My Personal Finance Blog

One of the things that we always explain to senior borrowers when they ask about reverse mortgages is that they are non-recourse loans. The next question is always, What is a non-recourse loan?. This is a very important feature of the reverse mortgage and I want to take a moment to explain just what non-recourse means and how that affects senior borrowers who get reverse mortgages.

Simply put, a non-recourse loan means that the lender has only your property as security for their loan they have no other way to obtain repayment of the principal and interest in the event something happens and your home is not worth enough to pay off the obligation including all interest and fees. Could this ever happen? The loan itself is designed utilizing actuarial tables and knowing when most borrowers will vacate their homes due to passing or other reasons. Some borrowers absolutely blow these tables out of the water living active productive lives many years beyond the average life expectancy. Also, while most properties appreciate and stay ahead in value of their loan balances, it is feasible that during times of extended downturns in values growing balances due to money borrowed, accrued interest and charges and longer than expected loans due to prolonged lives, etc. the balance of the reverse mortgage loan could grow to be greater than the value of the property.

While the interest rates are low, many don’t think about it but if the rates were ever to increase sharply on the adjustable rate reverse mortgages, then equity would be eroded much more quickly as well (a good example of this is to check the difference between the HUD Home Equity Conversion Mortgage HECM or Heck-um and a propriety jumbo reverse mortgage with an interest rate nearly 4% higher and see how much more quickly the balance rises on the higher rate mortgage). This is where the non-recourse nature of the loan is so important, regardless of what you owe when the loan becomes due as a result of your moving out of the home or passing, you or your heirs can never owe more than your home is worth.

This means that you can live in your home for life, never make another mortgage payment, and never have to worry about passing an obligation on to an heir. In most scenarios, you still pass equity on to your heirs but it’s nice to know that regardless of how much money you receive on your reverse mortgage, how long you live in your property, what the interest rates do, or what values do in the future, you or your heirs can never owe more money than the property is worth. That non-recourse feature is one of the kinds of security the reverse mortgage is known for.

Nowadays, the trend of making payments with bank credit cards is rapidly increasing. But having too many bank credit cards can create a negative impact on the credit score of the person. If a bank credit card is no longer in use, it is better to cancel it. When a bank credit card is lost or stolen, it is better to cancel the credit card in order to avoid fraudulent use of the card.

Before canceling a bank credit card, one should check whether any balance remains to be paid for the particular bank credit card. Notify the bank about canceling a bank credit card only after paying off the balance amount completely. Otherwise, some banks increase the interest rate if the cardholder tries to cancel while a balance still exists.

Canceling a bank credit card can be done either by sending a letter to the bank or notifying the bank of the cancellation by phone. The request letter should contain the name, address, and account number of the cardholder. Always keep a copy of this letter to avoid future problems. On accepting the request, the bank sends back a notice, either on the same day or the next day. The rewards on the credit card as well as bank machine access stops upon cancellation of a bank credit card. Moreover, the convenience checks issued by the bank are destroyed.

After canceling a bank credit card, the person must get a copy of the current credit report and make sure to verify the credit score. The cancellation of the credit card must be reported correctly in the credit report.

It is always advisable to keep the bank credit card when the person is planning to take a vehicle loan or mortgage. Canceling a large number of unused bank credit cards can also adversely affect the credit score.

The new CARD consumer credit protection act takes effect Feb. 22-and, in my mind, not a moment too soon.

The past few months have produced an appalling feeding frenzy by credit card companies raising interest rates through the stratosphere while they still can, cancelling accounts, reducing credit limits-all in anticipation that the brakes will be put on when this new law takes effect.

Now, hopefully, this behavior will now slow down.

One of my companies recently reduced my credit limit from $9,500 to $500 just because I hadn’t used the card for a few months. I decided to vote with my feet since they had initiated a hit to my credit score, I’d just bite the bullet and say goodbye to them.

The new CARD act doesn’t mean that your credit card company can’t still put the screws to you, but there are some limits.

Here’s what you get starting next week:
You must get 45 days notice before interest rates can be raised on future purchases. Interest rates on existing balances can’t be raised unless you’re in default for 60 days. Monthly statements from now on will tell you how many years you’ll be in debt if you only make minimum payments. Annual fees, if any (look out for them) cannot be more than 25% of the card’s limit. If you have more than one interest rate on your account, anything you pay over the minimum balance will be applied to the highest rate first. But beware, if you only pay the minimum, the money will still be applied to the lowest rate first. Teaser rates on new cards must be honored for one year. Credit won’t be extended to people under 21 without a co-signer, except in very specific circumstances.

Have you ever think to use the payday loan help? You need to know that the payday loan consolidation is very needed for those people who want to escape the unkind financial realities such as garnishments and bankruptcy. Also, it can be used to protect your credit for sure. So that, you are still be able to pay off your debt at that time. The payday loan consolidation will help you to get rid of the monthly burden. You see, you are able to live stress free for sure. You can sleep well at night as well.
Furthermore, you need to know that there is several different type of debt consolidation. Typically each of them is designed for a specific purpose on the financial circumstance. And the payday loan consolidation is one of the several types. Generally the payday loan hit the customer with its offer and advantages claimed. It seems as the safest service in the market. On the other hand, from time to time the payday loan becomes more of a problem than way out for people in financial needs. The high interest rates usually make people stuck in a spiral. They cannot get rid of the spiral since they cannot afford the interest rates of the debt.

Stuck in bad condition with no money to be used is like the end of the world. No one can help you because they also do not necessarily have enough money to be lent to you. Looking for credit is the only way to save you from this situation. Your loan will be achieved only in 24 to 48 hours. You see that this system is very fast and really help you in fulfilling your need for money.

The main thing you should remember is that you have to pay back your loan. For that you need many observations to determine the lenders who can provide elastic credit for you. So, you can get a lower interest rate with the repayment in accordance with your abilities.

Elastic card is the right solution for you; this elastic card is made to make your life easier. There are two kinds of elastic credit, first there is the Elastic Card. This card is made for Visa Debit Prepaid Card; you can use to pay your things in any merchant who accept visa logo. The second elastic card is called The Elastic Line of Credit; this card is for you who need much money in emergency situation. This card can accept until $500 to cover accidentally bill, car repairmen, and other emergency situation.