Debt is a serious problem in America. The average household owes close to $20,000 which does not include mortgages. And with a current savings rate of less than 0%, people are spending much more than they are bringing in and the debt problem will only get worse.

Debt is such a serious problem that it may affect your physical and mental health, your marriage, relationships, self confidence and your career.

 If your one of the many Americans that use credit cards on a regular basis, do you ever feel like you will never pay them off? If you are only paying the minimum payment on your credit card debts each month, you are barely making a small dent in the balance!

How is that possible?

 Most credit card debt is "revolving" debt, and because of the way the interest is calculated in revolving debt, it is difficult to predict how long it will take you to pay off the balance. Every month that you leave any balance at all on your credit card, the interest will be added onto that balance making it difficult to ever pay completely off. The problem is compounded when you add additional monthly charge to the balance. 

 With "fixed" debt, however, your payments are scheduled for a fixed amount of time, as in the case of a fixed mortgage. You can easily tell when you will pay off the principal on the debt, because the interest rate and the monthly payments stay the same and your pay off date is usually much sooner than with "revolving" debt.

Your Home is your Greatest Asset

Why buy over renting a home? Do you like to pay for other peoples mortgages? 

Will you have something to show for when all is said and done?

 Why choose to buy a home over renting a home. This is a very big question to ask yourself when  looking for a place. There are many pros and cons to consider when choosing either to buy or rent. While renting seems to be a very easy way to get by without the hassle of the upkeep of the home and the fact that you can decide to move when you feel as needed to. But is this easier approach really the best option for you. 

While there are still a lot of risks to be taking in buying a home u might find some of these advantages of buying over renting to be a big factor in your decision to buy instead of rent.

Buying a Home Benefits Over Renting a Home

BUYING

  • Having the choice to do whatever to your home. 
  • Building equity in your home.
  • Can control the loan payment options.

RENTING

  • Having to ask to make any changes to the home.
  • Making the payments for the owner. 
  • Rent May increase without your permission.

There are also many risks that must be thought of before buying.

Risks of buying over Renting

BUYING

  • Having to maintain property. 
  • Paying for income taxes and insurance. 
  • Improving the property can be costly. 

RENTING

  • Landlord must deal with fixes and repairs.
  • Usually don’t have to pay for taxes. 
  • Don’t have to be financially responsible for this.

Even after these risks I believe its still the best thing to do is buy a home over renting. Handing your money to a property owner so that they can make money from u is very disturbing in my mind. I work hard for my money and do not want to help my landlord by paying for his mortgage. When dealing with the choices of having maybe more stress by a few factors isn’t it worth it that u have a nice home that you own and have nobody to answer to or have to worry about upsetting them. 

I think that when deciding to buy a home u can also look to ways of helping the costs of making it easier on you. Look to find someone to rent a room from u and that will drastically help with monthly costs. 

Overall I know when people have been renting for many years and have nothing to show for it I think they might look back and say if I would have bought a home. This same person might be living in a home that they own and without any house payments. 

How your Home Can help you determine your Debt Freedom Date


If you have a number of high-interest debts, you might be able to benefit from consolidating your debts into one repayment. If you're a homeowner, getting a debt consolidation loan in the form of a home equity account or cash-out refinance is a smart way to manage your debt.

As with any financial decision, there are many factors to consider. Here are some ways you may benefit from a debt consolidation loan using your available equity. 

Tax advantages and lower interest rates

If you're paying high interest rates on credit card balances, a competitively priced debt consolidation loan could save you a significant amount of money over time. Mortgage refinances and home equity loans and lines of credit: 

  • Typically have lower interest rates than unsecured loans and credit cards, meaning you can save on interest payments and potentially free up some of your cash to pay down more of the principal balance. 

  • Are tax-smart. You can potentially deduct 100% of the interest, unlike with non-equity products. (Consult a tax advisor for more information.) 


