September 23, 2015
If you are finding it difficult to pay back your debts, you may be able to apply for temporary financial hardship. This would mean that your payment arrangement changes for a few months and the type of assistance may vary between creditors.
So what exactly is financial hardship and who can qualify?
An individual that is unable to meet their repayments and unable to pay for the bare necessities is considered to be in financial hardship. Such provisions that a person cannot support either for himself/herself, family or dependents can be:
- Medical expenses
- Education and other basic necessities
Creditors will examine your inability to pay basic bills on your current income. These are all lumped together as living expenses, but if you find yourself struggling to pay any one of these you may qualify. Having this information available when you call your creditors is generally a good idea.
Most creditors will want to know why you are having this financial hardship. If you have been made redundant, had your hours cut, had to take leave from work due to illness, etc., you should be prepared to send them paperwork confirming your financial situation.
Factors that led to financial hardships
- Tragedy in the family
- Serious illness that it drained your resources
- Injury that caused an inability to work
If you have lost a home, are having medical difficulties, or are going through a time of family emergency you may also be able to apply. Medical trouble can be a real problem with the inability to work when you are accruing larger medical bills. This means that if you find yourself needing to have extensive surgery, are injured on the job and you find yourself with unexpected expenses such as child care, you may be eligible.
Generally the creditors will want to know that your situation is temporary. If you have lost your job that means you must be on the look-out of a new job. They may ask you to estimate how long you anticipate needing assistance and only offer you help for that time period. However, you may be able to ring them up again and extend the terms of your agreement. There are only a limited number of times that one is able to apply for temporary hardship assistance and if you’re financial difficulties are more permanent,you may need to look for a long term debt management option.
Each creditor has different criteria and assesses the client’s whole situation with a financial statement of position plus looking at their circumstances as to why they can’t afford to pay their debts. During financial hardship you may be able to get your payments reduced or stopped temporarily. This will assist you to get back on your feet and pay your debts back in a timelier manner.
All requests for hardship must be responded to within 21 days by your creditors. This means that you will know within the month if your application has been successful or not. If your application is rejected or requires more proof, the company must tell you why otherwise you may be able to file a dispute with the Financial Ombudsman Service. Confirming the agreement in writing can save you a lot of time and money later as well.
If you want to know more in how to go about this; and if you are not sure of approaching the creditors, you can check the website www.debtcutter.com.au as they provide a number of fact sheets to guide people through applying for a financial hardship.
, Debt Problems
, financial advice
, financial planning
June 2, 2015
At present, owning a house has become a lot easier than before because of the prevalence of companies that offer loans with flexible terms and payment programs. Therefore, you can purchase your dream house just as long as you push the right buttons and make the right moves.
One way to achieve this is to apply for a home loan, because with this you can avail the necessary funding that comes with fixed interest rates andhas no ongoing fees. That’s value for money that you can never get elsewhere.
How do you avail the right home loan that will go well with your financial status? Read on and find out.
First, you should find a lender that offershome loans. The good news is: this is relatively easy because of the number of reputable companies out there that offer them. Plus, you can achieve this without leaving the comforts of your home because you can find a lender by doing an Internet search. You can look for building societies, like NPBS, talk to their loan officerto see if their home loan programs complement your needs, preference, and budget. Aside from the said institution, there is a wide array of companies out there that can help you avail your dream house.
Alternatively, you can check local bank and credit union websites to find out if they offer such program. If a local bank or credit union that is based in your area offers one, grab the opportunity and contact their loan officer. They’re generally more than willing to answer your queries and offer sound advice.
Once you’ve found a lender, you’ll have to study the application process. In general, this aspect is easy, but it may take some time. You’ll have to give your personal information and hand over paperwork that confirm your employment status and monthly income. After sending your application, company loan officer will check the authenticity of the documents and decide if your application will be approved or not.
If your loan application becomes approved, make sure to scrupulously review the terms and conditions before signing up. There are several factors that you need to consider and these include the interest rates, monthly payments, and penalties, among others. If you feel that they will not have a negative impact on your financial status, then sign the dotted line and avail your dream house.
Owning a house nowadays is a lot easier that it was, say, 10 or 20 years ago and you simply need to do your homework beforehand to avail the right loan that will not mess up your budget and credit rating. Afterwards, you can avail your dream home in no time at all.
Don’t overlook the precautionary measures that were elaborated above because neglecting this aspect may wreak havoc to your finances and bury you with debt. So, follow them and obtain your dream house and achieve financial stability in the process.
