This tag is a generic tag to be used when asking a question on Loans / lending. If there is a specific question the other related tags like home-loan, student-loans, etc should be used.

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73
votes
10answers
11k views

Why is being “upside down” on a mortgage so bad?

For the longest time (especially during/after the housing crash in the US), people would speak in hushed whispers or terrified pleas when they talked about being upside down on their mortgage. While I ...
60
votes
13answers
20k views

I cosigned for a friend who is not paying the payment

I cosigned for a loan for a friend. He has now moved away and is not making payments. I have been asked to pay--they even called my job--and I need to keep my credit. The payments are too high for me ...
48
votes
12answers
14k views

Should I pay off a 0% car loan?

I'm ahead on 0% interest car loan. I don't have to make a payment until October. I currently owe $3,000 and I could pay it all off. Should I do that or leave that money in my savings account that ...
44
votes
7answers
13k views

Why are 30-year mortgages seen as unwise, if you can pay off the loan in a shorter period of time anyway?

I'm slowly working towards buying my first home (yay!), and have been playing around with the numbers. As far as I can tell, there's literally zero advantage for getting a 10 or 15-year mortgage since ...
34
votes
7answers
3k views

Why use credit when you have the cash?

I've heard several people state that they get loans even when they have the money to cover the cost in the bank, and it befuddles me why they would pay interest instead of using their own money. This ...
33
votes
3answers
8k views

Can I take out a loan and invest it at higher interest?

I noticed today that my bank is offering small loans of up to £15000 at 3.3% interest. Meanwhile, services like Zopa and RateSetter are offering over 6% interest on investments in their platforms. I ...
31
votes
13answers
8k views

Do I pay a zero % loan before another to clear both loans faster?

I have $11,000 to put toward one of my three loans. I think I should pay off the 0% car loan and then in two months it will be zero and I can apply that $635 to the 2.5 % car loan and pay it down ...
31
votes
11answers
8k views

Should I charge my children interest when they borrow money? [closed]

My children (both male, ages 25, soon to be married, & 32, married) have borrowed money from me and my wife on several occasions. They have yet to pay us back what they borrowed. We have never ...
31
votes
8answers
3k views

Optimal way to use a credit card to build better credit?

I have a credit card with a $700 limit and I am curious how to optimize credit gain with it. Right now, I use it once a month (usually on something small like a drink from a convenience store or ...
27
votes
9answers
5k views

Is asking to pay off principal first a placebo?

Some people say that in order to pay off a loan sooner, you should ask the lender to "apply your payment towards the principal", so that they won't "apply your payment towards the interest". From my ...
27
votes
10answers
24k views

Why do governments borrow money instead of printing it?

This question is raised in the movie Money as Debt (at time index 29:00). The answer that immediately pops to my head is "because printing money causes inflation". However, according to this movie, ...
26
votes
6answers
8k views

Why will the bank only loan us 80% of the value of our fully paid for home?

We own Land and a home, wanting to downsize and just buy a home and lot. We do not owe anything on our land and home, but have asked about a loan using our land and home as collateral, but, even ...
26
votes
6answers
7k views

Loan to son - how to get it back

A few years ago, we loaned our son money to start a business, which did not flourish. Yep, we know now it was a bad idea. But now, we owe $54k on our equity line, which he is only paying interest on....
25
votes
7answers
13k views

Making a big purchase over $2500. I have the money to cover it. Should I get a loan or just place it on credit?

I am planning to make a big purchase. I have the money in savings to cover it, but I don't want to drop $2500 all at once if I can avoid it. I have a credit card with a $9000 limit, but I know that ...
24
votes
8answers
9k views

To pay off a student loan, should I save up a lump sum payoff payment or pay extra each month?

I am a new college graduate with a student loan of $17k at 6.8% interest. The monthly minimum payment due is $193. I have been paying the minimum amount, and then taking that same amount and placing ...
22
votes
7answers
2k views

Why do people use mortgages, when they could just pay for the house in full?

I would like your recommendation on whether you should buy a house with a mortgage, which you would pay as you go, or should you buy it in full.
22
votes
9answers
8k views

Should I pay cash or prefer a 0% interest loan for home furnishings?

