Danger Spots When Getting Car Finance

28 Feb

Car financing may seem the go-to option if you want to own a car but do not have enough money to pay the cash up front. However, there are certain traps along the road that you need to look out for, even before getting into that car of yours.

Do Not Invest in a Long Term Deal

Dealers often trick their customers into getting a car finance scheme extended over a long period of time, as they claim it will help us with lower monthly payments and hence better handling of the budget. But this is so not true. With a long term deal, you not only end up paying more in the interest but you also have to cover more in maintenance as your car gets older. Furthermore by the time you are done with your payments, the brand value of your car may have dropped, leaving you with a deal that resulted in a loss.

Deals for the Sub-Prime

People having a credit score below 660, often tend to be fooled by dealers who promise a car financing scheme that won’t be based on their credit ratings and thus helping them to get a car even with an average credit score. The thing to look out for in these deals is the large down payment they may require and revolve around interest rates that could be too high to afford, leaving you in a mess over the course of the deal.

The Cost of Extras

When you approach a dealer for car finance option, they offer you extras like tinted windows and rust maintenance. Getting everything under one roof seems convenient and you end up subscribing for these extras. Usually the cost accrued over these extras is “significantly” higher than what you would get at some other place. So always research your neighbourhood before committing to these extra charges.

The Roll-Over Policy

People like to switch their cars frequently and car finance dealers exploit this. By offering a car update over the previous one, even before the deal is paid off, they end up tricking customers into rolling over their remaining payments onto the new deal. This ends up increasing the cost that the customer initially had to pay.

Packaging

Sometimes the dealer would package more than one deal into a single deal, telling you that through distribution you would be able to save on your monthly payments. But the reality is far from it. Packaging the financing deal of a person having a bad credit along with someone who has good credit ratings, help dealers to secure the deal and earn some commission for themselves. The person with higher credit ratings end up paying higher interest.

Removal from Blacklist

Dealers often tell you that you are enlisted in a credit blacklist and then offer help by having to pay you extra charges. Some of the people falls prey to this technique without knowing that there is no such thing as a credit blacklist.

There are plenty of traps and danger spots that lie in your wait when you try for a car financing scheme. You may not be the smartest of all to avoid them, but educating yourself and questioning thoroughly what you are in for, you can surely avoid these danger spots.…

Identifying the Investor in You -What Kind Are You?

15 Jan

There are billions of people in the world and not even a single one of them is same as the other. Even the identical twins have dissimilar finger prints and have different mindset, even a different preference in pizza toppings. This is why when it comes to the world of investing you’ll find different types of investors. Broadly speaking there are three types of investors.

  • Pre-Investor
  • Passive Investment Strategy
  • Active Investor

So, let’s delve deeper into each type of investor and find out what type of investor should you aspire to be.

Pre-Investors

The name may deceive you but pre-investors aren’t investors in the first place. They live from pay check to pay check and never make that leap to various investment avenues. These are the people who are financially illiterate and contently like to live all their life stuck in a rat race. They do not have any plans what-so-ever in becoming financially independent. If you are such a person then your financial situation will deplete overtime so you must work towards becoming an active investor or at least a passive investor.

Passive Investor

A passive investor is better than pre-investor. This type of an investor do not know about how he himself can make investments in the market but realizes that investing is the first step in becoming financially independent. So, they invest their money in a tax free mutual fund or other investment avenue where a finance professional is responsible for the management of money. They are known as passive investors as they themselves are not actively investing in the market rather they are dependent upon financial institution and financial advisors who generates income for them.

Active Investor

This is the type of investor that you should aspire to be. If you have enough time to learn about investing and if you are not afraid of putting your money on a roller coaster ride then you should definitely progress your way up to become an active investor because it will make you financially independent within few years.

An active investor knows how to manage his money and is not only financially literate, but he also knows a lot about different financial markets and how to invest in them. They can spot opportunities and trends in the market. You don’t really need to be an economics major to be an active investor, what you need is a will and the courage to take risk and speculate with your own money.

With the above description about each type of investor, we believe that you can easily identify which type of investor are you. If you are a per-investor, which unfortunately most of the Brits are, then it’s time that you start getting some basic financial lessons in order to manage your money prudently.

Being an active investor does not mean that you will spend your days lying on your couch watching super bowl. In fact as an active investor you will be responsible for your investment and you’ll find yourself doing more work than a passive investor.…

The Curious Case of Credit Card and Millennials

24 Nov

Credit cards are quite common in modern times and most people like to use them for the benefits of better managing their expenses as well as having a lifeline to go to in case of a financial emergency. Millennials are individuals who grew up in the new millennium and saw the turn of the century. This group makes up the young adults of the working age and therefore it is all but natural to study their use of credit cards.

The Older Belief

There was a belief that the millennial generation wanted to stay away from credit cards and generally preferred debit card and cash payments. The older generation was more into using the credit cards. Several surveys show that most young adults of age less than 29 generally do not have credit cards and therefore do not use them.

It was due to the fact that the millennial generation grew up in a torrid economic time. Everyone in the early 2000s was struggling with debts. Many major financial institutions crashed during this time and the international markets plummeted creating a natural fear in the growing general who saw their adults in financial problems.

The New Information

The new information however reveals that now the millennial generation understands the use of credit cards and has shifted towards their greater use. This information includes people up to the age of 34. In fact, millennial generation seemed to not use credit cards because it is simply difficult for a young individual with no credit history to obtain them.

