The Benefits of Fixing Your Mortgage Rate

When making plans to purchase or refinance a home, you will need to decide whether your mortgage agreement will require you to pay a fixed or a variable interest rate. Fixed-rate mortgages are often the preferred choice for home buyers who do not wish to be caught off guard by sudden economic shifts or changes in personal financial circumstances. The main benefits of fixing your mortgage rate as opposed to signing up for a variable rate are described below. 

Steady Monthly Payments

Because mortgages with a fixed rate do not fluctuate over the course of the entire amortization period, your monthly home payments will remain steady until you are able to pay off your loan. Though minor adjustments to your tax and home insurance payments may occur on occasion, the amount of your mortgage loan itself is permanently set at a certain amount. This makes it easy for you to plan your monthly budget and adjust your expenses accordingly. For example, if your mortgage payment is fixed at $900 per month, you can easily plan to set that amount aside each time your bill is due.

Option to Make Additional Principal Payments

Though a fixed-rate mortgage agreement typically covers a 15-year or 30-year period, this type of loan does allow for you to make additional payments on your principal in order to settle your debt at a faster rate. If you are in the early stages of paying off your home and have extra money at your disposal each month, you may wish to apply that money toward the principal as your regular mortgage payment goes toward paying off interest. The option of supplementing your fixed-rate payments with additional funds can shorten the term of your mortgage by at least several years.

Security Against Inflation/Rising Interest Rates

Many homeowners appreciate the security that Fixed Mortgage Rates offer in regard to the continually rising cost of living. Inflation can increase the amount of your utility payments, grocery bills and entertainment expenses, but it cannot affect mortgage payments with a fixed interest rate. Similarly, if interest rates within the home buying industry become higher on the whole, you will not have to worry about paying an increased rate on your home. If your interest rate is fixed at 5.5%, it will remain there even if average mortgage rates rise to 6.5%, for example. In a world where monthly expenses can rise without much warning, the stability of a fixed mortgage payment is very attractive.

Fixing your mortgage rate is highly beneficial if you desire the comfort of knowing that your home payments will stay consistent from month to month. This option is ideal for people who prefer to live on a budget without having to worry about sudden debt increases. Speak with a professional mortgage lender for more information on how opting for a fixed rate can help you in the home-buying process.


Anna Cheswick is an experienced writer within the finance niche. She regularly submits pieces on obtaining and refinancing home mortgages to various blogs, websites and print publications. Anna works diligently to stay informed on current Fixed Mortgage Rates and variable mortgage rates.

How to Practice Golf Without Blowing Through Your Retirement Money

Growing up I always had some idea about what seemed to me like noble sports (golf for instance, lacrosse, polo) since it always seems such activities will never be available to those on a budget or with limited financial resources. The peculiar thing, however, is that playing golf does not require you to be rich, as I once believed. It requires much more consideration, granted, but it definitely can be done. 

Clubs and other equipment

What is most intimidating about golf, and perhaps the main factor that prevents new players from turning into regular players is cost, and cost begins where equipment purchase is concerned. And although it is clear that this particular sport is certainly one of those activities that will have players reaching deeper and deeper into their pockets, there are ways to minimize costs and still enjoy the sport as much as any other player.

The high prices of equipment nowadays can easily be explained by the technological advancements and sophistication that these items provide all to ease the game of players and to ensure maximum success rates. But it is not necessary to buy pro-line golf clubs right away, as these will surely be a large investment. There are starter golf sets that will rarely cost you over 200$ and which contain all the items needed for you to commence your golf adventure.

(Photo credit: Wikipedia)

There are many good deals on golf equipment internet sites like www.golfbox.com.au so take your time and search for what is in your price range. Moreover, if you may find yourself disliking the activity in this initial phase, such starter sets can easily be sold very close to the original amount you paid for it. Contrastingly, if you feel the need that investing in higher quality clubs, the same goes with selling this starter set. In this, re-selling your equipment will contribute greatly to your reduction endeavors when taking up golf. 

Instruction

For the newcomer, building a foundation is highly important when learning to play golf. Even though there are many PGA professional instructors trained to instruct in all aspects of golf, the private lesson prices (sometimes more than 100$ per hour) are simply too high to be justifiable. There are local courses however which also provide introductory group lessons and these are much more budget friendly (usually under 30$). If you have some experience with the sport and improving your swing is what you are after, you can save up on lessons by using a camera or recording device to analyze your swing by comparing it to pro player videos on YouTube. 

