189
votes
Accepted
Spouse wants to pay all debt in a month but I don’t. Is this a good idea?
Split the difference. Keep $30K in the bank and pay $25K of loans now. Use your $4,300/month to pay the remainder of the loans over the next 6 months, and then use the following 6 months to replenish ...
- 32.7k
185
votes
Accepted
My friend cosigned for a defaulted loan. Should he declare Chapter 7 bankruptcy?
DON'T talk to the creditor. DON'T trash your other good credit. DON'T declare bankruptcy for a good while.
The IRA is protected. Protect it.
First and foremost, the IRA is untouchable in MD. ...
169
votes
How do I lend money to a friend for a car and put the car as collateral?
As a frame challenge to your question, consider that a deposit in your bank is essentially you giving a loan to the bank. Now the bank has money which they can loan to your friend! Yes, you're only ...
- 17k
132
votes
I cosigned for a friend who is not paying the payment
Cosigning is explicitly a promise that you will make the payments if the primary signer can not. Don't do it unless you are able to handle the cost and trust the other party will "make you whole" when ...
- 43k
121
votes
Accepted
Should I pay for a computer up-front or on finance?
This is pretty simple, and doesn’t require too much math.
First, talk of liquidity is not necessary. You are currently paying $3000 extra on your mortgage every month. (Nice!) You certainly would ...
- 115k
113
votes
I’m 18 years old and want to finance a £30,000 car
You are talking about spending about a third of all your money on a car and committing to do so for the next 4 years.
As an 18 year-old you have a tidy disposable income and few expenses. But the ...
- 2,112
113
votes
Why would a loan company deposit a small amount into my account and require I send it back?
What exactly is the "small amount" we're talking about here? It is pretty common when setting up a direct deposit to send one or two payments of < $1 and to ask the owner of the account ...
- 26.5k
102
votes
Does a company have to have your login information to verify your identity?
No. Anyone who asks for your username and password is very likely a scammer. Access to id.me is especially valuable as it would allow the scammer to essentially steal your whole online identity. Make ...
- 166k
100
votes
Accepted
Hypothetically, should I pay off the smaller + higher interest rate loan first, or the larger + higher absolute interest cost?
This is an interesting question. Many people would tell you to pay the highest interest rate loan first. There are many others who would tell you to pay off the smallest balance loan first. In your ...
- 115k
98
votes
My mother co-signed for my car. Can she take it away from me if I am the one making car payments?
The registration (title too, right?) is in your name, the car is yours. You need to decide how to politely tell her this.
92
votes
Buy house with down payment, no loan, sell instantly
Wholesaling is basically the act of standing in at an auction and "buying" a home on behalf of a yet-to-be-determined buyer. You put a down payment on the purchase, and then, you go out, find that ...
- 17k
90
votes
I cosigned for a friend who is not paying the payment
I'm sorry you are going through this, but what you are dealing with is exactly is how cosigning works. It is among other reasons why you should never cosign a loan for someone unless you are 100% ...
- 4,196
88
votes
Accepted
Can I take out a loan and pay it back immediately to avoid interest?
It will depend on the terms and conditions of the loan you take. Some loans have penalties on early repayment while others do not.
- 3,642
84
votes
Accepted
Why is being "upside down" on a mortgage so bad?
I can think of a few reasons why they seem like a bigger deal to people than similar situations with other loans.
Mortgage values are a lot larger than car loans. For many people, real estate is by ...
- 15.1k
84
votes
Prepaying a loan: Shouldn't the interest be recalculated like a shorter loan?
When you pay off a loan early, you pay the remaining principal, and you save all of the remaining interest. So you do save on interest, but it's the interest you would have paid in the future, not the ...
- 1,193
83
votes
Would using an expensive car as collateral for a small loan to get cheap parking work?
I've never heard of a bank taking possession of collateral at loan issuing, they just obtain a legal right to use the collateral to satisfy the debt in case of default.
Pawnshops/pawnbrokers on the ...
- 69.1k
81
votes
Accepted
Borrowing money in one country to pay off debt in another
Logistics of borrowing in a different country aside, financially if the reason the interest rates are higher is because inflation is expected to be higher, you might be trading smaller interest ...
- 131k
79
votes
How can I support myself financially as a 17 year old with a loan?
There are two ways to improve your personal finances:
Make more money
Spend less money
That's literally the secret. To afford the car, you either need more income, or lower expenses. Don't fret, ...
- 24k
76
votes
Spouse wants to pay all debt in a month but I don’t. Is this a good idea?
If your interest on those loans accumulates monthly, it's cheaper to pay them off now (unless the interest rate is below what your money earns you in the savings), though I would make sure I have ...
- 2,404
76
votes
Accepted
How is making a down payment different from getting a smaller loan?
They are no different, but the language you are using is different than what is typical.
If you are buying a $100k thing (perhaps a house), and you only take an $80k loan, then you are necessarily ...
- 115k
75
votes
Accepted
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 would not be concerned about the impact to your credit rating. You already have an excellent credit score, and the temporary change to your utilization will have minimal impact to your score.
If ...
- 115k
73
votes
Accepted
Could the loan officer deny me even if I have the money as a first time home buyer?
A financial institution is not obligated to offer you a loan. They will only offer you a loan if they believe that they will make money off you. They use all the info available in order to determine ...
- 42k
69
votes
Accepted
What would be a recommended interest rate for an unsecured loan to individuals with mediocre credit rating and income close to expenses?
You're not a bank, so don't try to think like one. Banks base their interest rate off of the average risk of default for similar borrowers based on carrying multiple loans to spread the risk. In your ...
- 131k
67
votes
My mother co-signed for my car. Can she take it away from me if I am the one making car payments?
"Her solution to the problem is to take my car" - i.e. THEFT. If you are on the title, it is your car. A cosigner has no right to the item purchased - all he did was guarantee the loan in case the ...
- 11.6k
65
votes
Spouse wants to pay all debt in a month but I don’t. Is this a good idea?
Look at how much interest keeping that amount in cash is costing you. At 5% interest, that's $200 a month wasted in interest payments just for the peace of mind of having cash in the bank.
I agree ...
- 131k
63
votes
My mother co-signed for my car. Can she take it away from me if I am the one making car payments?
The car is yours, your name is on the title, and you are insuring it based on you being the driver (not her). You are responsible for parking tickets and toll evasion. Any arrangement you might do ...
62
votes
Accepted
Can I take out a loan and invest it at higher interest?
You must consider the different levels of risk associated with each loan.
When the bank loans you money, it does so based on a high degree of information about your financial situation (through your ...
- 42k
60
votes
Accepted
Options for paying for a nonreturnable leased vehicle
Unfortunately this is going to land in her mother's lap. Since she is a cosigner on the lease she is just as responsible as your girlfriend for paying the return value. Both of them would have to ...
- 131k
59
votes
Why is being "upside down" on a mortgage so bad?
The problem comes when the borrower cannot afford his home.
If a borrower buys more home than they can afford, as long as he can sell the house for more than he owes, he's not in a disastrous ...
- 115k
57
votes
Accepted
Should I pay cash or prefer a 0% interest loan for home furnishings?
There are several issues with paying for furniture and appliances with 0% credit instead of paying with cash.
When you pay with 0% credit, you might be tempted to spend more on something than you ...
- 115k
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