Archive for April, 2008
If you are an heir to an estate, it is possible to receive an advance upon the inheritance you expect to (eventually) receive. The person receiving the inheritance advance generally has to be of legal age and the legal heir of an estate that will be distributed within a set time frame (depending upon the policies of the company providing the advance). A good credit history, employment history, and similar factors generally have no bearing at all on the process, because an inheritance advance is not a loan.
Rather, it is money paid to the heir up-front, before probate has settled the estate. For this service, the company providing the advance generally charges a processing fee. The amount of the fee is determined by a number of factors, such as the complexity of the settlement process, whether or not real estate is involved (because disposition of real estate is more complicated), how long the process is expected to take (because the longer the company has to wait to get their money back, the more it costs them).
Because it is not a loan, you should not generally expect to pay interest, per se, nor to have to make monthly payments. Instead, the company is repaid the advance plus their fee when the estate is settled an you receive your inheritance.
Factors that enter into the equation later and are unknown to the applicant, such as those that delay distribution of the estate, or claims that can reduce the inheritance amount, do not generally change the repayment amount. However, every such possibility should be discussed, because if there is potential fraud on the part of the applicant (such as withholding information regarding an expected claim), the applicant could be liable in that case.
Inheritance advances can be especially helpful and appropriate in cases where the estate must have ongoing amounts of money invested in it in order to keep it running, or in cases where the heir does not have the money necessary to pay probate costs. It is possible to advance only a portion of the inheritance in order to receive needed funds, while retaining full value on the remainder of the expected inheritance.
Two acts that help to facilitate efforts to repair credit history include the Fair and Accurate Credit Transactions Act (also known as the FACT Act), which has been developed from the former Fair Credit Reporting Act (or FCRA), and the Fair Debts Collections Practices Act (FDCPA).
The FACT Act allows you to receive a copy of your credit report free once every twelve months, and also regulates (among other things) who is able to access your credit information and how it can be used. It is important to monitor your credit history on a regular basis and identify any errors that may negatively affect your credit rating. The credit report will highlight any items that warrant credit repair efforts.
The purposes of the FDCPA are to prevent abusive debt collection practices and to give consumers an avenue to require validation of various debt information and, if necessary, to dispute items and have them removed, if the creditor cannot prove their accuracy within a period of time. Generally, creditors have 30 days to respond to consumer requests.
These acts can be used to a consumer’s advantage, as outlined by credit repair services websites. These service websites offer to contact creditors on behalf of their clients in order to demand proof of the original late payment, charge off, collection action, etc. and, when the creditors fail to respond with the proof, as they often will, the services will report this to the credit reporting agencies (Equifax, TransUnion, Experian) in order to have the negative credit information removed.
We’ve talked quite a bit about Payday Loans and when they can be appropriate, as well as other options. We want to mention a few other things for your information and consideration as well.
When considering a cash advance company, be sure to ask about state licensing. Not all states allow the operation of payday loan businesses, but in those that do, you should be sure to seek State Licensed Cash Advances when taking out this sort of loan.
Another question concerns online applications. If you are planning to do business with a company via the internet, be sure to ask BEFORE you begin the application process about their security measures. They will be asking you for sensitive financial information, so be sure they use appropriate encryption technologies to protect your personal data.
Another feature we’ve noticed with some lenders involves the interaction of fees, interest rates, and loan periods. Generally, most of the cost associated with a payday loan are due to fees charged on the loan, while the amount actually considered to be interest is quite reasonable. The lenders are offering money with no credit check and minimal security for themselves, so they are expecting a high return on their risk. The return usually takes the form of fees you are required to pay for the processing of the loan.
The advantage to consumers occurs when the fees are fixed, and the repayment term offered is flexible.
Let’s say you take out a $500 loan to cover an absolute emergency. You THINK you can probably pay it back when you receive your paycheck next week, so you ask for a 7-day term. The interest rate on our example is only $2.50, which won’t even pay the wages of the person filling out the forms. Instead, the lender makes their money on the $112 fee they charge for processing the loan. In 7 days, you are expected to pay back $614.50.
Now, the problem comes when ANOTHER unexpected thing happens. You get really sick, so your next paycheck is a little short from the two days you missed with the flu. Soooo …. your only option is to extend your loan. This time you ask for 14 days, to make it to the next paycheck. Generally, you are going to have to pay another fee and more interest.The term is a bit longer, so now you are paying $3.50 for interest, but another $112 for fees.
At the end of 24 days, you will have to repay $730 for not one but TWO payday loans.
There is a smarter way to do this. Instead, find out what the maximum loan term is. If you can borrow the money for 29 days, for example, when you first apply, the interest jumps to only $7, and the fee is STILL the same $112. Now, you will be expected to repay the loan after almost a full month, and will only be expected to pay $619. Your savings over the above scenario is significant, and you have a longer term to repay. (Although we’d recommend paying it off as quickly as possible anyway, just so you don’t end up in an unexpected situation like the one described above and needing an extension.)
The details will vary with the state you live in, and the company selected. The above details were using Florida and PayDayOne as an example. Most states offer even longer repayment terms for even more significant savings, although a very few limit terms to a shorter period.
The bottom line is this: you are responsible for your financial well-being. Check into all of your options, and find the best ways to manage your money in every situation in order to maximize your potential from each decision.
The increasing development of technology continually opens new doors in every area of business. Other factors influence the applications of that technology. Currently, one of the most influential of these factors is the ongoing fuel price increases, resulting in costly transportation of everything from goods and produce on their way to market to clients and professionals commuting to their offices and meetings. A complementary influence is the desire to find more “green” solutions to a variety of problems. These factors together make telepresence company services an up and coming avenue for conducting many types of business.
Telepresence allows persons to interact with one another in real time, preserving all the nuances of speech and inflection, along with body language, and can be further enhanced by the projection of data in various forms, just as people meeting in the same meeting room would be able to share a power-point presentation or printed reports with one another.
Finance is one area that can benefit from these types of services. Because moment-to-moment changes in the stock market and fluctuations in interest rates affect virtually all aspects of finance, being able to meet immediately with consultants or advisers who may be geographically distant confers a great advantage to those with that capability.
In the near future, the choice of business partnerships, consultants, agents, etc. may be influenced by their level of access to this kind of technology, so keep that in mind in case you need to evaluate the services of various professional consultants regarding your personal finance needs.
Bankruptcy is a serious decision that will negatively impact your credit rating for years to come. For this reason, it is important to consider all options before making that choice. In many cases, bankruptcy alternatives exist that allow the consumer to get themselves out of debt without resorting to actually filing bankruptcy.
Options available depend upon the consumer’s location. In the UK, debtors may opt for a service such as an IVA (Individual Voluntary Agreement). An IVA is a proposal, prepared by a professional insolvency practitioner, and submitted for consideration to all of your debtors. If 75% of your creditors accept the proposal, all of them must legally abide by it.
For those who are struggling and unable to meet their monthly financial obligations, an IVA can be a lifeline. Typically 75% of outstanding debt may be written off, interest charges will become frozen, and a payment plan will allow the debtor to repay the newly-agreed-upon balances with a single affordable monthly payment over a period of about five years. In the meantime, all the harassing telephone calls and other contacts will cease, allowing life to return to a more normal tone while the consumer recovers his financial standing and eventually emerges debt-free.