:::: MENU ::::
Browsing posts in: Loans

A Surprise Check in the Mail and Some Paperwork Returned

by

It’s always nice to receive any money in the mail, even if it happens to only be $4.19. I guess that is the amount that I overpaid on my car loan. I’m not quite sure how that happened since our car payment was on automatic payments since day one – but I won’t complain. Receiving the money was a nice treat.

We also received the original loan papers and it had “PAID IN FULL” beautifully stamped in red across the top. Perhaps I never really paid attention before, or perhaps I was in denial, but it says right there that the total finance charge for the loan was $3,541.90. That added another 25% to the cost of our car. 25%!! What were we thinking back then??

Lesson learned – attempt to purchase next car with cash, if possible.


It’s Official…My Car is Now a Pure Asset, Baby!

by

After 5 years of payments, our car is paid off. The last payment was actually due on Monday but the company initiated the payment on Tuesday for some reason (we’ve always had automatic payment on this vehicle).

I waited to announce on here until I saw the following:

The car is officially ours and no more car payment!

We could snowball that payment to other debt, but it looks like it will be used for health insurance. My husband and I do not have any, and the plan my son is on will be lost at the end of the year.

Of course, I will write more about that once I make some progress on getting that ready. The to-do list that I wrote to myself some time ago is not shrinking as quickly as I would like.


The Carnival of Debt Reduction Results in a Flashback

by

The Carnival I hold close to my heart (Carnival of Debt Reduction) is over at Money Under 30. As usual, lots of great information over there, but one article hit close to home.

When Car Debt Turns Really, Really Bad brought me back in time almost 5 years ago.

We were looking to trade in our truck and buy a new vehicle. I had looked at the Kelly Blue Book value of our truck and I couldn’t believe it. The value of our truck was less than the amount we still had to pay on our loan. It wasn’t a large amount, but enough to make you feel uneasy when you want to trade a vehicle in.

We found our current car, and waited for the trade-in offer on our truck. They would pay off our loan in full and that was it. Since I did the research I was happy with that. But part of me wishes we didn’t extend our financing on the truck for so long (6 years). The few extra dollars a month would have provided some downpayment on our current car. But at the time, you don’t really think about it. We learned a lesson, and we bought our car under a 5-year loan. Not the best, but definitely better than a 6-year loan.

In September, our car will be paid off and it will still has value! Part of it probably has to do with it being a car that is known to hold its value well, but another big part is that we didn’t go for a longer term loan even though they offered it.

Of course, I hope to pay cash the next time we buy a newer used vehicle, but if we can’t we are getting the shortest term loan we can (hopefully 3 years).


Some News on How You Can Cut Student Loan Costs

by

I’ve been hearing the buzz all around that my student loan interest rates will be going up come July 1st. For someone with over $31,000 in student loans, if the rates raise just a few points – it’s going to hurt a little. I didn’t think there was much I could do since it’s a federal loan.

Turns out maybe something can be done and we all have until June 30th to make it happen. U.S. News & World report has an article on cutting your student loan costs. There is also an article to read that details when it might be best to not consolidate your student loans.

If you have student loans, make sure you check out the articles.


Ouch – A Forgotten Loan Appears

by

Back when we purchased our home, we took a loan from my in-laws. I completely forgot about it, and my mother-in-law recently mentioned the loan after 2 and a half years.

If she just mentioned it now out of the blue, so it must mean that they need it. It is a chunk of change ($1,775). I did have the money set to go to the credit cards, but I think I’d rather just pay the loan in full. Sure, it’s interest-free but it’s family.

Ouch, another big bump in the road and just a few days after announcing the goal date. I think I will leave the goal date intact for the time being because time is limited to run all the scenarios again.

And really, I already set it – let’s see what can happen. The worst that could happen is we don’t make it, but I bet a heck of a lot of progress will be made trying to make it – more so than if no goal was set ๐Ÿ™‚

Tags: bank, loan

Refinancing Your Auto Loan

by

My current vehicle was purchased new with a 10.9% interest rate. We may have been able to negotiate a lower rate at the time of purchase, but it was just a horrible day (it was 9/11/01) and we just wanted to go home and get the car purchase over with (we had to have a car because our other vehicle wasn’t working right – and we traded it in). So, we lived with that interest rate.

About two years into the loan, I learned that you could refinance your auto loans. I thought that was a great idea and it would help to negotiate a lower interest rate and receive a lower monthly payment. I cannot remember what company we tried, but we were denied. They said we had too much debt and were too much of a risk.

After getting turned down, I too easily gave up and didn’t try another company (which I realize now was a mistake on my part). I also should have tried going to a bank and seeing if they had a loan with a lower interest rate.

I am happy to report that our vehicle will be paid off in September of this year, and as it stands right now, our vehicle is still worth $6,000. That is a little less than half of the price we paid for the car, so I believe our car has held up in value quite a bit. I want to have a little party when our car is paid off. It will actually be ours and not the banks!

Technorati Tags: auto+loan, refinancing

Student Loan Payment Options

by

There are a few options available for those repaying their student loans who need a lower monthly payment.

The first one is income-based. They actually will consider your income and determine how much you can pay per month. This can be nice when you are still looking for after-college employment and enter repayment on your loan.

The second option is the graduated payment. With this option, you start off just paying the interest on your loan. This leads to a lower monthly payment. Then, after a certain timeframe, your monthly payment is increased. It will keep increasing (graduating) to a higher monthly payment until the loan is paid in full.

For our student loans, I decided to have both of them under a graduated payment for the time being. As soon as the credit cards are paid off, then I will probably change the status of our school loans to a normal payment plan and even send additional payments.

There is a downfall to the graduated payment plan. I will end up paying more in interest and the total amount that I will have paid to my lender is quite substantial. But, at the time it is the best option.

The important thing is to choose the option that is best for you.

Technorati Tags: student+loan+debt, debt, payment+plan, credit+cards