, personal finance
March 7, 2015
The concept of just making interest-only payments on your student loan while still in college sounds like a simple concept. This will require you to only pay the interest off on your loan without actually paying off the principal that the loan is based out of.
Here’s the Rundown
For an unsubsidized loan, interest accrues on day one after you’ve taken the loan out. The formula banks use to calculate interest is: rate x loan balance / 365 = daily interest. So if you take $4,000 to pay for college with 3.86% interest, the amount of interest you’ll accrue on the first year will be $154.4. If you take another $4,000 loan the next year, your principal now being $8,000, your interest will be $308.8. At the end of 4 years in college, taking out the same loan amount every year, the interest you would have to pay would climb to $1,544. If you’ve paid off your interest during college, the amount you’ll end up owing will be $16,000 instead of $17,544 when it comes time to paying down your loan.
You can make monthly payments each year to pay your interest while in college: $12.86 for year one; 25.73 for year two; 38.6 for year three and 51.46 for your last year of college. If you paid off your interest during your years in college, you’d avoid a term called interest capitalization which basically means interest accruing on top of interest. Essentially, you’ll end up saving a lot of money making this financial strategy very valuable. Here are a few other positives to paying off your interest while in college.
It Encourages Positive Habits
It is easy to fall behind on your payments if you don’t have sensible habits. You just need to consider making a good habit of paying off your debt whatever you have taken in form of loan. Interest-only payments on your loan will help you get into the habit of saving money for your loan and can even help you adjust your finances properly. It is critical for you to think about how you’re going to manage your finances when it comes to getting such good habits to work for your life in the long run.
It Manages Your Credit
You may find that your overall credit rating will be a little easier for you to work with if you just manage your debts the right way. By keeping the charges on your student loan from being too high while also making payments on time, you will find after a while that your student loan will do more to help your credit rating. This can be critical for any of the different forms of credit that you might require at some point in the future.
It Keeps Your Debts Organized
More importantly, you might find that your payments will be a little easier to manage over time. You will have a good idea of what you would have to spend in order to get your debts covered. Of course, you can always choose to pay a little extra every once in a while to cover a part of the principal but the fact that you can keep your debts from being a burden to your life is a point that is great in its own right.
You have to see that interest-only payments are going to work well for your demands. You can get more out of these payments as you will keep your costs down while being astute with your responsibility to take care of what you owe.
A Few Ways you Can Afford Making Monthly Interest-Only Payments
If cash is really tight, there are some things you can do to afford making those interest-only payments on your loan. You can reduce the amount of your loan by seeking out easy scholarships to apply for that’ll help pay for school. You can also find a part-time job or find a few online gigs like being a virtual assistant, selling services on Fiverr, or getting paid to write articles on iwriter or text broker.
, Education Loans
, financial planning
, Pay Off Debts
, personal finance
, student loans
March 6, 2015
Developing an effective and sound budget is truly important or crucial when you wish to achieve financial targets, control household costs and manage debts. A budget is the key ingredient to achieving financial goals, achieving household goals and managing debt successfully. Apart from this, by creating a budget you may pay off debt, buy a bigger apartment and get a better car.
A sound budget can only be developed when you understand your entire financial situation in a better way. You may experience a lot of challenges while creating a budget that suits your young family. In your attempt to develop a smart budget, you might wonder how to begin with it. Developing a budget is about identifying the starting point and the steps to go with it. There are a few good websites that may help you prepare an effective budget. In order to catch up with the best sites across major search engines, you may click on Check n’ Go•.
Consider a few budgeting tips that will keep you motivated -
1. Note all expenses
All of your monthly expenses need to be written in a notepad. Make a list of each single item that you purchase every month. Record all goods that you use on a daily basis, be it those ice creams that you keep on the refrigerator, your parking meter charges as well as your morning coffee.
Although it might seem tedious it will work in your best interest. Once the costs are itemized, you’ll need to go through the list and find which items are absolute necessities. You may try creating two categories namely discretionary and essential. You’ll certainly come to know how much you can actually avoid spending or save out of your list of expenses.
2. Exercise discipline
In order to stay within a tough budget, you’ll need to count on your means and exercise discipline and self-control. You must learn how to cope with the challenges of staying within a budget. There is a certain trick to get things done while staying within your budget. A budget resembles a diet; you’re bound to shed a few pounds once you start having lettuce leaves for about 7 days. You don’t need to live without fulfilling your daily necessities. For an occasional reward or treat, a certain allowance needs to be incorporated within your budget.