I live in France. I bought an apartment with a mortgage a month ago. I've been buying plenty of stuff for this apartment like furniture, decoration, oven, etc. And I still need to buy other stuff. I'...
22
votes
1answer
1k views

Paying off home mortgage and lender wants a “Recording Fee”

So I whittled down my house note to the point where I have enough cash to just pay it off early and be done with it. Yay! I asked my lender for a "payoff" statement, which provides an accounting of ...
21
votes
3answers
1k views

What are the pitfalls of loaning money to friends or family? Is there a right way to do it?

What are the pitfalls of loaning money to friends or family? Is there a right way to do it?
20
votes
10answers
10k views

Someone asks you to co-sign a loan. How to reject & say “no” nicely or politely?

Hypothetical situation: A dear friend or family member comes to you and asks you to co-sign for their loan. Let's say the reason they need the money is not a life-or-death type of situation. ...
20
votes
9answers
2k views

What is the difference between “good debt” vs. “bad debt”?

This other question about home renovations makes reference to the concept of "good debt." Could somebody explain the concepts of good debt vs. bad debt, providing examples of each? Are there cases ...
18
votes
5answers
4k views

Would it be advantageous for me to pay off these two credit cards and cancel them with a 401k loan?

I'm considering taking a loan on my 401k in order to pay off and close 2 credit cards. I have approximately 30 years until I consider retiring. The amount of the loan will be $1700 which is less ...
17
votes
2answers
3k views

Paying off student loans early/lump sum — best practices?

My wife & I have run into a large sum of cash recently and are interested in paying off/paying down our student loans -- about $30k between us, at about 6.5% avg interest. We're both earning ...
15
votes
2answers
5k views

Cosigned on a loan. If I pay loan off, are purchases now mine?

I cosigned a loan for my ex on a refrigerator, microwave, and oven. I know it wasn't smart. But if I pay off loan, can I retrieve the items?
14
votes
7answers
4k views

Is a car loan bad debt?

I've heard people saying that a car loan is considered a bad debt, while a house mortgage is a good debt and so on. My bank is offering 1.49% interest for a 36 month loan or 2.49% for a 37-60 month ...
14
votes
4answers
4k views

Should you co-sign a personal loan for a friend/family member? Why/why not?

I know someone who was recently asked to co-sign a hefty loan by a family member. I don't know what I'd do if I was put in the same position as the one asked. What are the risks? What are things to ...
14
votes
6answers
2k views

What do I need to know before getting a loan?

Recently, due to a series of events, I've been finding myself... uncomfortable with my financial situation. I'm not in debt, but my account balance did drop into the low three-digit figures a couple ...
14
votes
6answers
1k views

Is it okay to be married, 30 years old and have no retirement?

I am a 31 year old attorney with a 10 month old baby. I make $130K a year. My husband is also an attorney, and makes approx. $60K a year. WE both do not have any retirement savings or college ...
14
votes
4answers
2k views

What should I do with my credit card debt?

I have almost $20,000 in credit card debt and, though I have stopped accumulating it for quite a while now, I'm trying to figure out the best way forward. Can someone please offer advice based on this ...
14
votes
1answer
2k views

What does it mean if a lender asks for a “title” from your purchase?

My boss at my company has agreed to lend me money to buy a car to use for work, where I would pay him monthly for a couple of months until it is paid off. Upon giving me the money, he asked me to ...
13
votes
8answers
903 views

Paying Off Debt: When CC Companies Won't Reduce APR

For the past two years I've been living, for the first time, under the weighty, grey cloud of credit card debt. Foolish use of personal credit cards to fund asset purchases for an LLC have resulted in ...
13
votes
4answers
10k views

Will our hefty student loans affect our chances of getting a mortgage?

My husband and I live simply but we're content. I'm an avid budgeter and love finding ways to be frugal. My dilemma right now is that we've been able to keep our living expenses below what we make, ...
12
votes
6answers
5k views

Advantages of paying more of your mortgage while you know you won't continue to live there your whole life

Recently I bought a house for 140k in the Netherlands. It had a mortgage of 110k (3,0% interest) and a startersloan of 30k (4,0% interest, no payments/interest the first 3 years). I am getting ...
12
votes
10answers
3k views

Recent college grad. Down payment on a house or car?

