Banking Fraud – Prevention and Control

Banking Fraud is posing threat to Indian Economy. Its vibrant effect can be understood be the fact that in the year 2004 number of Cyber Crime were 347 in India which rose to 481 in 2005 showing an increase of 38.5% while I.P.C. category crime stood at 302 in 2005 including 186 cases of cyber fraud and 68 cases cyber forgery. Thus it becomes very important that occurrence of such frauds should be minimized. More upsetting is the fact that such frauds are entering in Banking Sector as well.

In the present day, Global Scenario Banking System has acquired new dimensions. Banking did spread in India. Today, the banking system has entered into competitive markets in areas covering resource mobilization, human resource development, customer services and credit management as well.

Indian’s banking system has several outstanding achievements to its credit, the most striking of which is its reach. In fact, Indian banks are now spread out into the remotest areas of our country. Indian banking, which was operating in a highly comfortable and protected environment till the beginning of 1990s, has been pushed into the choppy waters of intense competition.

A sound banking system should possess three basic characteristics to protect depositor’s interest and public faith. Theses are (i) a fraud free culture, (ii) a time tested Best Practice Code, and (iii) an in house immediate grievance remedial system. All these conditions are their missing or extremely weak in India. Section 5(b) of the Banking Regulation Act, 1949 defines banking… “Banking is the accepting for the purpose of lending or investment, deposits of money from the purpose of lending or investment, deposits of money from the public, repayable on demand or otherwise and withdraw able by cheque, draft, order or otherwise.” But if his money has fraudulently been drawn from the bank the latter is under strict obligation to pay the depositor. The bank therefore has to ensure at all times that the money of the depositors is not drawn fraudulently. Time has come when the security aspects of the banks have to be dealt with on priority basis.

The banking system in our country has been taking care of all segments of our socioeconomic set up. The Article contains a discussion on the rise of banking frauds and various methods that can be used to avoid such frauds. A bank fraud is a deliberate act of omission or commission by any person carried out in the course of banking transactions or in the books of accounts, resulting in wrongful gain to any person for a temporary period or otherwise, with or without any monetary loss to the bank. The relevant provisions of Indian Penal Code, Criminal Procedure Code, Indian Contract Act, and Negotiable Instruments Act relating to banking frauds has been cited in the present Article.

EVOLUTION OF BANKING SYSTEM IN INDIA

Banking system occupies an important place in a nation’s economy. A banking institution is indispensable in a modern society. It plays a pivotal role in economic development of a country and forms the core of the money market in an advanced country.

Banking industry in India has traversed a long way to assume its present stature. It has undergone a major structural transformation after the nationalization of 14 major commercial banks in 1969 and 6 more on 15 April 1980. The Indian banking system is unique and perhaps has no parallels in the banking history of any country in the world.

RESERVE BANK OF INDIA-ECONOMIC AND SOCIAL OBJECTIVE

The Reserve Bank of India has an important role to play in the maintenance of the exchange value of the rupee in view of the close interdependence of international trade and national economic growth and well being. This aspect is of the wider responsibly of the central bank for the maintenance of economic and financial stability. For this the bank is entrusted with the custody and the management of country’s international reserves; it acts also as the agent of the government in respect of India’s membership of the international monetary fund. With economic development the bank also performs a variety of developmental and promotional functions which in the past were registered being outside the normal purview of central banking. It also acts an important regulator.

BANK FRAUDS: CONCEPT AND DIMENSIONS

Banks are the engines that drive the operations in the financial sector, which is vital for the economy. With the nationalization of banks in 1969, they also have emerged as engines for social change. After Independence, the banks have passed through three stages. They have moved from the character based lending to ideology based lending to today competitiveness based lending in the context of India’s economic liberalization policies and the process of linking with the global economy.

While the operations of the bank have become increasingly significant banking frauds in banks are also increasing and fraudsters are becoming more and more sophisticated and ingenious. In a bid to keep pace with the changing times, the banking sector has diversified it business manifold. And the old philosophy of class banking has been replaced by mass banking. The challenge in management of social responsibility with economic viability has increased.

DEFINITION OF FRAUD

Fraud is defined as “any behavior by which one person intends to gain a dishonest advantage over another”. In other words , fraud is an act or omission which is intended to cause wrongful gain to one person and wrongful loss to the other, either by way of concealment of facts or otherwise.

