FNTN

Archive for the ‘Finance’ Category

Introduction.

Whether you’re looking for a new credit card or are concerned about the safety of using your credit card - at last there is a new safe credit card that you can ask for. Currently only available as a Visa credit card it is the ultimate in new safe credit cards not only having an in-built chip, but also its own built-in keypad and LCD screen.

Visa CodeSure.

The new Visa CodeSure secure credit code.

Following months of trials in Europe the new credit card known as Visa CodeSure can now be being rolled out to banks. The card is the same size as the normal credit card you’re already familiar with and, on the front, looks exactly the same too. The difference is when you turn the credit card over. By the signature strip you’ll now see a small screen and a tiny 10 digit pressure keypad. The significance of this is that now, prior to a transaction being you enter the PIN number only onto the card - not a card reader that is not permanently in your possession or control. The result of this is a massive reduction in the risk of credit card fraud by a reader recording both your credit card number and its PIN. Visa CodeSure also means the end of the need to remember your Visa Verified id and password when making online transactions or needing to carry your own separate card reader around with you. Instead on entering your PIN onto the card a unique one-time pass-code will appear on the card screen instead.

The cost of safe credit cards.

The cost of the new credit card to you should be $0 - with the banks themselves picking up the bill for a credit card which is, understandably, much more expensive than the current ones in use. However, with credit card fraud still rising by around 15% a year surely that’s a cost the banks won’t mind if they are truly serious about reducing credit card crime. One thing to watch out for as a user of these new credit cards is that they do have an on-board battery to power them, that has a life-cycle of about 3 years. No problem really as all the banks need to do is have credit card expiry dates within the lifetime of the battery. But, as it contains a battery, please do remember to be a green card user and dispose of it in an environmentally friendly way.

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Introduction.

With so many people struggling now to take out personal loans - it has been almost inevitable that some unscrupulous lenders would try to worm there way into the market. As the High Street banks become less inclined to offer loans especially to low credit score borrowers - the more people turn to online loans providers to get hold of the cash they so desperately need. For most people, most of the time, this is not a problem at all and there are many great offers out there to be had in online loans. However, if a personal loan provider wants to charge you an up-front loan fee before giving you any of the loan cash - you’re better off refusing them and seeking your loan from another online lender.

Bogus loan companies.

The idea is they lend you money - not you give them your money!

Even if you have the worst possible credit score imaginable, there really is no reason for a finance company to ask you to pay a fee up-front before deciding whether or not to offer you a loan. Any company that insists on you making a payment before giving you the cash should be treated as at best suspicious - if not a downright bogus loans company who have no intention at all of lending you any money. A typical scenario is for you to work through the application procedure only to find that before the company can process your application you have to pay an ‘administration fee’ of anything around $100 to well over $1000!

3 reasons not to pay an up front fee for a loan.

The simplest possible of reasons here is that there is no guarantee that having handed over your cash - that they’ll then agree to your loan request at all. The chances of you being ripped off like this are quite high from companies demanding up-front payments - it really is just a scam for them to get money from you. Second, OK so the company you’re borrowing money from wants to make a profit itself - fair enough they’re not a charity, but if they need you to pay them for a bit of administration in advance - then you really should worry as to whether they can afford to lend you the money in the first place. Third, even if a loan company says you’re a bad risk to lend money to - that’s no reason to get you to pay them for giving you a loan before you’ve seen the color of their money, they’ll soon enough recoup any expenditure they make through the interest rate they charge you anyway.

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Introduction.

Following months of uncertainty regarding the economy, the general consensus of opinion now seems to be that it is finally time to start buying again. We’re not talking here about things like electrical goods for the kitchen, furniture or TVs etc - but the bigger items that we tend only to buy when we think our jobs are secure, our finances are sound and the national economy is stable. Such bigger items are things like a new car or home, things most of will need to take out a loan for like an auto loan or a mortgage.

Are you ready to start buying again?

