National Payday - Cash Advance

Finance 101: Basics of Cash Advance and Payday Loans

It’s no secret that the American banking industry has undergone major challenges and transformations over the past two years. Institutions have closed ranks and have reduced the amount of money available to borrowers. This includes everything from declining to offer certain types of consumer loans to reducing the credit limits of millions of borrowers. According to a recent Wall Street Journal article, the total lending funds available to consumers fell to $433 billion in 2010, “down 51% from $887 billion in 2007”. Borrowers that make up the low end of the credit community have virtually been left with no recourse for fulfilling their short term lending needs. In stepped cash advance and payday loan establishments. […]

Finance 101: How To Avoid Bad Tenants

Finance 101: How To Avoid Bad Tenants

Until the collapse of the mortgage industry under the weight of fraud, real estate had traditionally been viewed as a safe investment vehicle. Skyrocketing prices at the height of the real estate bubble brought many buyers into real estate that were enticed by the idea that they could make money from their investments. While property prices have fallen nationwide, some savvy investors are holding on to their property and renting to tenants.

Dealing with tenants if you are not a real estate professional can be very difficult as I have documented with my tenant from hell stories. The easiest way to lose your investment in real estate is to be a lax landlord and let bad tenants run roughshod over you.  Hopefully, with this handy guide, you won’t have too much trouble when  you run into a bad tenant. […]

Finance 101: Introduction to Bond Lesson 1

Finance 101: Introduction to Bonds Lesson 1

All of my life I’ve heard about diversifying your assets by having stocks and bonds. I kind of know what a stock is but the other day I wondered, just what’s a bond, and why would I want one? If you have the same questions then stay tuned for the latest installment of my basic finance course: Finance 101.

I actually own some bonds as part of my investment strategy. My last employer offered employees the ability to purchase bonds automatically through a direct payroll deduction on a monthly basis. I figured, hey, why not and allocated $100 each month for about 6 months towards bonds. They were mailed directly to my mom, and I promptly forgot about them until I bumped into an old pay stub last week. I began to wonder, just what the heck did I purchase anyway? Let’s begin with definitions. According to About.com, a bond is “simply an ‘IOU’ in which an investor agrees to loan money to a company or government in exchange for a predetermined interest rate.” Great! So who’s the investor? Well, in this case that would be me or whoever purchased bonds. Sweet! I’m an investor. Now, how do I make money from this? This is where it gets interesting. It all depends on what types on bonds you’ve purchased. […]

Finance 101: What the Heck is Peer-to-Peer or P2P Lending?

Finance 101: What the Heck is Peer-to-Peer or P2P Lending?

This is part two in my Finance 101 series and it’s a long one. This time we’re learning about peer-to-peer, person-to-person, social, P2P or sometimes micro lending. The concept has many names but it’s basically the same thing – you are getting a loan from a private individual instead of a bank. That’s the short, short version for those without the time to stick around for the article. The rest of this post is directed to those who are completely clueless about the process. Read on.

Let’s begin with the most basic. According to Wikipedia, this is a type of lending or borrowing “which occurs directly between individuals (‘peers’) without the intermediation/participation of a traditional financial institution.” I like my definition better. You’re thinking, well how does this work? Let’s look at two scenarios.

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Savings Account - Finance 101: Why Banks Want You to Open Accounts

Finance 101: Why Banks Want You to Open Accounts

I’m starting a new series here called Finance 101. When the mood stikes me I’ll cover one basic consumer finance topic that I think will help us as we both get out of debt. Let’s begin this series with the most basic thing…why banks need you to open accounts and deposit money in the banks.

Deposit accounts are your typical savings or checking accounts where you deposit money into an account at a bank. They’re sometimes called demand accounts meaning that they have to give you your money when you ask for it. When you deposit money at a bank, the bank now physically has your cash and gives you some note that says they’re holding that money for you. It might be your deposit receipt, your statement or a passbook. So, the bank now counts your money as their asset but also lists that same money as a liability that they owe to you. What’s just happened is that you have effectively given the bank a loan and now they owe you the money whenever you come back and say that you want it or when you spend it by using debit cards or checks. […]