New Thread.......Debt and the differences

[ddrane2115]

OK, one of the other threads prompted me to start this one. We all have or have had mortgages. I have one. I also have sold financial services at one time in my less than perfect past. I could not knowing sell what was handed to me, so I quit doing it.

How many people do you think go for the new, "lower payment" loans by quicken and others? How many realize that MOST of these are INTEREST only payments with less than average or NONE of the payment going to pay the loan off? I watch balances closely, and I even noticed on my second that the lock portion does fine, but the small <500.00 unlocked is not going down, but in fact going UP..........to which I called the bank and ripped their ass for being a con artist. I just paid off a couple of things, and will be applying that money to the second.

So do any of you have horror stories or experiences that may help others here.

 

[Junkman]

I don't see this as the bank doing anything wrong, but rather a deficiency on your part not to read and understand the entire agreement that you are signing. You don't have to be a rocket scientist to realize that the banks, loan companies, and any other institution that loans money are always going to tailor the products for there best gain, not the customers. That is how they make there money..... the old fashioned way.... they steal it!

 

[ddrane2115]

Your right, that was half the point. Most people are drawn in when someone says cut the payment by *** %, they dont realize the other side of the coin. Yeah it is legal, and yeah it is done, but that does not make it right!

 

[Junkman]

Your right, that was half the point. ............................... Yeah it is legal, and yeah it is done, but that does not make it right!

First you tell me that I am right, and then you say "that does not make it right!" The only thing that is wrong is that you didn't look at the paperwork and understand what you were signing. Today, people believe that it is governments obligation to keep business practices "fair" for the people that don't understand what they are signing. Like life in general, we are all responsible for our own mistakes and no one can stop you from making foolish mistakes except for yourself. Remember, when life hands you a lemon, you can either squeeze it and make lemonade out of it, or you can suck on it and have a sour puss. The choice is yours how to make a good situation out of a bad one. Make the right choice and enjoy a cool glass of lemonade.

 

[Spiffy1]

My favorite is asking car dealers a price:

"How about the low payment of $XXX"
"No, I asked the price; you know: how much to buy the car."
"Well, we have a great financing plan right now; I can even get that payment down to $XWY"
"no, No, NO! I don't want your financing plan; what is the price for that car?"
"Oh, I have to ask my manager"

 

[HGM]

Its a trap.. Yes its leagal(right), its just not morally right..But no one really cares about that.. So, ultimatly the choice is the consumers, I've learned not to trust salespeople, period.. The problem lies, as I found when I was yonger, in the fact that when you have credit(rated something better than bad) you will continually be baited to "save money" and "better your finances" with all types of credit offers..

I learned how to shuffle my money with "good" credit to make the most of it.. I had my first home, new truck, 2 Harleys, and a boat by the time I was 24.. Of course, when something changed(wife was layed off because she was pregnant) the bottom began to fall out.. I was young and didnt realize things would change so drasticly, my good credit allowed me to continue the lifestyle I was used to by turning to the cards that were constantly sent to me because of my "good credit".. I left my job, moved to Georgia, sold nearly everything, lived in a cheap rental for 4yrs and worked my way out of the hole.. I saved myself from bankrupsy(barely), but allot of folks wont, they'll simply give up.. I truly believe suicide rates will rise dramaticly in the next several years.. Notice how medicated our society has become?

We need to teach our kids the old "if you cant buy it cash, you dont need it" philisophy of life... Thats what I'm doing, I learned my lesson....

 

[HGM]

My favorite is asking car dealers a price:

"How about the low payment of $XXX"
"No, I asked the price; you know: how much to buy the car."
"Well, we have a great financing plan right now; I can even get that payment down to $XWY"
"no, No, NO! I don't want your financing plan; what is the price for that car?"
"Oh, I have to ask my manager"

I like to hear the guys tell me about how they "got a great deal, I payed cash".. Unless you let the dealer believe they were going to get the financing(first), I prommise they didnt get that good of a deal...

 

[ddrane2115]

Buying a car and letting all the worms out of the can first can kill a good deal. Get the price letting them THINK you are financing, then pay cash............they hate that. Also learned to NEVER trade in. Last time is the LAST time for that.

It also does not hurt to get a calculation of the value of the car you are looking at. Get a price from the dealer, then mark thru it, make an offer......watch them squirm for once.

I interviewed once for a thief position at a dealer. Some dud wanted so bad to sell this car he talked the customer into putting the down payment on her credit card..............then the card would not go thru for the amount..........I was still in the mgr office.............they tried to get her to do the loan shark thing. I did not take the job.

 

[dzalphakilo]

Hope I'm not to far off the topic, but something similar (sp?) that your reading about here in N.C are those offices that you go in, they give you a loan, and you "give" them your "future check" from work as collateral.

Now, I'm not sure how this works, but apparently the interest is so high that it's hard to pay the loan off with the check you're getting in from your employer.

They are trying to make these offices illegal down here. Apparently people get themselves into too much trouble.

Other than the house/land payment, pretty much debt free (if you want to call those payments debt free ).

I am guilty however of every once in a while going into a gun shop and using 90 day interest free "loan"

Only thing I don't like about those is with some outfits (as far as whos doing the "loan") it seems like they intentionally (sp?) try to screw with your payment plan (as far as sending you the invoice in the mail) so you will miss your payment and have to pay the interest accured (sp?).