Having gone through an economically unstable period you’re probably one of the millions of American’s that haven’t been spending money of things that were not seen as essential. Instead, and rather than banking spare cash with the interest rates having been so poor, that was the time to pay off debts like credit cards and personal loans so that now the economic climate is brighter - you’re no longer saddled with those old debts and can start applying for new loans confident that your credit score is good. However, when starting to spend money again on big items - should you protect yourself against another downturn in the economy?

Protecting your new purchases.

Look for redundancy insurance cover online.

Let’s face it nothing could be worse than starting to pay for something like a new car only to lose your job, fall behind with the payments and end up having the auto repossessed. The solution to this is to take out redundancy cover on an auto loan or new mortgage - to make sure that if your job does fold your payments will be covered. When taking out redundancy cover do make sure the contract you sign is exactly what you need and take special care to check with your boss that your job is safe. The reason for this is that quite often redundancy cover insurance can be ruled invalid if, at the time of taking out the cover, your job was under threat. Also, be aware that mortgage redundancy cover will rarely pay off the whole mortgage if you should lose your job, but will more likely agree to pay your mortgage for a fixed period giving you breathing space to find a new job.

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Introduction.

It’s a fact, but worldwide financial instability and political uncertainty is once again wreaking havoc with USA money markets, quite apart from our own ‘home-grown’ financial problems. One result of these problems has been a rise in the rate of inflation from -0.4% in 2009 to nearly +2.4% already this year, or put another way in less than a year inflation has risen 3%. The net result of this is that interest rates on loans will be rising - something that can hit anyone paying off their student debts really hard.

The cost of graduating.

Can’t believe where all that student debt’s come from?

This rise in inflation and interest rates means that all but the best paid graduates, with large loans to repay, will be particularly hard hit as the re-payments will rise completely out of proportion to their wages; with the risk that whereas last year they were making great in-roads into paying off their student loans - they will now find the gains they made last year wiped out and even reversed this year. As if that’s not bad enough, with many graduates having to take out personal loans on completing their courses to afford things like the clothing they’ll need for their new jobs, fitting out an apartment to live in or even just needing an auto loan to buy a car so they can get to work - having all of these loans whilst struggling to establish yourself in a new job can seem just too much.

Consolidate your debts.

If you’ve recently graduated and are struggling to repay your loans the solution is to seek a debt consolidation loan; putting all of the separate loans together - meaning that you have one repayment to make, to one company and at one interest rate. As student loans traditionally have lower interest rates than other types of unsecured loans, you will need to make sure that the actual student loan you’re repaying isn’t better left as a separate loan and then just consolidate the other ones. Either way, the fewer companies you have to deal with when clearing student debt the better.

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Introduction.

Tired of that 9 to 5  job, tired of being tied down to doing ‘what the man says’ etc, then perhaps you’re ready to have a shot at home trading. Home trading isn’t just sitting in front of your computer at home selling the odd bit clutter that you no longer want on eBay, oh no. Becoming a home trader means that you’re moving into the world of stock trading, but rather than having to suffer the city rush hour - you’ll be surfing the internet from the comfort of your own home.

Don’t suffer the rush hour - surf for work at home!

Stock trading systems.

There are several stock trading systems you can use to operate as a home trader from ones that are highly automated according to pre-set parameters to ones that give you personal and total control as to which stocks you buy or sell and at what prices. To go into home trading you do need to have a good head for money and at least an idea as to how the stock markets work, preferably by having previously had some sort of investment portfolio, even if it was managed by someone else. After that, if you think about the mess the so called professionals made of all our investments just a few months ago - surely you can’t do any worse than they did? Alternatively, using Web 2.0 technology you could join a group of other online stock traders to share expertise and information, in order to learn about day home trading as you go along.

CFD trading.

CFD or contract for difference trading is a way of trading from home over the internet without needing to invest any real assets. A CFD trader watches the changes in prices of stocks, indexes and foreign currencies looking for advantageous margins of trade between the opening and closing price. CFDs work by a seller agreeing to pay a buyer the difference in the value of an asset between the price at the start of a contract and its conclusion.

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Introduction.

