Land Loans 101


You are ready to buy a home, but you cannot find a home that has all the features that are important to you. However, you have found the perfect plot of land on which to build your own dream home. That means you will soon be entering the world of land loans – loans that are similar to mortgages but with some distinct differences.

Land loans are loans to buy property that is not currently being used for any home or business purpose, generally referring to undeveloped land. Land loans usually require larger down payments and will carry higher interest rates because they represent a larger risk for the lender. Without a house on the lot as collateral and no guarantee that you can complete the building of one, lenders will have difficulty dealing with the land if you default.

The terms “lot loan” and “land loan” can be used interchangeably, but there are differences. Lot loans generally imply that the property is in a platted development with roads and utilities, or …

Microfinance Loans 101


A microfinance loan is a loan extended by non-traditional lenders to people who are not served by traditional banks, such as lower-income borrowers, people without collateral, or people with lower credit scores. It does not necessarily refer to the loan amount, although most loans are small – from the $500 range to thousands.

Microfinance loans may also be called microcredit. The broad term microfinance implies other services such as specialized savings accounts, insurance or other financial services for the same underserved market.

  • Who Uses Microfinance Loans? – Usually small business owners or entrepreneurs, or those wanting to become one. They cannot acquire bank financing because of the risks associated with their ventures, the smaller size of the loan required, their limited experience, or the variability of their income. Many are self-employed.

    These people may also be unable to secure

Asking A College to Reconsider Their Financial Aid Package


When a college makes an offer of financial aid, parents and students have the right to appeal and discuss the findings with the financial aid officer. In some cases, the institute of higher learning may up their offer.

When possible, try leveraging off of any aid packages offered by a competing institution where you applied. Some amount of aid is kept in reserve to enhance offers for kids schools really want. Contact the financial aid officer indicating that the school is your child’s preferred choice but that other schools offered better packages. Competition never hurts and here it may help you. Provide specifics of the other aid packages. Do this as soon as possible before the reserve funds are exhausted.

Financial aid officers may also exercise “professional judgment” to review and change offers. “Special circumstances” are the basis of exercising such judgment. Special circumstances may include unusual or one-time income in the Base Year used to calculate th…

Why Your Neighbors Are Tapping Their Home Equity


You’ve accumulated a decent amount of equity in your home. Why not put your equity to use with a home equity loan or a home equity line of credit (HELOC)?

Both allow you to borrow against the equity in your home. A home equity loan is a lump sum option with a fixed interest rate and payment schedule, while a HELOC allows you to draw funds as needed (similar to a credit card).

If you did tap your home equity, what would you do with the funds? Probably make home improvements or repairs, according to a recent survey. Almost three-quarters of homeowners considered those good reasons to borrow from your home equity. Other popular reasons included debt consolidation (44%), covering educational costs (31%), paying regular household bills (15%), and making investments (12%).

It’s a sign of trouble when you’re using a loan to pay regular expenses. According …

Free Government Program Can Help You Master Your Finances


You’re never too old to learn new things – including better money management practices. The Federal Deposit Insurance Corporation (FDIC) agrees.

To address financial literacy concerns, the FDIC created the Money Smart teaching program in 2001 to help educators and financial institutions increase consumer understanding of basic financial systems work and how to use them to stay financially healthy.

The Money Smart for Adults program is expanding to include more topics. According to the FDIC website, the updated Money Smart for Adults program is set to begin in fall 2018.

The updated program contains eleven separate modules that take one to two hours of time per module. Topics include how banking services work, the basics of credit and credit histories, how to use credit cards…

4 Top Myths Surrounding VA Loans


Home sellers and their agents may be limiting their potential base of buyers by ignoring a growing pool of them. Mortgage industry software company Ellie Mae reports that loans acquired through the Veterans Affairs (VA) Department account for 10% of all primary insured home loans.

It is easy to see why VA backing is preferable from a buyer’s point of view. If you qualify, you can purchase a house with no money down (up to a particular loan limit that varies by market) and no Private Mortgage Insurance (PMI) requirement. Yet, sellers shy away from buyers with VA loans, and seller’s agents may serve as a screen to exclude VA-backed offers from ever reaching the seller.

Why is this so? It makes little sense, since the risk of default is borne by the lending institution and not the buyer. In addition, …

Is the Housing Market Turning?


Nearing the Limit

The housing market has suffered from excess demand and limited supply for years, causing a sharp increase in home prices. Add continually increasing interest rates to the mix, and eventually something has to give.

The turning point may have arrived.

The S&P CoreLogic Case-Shiller report shows that home prices are still rising, but at the slowest pace in almost two years. For almost a year, the National Case-Shiller Price index has risen by an annualized rate over 6% – well outpacing wages as well as inflation. Meanwhile, existing home sales were down 3.4% in September and down 4.1% from the previous year, according to the National Association of Realtors (NAR) – the lowest mark since November 2015.

An out-of-balance market may be adjusting toward normalcy. That’s potentially good news for you, if you keep your finances in decent shape.

Don’t Let Your Kids’ Schools Release Their Personal Data


Identity thieves love to steal children’s identities. Nobody thinks to check their child’s credit report because there’s no reason to expect them to have one. Criminals can exploit the stolen identity undetected for years, until the child grows up to find his or her credit ruined.

How bad is the problem? The 2018 Child Identity Fraud Study from Javelin Strategy & Research found that over one million children were victims of identity theft in 2017 alone, with cumulative losses of $2.67 billion.

Criminals find children’s identities anywhere they’re stored in quantities, such as schools – and some of your child’s personal information may be handed out there, just for the asking. Thanks to the Family Educational Rights and Privacy Act (FERPA), public schools may release directory information on request.

Directory information varies by school district, but it may contain your child’s name, address, phone number, birthday and birthplace, and email address…

Only 1 Out Of 7 Monitors Their Social Security Number Online


Do you monitor your Social Security number for any signs of fraudulent use? A new survey suggests you think that you should, but you probably don’t.

According to the 2018 Capital One Credit Protection and Security Survey, only one in seven Americans uses a service to monitor activity on their Social Security number – but just over half of Americans who don’t use a monitoring service think they should use one.

Why is Social Security monitoring so important? Your Social Security number is your most important and most often-used identifier. Criminals can use your Social Security number to apply for credit in your name. Without monitoring services, you may not realize your Social Security number has been abused until you’re confronted with major unpaid bills and ruined credit.

Because of their versatility in identity theft scams, Social Security numbers are highly prized pieces of information. Depending on what other information criminals have on you, your …