Five Questions to Ask When Getting an Auto Loan

The right questions can get you the right deal

In the market492494951 for a new car? Car shopping probably has you focused on questions like, What kind of car do I want? What are the safety ratings? Leather or cloth interior? However, a main question you should be asking yourself is, How am I going to pay for this car?

If you’re like most people, you probably plan to use an auto loan to finance your new purchase. And if that’s the case, you’ll need to consider a few questions beforehand to make sure you’ll be able to afford the car you want and won’t encounter any negative blows along the way.

“The big mistakes are made in the financing office,” explains Phil Reed, the senior consumer advice editor at Edmunds.com, the auto research website. “Making the right decisions can save thousands over the life of the loan.”

To make sure you’re making the right choice regarding an auto loan, here are five questions to ask before you sign the dotted line:

1. What is the type and amount of the interest rate?
With any type of loan comes an interest rate. But all rates are not the same – they vary among factors like your credit score, how much you’re putting down on the car, etc. A fixed interest rate is when your payments stay the same throughout the term of your loan. This type of loan is preferred among many since it makes budgeting easier, since you’ll always know what you owe. A variable interest rate, however, changes, so repayments may differ in amount. To avoid future headache-inducing surprises later, find out the type of interest rate you’ll be paying off before you complete the deal so you can factor it into your budget. The interest rate percentage is also important to know because it can vastly impact your monthly payment amount. Knowing what the interest rate is will help you determine how much interest you’ll pay over the life of the loan.

2. What is the loan’s term?
A term is the length of your repayment period. Finding this out is essential because some finance contracts require that there be a specific time period, typically two or three years. If that’s the case, your monthly payments will be higher. For some, it makes more sense to have lower monthly payments over the course of additional years, say five or six. For example, say your loan is for $18,000 at a 10 percent interest rate. If your term is 24 months, monthly payments will be $887. But if your term is 36 months at the same interest rate, monthly payments will be $615. Talk with your auto loan provider to determine what’s right for you.

3. What will my monthly payment be?
For the same reasons as knowing your interest rate beforehand, find out what your monthly payments will be. Make sure the dealer factors in the interest rate and any other fees bundled into that payment. For instance, if you’re purchasing add-ons to your vehicle, like fabric protection and paint sealant, that is an extra cost that should be calculated into your repayments. It’s important to understand the exact amount that you’ll be paying each month.

4. Are there penalties and fees I should know about?
Ask the finance company or lender if there are any additional costs that haven’t been presented yet on the loan. If you’re interested in paying off your car early, find out if there are any prepayment penalties you’ll ensue. Also ask about late charges as lenders will typically charge a fee if you’re late on your payments. The amount varies, but it could be around five percent or more of the unpaid portion of your monthly repayment, or a specific dollar amount. Also, there may be an establishment fee, which is the cost to set up a loan, or a monthly account keeping fee, a monthly charge to cover account keeping costs.

5. What documentation do you need?
To apply for a loan, you’ll usually need to provide several documents, for example, proof of income. Also, you may need to acquire comprehensive insurance coverage. Find out what kinds of documentation you’ll need to provide, and also if there’s anything that may delay the loan approval processing, such as past credit issues, repossession or bankruptcy. Make sure when signing the loan agreement that you read all the fine print and understand what it all entails. If you don’t understand something, ask questions to clarify.

Most of the time, your financial institution is a better bet when it comes to auto loans. You don’t have to worry about someone trying to take advantage of you either. If you’re looking to purchase a car and are in need of an auto loan, contact us today to see how we can help you.

Used with Permission. Published by IMN Bank Adviser Includes copyrighted material of IMakeNews, Inc. and its suppliers.

Be Green by Wasting Less Food

Tips for saving food and saving money

If you are searchingIMN23523B2 for new ways to be environmentally friendly, you may have noticed that many options, such as installing solar panels in your home, can require an initial expense that may be hard to manage before the cost savings add up to offset the expense. There are ways to help save the planet that don’t cost anything and can even create instant money savings, however, and learning how to waste less food is one of the easiest and most rewarding.

According to Good Housekeeping magazine, it is estimated that people waste a third of the food they purchase on a weekly basis. This is an obvious drain on your wallet, and nobody likes to waste money, especially when it is continuously wasted for the same reason, week after week.

Not only is it unpleasant to have mystery food items rotting in your fridge, this wasted food can also have a negative impact on the planet. Many people don’t realize that by finding ways to throw away less food, they can actually help reduce the greenhouse gases that contribute to global warning.

“When food is disposed in a landfill it rots and becomes a significant source of methane – a potent greenhouse gas with 21 times the global warming potential of carbon dioxide,” states the EPA.

If you want to stop spending money on food you don’t use and help fight against climate change, the following tips are a great place to start.