 

[Dargo]

Not that it means squat, but for a former job I became a Certified Financial Analyst. One of the first pieces of advice I am to offer someone who has realized that they are in a financial "hole" is to quit digging. By that, one has to prioritize things. You place things in order of what is most important and work from there. For example, food would be first on the list. Shelter would be second. I'll not waste people's time by going further. By shelter being there, the professional advice is to do whatever it takes to make sure you get your mortgage paid off before other things. To do that, one must take the most basic and non complicated finance plan on the house and simply bang that thing down. Whether it takes weekly, bi-weekly payments, or simply paying over. One of the biggest problems now are banks and financial institutions luring people into these "new" finance things. Hey, you're talking about #2 on your priority list here. I wouldn't screw with it. For a refi, generally you need to be able to save at least one point of interest and have a plan to pay off the note sooner.

There is some talk radio guy who advertises that the paid off home mortgage has now taken the top status symbol of the "made it" crowd as opposed to having the BMW and Lexus in the driveway. I've never heard him, but I do like his ideas I've heard. Good luck, and get debt free.


On the car dealer thing, don't use a blanket statement to cover all dealers and think that all dealers are crooks. There certainly are some, but not all. Also on a trade in, if you think that under no circumstances you should trade your car to a dealership, you may make a very stupid mistake at times. I've worked with over 1000 dealers all over the country during the last 20 years. I've likely seen more car deal situations than everyone else on here combined. Don't go in being stupid, but if you make stupid lies to a dealer, you will get nailed and you will not get a deal. Worse yet, you lie and try to screw your dealer, you better be prepared to drive hundreds of miles for any possible repair work. Sometimes the old "words to the wise" are not from educated people who know the business.

 

[ddrane2115]

Hope I'm not to far off the topic, but something similar (sp?) that your reading about here in N.C are those offices that you go in, they give you a loan, and you "give" them your "future check" from work as collateral.

Now, I'm not sure how this works, but apparently the interest is so high that it's hard to pay the loan off with the check you're getting in from your employer.

They are trying to make these offices illegal down here. Apparently people get themselves into too much trouble.

Other than the house/land payment, pretty much debt free (if you want to call those payments debt free ).

I am guilty however of every once in a while going into a gun shop and using 90 day interest free "loan"

Only thing I don't like about those is with some outfits (as far as whos doing the "loan") it seems like they intentionally (sp?) try to screw with your payment plan (as far as sending you the invoice in the mail) so you will miss your payment and have to pay the interest accured (sp?).

You are right on target. Loan sharking, or give me a 2 week "loan" on money I dont have now, can not afford to pay back in 2 weeks, and I will pay you big $$$ in interest.

They are legal here, and run by guys who drive VERY expensive cars.

As for 3 months SAC. It is really 2 months and 29 or 30 days. Run into the 4th month and you owe ALL of the interest. See the 3 months STARTS that day, not next month.......as with most payment plans. Furniture company did that to me 13 years ago. I won, but nearly cost me 400.00 and change in interest.

My biggest concern is the "interest only" mortgages that are now so popular. Sure your "payment" is less, but you also NEVER pay it off, or worse off when the time period ends, you have to borrow to pay off the original loan.

Consolidation loans are "con" loans. Borrow on your home to pay for the things you bought you dont need, and put your home as collateral for a loan that was NOT on your home first. Now when you can not make the payment, they take the house.

 

[ddrane2115]

Not that it means squat, but for a former job I became a Certified Financial Analyst. One of the first pieces of advice I am to offer someone who has realized that they are in a financial "hole" is to quit digging.

Exactly!

By that, one has to prioritize things. You place things in order of what is most important and work from there. For example, food would be first on the list. Shelter would be second. I'll not waste people's time by going further. By shelter being there, the professional advice is to do whatever it takes to make sure you get your mortgage paid off before other things. To do that, one must take the most basic and non complicated finance plan on the house and simply bang that thing down. Whether it takes weekly, bi-weekly payments, or simply paying over. One of the biggest problems now are banks and financial institutions luring people into these "new" finance things. Hey, you're talking about #2 on your priority list here. I wouldn't screw with it. For a refi, generally you need to be able to save at least one point of interest and have a plan to pay off the note sooner.

Excellent advice. I was a Primerica Rep for a while. Good financial advice, but they started some products I dont go along with.......so I left. Also the guy I worked with did not have my same priorities. I pay 70.00 a month extra on my principal. 15 year mortgage paid off in less than 10 and save a bundle


There is some talk radio guy who advertises that the paid off home mortgage has now taken the top status symbol of the "made it" crowd as opposed to having the BMW and Lexus in the driveway. I've never heard him, but I do like his ideas I've heard. Good luck, and get debt free.

Dave Ramsey. Get the ducks in a row, pay down the least CC then start on the second least till none exist. Have 1000.00 emergency fund, and DO NOT USE credit.


On the car dealer thing, don't use a blanket statement to cover all dealers and think that all dealers are crooks. There certainly are some, but not all. Also on a trade in, if you think that under no circumstances you should trade your car to a dealership, you may make a very stupid mistake at times. I've worked with over 1000 dealers all over the country during the last 20 years. I've likely seen more car deal situations than everyone else on here combined. Don't go in being stupid, but if you make stupid lies to a dealer, you will get nailed and you will not get a deal. Worse yet, you lie and try to screw your dealer, you better be prepared to drive hundreds of miles for any possible repair work. Sometimes the old "words to the wise" are not from educated people who know the business.

Again good advice. Dont lie, and be prepared to do as you say. But I still would NOT let on I am paying cash.