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By Robert Benjamin

What Is The Difference In Credit Card Types ?

There are credit cards for everyone, I will explain two major differences between them so you will understand.

Secured Credit Cards:

A credit card secured by a savings account that has been established in advance by the borrower. The amount in the account usually determines the limit on the credit card. These accounts present no real risk factor for creditors and are therefore much easier to obtain. The required savings deposit for a secured card may range from a few hundred to a thousand dollars or more. Your credit line is a percentage of your deposit, typically 50 to 100 percent. Usually, a bank will pay interest on your deposit. In addition, you also may have to pay application and processing fees — sometimes totaling hundreds of dollars. Before you apply, be sure to ask what the total fees are and whether they will be refunded if your denied a card. Typically, a secured card requires an annual fee and has a higher interest rate than an unsecured card.

Unsecured Credit Cards:

Unsecured credit cards require no deposit to acquire. They are given based upon the applicants high credit score.

Credit Card Terms ?

There are numerous credit card terms, and you should understand them, because not knowing what they mean, can be costly. Here is a list of the important ones and a summary of each:

Over The Limit Fee:

Some credit card companies charge you if your purchase exceeds your credit balance. Instead of the purchase being denied, it may be approved. But the next time your monthly bill arrives, you may be hit with a charge of an extra $20 or even more! This charge will probably be on each additional bill, until your balance is again within the normal credit limit.

Late Fee:

This is a charge you will be hit with, if your payment is not received and processed by the payment due date. This can be $20 or more a month.

Minimum Payment:

This is the amount you must pay to keep the card from going into default. If you fail to make the minimum payment, you can be hit with a monthly ‘late fee’, just as if you failed to make any payment.

Annual Fee:

Some credit card companies charge an annual membership fee. This extra charge can range from $20 to $100 or more. Once a year this fee is added to your total balance due.

There is a website that shows you numerous sources for getting a credit card or a fast cash loan, even if you have bad credit, also you can discover the best sources for credit reports, help prevent identity theft, understanding credit card terms, and much more, this website is called: Credit Cards and PayDay Loans, and it may be found at this URL: http://www.rb59.com/creditcards

You may publish this article in your ezine, newsletter or on your web site as long as it is reprinted in its entirety and without modification except for formatting needs or grammar corrections.

About the Author: Robert W. Benjamin has been in the software business since the early 1980’s on the VIC 20, C64, AMIGA, and WINDOWS Computer Systems. He has won magazine awards for the ‘Game of the Month’, and more, in several European computer magazines. Credit Cards and PayDay Loans rb59.com/creditcards

Source: isnare.com

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By Simon Volkov

Mortgage refinancing can be beneficial to borrowers who need to reduce monthly loan installments or want to take advantage of reduced interest rates. It can also offer a solution to those in preforeclosure; meaning banks have not taken legal action to repossess the property.

A second type of mortgage refinancing is that of cash back mortgages. This option allows borrowers to obtain lump sum cash using accrued home equity. Since home loans are assessed with a lower rate of interest than other types of loans, entering into a cash back mortgage might be a smarter option when funds are required for large purchases.

Refinancing requires mortgagors to apply for a new home loan. Proceeds from the new loan are used to pay off the previous loan. Borrowers must possess sufficient credit scores and payment history to qualify for financing. Those with bad credit, mortgage arrears, or high debt-to-income ratios typically will not qualify.

Many homeowners refinance through their current lender. However, it is always smart to shop around and compare lender rates. It is also smart to review current loan documents to determine if prepayment penalties exist.

Many banks include a prepayment clause within the ‘Truth in Lending’ section. In many cases, prepayment penalties are assessed during the first 5 years. Others reduce penalties annually throughout the duration of the loan.

Borrowers often fail to read loan contracts and are shocked to discover they are penalized for early payoff. Mortgagors holding two or more mortgages can take a hard financial hit when refinancing.

Mortgage lenders typically assess closing costs for refinanced loans. Fees can be as much as 6-percent of the outstanding principal and interest. Common refinance fees include: loan application, loan origination, title search, land survey, property inspections and appraisals, and legal expenses. Cost to refinance a $200,000 mortgage could hover around $12,000.

One source for borrowers facing foreclosure is Making Home Affordable. This government-sponsored program offers solutions to those struggling to meet mortgage obligations under Home Affordable Refinance Program (HARP).

HARP eligibility requirements are provided at MakingHomeAffordable.gov, but may vary by lender. The program is offered to borrowers with Fannie Mae or Freddie Mac loans who are current with loan installments and have not been more than 30 days late with payments within the previous 12 months.

Borrowers can apply for HARP mortgage refinance as long as the outstanding balance of their current mortgage does not exceed 125-percent of current market value and they have the financial ability to comply with new payments.

Another credible source for borrowers in need of mortgage assistance is the Department of Housing and Urban Development. HUD provides complimentary housing counseling to those facing foreclosure; in need of loan modification; or assistance with refinancing home loans.

HUDs website includes an entire section dedicated to mortgage refinance. Visitors can download lender comparison guides and financial worksheets; locate local housing counselors; and learn about all available programs at HUD.gov.

Mortgage refinance can be a good option as long as borrowers conduct due diligence and carefully weigh the advantages and disadvantages of taking out a new home loan. Borrowers should only engage this option if doing so makes smart financial sense.

For most people, their home is the most valuable asset owned. Borrowers should pursue all available options to protect it. Making poor financial decisions or engaging in wasteful spending can quickly place real estate at risk for foreclosure. Take time to assess the risks and rewards of mortgage refinancing before entering into a new contract.

About the Author: If you are considering mortgage refinancing it is crucial to research every available option and compare home loan providers. Author and real estate investor, Simon Volkov shares insights and resources to help homeowners make informed decisions at SimonVolkov.com.

Source: isnare.com

Permanent Link: isnare.com/?aid=745558&ca=Finances