Your Questions About Save Loan

Linda asks…

Should I take out a $20000 car loan. Or save up?

Im 19 years old, currently living at home (rent free) and earn about 800 a week. Should I take out a loan to buy a car or take the time to save up?

John answers:

At $800 a week it will take you 6 months of saving every dime you earn to save $20,000.

If you can do that you’re smart. If you save half of what you earn you can do it in one year. So, if you can budget your money so that you can realistically put away 50% of every pay check then in 1 year you can pay cash for a $20,000 car. That would be a very smart move. But it takes a lot of discipline to save that much money. If you have no other expenses it should be easy.

Donald asks…

Consolidating Payday loans…to save marriage!!?

K well like many out there i got stupid a year ago & had to take a Payday loan out to Survive, Well now im paying for it big time. Now i got several payday loans…& i cant keep this up.
I learned my lesson But now i need to find a way to free myself.

Im reacently Married & this has become a burden on both of us, If you read some of my Other questions you can see my Marriage is breaking apart, & the biggest cause are the fact we have few reasorces because of these Payday loans.
Now I have already tooken many Steps:

#1 I have already Closed my Old bank account to keep then from Withdrawing fees.

#2 i have changed my cellphone number to stop them from duing the annoying calls BUT i still try to keep in touch to update.

#3 I have TRIED to takeout a Loan with my Bank to pay these off but BOTH my wifes AND my Credit are Crap.

#4 i have repetedly Called them trying to set up a payment plan With them but there Refusing to work with me or AT LEAST work with my budget.
#5 i have basiclly completely Defualted on at LEAST 3 of them. so i can TRY to pay the others but our Budget STILL wont let me pay MORE then the fee’s & charges.

#6 we have set a budget & sold EVERYTHING we can afford to sell or can sell

#7 We BOTH have tried looking for a 2nd job but neather of us can find one. to make things worse our current jobs have DRASTICLY cut our pay AND hours back.

#8 we both live in Texas, & i have TRIED to Reaserch texas laws but i dont understand all of it.

#9 I WAS thinking of Bankruptcy, Because we do NOT own a car or a house We rent from her In-laws, We have NO kids, Were both young in are 20’s, Her Parents WILL NOT help us & I my Family gone…
If i do file Bankruptcy i want to do it in a way that will NOT involve my wife in any way!….If i can. Mostly i dont know how to nor do i have the money to File Bankruptcy.

can ANYONE help us consolidate? or know a way we can conslidate these loans?….Im so lost & WE NEED help….I knwo what i did was stupid in the past, I have learned my lesoon about payday loans, Now i Just want to escape & get a chance. PLEASE HELP..any Adivce wil lbe helpful.
Please i dont need ANYMORE payday loans, I need help Do not Answer this if your solution is another payday loan!! or a loan that i cant get. Again i have crap Credit

John answers:

First off your charted on dangerous territory… Those payday loan places are dangerous cause of the extreme interest rates. Your probally only choice is too file bankrupcy. Check the bankrupcy laws in your state. If a bank has turned you down for a considilation loan most likley it was caused by the poor credit and payday loans. So I would seek a lawyer now, before it gets worse

Robert asks…

Can i save money and take out student loans at the same time?

im wroking part time right now no money but will have 3K by years end. im starting community college in january. It will cost total 8K a year with all fees etc. I need to save up money to trade/invest in the stock market because thats my chosen career path .. i need 10 k just to get an interview at a firm in my industry. thing is when i transfer college will cost 40 – 50 K total im looking at ging to DePaul or other top 50 private unversity. when i transfer i will have a high GPA and use grant money or something to offset a little of the costs.. but ill be in debt to loans.. but i need to save money as well.. parents can t help me with the costs so il all alone.. so heres my numbers 80-100K total for school…. 10 – 20 K saved up in the bank by the time i graduate.. i can go lower on the loans if need be but cant on my personal capital… sooo what can i do? is there a way to make all this happen?