Make a meal plan
When you make a meal plan, you are less likely to end up wasting food. Don’t worry, it doesn’t have to be too elaborate or take much time at all. For example, if you plan to order pizza one night and know that you typically have one day’s worth of leftovers from each meal, then you should only plan to cook three dinners. This means that you don’t need to buy chicken, pork chops, hamburger and fish, unless you plan to freeze one of those items.

Stick to your list
Once you’ve made a meal plan for your dinners and lunches (breakfast items typically don’t go bad as quickly and don’t require as much planning) write a grocery list of items you will need. If you stick to that list when shopping you will spend less time lingering in the aisles, which will help you ignore the tempting impulse buy items that are craftily displayed to grab your attention when browsing. Furthermore, sticking to your list will help you avoid purchasing more family than your family can eat in a week.

Check your fridge’s condition
Even if you don’t have too much food, it can still go bad if your fridge isn’t keeping it at the right temperature.

“Check that the seals on your fridge are good and check the fridge temperature, too. Perishable food should be stored at 37 degrees Fahrenheit for maximum freshness and longevity (keep your freezer at 0 degrees or just a little lower),” states Good Housekeeping.

Rotate pantry and fridge items
When you bring home new groceries to store in your pantry and fridge, bring the older items to the front of your shelves first. This will help you remember to use up items that are closer to going bad, before breaking into the new packages.

These tips are easy to incorporate into your life and can help you start saving money and the planet today.

Used with Permission. Published by IMN Bank Adviser Includes copyrighted material of IMakeNews, Inc. and its suppliers.

Choosing the Right Life Insurance Policy for College Students

One without the other could leave your loved ones at risk

No one wants to153437909(1) think about dying prematurely, but you may wish to discuss it if you have large private student loans. Taking out a life insurance policy for the student with the loan will protect parents or beneficiaries from inheriting a huge unexpected debt should tragedy strike.

Here are some basic facts to consider about how and why life insurance and student loans should potentially go hand in hand.

Death Discharge – Under such circumstances, the borrower’s estate is released from liability when dealing with federal student loans, but that may or may not be the case with private loans. Loan documents’ fine print will detail the protocol should you or your co-signer pass away before loans are paid off. Private lending giants Sallie Mae, Wells Fargo and Discover offer this service, but not all others do. If your lender is one that does not, it is strongly recommended to look into life insurance.

Similarly, life insurance for your co-signer is suggested, as well. Furthermore, if you don’t have a co-signer but are married, your spouse is likely to inherit your student loan debt should you pass on unexpectedly. That is, of course, unless your lender offers death discharge or you have life insurance.

Protecting Assets – Student loan blog site Tuition.io recommends estimating what your estate might amount to in the event of your passing before looking into or dismissing life insurance.

“Creditors can apply to your estate for payment, but if you don’t have any assets, you may not have much of an estate,” Tuition.io reads. “If you don’t have a cosigner or spouse to protect and any estate will go to your parents or someone else, it may not be a big deal. If you do have significant assets you want to protect or want to be able to leave something behind, insurance is smart.”

Types of Insurance – There are many different types of insurance, so make sure to be specific when researching details. The type you’re looking for in this case is term life insurance because you can set the length of the coverage to any given term. You would want the term to run for the same amount you likely have left on your student loans and for about the same amount on the loan balances. For best results, talk to a professional broker, but anyone can ‘try and check’ with the premiums to find your most manageable rate. Websites like InsuranceQuotes.com compile results from many top-rated insurers to help with your comparison shopping.

Your unexpected death would be a lot for your family to handle already; do you want them to have to worry about paying back tens to hundreds of thousands of student loans on top of it all? Helping ease that potential burden could cost as little as $10 a month. Leave a thoughtful legacy.

Used with Permission. Published by IMN Bank Adviser Includes copyrighted material of IMakeNews, Inc. and its suppliers.

The End of the Wallet as we Know It?

Smartphone payment apps allow you to leave your card at home

For years, consumersaofcu_pic_003047337 have had the capabilities to use apps on their smartphones to pay for items in the modern-day marketplace. Recently, this technology has begun catching on, with Internet start-ups and financial institutions scrambling to capitalize on this revolution.

“Every device will become a commerce device,” said Gary Flood, president of global products and solutions for MasterCard, to the Boston Globe. “Technology is opening up the potential to do things in a different way around the world.”

A recent survey found that more than 60 percent of people expect that mobile devices will soon replace cash and credit cards. There are many different smartphone apps that offer the abilities:

Google Wallet
This app allows you to e-mail money via gmail and link your phone to your credit and debit cards and checking account to use anywhere contactless payments are accepted. Positive aspects of Google Wallet are the ease of set-up — it takes about five minutes to create a secure PIN number and enter your personal information, including account info — and the inclusion of Google Offers, which informs you of deals and coupons at nearby places at which you may be shopping. The PIN safeguards your account from breaches, and the software’s cloud connection allows you to shut down your Wallet from a computer if your smartphone is lost or stolen. There is a fee for using credit and debit cards through Google Wallet, but checking account payments are free.

