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Important Safety and Emergency Accessories

Posted on Nov 06, 2011 by Thalia Green
Nov 06

Whether you are driving across town or across the country, there are some items you should think about keeping in your car at all times. These can help keep you safe in the event of an emergency, and also help get you back on the road faster. When figuring out the cost of car ownership, make sure you allow a little room in your budget for these items, along with your car loan payment.

 

LED Safety Lights
In years past, drivers in distress had to rely on flares to alert passing cars to their presence. However, there is now a better solution. LED safety lights are rechargable and don't emit toxic fumes the way flares sometimes can.
Safety lights are avalilable individually, or in 3-packs or 6-packs.

 

Road Atlas or GPS
While some people can't imagine navigating without a GPS, there are others who don't like the idea of relying on technology to get them where they need to go. GPS directions can sometimes be incomplete or even incorrect, but in major metropolitan areas they are generally accurate. Whether you opt for old school or new school navigation, make sure that one of these items is in your car. If you enjoy travelling over back roads, you may want to also invest in some regional maps for where you are going, to make sure that the smaller roads are also included.

 

Flat Tire Change Kit
Even if you have AAA membership, you should educate yourself on how to change a tire. This can save you time so you don't have to wait for someone to arrive to change the tire for you. While most cars are equipped with a spare, you might find it beneficial to purchase a flat tire change kit as well. This handy kit can be used to remove a nail or other road debris, permanently patch the leak, and then quickly reinflate the tire. You'll be on the road again before the service truck arrives!

Travelling is fun, but make sure that you are prepared for the emergencies as well. You'll enjoy the ride knowing that your emergency items are stowed safely in your trunk. 

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Recovering from Bankruptcy

Posted on Oct 28, 2011 by Thalia Green
Oct 28

So you've filed for bankruptcy. Now what? While it may feel like you have been ostracized, the truth is many people have filed for bankruptcy and not only recovered but also thrived. Bankruptcy definitely creates a temporary setback but it's an obstacle that can be overcome. Here are some suggestions to help you on the road to recovery from a bankruptcy.

 

If necessary, seek counseling.
It's important that you get to the root of the problem. What was the reason that you went in to bankruptcy in the first place? Do you have a shopping addiction? Was there a financial hardship such as an illness? Whatever the reason is, it's important to address it so that you can overcome it. The type of counseling needed may vary depending on the problem. Whether its emotional or financial counseling, your adviser can help you get into a mental mindset that you CAN overcome the obstacle.

 

Establish a new line of credit.
To help rebuild your credit, you should look for options to open up a new line of credit following your bankruptcy. One is a secured credit card, which is backed by a money that you put into a savings account. The limit on the card is whatever amount is in the savings account. You'll make monthly payments on the card just like a regular card, but if you miss a payment for some reason the money will be pulled out of your savings account to pay for it. If you keep current with the payments, you can begin to rebuild credit. Another option is a bad credit auto loan. By using a company such as Autoloan.com, you can locate a lender who specializes in approving car loans after bankruptcy. Making on time payments for the auto loan can also help rebuild your credit.


 
Keep an eye on your credit report.
While you are working hard to rebuild your credit, make sure that there is nothing fishy on your credit report to hold you down. After 7 or 10 years (depending on the type of bankruptcy), the bankruptcy will be removed from your report. If it is not, you can contact the credit bureau and request that it be removed.

 

Remember that recovery from a bankruptcy takes awhile but it can definitely be done. Not only that, but you may emerge stronger and more financially savvy because of it. 

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Tires for extreme conditions

Posted on Oct 28, 2011 by Thalia Green
Oct 28

Tires are not the most glamorous part of the car, but few would argue that they are one of the most important parts. You should not only invest in a reputable brand of tires, but also the right type of tires for the climate you will be driving in. Driving on the correct tires can help improve your miles per gallon. If you are still in the process of paying off your car loan, it's important to make your dollar stretch further, and having good tires is one way to do that. Here is a brief overview of some of the specialized categories of tires.

 

Heat Resistant Tires
In extreme hot temperatures, heat resistant tires can be especially helpful. Having heat resistant tires can decrease the likelihood of a blowout. If you live in Arizona, New Mexico, or Nevada, you should look for tires with the best heat resistance rating possible.

 

Winter Tires/Snow Tires
At the opposite end of the scale are states such as Minnesota, the Dakotas, and Montana, which are known for their cold winters and heavy snowfall. If you make your home in the northern states, investing in snow tires is definitely the way to go. Snow tires will offer more grip than average tires, which is especially helpful when attempting to get your car out of a snow drift, or if you are doing highway driving in incliment weather.