John answers:

As a dependent student, you’ll only be able to borrow $5,500/freshman year, $6,500/sophomore year, and $7,500/junior and senior years — that will not equal 80k – 100k. If your parents are willing to cosign, you might be eligible for some private loans; however, these are not recommended because of the variable interest rates. Choose a cheaper school to transfer to — go to a public state school and you’ll save 50k. You should only borrow what you’ll reasonably expect to earn your first year working… And it’s highly doubtful that you’ll be earning 100k that first year.

Think of it in terms of monthly repayments. If you borrow 27k in federal loans at 6.8% and 73k in private loans with an average interest rate of 9%… Your monthly repayment will be $1,235.45 every month for ten years. Now, add in the cost of rent, a car payment, car insurance, health insurance, groceries, entertainment, internet/cable, cell phone, medical costs, clothing, etc. – can you really afford to pay over $1200 to repay a student loan each month? If you default, future jobs could be at risk because your credit score will drastically be affected (and in the financial industry… That’s a big no-no).

Honestly, 8k/year for community college is over the average. The majority of community colleges cost around 3k/year. Are you attending a school in-state? You can protect your capital by keeping your personal expenses low over the next four years. If you can live at home with your parents… That will save you a ton of money (especially if they’ll cover the cost of utilities as well). Living at home will also save you in household expenses and grocery costs (although make sure you contribute to the household budget for these items or pick up chores in exchange). If you can go without a car that will save you money as well – ride a bike or use public transportation. If you have an expensive cell phone, consider a pre-paid phone for around $30/month (or less – depending on how much you use it). Bring your own lunches to school instead of eating out – this is another cost saver. Watch your entertainment budget by choosing lower cost activities with friends and only splurging once a month or so. Aim to save 50% of your take-home earnings if you really want to build your capital. Be aware that your income and savings will affect your eligibility for need-based aid (but it will not affect your ability for federal loans). Definitely look at transferring to an in-state public school instead of a private university – unless, the private school will offer you a ton of financial aid and bring down the tuition costs to that of a public, in-state school. Apply for all of the scholarships that you can to get “free” money for school. There are need-based scholarships and merit-based scholarships, so pick the category that fits your needs the best.

Realize that to get into the company of your dreams (or even any company), you’ll likely start at the bottom and you may only be making 30k/year. If so, then you will not be able to afford anywhere near 80k-100k in student loan debt.

Lisa asks…

requirements for student loan?

i want to avail private student loan next year for college, i want to get the maximum from it like $40k a year! do they have a strict requirements? what if you have $50K savings????
anyone here who availed those loan like sallie mae, next student, nelnet, etc.?

John answers:

If you already have 50k saved, why would you need a loan this year?

Edit: You usually ask for a loan for one college year at a time.

Joseph asks…

Mortgage loan approval chances…….?

I have a decision to make and am unsure which would be the better choice. Please note they are one year goals.

I am very interested in applying for a home mortgage loan, however, due to circumstances, I must prolong my purchase. Which of the following scenarios would be more favorable to approval for a home mortgage? Option A: Paying all outstanding credit reported bills including personal loans to bring up credit score and save 10K in the meanwhile. Option B: Pay all outstanding credit reported reported bills, save 16K, and continue to make personal loan payments?

Option A: Pay outstanding bills, current personal loans, and save 10K.
Option B: Pay outstanding bills, save 16K and continue personal loan payments.

Any input is appreciated………

John answers:

The biggest issues that come into your credit rating are your total amount of debt, and your reliability on paying it. If you have too much debt with your personal loans, and it makes you look too stretched, then that could affect you. However, if your personal debt is relatively small to your income/level of debt, then I’d save up more for the downpayment. The important thing is to avoid adding any NEW debt in the months prior, keep paying on your old debt (a bit more than is required can be good). With mortgage rules being tighter now, you’ll likely need a 15-20% downpayment, so you may need more cash in hand.

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