. Underwriting issues come about if you have a health history that would affect your premiums. For an example if you have Diabetes, Cancer or Heart Disease.

* Lastly you need to know who has good permanent life product that you could possibly convert to later down the road. Why you need to know this is if you have a major health event that would impair you from getting a good offer down the road. This way you know if you got a Preferred Rate Class offer on your Term Life Plan then you can convert it to a permanent plan later at the Preferred Rates. Now your rates are offered at your current age but even so they typically would be much more affordable than a rated up policy.

These three tips on How To Buy Term Life Insurance really are the big three that in our opinion you need to be concerned with. From here you should be able to find and purchase a policy that meets your families or business needs with a premium that you feel comfortable paying and can afford. (www.lifeinsurance-pros.com)

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Why should I buy life insurance ?

Many financial experts consider life insurance to be the cornerstone of sound financial planning. It can be an important tool in the following situations:
- Replace income for dependents
- Pay final expenses
- Create an inheritance for your heirs
- Pay federal “death” taxes and state “death” taxes
- Make significant charitable contributions
- Create a source of savings

1. Replace income for dependents
If people depend on your income, life insurance can replace that income for them if you die. The most commonly recognized case of this is parents with young children. However, it can also apply to couples in which the survivor would be financially stricken by the income lost through the death of a partner, and to dependent adults, such as parents, siblings or adult children who continue to rely on you financially. Insurance to replace your income can be especially useful if the government- or employer-sponsored benefits of your surviving spouse or domestic partner will be reduced after your death.

2. Pay final expenses
Life insurance can pay your funeral and burial costs, probate and other estate administration costs, debts and medical expenses not covered by health insurance.

3. Create an inheritance for your heirs
Even if you have no other assets to pass to your heirs, you can create an inheritance by buying a life insurance policy and naming them as beneficiaries.

4. Pay federal “death” taxes and state “death” taxes
Life insurance benefits can pay estate taxes so that your heirs will not have to liquidate other assets or take a smaller inheritance. Changes in the federal “death” tax rules between now and January 1, 2011 will likely lessen the impact of this tax on some people, but some states are offsetting those federal decreases with increases in their state-level “death” taxes.

5. Make significant charitable contributions
By making a charity the beneficiary of your life insurance, you can make a much larger contribution than if you donated the cash equivalent of the policy’s premiums.

6. Create a source of savings
Some types of life insurance create a cash value that, if not paid out as a death benefit, can be borrowed or withdrawn on the owner’s request. Since most people make paying their life insurance policy premiums a high priority, buying a cash-value type policy can create a kind of “forced” savings plan. Furthermore, the interest credited is tax deferred (and tax exempt if the money is paid as a death claim).(iii.org)

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What is auto insurance ?

Auto insurance protects you against financial loss if you have an accident. It is a contract between you and the insurance company. You agree to pay the premium and the insurance company agrees to pay your losses as defined in your policy.

Auto insurance provides property, liability and medical coverage:
* Property coverage pays for damage to or theft of your car.
* Liability coverage pays for your legal responsibility to others for bodily injury or property damage.
* Medical coverage pays for the cost of treating injuries, rehabilitation and sometimes lost wages and funeral expenses.

An auto insurance policy is comprised of six different kinds of coverage. Most states require you to buy some, but not all, of these coverages. If you're financing a car, your lender may also have requirements.Most auto policies are for six months to a year. Your insurance company should notify you by mail when it’s time to renew the policy and to pay your premium.(iii.org)

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8 Things You Should Know About Life Insurance

Dealing with the ins and outs of auto insurance can be as tricky and confusing as trying to untie the Gordian knot. Although we can’t help you with the knotty Gordian problem, the following recommendations could help you figure out some of the more complicated points of auto insurance.

1) Determine appropriate coverage.
Help control the price you pay, just ask American Insurance Association executive Dave Snyder. For example, Snyder notes that half of your auto insurance bill covers liability and “that has to do with how you are going to use the vehicle, such as for commuting to work and your driving record. If you’ve got a clean driving record, you figure to pay less for insurance than you would if you had a speeding ticket on your record. You can control the other half of your premium which covers damage or loss to your vehicle, comprehensive and collision coverage.”

2) Shop around for insurance.
“In most states,” Snyder reports, “there are hundreds of insurers competing for business, so it’s possible to save hundreds of dollars by obtaining quotes from different auto insurance providers.” Picking up on Snyder’s theme is his AIA colleague, Nicole Mahrt. Mahrt urges you to work with your insurance provider to get more than one quote. “It pays you to shop around, especially if you feel you’ve been paying too much.”

3) Look for insurance discounts.
“Many insurers will give you a discount if you buy two or more types of insurance from them, for example auto and home insurance,” confirms John Marchioni, senior vice president of Personal Lines for Selective Insurance, in Branchville, N.J. More cost-saving suggestions from Marchioni: “Ask about discounts for air bags, anti-lock brakes, daytime running lights and anti-theft devices.”

4) Consider taking a higher deductible.
“You could lower your insurance bill by increasing your deductible,” Mahrt says. “But just make sure you can pay the higher deductible if you file a claim.”

5) Look into “stacking” coverages if you file an insurance claim.
Insurance trade group officer Daniel Kummer explains that stacking uninsured/underinsured motorist coverages means “you can collect from more than one of your auto insurance policies. Most states prohibit this practice, but there are about 19 states that either allow stacking or don't address the issue either through legislation or litigation,” according to Kummer, director of personal insurance for the Property Casualty Insurers Association of America. “Be sure to check your auto insurance contract to see if it's allowed. “Be advised that you’ll likely pay a higher insurance premium if you have stacked coverage. “It could be 10% to 30% more depending on the litigious nature of the state in which you reside,” says Kummer.

6) Check with your insurance provider BEFORE buying a car.
“Your premium is based in part on the car’s sticker price, the cost to repair it, its safety record and the likelihood of theft,” answers Selective’s John Marchioni. Remember to avoid shopping by price alone. “You want an agent and a company that answer your questions and handle claims fairly and efficiently,” emphasizes Marchioni, senior vice president of Personal Lines for Selective Insurance.

7) Notify your auto insurance company as soon as you change companies.
“Be sure to cancel your old policy,” suggests PCI’s Dan Kummer. “Do it the same day, but don’t cancel your old policy until you’ve lined up a new contract. That’s important because some states like New York will fine you for the number of days you go without insurance.” One last thought from Kummer on the subject: “Most auto insurers specify in your contract that you can terminate your policy any time you want by informing your company in writing about the date you wish that coverage be terminated or you can do that over the phone.

8) Pick the insurance payment option that best fits your budget.
“Generally, most companies will give you the ability to pay over time, but that comes at a price,” says Kummer. “Your payment could increase a few dollars each time you pay by installment. Insurers can accept payments monthly, quarterly, or every six months, what ever is most convenient for you. Remember, though, that the more you break down your payments, the more the cost adds up.” (article from insurance.com)

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