 

All Season Tires
If you don't drive in heavy snowfall and don't have to worry about extreme temperatures very often, then you might be able to save some money by purchasing all-season tires. Less expensive than specialty tires, all season tires will allow you to drive in a variety of climates.

 

Not sure which one to go with? Some car owners opt to purchase once set of regular tires and one set of winter tires, storing the second set during the months when they're not needed. Just be sure that you change your tires over in advance of bad weather. The last thing you want is to be stuck in heavy snow with all-season tires! Visit your local tire shop to learn more about the different types of tires and find out which one is right for you. 

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Fun Cars, Great Bargains

Posted on Oct 21, 2011 by Thalia Green
Oct 21

Best cars for bad creditJust because you have a tight budget does not mean that you have to settle for a car without style. If you are looking to get a car loan with bad credit or no credit, you will likely be required to make a substantial down payment. Fortunately there are many options available for affordable vehicles that turn heads. Here are some suggestions to help you in your search.

 

Sports Cars
Yes, you can get a head-turning sports car for under five grand! Consider the 1997 Ford Mustang. The Mustang has long been known as the quintessential muscle car. If you have a taste for sports cars, go with a 1996 model or newer, also known as a fourth-generation Mustang. Ford made several design changes to the fourth-generation, which made the car more aesthetically appealing than its third-generation predecessors. Mustangs made after 1996 feature the powerful 4.6 liter V8 engine. If you prefer a convertible, the fun 1997 Mazda Miata is definitely the way to go. You'll enjoy driving around in your two-seater Miata, and the ride will be that much sweeter knowing that your car loan payments are affordable.

 

For the Family
If you are needing something to get you to and from school, after-care, and soccer games, you might be pleasantly surprised to find out that there are many great minivans and SUV's available for less than $5000. The 2000 Honda Odyssey is definitely within your budget, and comes with the reliable construction that Honda is famous for. Honda was a pioneer in several now-common features, including sliding doors on both sides. For those who prefer an SUV, consider a 1995 Toyota 4Runner. While SUV's are notorious for being gas guzzlers, Toyota made the 4Runner smaller than its competitors and offered a more gas friendly 4-cylinder engine. Yet the roomy cabin will allow plenty of space for your kids and their sports gear.

 

When buying an older car, it's important to get it looked over before purchasing. Have a third-party mechanic take a look under to hood to spot any possible problems. This way you'll know for sure you are getting a great deal. 

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Making a Road Trip You Can Afford

Posted on Oct 21, 2011 by Thalia Green
Oct 21

One of the wonderful things about getting a car is taking vacations with your friends and family. Here are some suggestions to keep your vacation affordable so that you don't fall behind on your car loan payment.

 

Meals and Snacks
Although fast food is convenient, it's not a good value in terms of quantity for your money. Most value meals are around $7, they don't fill you up, and are nutritionally low. By comparison, family owned diners and cafe's often have blue plate specials where you get a full sized entree and sides. For the same amount of money or a little bit more, you can get satisfying meal. As for snacks, consider purchasing them at grocery stores rather than convenience stores. Discount grocery stores like Aldi can offer even deeper savings. A full sized bag of chips can be bought for less than $2.

 

Lodging
Camping overnight can be free or very low cost. Staying with friends or family is also a good option, but if you are in a city where you know no one, consider using a website like Couchsurfing.org. This website matches up travelers with people who are willing to put them up for the night. It's free, and a great way to meet people all over the country.

 

Gas
While you can't do much about the price of gas, there are things you can do to minimize the amount you use. During the summer, consider traveling before or after the heat of the day so run the A/C as little as possible. Better yet, opt to take your trip during a cooler month. If you choose to travel at night, you'll also have the added benefit of avoiding traffic.

 

Entertainment
If you will be staying in a city for a week or longer, consider picking up a coupon book for that city. There are many 2-for-1 deals in these books, which can help you to stretch your dollar further. Also visit the websites of
attractions you want to see...you might find some internet specials to take advantage of.

 

While it's very easy to drop a few thousand on a vacation, you don't necessarily have to. With some preparation you can have a vacation that is both affordable and fun. 

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Beyond the Dealer: Options for Where to Buy Your Next Car

Posted on Sep 26, 2011 by Thalia Green
Sep 26

If you asked a group of people where they bought their last car, most likely virtually all of them would say at a new car or used car dealer. There are many good, honest dealers out there, but there are also some that do business dishonestly. If you were burned on your last experience with a car dealer, here are some options for alternatives on where to buy a car.

