Thursday, July 14, 2011

Simple Tips on Borrowing Money

While the best advice regarding borrowing money is "don't", there are times when taking a loan is a good choice. Follow these tips when you do:

  • Shop around for Interest rates. You might find a lower interest just by spending a few additional minutes or hours talking with a few more banks. They want your business so don't be intimidated. You have control over who you want to do business with. So choose wisely and carefully.
  • Try home equity loans. If you're going to do a large purchase or expense, you can tap into the equity in your home, otherwise called home equity loan or a second mortgage. This will allow you to leverage the money you've already paid against your mortgage and use the value of your home as collateral against the larger loans. Check out private banks on this one.
  • Check out lines of credit. Lines of credit have more flexibility than standard loans. They are like bank accounts and you only pay the interest on the outstanding balance. This is helpful to set up in an emergency.


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