Everyone wants to find that elusive way to make money without any risk or too much hard work. Well the fact of the matter is that anyone with some spare cash can make even more money from it - if they’re prepared to be a little bit patient and take a small risk with it. The answer is quite simply to invest your spare cash in a business that’s either in need of a loan or looking for partners to perhaps finance a new project.

Considerations for investing in a business.

It’s not just Wall Street traders that can invest for profit.

Quite simply with bank interest rates being so low at present - you might as well put all your cash under the mattress for all the money it will currently earn in the bank. So, instead of waiting for the day to come when the banks finally start to pay you a decent return on your savings - why not get that cash earning more money for you by investing it instead? If you’ve never invested in a business before this might seem like a big step to make, the key thing to do here is not just to randomly pick a business to invest in. Instead, find one that meets your values and ethics and, perhaps even more importantly, think about the people you’re investing your money with rather than just the business. If one business might seem to offer a fantastic return on your investment, but you don’t like the people you’re dealing with; your gut instinct to invest in  another company even if it offers a lower return might well be the best one to make.

What about social lending networks?

If you’re still not too sure about dealing face-to-face with someone to invest your cash in, why not look into social lending groups. Social lending groups have been around for a long time and now invariably operate through the internet.  Individuals, or small businesses, needing to borrow money advertise on social lending websites for potential investors. You can choose the type of businesses to invest your money in and, if the required loan amount is beyond your personal capability, you can join a group of lenders who together can make up the full loan amount.

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Introduction.

As the money markets start to get themselves back into gear - what chance do first time buyers have of getting a good mortgage deal? Whereas before the credit crunch getting a 100% or even better than a 100% first time mortgage was as easy as a trip to the supermarket, post credit crunch all of the great deals simply melted away. The situation now is that without a big wad of money to put down as a deposit getting any sort of a mortgage is still tough for the first time buyer.

Things are improving.

Ready to move into your own home - get an online for a first time buyer’s mortgage.

The good news is that, even compared to six months ago, things are starting to look up in the mortgage markets, especially the highly competitive online mortgage deals. You’ll still not find that 100% or better mortgage offer, but the days of being asked for a whopping great 25% or even 30% deposit do seem to be over and deposit requests are falling and seem to be settling around 10%. Of course even a 10% deposit is still a hefty sum to find, a fairly modest apartment in most places will be $150k, so finding $15,000 as a deposit is still a big ask. So, is anyone out there prepared to offer 95% mortgage loans reducing the deposit requirement? Well, yes you will find online 95% mortgage offers for first time buyers, but the catch is that they will carry a higher rate of interest on the mortgage.

Loan to value calculations.

If you’re struggling to make a big deposit for the dream home you want to buy and so are looking for a 95% mortgage, the company making the loan will make a loan-to-value calculation to determine exactly what mortgage deal to offer you. To get the very best mortgage deals at present you still need to offer at least a 23.2% deposit, a lot yes but better than last year when it was 24.3%. So, without wishing to be too over-simplistic; if you can make their full deposit target you’ll get the best interest rate - let’s say 3.5%. If you can’t make that full deposit - you will still get your first time mortgage but with interest rates to penalize you, which on a 95% mortgage could easily exceed 5%.

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Introduction.

If it’s something you’ve been thinking about but not acted on so far - there might never be a better time to start doing some FX trading of your own now that the Euro is so weak. After what began as concerns regarding how the Greek government could cover its huge national debts, being one of the 16 member Euro zone states, the whole economy of the Euro could come under threat leaving it wide open to FX speculation.

Europe and the Euro.

If you really are new to the idea of FX, it simply means foreign currency exchange - where you buy and sell foreign currencies making profits on them as there values rise and fall. The problem for Greece and the Euro is that unlike the US dollar, Japanese Yen or the UK sterling that are the national currencies of single countries, the Euro is a currency commonly used across most of the rest of Europe. Subsequently, if one country in the Euro zone has financial difficulties all of Europe can suffer by having to help bale them out. The net result of this is that on the FX markets the value of the Euro falls.

