Related Consumer Finance Programs - The following sub-directories of companies offer a wide variety of financial programs to assist you with the management of your finances. Consolidate debt with a consolidation loan or use a debt counseling service or mortgage refinance for help with the consolidation of your charge card debt and other monthly payments.
- Personal Loan Financing - Looking for a small loan? Start at the personal loans directory, where you can shop and apply with different lenders and related services online.
- Debt Settlement Program - High credit card balances making your monthly payments impossible to meet? The negotiation of your outstanding bills with your creditors may be a good debt solution for you. Educate yourself on your options and compare available programs.
- Debt Management Counseling - Having trouble managing the demands of mounting credit card debts and other bills? You are not alone. Using the services of a debt management company may be the solution to your problems.
Home Loans
How to Keep Costs from Going Through the Roof
29. Save money on insurance. Because the value of your house is backing your mortgage, you will be required by your lender to have homeowners insurance to cover a variety of damages that could reduce the property's value. Prices can vary significantly, so shop around.
Also make sure you get the right coverage for your situation. For example, if you live in an area that is at high risk for floods or earthquakes, you should consider purchasing additional insurance coverage if it is not otherwise required by your lender.
Private Mortgage Insurance (PMI) protects the lender when a borrower fails to pay. It is usually required for loans in which the down payment is less than 20 percent of the sales price. For the typical mortgage loan, PMI costs about $40 to $70 per month or around $500 to $800 a year. "PMI is costly and you should try to avoid it," said Luke Reynolds, an FDIC Community Affairs Specialist. "If you can't afford the large down payment that would save you from PMI, ask the bank if there are other options for a smaller down payment without PMI." Under federal law, with certain exceptions, PMI automatically will be terminated if the borrower accumulates 22 percent equity in the home and is current on mortgage payments.
Some homebuyers inadvertently pay for PMI if they add the closing costs to the loan balance, thereby reducing their down payment to less than 20 percent of the home's value. By paying the closing costs instead of adding them to your loan, you can avoid paying interest on the closing costs and avoid paying PMI.
FDIC Consumer News is published by the Federal Deposit Insurance Corporation
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Last updated on 8/10/2007