Young Seniors Have High Non-Mortgage Debt

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By Sandra Parsons

Debt is a major barrier to financial well-being among Americans. While we tend to think of debt as an issue affecting young and middle-aged people, the truth is that senior citizens carry debt, too. Among seniors approaching retirement, debt can be an obstacle to maximizing savings. Retirees living on a reduced income may find debt especially crippling in an economy of rising costs.

Using an anonymized sample, LendingTree analyzed 2018 second quarter credit report data for 75,000 My LendingTree users aged 65-70 across the fifty largest metropolitan centers in the US. They calculated three main metrics: median non-mortgage debt balances; distribution of debt by type (auto loans, credit cards, personal loans, student loans); and average credit score. The results might surprise you.

The Average Median Non-Mortgage Debt Among Retirement-Aged…

2 Out Of 3 Loans Used for Credit Cards and Loan Consolidation

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What do you do with debts that have unfavorable interest rates or difficult payment terms? If you can, consolidate them into one debt stream with more favorable terms. Balance transfer credit cards exist for this purpose, but personal loans may be an even better alternative.

November 2018 data from LendingTree shows that over two-thirds of all personal loan inquiries are for debt consolidation (37%) or credit card refinancing (31%). Personal loans generally offer lower interest rates for equivalent credit profiles, and consumers are taking advantage of the difference.

The lowest average annual percentage rate (APR) for all credit cards is 17.15% according to CreditCards.com, and balance transfer cards aren’t much better at a 16.33% average lowest APR offer. According to LendingTree, borrowers with excellent credit averaged 9.62% APR on pers…

Nearly 1 In 4 Feel They’ll Never Escape From Significant Debt

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According to the latest Household Debt and Credit Report from the New York Federal Reserve, America’s total household debt has surpassed $13.5 trillion. Do you sometimes feel like $13 trillion of that debt is yours?

Based on a recent survey by LightStream, almost one-quarter (23%) of Americans believe that it’s nearly impossible to climb out of significant debt once you acquire it. The sense of hopelessness can lead to bad decisions and a treadmill of running debt. In that harmful mindset, $13,000 might as well be $13 trillion – you’ll never pay it off anyway.

Don’t let despair blind you from alternatives. According to LightStream senior vice president Todd Nelson, “People who are carrying debt often overlook cost-reducing solutions.” Nelson adds that debt consolidation can be a smart strategy that can benefit Generation Xers (ages 36-51) with good credit.

Why does Nelson highlight Generation Xers? LightStream found that while large majorities of adult …

Five Arizona Title Lenders Sued

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Five loan companies in Arizona have been sued by the Consumer Financial Protection Bureau (CFPB) for failing to follow disclosure guidelines in online advertisements. Guidelines state that lenders must follow specific formats for disclosing any interest rate changes in online marketing. The five lenders, which make loans secured by the borrower’s car title, did not include information related to the APR of their loans.

Named in lawsuits by the CFPB, the five companies are Interstate Lending, Auto Cash Leasing, Phoenix Title Loans, Presto Auto Loans, and Oasis Title Loans. Allegations against the companies state that the listed rates in the advertisements were lower than those borrowers would be given.

All the loans offered by …

Video: The Dirty Secret Behind Zero-Percent Financing

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You buy a big-ticket item today and only start paying for it in a year’s time. That’s a good deal, right? Not always. Zero-percent financing may sound great, but it could end up costing you a whole lot more in hidden interest charges. Professor MoneyTips Jeff Hoyt explains how to assess a zero-percent financing offer to make sure that you don’t end up paying extra in our exclusive video above.

If you want to reduce your interest payments and lower your debt, join MoneyTips and use our free Debt Optimizer tool.

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Odd Online Loans

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Can you believe someone was able to borrow money online to buy basketball trading cards? Not just any card, but a Michael Jordan rookie card that could be worth six figures! While millions of people have borrowed money online to buy a house or condo, we found a social worker from New Mexico who used financing to finish paying off her yurt!

These wacky loan requests were both fielded by the online lender LightStream, which has lent money to good-credit borrowers for all kinds of reasons without any collateral. Among the oddest requests they have fulfilled:

  • A Kentucky man took $10,000 to buy a laser engraving cutter to pursue his hobby;
  • A social worker from New Mexico borrowed $15,000 to finish paying off her yurt;
  • An Arkansas resident borrowed $6,000 “for hearing aids and a car repair”;
  • A California man took out a $35,000 loan to purchase an “exquisite” Michael Jordan rookie card;
  • A Georgia resident got a $5,000…

Video: How To Raise Your Credit Score If You Mostly Use Cash

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Do you have limited credit because you usually use cash? There will come a time when you need a solid credit score to get a mortgage or auto loan, or even to rent an apartment! Watch National Financial Educators Founder Adam Carroll explain how to increase your credit score by getting a credit-builder loan in our video above.

You can check your credit score and read your credit report for free within minutes by joining MoneyTips.

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Personal Loans Are Fastest-Growing Consumer Debt

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We often hear about skyrocketing student loan and credit card debt, but a different type of debt is growing at a faster rate than either of those. According to data from the credit bureau Experian, debt from personal loans rose by 11.4% in the second quarter of 2018 compared to the same quarter in 2017 – well above the 7.1% increase in student loans and 6.6% increase in credit card debt.

Personal loans are a form of installment loan. You receive a lump sum of money and agree to repay the loan with interest over a set period of time per the loan terms. Unlike mortgages and auto loans, personal loans are generally unsecured – meaning that there is no asset to repossess in case of default. As a result, interest rates on personal loans are typically higher than rates for mortgages or auto loans.

However, personal loan interest…

Your Low Credit Score Could Cost You $45,000

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Your credit score is one of the primary items that lenders check when they consider loaning you money. A lower score means greater risk, and lenders will charge you a higher interest rate because of that difference – but how much could it cost you over the lifetime of a loan?

According to a new study from LendingTree, if you have only fair credit instead of very good credit, the difference can cost you over $45,000.

LendingTree analyzed loan data from their database to assess the costs of a lower credit score as applied to five different sources of borrowing (credit card debt, personal loans, auto loans, student loans, and mortgages). Interest was calculated based on the average loan amount for each type of credit. Combined, the loans totaled $310,263 – dominated by the average mortgage loan of $234,437.

At interest rates available with very good credit (740-799), the total interest payment over the lifetime of all five credit sources was $212,498. At t…