Fraud is defined u/s 421 of the Indian Penal Code and u/s 17 of the Indian Contract Act. Thus essential elements of frauds are:

1. There must be a representation and assertion;

2. It must relate to a fact;

3. It must be with the knowledge that it is false or without belief in its truth; and

4. It must induce another to act upon the assertion in question or to do or not to do certain act.

BANK FRAUDS

Losses sustained by banks as a result of frauds exceed the losses due to robbery, dacoity, burglary and theft-all put together. Unauthorized credit facilities are extended for illegal gratification such as case credit allowed against pledge of goods, hypothecation of goods against bills or against book debts. Common modus operandi are, pledging of spurious goods, inletting the value of goods, hypothecating goods to more than one bank, fraudulent removal of goods with the knowledge and connivance of in negligence of bank staff, pledging of goods belonging to a third party. Goods hypothecated to a bank are found to contain obsolete stocks packed in between goods stocks and case of shortage in weight is not uncommon.

An analysis made of cases brings out broadly the under mentioned four major elements responsible for the commission of frauds in banks.

1. Active involvement of the staff-both supervisor and clerical either independent of external elements or in connivance with outsiders.

2. Failure on the part of the bank staff to follow meticulously laid down instructions and guidelines.

3. External elements perpetuating frauds on banks by forgeries or manipulations of cheques, drafts and other instruments.

4. There has been a growing collusion between business, top banks executives, civil servants and politicians in power to defraud the banks, by getting the rules bent, regulations flouted and banking norms thrown to the winds.

FRAUDS-PREVENTION AND DETECTION

A close study of any fraud in bank reveals many common basic features. There may have been negligence or dishonesty at some stage, on part of one or more of the bank employees. One of them may have colluded with the borrower. The bank official may have been putting up with the borrower’s sharp practices for a personal gain. The proper care which was expected of the staff, as custodians of banks interest may not have been taken. The bank’s rules and procedures laid down in the Manual instructions and the circulars may not have been observed or may have been deliberately ignored.

Bank frauds are the failure of the banker. It does not mean that the external frauds do not defraud banks. But if the banker is upright and knows his job, the task of defrauder will become extremely difficult, if not possible.

Detection of Frauds

Despite all care and vigilance there may still be some frauds, though their number, periodicity and intensity may be considerably reduced. The following procedure would be very helpful if taken into consideration:

1. All relevant data-papers, documents etc. Should be promptly collected. Original vouchers or other papers forming the basis of the investigation should be kept under lock and key.

2. All persons in the bank who may be knowing something about the time, place a modus operandi of the fraud should be examined and their statements should be recorded.

3. The probable order of events should thereafter be reconstructed by the officer, in his own mind.

4. It is advisable to keep the central office informed about the fraud and further developments in regard thereto.

Classification of Frauds and Action Required by Banks

The Reserve Bank of India had set-up a high level committee in 1992 which was headed by Mr. A… Ghosh, the then Dy. Governor Reserve Bank of India to inquire into various aspects relating to frauds malpractice in banks. The committee had noticed/observed three major causes for perpetration of fraud as given hereunder:

1. Laxity in observance of the laid down system and procedures by operational and supervising staff.

2. Over confidence reposed in the clients who indulged in breach of trust.

3. Unscrupulous clients by taking advantages of the laxity in observance of established, time tested safeguards also committed frauds.

In order to have uniformity in reporting cases of frauds, RBI considered the question of classification of bank frauds on the basis of the provisions of the IPC.
Given below are the Provisions and their Remedial measures that can be taken.

1. Cheating (Section 415, IPC)

Remedial Measures.

The preventive measures in respect of the cheating can be concentrated on cross-checking regarding identity, genuineness, verification of particulars, etc. in respect of various instruments as well as persons involved in encashment or dealing with the property of the bank.

2. Criminal misappropriation of property (Section 403 IPC).

Remedial Measure

Criminal misappropriation of property, presuppose the custody or control of funds or property, so subjected, with that of the person committing such frauds. Preventive measures, for this class of fraud should be taken at the level the custody or control of the funds or property of the bank generally vests. Such a measure should be sufficient, it is extended to these persons who are actually handling or having actual custody or control of the fund or movable properties of the bank.

3. Criminal breach of trust (Section 405, IPC)

Remedial Measure

Care should be taken from the initial step when a person comes to the bank. Care needs to be taken at the time of recruitment in bank as well.