Once the millennial generation got enough credit history or job continuity, it was able to get its hands on the credit cards. This has therefore resulted in a much greater use of the credit cards for shopping, travelling and other purposes. The recent survey also shows that the millennial generation is now interested in performing large purchases from their credit cards such as buying a car.

Why are Millennials Interested?

The millennials are now interested in credit cards because they want to access the benefits that are on offer. They want ease in paying off large sums as well access to everyday facilities and appliances. The people from this generation are preferring cards that do not have an annual fee and offer cash-back in their reward systems.

The members of this generation are also favouring credit cards that provide greater account control and offer superior safety features. This generation is known to stop using an account if a fraud occurs on it on a permanent basis.

Building Credit History

A strong reason for using credit cards early in your life is to build a strong history by the time you are ready to make a large purchase such as that of a car. Millennial generation has now realised that it will have to build credit history in order to enjoy the benefits on offer in the new mode of digital economy.

A strong history allows credit card users to obtain cards with greater limits and purchase more expensive products with the relative ease of paying in a few months. The growing need to obtain credit is now shifting millennials into using more and more credit cards and we have seen the rise of the new leading generation who are credit card users.…

Why Do People Waste Money Playing the Lottery?

08 Nov

Whether it is the United Kingdom, or the rest of the world, a pretty good chunk of people are addicted to playing lotteries, even though most of them never win anything major throughout their entire lives. On the other hand, around ninety nine percent of the people who win something from the National Lottery games in the UK re-participate in them, being convinced of another win.

The most obvious reason of why people participate in these lotteries is because its reward could potentially be enough to last several generations. According to statistics, around forty percent of Brits spend 416 pounds each on lotteries every year. With the odds of winning being one in fourteen million, it is mind-boggling how so many people still buy a lottery ticket or a scratch card.

To answer the question, we have listed some of the reasons why people tend to invest in this industry despite their overwhelming odds of losing.

The ‘Near Miss Effect’

A Near Miss effect is one of the most common reasons why people buy a lottery ticket for the second time. It simply states that you feel you were too close to winning, and that is why you need to try your luck again. This effect is so drastic and so powerful that you have already bought a lottery ticket several times before understanding what you have fallen prey to.

Failure of Comprehension

For the most part of human history, we were not required to solve complex probabilities. This is another reason why our brains fail to comprehend the weight of probability, “one in fourteen million”. Research tells us that most people think of such probabilities as ‘1 in 100,000’, the odds of which don’t sound as bad. It is only when we ponder on it that we realise how bad our actual odds of winning are.

Availability Bias

This is when we overestimate the likelihood of a certain event based on our confined range of experiences. In other words, people do not think about the millions who have lost the lottery. Instead, they hear of one or two of the people in their circle who have won it, and take the entire decision thinking about them. This phenomenon is called the Availability Bias.

The High-Return

Another key reason why most people tend to waste their money playing the lottery is that they only think of the extremely low investment as opposed to the enormous return they could get for it. While it is fair to bet on your luck, you shouldn’t ignore the probability of your win—which is extremely low. In fact, investing that money in a savings account gives you a far higher chance of earning a profit than a lottery does.

Before you invest your money in buying a lottery ticket and putting your money on a stake that is likely to provide no good, take into account the possibilities of other investments in the financial market. With this many financial institutions in the United Kingdom, you are bound to get a good yield off your investment.…

Remembering vital points when Applying for First Payday Loans

26 Oct

consumer-loansMoney is an important aspect of human life. Though there is a saying that the best things in life are for free, things in the modern world are fast changing. People need money for everything, be it education, food, clothing, entertainment or medical facilities. It is important to have a good amount of cash in the savings account to meet the uncalled for expenses. Life is very uncertain and no one knows when danger might show its ugly face. Things must not stop for the dearth of money. This loan has gradually become an integral part for the USA citizen in respect of Finance.

But what if you suddenly find yourself out of cash in the hour of need? The answer is simple. Just apply for first payday loans and get the amount that will help you to recover.quick-10-second-loan-630-x389_20150923211620_pf

Payday is a short term loan that will provide you with the needed amount. There is a certain rate of interest that you must pay in addition to the original amount, which you have borrowed. There are different time slabs too, within which one needs to pay back the entire amount. The main aspect is that you need to pay the stipulated fee only when the payday arrives.

The first thing that strikes a person, before applying for a loan is the credit score. Many banks decline from providing loans to people who have bad credit score. Applying for first payday loans is the only way out for people like that. The money lenders will not judge you on this parameter. When you make the refund of the borrowed amount, on the payday, your credit score will develop.

unsecured-personal-loansBanks require a lot of documentation while sanctioning a loan. This can be a cause of worry for many who do not have authentic documentation. In the case of payday loans, you will not need to produce many documents. All that the money lender needs to know whether you have a job under the government, and you get a fixed salary, on a specific day.

Banks and other financial institutes will take a significant amount of time for processing the unsecured loan application. This is because they need to verify the documents, which the applicant has provided them with. With this loan, the applicant will not have to wait for long in order to receive the cash. Due to the lack of detailed documentation, the request can be passed within a few hours.absa-loans-loan-banking-financing

If you are incapable of going to the banks or other money lending institutes then fear not. With the advent of money lenders, who offer their services online, one can get hold of the loan from the comfort of their living rooms. Payday loans have come as a boon for many. It is easy to get and offers lot of conveniences as well. So, next time, apply for this loan, when you are in dire need of money.