Better money management

A debt consolidation loan also offers the benefit of consolidating all your bills into one single monthly payment. Having just one monthly payment can help you: 

  • Effectively manage debt and enjoy the peace of mind of a consolidated monthly bill 
  • Avoid accidentally missing a bill payment, thus saving on late fees 

Benefit from a debt consolidation loan

Save money and get control of your finances by consolidating several debts into a single monthly payment.

It’s all too easy to get yourself caught under a heavy load of high-interest debt. If your monthly debt payments have become unmanageable, one way to reduce them is with a debt consolidation loan. 

Why it’s a good idea

The principle of a consolidation loan is simple. You take out a new loan at a lower rate than your existing debts, which may carry higher rates often charged by credit card companies and retailers. Then you use that money to pay off your existing accounts, leaving you with one monthly payment instead of several. And since the new loan is at a lower rate, your new payment will be lower than the combined total of your old payments. That means you can pay off your debt sooner. 

An example of how it works:

You have a balance of $5,000 on your bank credit card at 18.9 percent interest.
Monthly payment = $100 
You owe $4,000 on a store credit card that charges 17.5 percent.
Monthly payment = $80
You have $11,632 left on a $15,000 car loan at 6.97 percent.
Monthly payment = $359 

Your total debt (not including your mortgage) = $20,632
Total monthly debt payments = $539.
At that payment level, your debt is not going down very fast. To ease this burden:
You take a 60-month home equity loan for $20,632 at 7 percent.
New monthly payment = $409

You use this new loan to pay off your other creditors. With the significantly lower interest rate, your new monthly payment is $130 less than your old one. As well, your debt will be paid off in five years, and you’ll pay a total of $3,880 in interest. That’s $5,541 less than you would have paid with your original debts! 


Using a home equity loan or line of credit

One common type of debt consolidation loan is a home equity loan or line of credit. Since the loan is secured by the equity you have in your home, the lender is able to give you a lower interest rate. The amount you can borrow depends on how much equity you have; lenders will typically loan you an amount equal to 80 percent of your equity, although some will lend up to 125 percent. 

The interest on a home equity loan may be tax-deductible, effectively reducing the cost of the loan (check with a tax adviser about your particular situation). However, remember that home equity loans use your house as security, and if you fail to repay them, your home could be in jeopardy. 


Using a personal loan

Lenders also offer personal loans to consolidate your debt. However, with this type of loan it may be more difficult to get an interest rate low enough to improve your situation, especially if your credit rating is considered risky. If the loan is unsecured, the interest rate can be much higher than with a home equity loan. One way to secure better terms is to have a family member or other responsible person co-sign with you, guaranteeing repayment. 


Other ways to reduce your debt

You can also transfer your credit card balances to a card with a lower interest rate. Or, if you have serious credit problems, you can resort to credit counseling, and have a debt manager negotiate lower rates with your creditors. However, using a debt manager may affect your credit rating, and it’s important to choose carefully: some debt managers charge high fees and use unscrupulous practices. 

Compare loans

Look carefully before you sign any loan. In order to help reduce your debt, a debt consolidation loan should have an interest rate that is significantly lower than what you’re paying now. Also, be careful it doesn’t just lower your payments by stretching them out over a much longer period as this can significantly increase the total amount of interest you pay. And check for extra fees and commissions, plus added costs such as unnecessary credit insurance. 

Change your spending habits

It’s important to remember that a debt consolidation loan works only if you stop creating new debt. Otherwise, you’ll end up back in the same situation. It can help get you back on the road to fiscal health. But it’s only effective if you choose the right loan, and change your spending habits to avoid running up new debt.

Staying the course

It's important to keep in mind that a debt consolidation loan simply transfers the debt to a new lender, so you will still have debt. The key to success is discipline. If you're consolidating credit card bills, don't start using the card, even if you've cleared your balances. You could be tempted to overspend, and this would defeat the whole purpose of consolidating. 
It's now time to invest the money that you have freed up so that you can make it GROW!

 

Prestige Professional Management

If you are interested in learning more about becoming debt free, simply fill out this application, and a professional representative will contact you within 24 hours to answer your questions.


Name

Email

Phone

Best time to call
The Debt Freedom Day Planner