4. Forgery (Section 463, IPC)

Remedial Measure

Both the prevention and detection of frauds through forgery are important for a bank. Forgery of signatures is the most frequent fraud in banking business. The bank should take special care when the instrument has been presented either bearer or order; in case a bank pays forged instrument he would be liable for the loss to the genuine costumer.

5. Falsification of accounts (Section 477A)

Remedial Measure

Proper diligence is required while filling of forms and accounts. The accounts should be rechecked on daily basis.

6. Theft (Section 378, IPC)

Remedial Measures

Encashment of stolen’ cheque can be prevented if the bank clearly specify the age, sex and two visible identify action marks on the body of the person traveler’s cheques on the back of the cheque leaf. This will help the paying bank to easily identify the cheque holder. Theft from lockers and safe deposit vaults are not easy to commit because the master-key remains with the banker and the individual key of the locker is handed over to the costumer with due acknowledgement.

7. Criminal conspiracy (Section 120 A, IPC)

In the case of State of Andhra Pradesh v. IBS Prasad Rao and Other, the accused, who were clerks in a cooperative Central Bank were all convicted of the offences of cheating under Section 420 read along with Section 120 A. all the four accused had conspired together to defraud the bank by making false demand drafts and receipt vouchers.

8. Offences relating to currency notes and banks notes (Section 489 A-489E, IPC)
These sections provide for the protection of currency-notes and bank notes from forgery. The offences under section are:

(a) Counterfeiting currency notes or banks.

(b) Selling, buying or using as genuine, forged or counterfeit currency notes or bank notes. Knowing the same to be forged or counterfeit.

(c) Possession of forged or counterfeit currency notes or bank-notes, knowing or counterfeit and intending to use the same as genuine.

(d) Making or passing instruments or materials for forging or counterfeiting currency notes or banks.

(e) Making or using documents resembling currency-notes or bank notes.

Most of the above provisions are Cognizable Offenses under Section 2(c) of the Code of Criminal Procedure, 1973.

FRAUD PRONE AREAS IN DIFFERENT ACCOUNTS

The following are the potential fraud prone areas in Banking Sector. In addition to those areas I have also given kinds of fraud that are common in these areas.

Savings Bank Accounts

The following are some of the examples being played in respect of savings bank accounts:

(a) Cheques bearing the forged signatures of depositors may be presented and paid.

(b) Specimen signatures of the depositors may be changed, particularly after the death of depositors,

(c) Dormant accounts may be operated by dishonest persons with or without collusion of bank employees, and

(d) Unauthorized withdrawals from customer’s accounts by employee of the bank maintaining the savings ledger and later destruction of the recent vouchers by them.

Current Account Fraud

The following types are likely to be committed in case of current accounts.

(a) Opening of frauds in the names of limited companies or firms by unauthorized persons;

(b) Presentation and payment of cheques bearing forged signatures;

(c) Breach of trust by the employees of the companies or firms possessing cheque leaves duly signed by the authorized signatures;

(d) Fraudulent alteration of the amount of the cheques and getting it paid either at the counter or though another bank.

Frauds In Case Of Advances

Following types may be committed in respect of advances:

(a) Spurious gold ornaments may be pledged.

(b) Sub-standard goods may be pledged with the bank or their value may be shown at inflated figures.
(c) Same goods may be hypothecated in favour of different banks.

LEGAL REGIME TO CONTROL BANK FRAUDS

Frauds constitute white-collar crime, committed by unscrupulous persons deftly advantage of loopholes existing in systems/procedures. The ideal situation is one there is no fraud, but taking ground realities of the nation’s environment and human nature’s fragility, an institution should always like to keep the overreach of frauds at the minimum occurrence level.

Following are the relevant sections relating to Bank Frauds

Indian Penal Code (45 of 1860)

(a) Section 23 “Wrongful gain”.-

“Wrongful gain” is gain by unlawful means of property to which the person gaining is not legally entitled.

(b) “Wrongful loss”

“Wrongful loss” is the loss by unlawful means of property to which the person losing it is legally entitled.
(c) Gaining wrongfully.

Losing wrongfully-A person is said to gain wrongfully when such person retains wrongfully, as well as when such person acquires wrongfully. A person is said to lose wrongfully when such person is wrongfully kept out of any property, as well as when such person is wrongfully deprived of property.

(d) Section 24. “Dishonestly”

Whoever does anything with the intention of causing wrongful gain to one person or wrongful loss to another person, is said to do that thing “dishonestly”.