(Photo credit: Wikipedia)

Golf course

Another issue where most new golfers seem to get stuck on is practice venue: there are golf clubs in California for instance who charge anywhere between 400$ and 500$ for the entire course (18 holes) and this would indeed burn a hole through the player’s pockets. In this case, it is not about the amount of practice or in choosing low quality practice venues, but in correctly and efficiently practicing. And this is certainly something you can accomplish: as many golf courses are swarming with players hopelessly swinging at balls, you can effortlessly be one of those who swings once while others swing 5 times, but land the ball where you want it.

When working on your full swing for instance, make sure to concentrate on spending the majority of time working with the irons (and change your clubs on a constant basis). And since you are training to be a complete player, you need to address all aspects of the game, such as putting, pitching, bunker play, chipping: and since these elements belong to the short game, you need to know that many facilities offer practice greens for no additional costs. Another thing that will make your practice sessions more efficient is setting a goal for each one. You can also try nine-hole tournaments instead of 18-hole ones since they are significantly more affordable. 

Conclusion

All in all, it is essential that you are not overwhelmed by all you think you will have to spend in order to begin pursuing your new found interest. Be sure to focus on your game, practice while being concentrated what you are doing, be in tune with what it is you struggle with because you can work on those aspects that need improving. And all this while saving both money and time and shooting lower scores.

Understanding the Differences Between Personal and Business Credit

Image via CrunchBase

If you’re a business owner and you’re in the market for a business loan, it’s a good idea to understand that there are big differences between business credit and personal credit. 

Personal Credit

Let’s begin with your personal credit. Hopefully you are already aware of the fact that your personal credit score takes into account your credit history. A credit agency most commonly will calculate your score using the FICO method, which is based on several factors such as your payment history, outstanding debt, new credit, and the length of your credit history.

TransUnion, Experian, and Equifax are the top three personal credit bureaus in the US. It is required by law that these three agencies allow you to request a free credit report from each of them every 12 months. Additionally, if you find an error or discrepancy on your report, under the Fair Credit Reporting Act, the credit reporting company and the organization that provided the incorrect information must investigate the error in a timely manner.

It’s important to note that any accurate negative information on your credit report, like missed payments, will eventually disappear after seven to ten years. And although those marks stick around for several years, you always have the opportunity to build and repair your own credit in the meanwhile.

You want to maintain the best credit score possible because it is your passport to low interest rates and fees when you decide to apply for a car loan, take out a mortgage, request a credit card, and more. If you have a favorable credit history, companies will be more inclined to offer you good benefits and trust that you will make payments on time.

Business Credit

With that being said, if you’re looking to take out a loan for your business, it’s best to do it under your business’s credit. Regardless of how stable your business may be right now, business endeavors can be risky, so you don’t want any of your business’s potential debt or missed payments to reflect on your own personal credit report.

So that’s where business credit comes into play. If you don’t currently have business credit, you’ll want to first form a business entity, apply for a tax number, and then set up a business bank account. Once you’ve done that, you can register with business credit bureaus, so that vendors can begin reporting your business’s payment history to them. The top three business credit bureaus include Dun & Bradstreet, Business Experian, and Business Equifax.

These credit bureaus calculate your business’s Paydex Score, which is similar to the FICO scoring method. The Paydex score takes into various factors, but relies heavily on your business’s payment history.

One of the main differences between your business and personal credit, is that there is no way to repair your business’s credit report. Just a few missed payments, and your business credit could be tarnished forever.

Another big difference is that there are no rules or regulations in place that require the credit bureaus to fix errors on your business’s credit. While you can still report mistakes or dispute errors, there aren’t any laws in place to facilitate the process or protect your business like there are with personal credit.

Understanding some of these main differences between personal and business credit will make you more savvy when it comes time to take out a loan for your business.

Chloe Mulliner writes and edits for CreditSources.org, a website that focuses on bad credit unsecured loans, cash advances, and all things credit related.

Ways to Reduce Your Gas Usage This Summer

At last, the sun seems to be shining and the temperature is rising. We’re starting to reorganise our wardrobes to bring our spring and summer clothes to the front, and we’re banishing our winter boots, hats and scarves to the depths of the attic. When we get to this point of the year, it’s common to hear people discussing whether their central heating is still on, and how they want to save money during the spring and summer in case the next winter is just as cold. 

This is possible to achieve, although it does seem difficult when suppliers are increasing prices every few months. If you are looking to reduce your gas usage this summer, use my helpful tips and let me know if they’ve worked for you... 

Consider your heating needs

The first step to a cheap gas bill is to think carefully about whether you’ll need to use your central heating throughout the spring and summer. You may still get a bit chilly in the evening, but consider whether a jumper, shrug or even a blanket could work better to warm you up. It really is worthwhile setting a programme for your central heating if you feel that you do need to use it during the warmer months for medical needs - try and set the heating to come on when you are actually in the home or you’ll be paying to heat up an empty house!