So here's the situation I'm facing. I've recently graduated college but have been working for a while now. I've managed to save up around $10,000 aside for my "money to live" stash. And like most ...
12
votes
7answers
9k views

Saving $1,000+ per month…what should I do with it?

I am able to save $1,100 a month, after all expenses and after paying the minimums ($225 a month on my 2.24% and 3.25% student loans). I want to make smart decisions with my money, but am not sure ...
12
votes
3answers
30k views

Co-signed a loan and I need to have my name removed

I co-signed on a car loan with my partner, and now that we are no longer together I want to have my name removed. He has had the car a year now and has been on his job over an year, but he won't do ...
12
votes
2answers
2k views

Mortgages: What is the terminology for how much I own and how much I still owe?

I'm looking for the terminology related to my home mortgage. The word or phrase for how much of my house I own. The word or phrase for how much I still owe. For example, suppose I bought a $500K ...
12
votes
2answers
2k views

In which situations is it better to consider a loan instead of paying cash?

I live in France where credit cards are less widespread than in the U.S. The default account for us is a checking account. Often you can't spend more than what is in your account; otherwise you have ...
12
votes
4answers
54k views

When can you use existing real estate as collateral to buy more?

My grandfather owned a dozen apartment buildings, and when I asked him when I was little how he got so many, he said he just bought one, and then used it for collateral to get the second, and so on. ...
12
votes
4answers
2k views

Can someone help me understand my student loans?

I have more loans than these but I am wondering how to handle these three (all with the same bank): 3%, last payment ~$36, current balance $6153, original amount $5500, payoff balance $6170 2.5%, ...
12
votes
2answers
2k views

What are advantages & disadvantages of using a Peer-to-Peer lending site or network?

If I was looking to consolidate some credit card debt and wanted to use a peer to peer lending service, what things do I need to look out for?
11
votes
7answers
650 views

Are Kiva or other microlending institutions a decent way to improve overall yield?

Have you used Kiva.org, Microplace.com or any other microlending institutions? Any positive or negative experiences? Does this seem like a decent way to improve overall yield, assuming I'm willing ...
11
votes
7answers
429 views

A loan or a self loan: Is there any reason I should ever take out a loan when I have that money in saving?

Is there any reason I should ever take out a loan when I have that money in saving? Example: I have 20k in a house fund, and I want to spend 8k to buy a car?
11
votes
1answer
1k views

What is the difference between an amortized loan and a non-amortized loan?

As an example, my parents told me that their current car loan is amortized. Does that make any practical difference to how they pay off their loan, as opposed to if their loan had not been amortized?
11
votes
4answers
784 views

Did my salesman damage my credit? What can I do?

I am in the process of purchasing a new truck. A few months ago I put a $500 security deposit down on a truck. I was told that the truck was at a neighboring dealership and that it would take 2-5 days ...
11
votes
5answers
2k views

What are the pros and cons of buying a house just to rent it out?

My situation is that I'm 23 and have about $4k a month of spare income after everything. I'm considering buying a house in the area I come from, a relatively cheap area where I have friends who bought ...
11
votes
2answers
3k views

How do loans against 401k / 403b accounts work?

I'm really clueless about these loans. Who gets the interest? Does the account fund the loan, or are they simply used as collateral? What are the tax implications?
10
votes
8answers
7k views

Paying $1000 a month to keep a car in New York City

I am 25 working in New York city making ~117k a year. After tax and various pre-tax deductions, (mta fare etc) my take home is just shy of 6k a month. I pay $1875 in rent a month for a nice ...
10
votes
2answers
2k views

Money sent to loan account after it has been paid off and closed

For the last few months I have been paying off a loan via automatic payments from my current account that transfer over automatically each month. The loan got paid off and the bank closed the account. ...
10
votes
4answers
1k views

What do you do when a family member won't pay you back?

What do you do when a family member won't pay you back?