3. Set your targets
Set achievable targets. This way, you’ll be able to analyze each of your moves and proceed without committing mistakes. Meeting new targets will be easier once you reach your initial goals.
4. Use an online budget plan
You’re bound to come across a number of online budget planners that come for free. A majority of the budget plans are friendly towards their users. A budget planner helps you to measure the out flow of your money. Once you can measure your expenses, it will be easier for you to manage them.
5. Seek assistance
You may use free information available over the internet for maintaining or developing a budget. When it comes to promoting financial websites bearing quality budget tips, you may utilize sites like Check n’ Go•. Websites like this are aimed at educating people on budgeting and other financial areas.
, personal finance
February 8, 2015
Filing for bankruptcy is a drastic step in regaining your financial health, and the impacts are long-lasting. It is not something to be done lightly, or without weighing out all of your available options. If you are drowning in debt, however, bankruptcy can be a valuable first step in rebuilding your financial future.
GetFreeOfBills.com notes that bankruptcy comes in two forms: Chapter 7 and Chapter 13. While Chapter 7 allows you to discharge most debts, Chapter 13 requires you to follow a structured plan to repay your debts under more favorable terms. Depending on the amount of disposable income you have, you might be required to file Chapter 13. Regardless of which type you file, however, the pros and cons are generally the same.
- Clean slate: A bankruptcy provides a clean slate. It effectively resets your credit to zero, except for the debts that cannot be discharged such as student loans, recent back taxes, and child support. It provides you with the opportunity to stop making costly payments and provides you with more money to live on each month.
- Opportunity to rebuild: Some people believe that bankruptcy prevents you from ever having credit again, but this is not the case. Many people manage to build new lines of credit shortly after their bankruptcy, and it gets easier as time passes. While it is true that bankruptcy remains on your credit report for 10 years, its effects gradually lessen.
- Stopping adverse collections actions: If you are being hounded by creditors, facing foreclosure, or afraid that your wages will be garnished, bankruptcy can be a psychological relief. When you file for bankruptcy, you will receive an automatic stay from the court. This forces your creditors to cease all adverse collections activities against you. If you have a bankruptcy attorney, he or she will also act as a shield, handling creditors on your behalf.
- Exemption laws: Your home and car are generally exempt from bankruptcy, as long as you continue to meet your payment obligations. You are also entitled to a cash value for personal possessions. If you have a significant number of luxury possessions, you might be required to sell some, but the exemptions are generally high enough to let most people keep their personal items.
- Job protection: Although some employers will not hire applicants with a bankruptcy on their credit report, the job you already have is protected. It is illegal for an employee to be fired for declaring bankruptcy.
- Damaged credit: Bankruptcy is a major hit on your credit report. In the immediate aftermath of the bankruptcy, you might be unable to get any new credit at all. Although it usually does not take long to get new offers, you will fall into a high risk category for lenders. Expect to pay interest rates that are significantly higher than the ones you had prior to your bankruptcy. However, if you are in the position of filing for bankruptcy, your credit is probably already damaged. Some people find that the credit hit is much less significant than they anticipated.
- Filing costs: Filing for bankruptcy typically costs a few hundred dollars, depending on your location. Attorney’s fees are billed on top of that. However, in most cases you can make a payment arrangement if you can prove that paying a lump sum would present a financial hardship.
- Embarrassment: Although it is surprisingly common, filing for bankruptcy still carries a certain stigma. Some people worry that their loved ones will find out and ultimately think less of them for their decision. However, bankruptcy typically comes at the end of a long journey through mounting debt. Most people understand that sometimes life happens, and do not judge their friends and relatives for making a tough financial decision. Besides, having your home foreclosed or your car repossessed is not exactly a less embarrassing option. When taken seriously and only as a last resort, bankruptcy can actually be the smartest choice for some situations.
- Exempted debts: Some debts cannot be discharged in a bankruptcy, including recent back taxes, child support, and student loans. In addition, most people choose to keep their mortgage and car loan, if applicable. However, discharging your other debts will create more available money each month, which can then be diverted toward paying your remaining obligations.
Bankruptcy is not for everyone, but it is the best solution for many people. Attorney David M. Often of Get Free of Bills understands the complex decision-making process that is involved in determining whether bankruptcy is the right choice for you. Contact his office today for professional advice on how to proceed along your journey to financial freedom.
, Bankruptcy Laws
, Credit Card
, Credit Card Debt
, Financial Panning