Why you should buy Euros for FX trading.

There’s never been a better time to start FX trading in Euros.

All of the major international currencies rise and fall in value on a daily basis. The problems that the Euro is having looks like it could well last some time and the value of the Euro could yet fall even more. So, you can currently buy Euros quite cheaply and by waiting for the value of the Euro to then rise again, when the economic crisis is over, then selling them you can make a huge profit - all just for being patient. Patience is something you need to have when starting out in currency FX finances. Big profits can be made overnight by dealing in Euros or just about any foreign currency - but the really big money is made by buying a foreign currency at its lowest value then using specialist FX software and services to calculate the optimum price to then sell it at.

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Introduction.

We’re never afraid at “fntn.com” of advising anyone with a large amount of debt to destroy all but one of their credit cards. However, is that also good advice to give to people without any debt or those with a manageable level of debt? The past 12 months or so have seen millions of people see their credit limit on credit cards that they don’t use, or use infrequently, lowered. Why is that and what might it mean to you in the future?

Using credit cards and credit scores.

Don't use your credit card and your credit score could suffer!

It’s a simple matter of fact these days that if you have a credit card but don’t use it, the credit card company may well reduce the credit limit or even cancel it. If you have several credit cards this won’t be a massive inconvenience, you can simply use one of the other credit cards you possess. However, if that was the only credit card that you owned or if you then wanted to apply for another new credit card - the fact that you’ve had one cancelled, or even the credit limit reduced, could well go against you! How can cancelling a credit card or having the credit limit reduced go against you? Well, as far as the credit card company is concerned their logic works along the lines of - you’re not using our credit card because you can’t afford to repay any debts on it, for good measure they’ll then lower your credit score too.

Maintaining your good credit score.

It might well sound a ‘topsy turvy’ old world but these days, in that to maintain a good credit score, you need to be able to almost constantly prove to the credit agencies that you can repay debts without any problems. Needless to say, using and repaying credit card debts is one of the things they look at for that. So, an inactive or cancelled credit card can be interpreted as potential credit trouble - as outlined above. Although you need to keep tight track on what you’re spending on your credit cards; do use them regularly, not forgetting to regularly and on-time pay them off. Also, don’t forget to keep track of your FICO credit score, and that you’re entitled to a free credit score report once a year from each of the credit agencies.

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Introduction.

With unemployment back up to 10% at the start of this year the so called signs of economic recovery and, therefore, many folk’s personal finances, seem to be emulating the weather at the moment. Paychecks and money are either melting away with the snow or being frozen solid as we dare not touch them, for fear of what might happen to our jobs in the near future. One thing that will surely happen as a result of the unemployment figure going up again is that there will be more foreclosures on mortgages.

Foreclosures can mean investment opportunities.

Not wishing to sound heartless but it’s a fact that “one man’s loss in another man’s gain”; and the same is true when it comes to someone having their mortgage foreclosed. If you have some foresight, why not plan ahead and buy a foreclosed property for less than its true market value? Of course mortgage companies will always offer a re-finance mortgage to try and help avoid the foreclosure, but sometime folk have simply over-stretched themselves in terms of the mortgage they could afford. The net result of this in a time of economic recession is that the property market can be become flooded with properties, ostensibly owned by the mortgage companies carrying out the foreclosure. However, they don’t want to hold on to these properties until the economy heats up again and so auction them off to recoup their money. This is where a foreclosed property can turn into an investment opportunity for someone else.

You could turn a new mortgage into a second home investment.

Buying a property at an auction.

Obviously, if you haven’t got the cash to buy with you’ll need to secure a new mortgage before making a bid. Buying a property at an auction you will get it for tens of thousands of dollars less than if it was worth on the open market. Even better, you can make an offer directly to the vendor ahead of the auction or, even better still, if a property doesn’t sell at an auction you can make them an even lower offer after the auction - which if they’re keen to sell will probably accept. Buying a foreclosed property is one way that you can secure a property for a family member, as a dream second home or simply as an investment for the future.

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