Set a timer for hot water

If your gas boiler is also used for your hot water supply, you could set a timer to make sure that you are only heating your water during practical hours, such as when you are due to get a shower in the morning or when you are doing the washing up in the evening. You don’t want to throw away money where it isn’t needed, meaning that you could save a few pounds by implementing this simple process.

Eat differently

A slightly different way to reduce your gas usage is to change your diet this spring and summer. If you have a gas hob or oven, you could find alternative meals that don’t require cooking in this way. For example, the summer is an ideal time to eat lots of fresh fruit and vegetables, making salads a great choice. If you’re looking to make these slightly more exciting, think about adding canned food such as tuna or pre-cooked prawns. Another way us Brits like to cook in the summer is using a charcoal barbecue, so it might be time for you to uncover yours for the season.

Review your usage

Finally, review your usage every month and see whether you can find a better deal with an alternative provider. Start your search on a price comparison website and follow up by speaking to the energy companies directly.


About the author
John Parker is a blogger interested in going green, as well as the money saving benefits from doing so. This year he has been working on how to get a cheap gas bill during off-peak seasons.

The Retirement Savings Crisis - Infographic

It's terrible how ill prepared most of us are for retirement. It's not like we don't know it's going to happen. We have more than half of our lives to get ready for it. Sadly, some of those that did prepare have had their savings taken out by the current economic problems. 

If the government really wanted to do something about this they should have a method to start the preparation for retirement when we are born. At birth we give children a Social Security card, why not a retirement account also. Why wait to start something important like that 25 years later? What's your take?

Image created by www.MastersinAccounting.info

Common Credit Score Myths Debunked

Credit Scores (Photo credit: i am real estate photographer)

Ahh myths...they are fun but, when they are about financial stability, they can cause quite the stir! With credit scores being more important today than ever before, it is no surprise that myths have started to form as the result of lack of knowledge about this topic. The truth is, most schools don't teach kids about credit cards and credit scores. When it's time to fend for ourselves financially, we try to just learn as we go. In this process, we often times take suggestions offered up by friends when the truth is, they know no more about the topic than we do. Well, today, I am writing this article to debunk the most common credit score myths! 

Myth #1: Will Checking My Credit Score Harm My Credit Scores?

Over time, I've been told by several people that if I check my credit score, it will harm my credit score. The truth is, this is definitely a myth. How is it that you would be able to manage your credit if your score went down every time you went to check it! Although, this myth does have a reasonable explanation. When consumers apply for loans, their credit is checked. As a result of this check, the credit score will be decreased. However, the decreases are small and consumers would have to apply for a few loans at a time to notice any huge changes. The bottom line is, negative changes as the result of a credit check only happen if the check is requested by a third party for the purpose of issuing credit. 

Myth #2: Is Closing My Credit Card A Bad Idea?

It is a widely thought idea that closing a credit card is a bad idea. But, is this always the case? This idea is a MYTH! Although it's not always a good idea to close a credit card, it's not always necessarily a bad idea either. There are many factors that determine your credit score. One of the factors is the average amount of time your credit cards have been opened. Therefore, every time you open a new credit card, the average time goes down and it causes a minor ding. But, if you open a new credit card and find out it's not something you enjoy, it's probably a good idea to close it, considering you have other accounts that have been opened for a while. As a matter of fact, in this case, it shouldn't do the slightest bit of damage and may have a positive impact. 

Myth #3: Are Lenders Willing To Help Consumers Through Rough Times?

It is a common misconception that lenders are evil corporations that don't care about us little guys. Without us little guys, the credit card companies would have absolutely nothing. So, even if they don't care about anything but the bottom line, it's in their best interest to help us out from time to time. As a matter of fact, many lenders have opened up financial hardship departments to provide a helping hand when needed. Learn more about credit card hardship programs here in an article I recently wrote for Top Finance Blog! 

Final Thoughts

When it comes to something so incredibly important as your credit score, it's important to believe nothing you hear without research. The truth is, if you are afraid to check your credit score, it's unlikely that you will build an excellent one. If you don't understand how closing a credit card may or may not change your score, it will be hard to manage reasonable amounts of debt and lines of credit. Finally, if you are afraid to ask your lender for assistance in the midst of hard times, you will find harder times to come in most financial hardship situations. This is why doing your research is so important!

About The Author, Joshua Rodriguez

This article was written by Joshua Rodriguez, proud owner and founder of CNA Finance and avid personal finance writer. This article was inspired by Joshua's most recent work, “How Long Does It Take To Improve Your Credit Score”. Join the discussion about credit scores or any personal finance topic of your choice on Google+!