 

Private Sellers
One of the most common ways to get a used car outside of a dealer is to purchase it through a private seller. Private sellers list their vehicles through newspaper classifieds, but also through websites such as Craigslist. If you choose to go through this option, make sure that the seller is willing to let you get the vehicle checked out by a mechanic of your choice. This is especially important as the mechanic will be able to alert you to any possible issues you might face in the near future. It's also a good idea to run the VIN # through Carfax.com, to get a history on the vehicle and see if it has been in any bad accidents.

 

Auction Websites
Another source for private sellers is through online auction websites. You might have used such sites in the past to purchase housewares and kids' clothing, but were you aware that you can also purchase cars on internet auction sites? This can broaden you options beyond what is available in your immediate city. Should you decide to purchase the car at a remote location, make sure that you still have it checked out by a mechanic who is local to the seller before finalizing the sale.

 

What about Financing?
One of the reasons people opt to purchase a car through the dealer is that they need financing. But are there options for financing if you purchase through a private seller or online auction? The answer is YES! Banks and credit unions can help you get the car that you want, even if its through a private seller. You would go to the lender and explain to them the type of car you are looking for. Assuming that the bank approves your car loan, they will give you a cashier's check for the full amount of the vehicle. You would then use this check to pay off the seller, and you would make payments on the loan to the bank. Visit with your local bank or financial institution to find out what your options are when dealing with a private seller.

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The Anatomy of a FICO Score

Posted on Sep 22, 2011 by Thalia Green
Sep 22

Few numbers will have more impact on your car loan application than your FICO score. A FICO score can tell a lender at a glance whether or not you will be a good credit risk. Most people know that a higher FICO score is desirable, but may not be aware how a FICO score is determined. Here is a breakdown of what factors will impact your FICO score.

 

1) Payment history on loans
Without question, your ability to make payments on time will impact your FICO score more than anything else. A whopping 35% of your FICO score is determined based on your payment history for other loans. This includes car loans, credit cards, personal loans, mortgages, and even utilities. If your FICO score is low, keeping your payments current is one of the easiest ways to improve it over time.

 

2) The amount of debt in relation to your income
30% of your FICO score is determined by the amount of debt that you have. For this reason, it's not good to have too many credit cards maxed out, as a high debt-to-income ratio will lower your credit score. Paying off your credit cards and keeping the balances low will definitely help your FICO score improve.

 

3) Length of credit history
Although it only accounts for 15% of your FICO score, the length of your credit history definitely is important. This is the most frustrating aspect for many young adults as most are working to build a credit history. Secured credit cards can be one way to begin building a small credit history. A secured credit card usually has a smaller balance, which is backed by an account at the same bank where the card is issued. The account is maintained solely for the purpose of insurance for the credit card. Should the customer default on a card payment, the bank can take the money out of the account. However, by keeping monthly payments on the card current, the customer can begin to build a credit history.

 

4) Number and diversity of accounts
Rounding out the list of factors are the number of accounts and the diversity of accounts. Each of these factors impacts the FICO score by 10%. While you certainly don't want to have too many accounts opened, having a few open can show that more than one lender believes you are a good credit risk.

 

In a way, all five factors are tied to each other. Ultimately the best way to improve your FICO score is to make regular payments on your current loans, keep your balances on credit cards low, and do not open new loan accounts unless you absolutely need them. These three things will guarantee that your credit score will go up over time. 

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A Full Deck: What Income Can You Bring To The Table?

Posted on Sep 22, 2011 by Thalia Green
Sep 22

Calculate income for car loansRegardless of your credit status, most lenders will want you to show proof of income. There are many ways to show a lender that you have the means to pay for a car loan. Here are some options that you can consider.

 

Employment
Employment is most commonly they way that people show that they they have the means to pay for a car loan. To show proof of employment income, most people bring a few of their paystubs. However, if you are an independent contractor or self-employed, there are other ways that you can show proof of income. Bank statements showing proof of direct deposit, or tax returns showing reported income from all customers are also acceptable to show proof of income. Don't forget that if you are currently holding two jobs, you can also use the income from your second job to qualify for your loan.

 

Alimony
If you are receiving alimony from a divorce settlement, this too can be shown as proof of income. Like employment, alimony earnings can be shown through bank statements, cancelled checks, or tax returns.