Square Cash
This app only works with debit cards, with no fee involved, and you don’t even need an account with Square to accept money this way. This makes it ideal for splitting a bill with friends, for example, or chipping in for rent. Pay with Square is an app that allows you to pay simply by saying your name. Through the app, you can find Square-enabled businesses nearby, which utilizes your phone’s GPS, and before you head into one of those stores, you hit “Open a Tab.” From there, you go into the store, grab what you want, and tell the cashier your name. The only problem is that you’re often identified by pictures in this case, and online photos can be blurry which can lead to potentially costly confusion.

Venmo
This popular app helps friends to pay each other, but it is a pay-by-text service. Checking and debit options are free with this app, but there is a fee for credit card transactions. Set-up is quick and easy, with a text confirmation for extra security, and you can connect to the service through your Facebook account as well. This will help you find friends that are also signed up for the service. Venmo’s connections with Facebook don’t end there. The Wall Street Journal’s Joanna Stern explained the service’s fun social qualities.

“As soon as you open the app, there is a Facebook-like newsfeed of your friends’ transactions — hotel rooms, Indian food and cab rides are just a few things my friends seem to be paying for with Venmo,” she said. “You can then comment or ‘like’ the update. Fortunately, the amount paid isn’t public and you can disable the sharing features on each transaction.”

To use Venmo, you just enter the amount you want to pay, identify the recipient by name, phone number or e-mail, and click “Pay.” There is a limit, however, on much you can send per week and per month.

LevelUp
This app allows you to link to your debit or credit card, while also linking to various stores’ loyalty cards. The app offers built in discounts and says its users save around $25 a month by using its service. Like many of the above options, set-up is simple by just entering your card number. Scanning your card with your phone’s camera doesn’t always work, said CNN Money’s Laurie Segall, who tried out all of these applications for a 2012 story.

To pay, on participating merchants’ LevelUp-provided devices, you just scan a code displayed on your phone after you hit “Pay.” It all works within seconds.

Paypal
This is probably the most well-known of all of these, allows you to completely scrap your phone altogether and pay with just a phone number and PIN. You must remember to first go into your Paypal account and enter your mobile number. Even if there is already a number on file, the mobile number needs to be specified. Then, at the payment device, all you have to do is enter your number and the PIN. For extra safeguards, Paypal texts you after every transaction to let you know there was a purchase. Paypal is great because it is a commonly used service that most people already have for shopping online or for international transfers. But beware of the fees, they are charged for every service (credit and debit) except for the checking account.

Store loyalty cards are a widely used option among retailers that allows you to prepay money or attach an account to them while also accumulating points or perks. Over a quarter of Starbucks customers either pay with a digital or plastic loyalty card, the company disclosed. That also means that Starbucks has reduced its cost of processing purchases by 25 percent. Typical merchant fees for a regular debit card transaction are around 4 percent, while use through loyalty cards and apps like those above can reduce the fees to 2 percent or even make them disappear altogether.

A similar option to those mentioned previously includes the Tango Card, which allows consumers to securely store gift cards and then generate a barcode for their use at the register. Also, Uber is an app that enables a user to pay for a town car or a taxi through its technology linked to credit or debit accounts. Many parking garages, parking meters and vending machines across the country have gone the “touchless payment” route as well.

Going forward, technology will be making even greater strides. NXT-ID, Inc. is developing a means to replace all the cards in your wallet with no smartphone required. The Wocket™ is its own device; it will work anywhere credit cards are accepted, and only with your biometric consent. See an official presentation about the Wocket here: https://www.youtube.com/watch?v=h2zPNB5i9CA.

All of these technological advancements are not without their problems, however. Security really is not a concern, as most of the aforementioned services are more protected than your own actual wallet! The main issue with digitized payments is that the systems are not synchronized. One app doesn’t work everywhere, or with every point-of-sale device. But that, too, may be a problem of the past. Scvngr, the operator of LevelUp, is working on a single POS that will allow merchants to accept any mobile payment app.

“Until you solve that particular problem, you can’t really drive much widespread consumption,” said Will Graylin, founder of ROAM Data, a premier mobile application and payment services company.

As Graylin indicated, it will be a while before there is extensive adoption of the mobile wallet, but be aware of increased spending when this future is upon us. These apps and devices certainly increase convenience, as software can track spending and balances with the push of a button, but they also increase sales, with GPS tracking helping to notify you of sales and discounts near you. Individually, these technologies have their own pros and cons; each is best used in different places and under varying circumstances. Therefore, it’s solely up to your discretion if next time you go shopping, you want to leave your wallet at home.


Used with Permission. Published by IMN Bank Adviser
Includes copyrighted material of IMakeNews, Inc. and its suppliers.