 

Settlements, Inheritance, Lottery Winnings
In some cases, people are receiving regular payouts of a large amount of money. This could be the case if you have inherited money, but also if you are receiving payments from a large lawsuit settlement, or monthly payments on lottery winnings. In all three cases bank statements and cancelled checks can be used as proof of income. You may also have to show additional paperwork regarding the payment arrangement as proof that the income from this source will be steady through the term of the loan.

 

Rental Income
If you are making money off of a rental property, rental income can also be used as income. You'll need to show proof that you own the property, in addition to your bank statements and cancelled checks from the renters.

 

In most cases employment is the primary source of income, but don't forget that other sources of income can be counted towards your loan application as well. By presenting all your cards on the table, you may find that you are able to qualify for a larger loan, or a more favorable interest rate. Each lender will have their own regulations as to what income sources are permitted. If you have sources of income other than your job, be sure to inquire with your lender as to whether your other income sources can be applied to your car loan. 

The Real Cost of Car Ownership

Posted on Sep 21, 2011 by Thalia Green
Sep 21

Are you thinking about getting your first car? If so, there are several expenses you'll need to consider. Certainly the car loan payment is the largest expense associated with car ownership, but there are others that will need to be factored into your budget. Here is a short list of car-related expenses that you'll need to consider.

 

Gas
It's no secret that gas costs have gone up significantly for everyone over the last several years. Speculators believe that gas prices of over $3 per gallon are hear to stay. With this in mind, the price of gas will definitely need to be considered. To determine you gas costs, you'll need to know your car's MPG (miles per gallon) rating. Cars with 4-cylinder engines are always more fuel efficient than V6 or V8. Consider the length of your daily commute, as well as transportation necessary for extracurricular activities. From this you should have a decent idea of how much you can spend on gas per week.

 

Insurance
Having car insurance is required in all 50 states, but the minimum coverage required varies from state to state. While state requirements are usually for liability only, most lenders will require the more expensive comprehensive and collision insurance to cover the car while you are paying off the car loan. It's a sensible measure to visit with at least a few agents and get some quotes to find out what your best option is. Insurance payments can be made anywhere between once a month to every six months. If the payments are less frequent, you may need hold back a portion of your monthly paycheck in savings.

 

Maintenance
Even for newer cars, there will be maintenance costs to consider. Regular oil changes, tire and brake replacements, as well as milestone checkups. All of these will need to be budgeted for to keep your car running in top condition.

 

By knowing what expenses are associated with the upkeep of a vehicle, you'll have a much better idea of the true cost of ownership. More than just the car loan payment, additional related expenses will help you to budget accordingly, and not be taking by surprise as to how expensive owning a car can be. A good option is to talk to someone who already owns the car that you are thinking about buying. They can tell you about the ongoing expenses that they have, and also give you any suggestions about problems that they have faced with that vehicle.

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Should you purchase gap insurance?

Posted on Sep 21, 2011 by Thalia Green
Sep 21

When you get a new (or new-to-you) car, the salesperson and finance manager will attempt to add in all sorts of additional extras to the auto loan. While some of these are tangible, such as a nicer stereo system or a moon roof, others fall into the service category. Gap insurance is an example of the latter. Depending on your situation, it may make sense to add the cost of gap insurance into your car loan. To help you decide whether its right for you, consider the following.

 

What is gap insurance?
In order to determine whether gap insurance is right for you, it's helpful to first know what gap insurance is. Gap insurance will cover the difference between the balance on the loan and the value of the car. In other words, it will cover you in the event that you find yourself underwater on the loan. Gap insurance is often recommended, but it is not required.

 

When is gap insurance helpful?
If you are purchasing a new car and not making a very big down payment, gap insurance is almost a must. During the first three years a new car depreciates rapidly, almost always faster than the rate of payment on the loan. Its a certainty that you will have a period during the beginning of the loan where you owe more than the value of the car. If you were to total the car, the insurance would only pay the fair market value, which could be less than the value of the loan. You would be responsible for the balance...unless you had gap insurance.

 

Can I get around needing gap insurance?
The easiest way to get around purchasing gap insurance is to buy a used rather than new car. Ideally, you should shoot for a car with low mileage that is between 3 and 5 years old. This is old enough that the car has already taken its largest depreciation hit, yet not so old that it has a high likelihood of having major problems. If you absolutely must purchase a newer vehicle, make at least a 20% down payment. This will cover the depreciation within the first year and give you a better chance of outpacing depreciation for the balance of the car loan term.

 

Gap insurance is not a scam; it's definitely something that makes prefect sense for certain buyers. If you would like to find out more about the cost, ask your lender about gap insurance and whether it would make sense for the car you have in mind.

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