(e) Section 28. “Counterfeit”

A person is said to “counterfeit” who causes one thing to resemble another thing, intending by means of that resemblance to practice deception, or knowing it to be likely that deception will thereby be practiced.

BREACH OF TRUST

1. Section 408- Criminal breach of trust by clerk or servant.

2. Section 409- Criminal breach of trust by public servant, or by banker, merchant or agent.

3. Section 416- Cheating by personating

4. Section 419- Punishment for cheating by personation.

OFFENSES RELATING TO DOCUMENTS

1) Section 463-Forgery

2) Section 464 -Making a false document

3) Section 465- Punishment for forgery.

4) Section 467- Forgery of valuable security, will, etc

5) Section 468- Forgery for purpose of cheating

6) Section 469- Forgery for purpose of harming reputation

7) Section 470- Forged document.

8) Section 471- Using as genuine a forged document

9) Section 477- Fraudulent cancellation, destruction, etc., of will, authority to adopt, or valuable security.

10) Section 477A- Falsification of accounts.

THE RESERVE BANK OF INDIA ACT, 1934

Issue of demand bills and notes Section 31.

Provides that only Bank and except provided by Central Government shall be authorized to draw, accept, make or issue any bill of exchange, hundi, promissory note or engagement for the payment of money payable to bearer on demand, or borrow, owe or take up any sum or sums of money on the bills, hundis or notes payable to bearer on demand of any such person

THE NEGOTIABLE INSTRUMENTS ACT, 1881

Holder’s right to duplicate of lost bill Section 45A.

1. The finder of lost bill or note acquires no title to it. The title remains with the true owner. He is entitled to recover from the true owner.

2. If the finder obtains payment on a lost bill or note in due course, the payee may be able to get a valid discharge for it. But the true owner can recover the money due on the instrument as damages from the finder.

Section 58

When an Instrument is obtained by unlawful means or for unlawful consideration no possessor or endorse who claims through the person who found or so obtained the instrument is entitled to receive the amount due thereon from such maker, accept or holder, or from any party prior to such holder, unless such possessor or endorse is, or some person through whom he claims was, a holder thereof in due course.

Section 85:

Cheque payable to order.

1. By this section, bankers are placed in privileged position. It provides that if an order cheque is endorsed by or on behalf of the payee, and the banker on whom it is drawn pays it in due course, the banker is discharged. He can debit his customer with the amount so paid, though the endorsement of the payee might turn out to be a forgery.

2. The claim protection under this section the banker has to prove that the payment was a payment in due course, in good faith and without negligence.

Section 87. Effect of material alteration

Under this section any alteration made without the consent of party would be void. Alteration would be valid only if is made with common intention of the party.

Section 138. Dishonour of cheque for insufficiency, etc., of funds in the account.

Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid. either because of the amount of money standing to the credit of that account is insufficient to honor the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that bank, such person shall be deemed to have committed an offense and shall, without prejudice.

Section 141(1) Offenses by companies.

If the person committing an offense under Section 138 is a company, every person who, at the time the offense was committed, was in charge of, and was responsible to, the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the offense and shall be liable to be proceeded against and punished accordingly.

SECURITY REGIME IN BANKING SYSTEM

Security implies sense of safety and of freedom from danger or anxiety. When a banker takes a collateral security, say in the form of gold or a title deed, against the money lent by him, he has a sense of safety and of freedom from anxiety about the possible non-payment of the loan by the borrower. These should be communicated to all strata of the organization through appropriate means. Before staff managers should analyze current practices. Security procedure should be stated explicitly and agreed upon by each user in the specific environment. Such practices ensure information security and enhance availability. Bank security is essentially a defense against unforced attacks by thieves, dacoits and burglars.

PHYSICAL SECURITY MEASURES-CONCEPT

A large part of banks security depends on social security measures. Physical security measures can be defined as those specific and special protective or defensive measures adopted to deter, detect, delay, defend and defeat or to perform any one or more of these functions against culpable acts, both covert and covert and acclamation natural events. The protective or defensive, measures adopted involve construction, installation and deployment of structures, equipment and persons respectively.

The following are few guidelines to check malpractices:

1. To rotate the cash work within the staff.

2. One person should not continue on the same seat for more than two months.

3. Daybook should not be written by the Cashier where an other person is available to the job

4. No cash withdrawal should be allowed within passbook in case of withdrawal by pay order.

5. The branch manager should ensure that all staff members have recorder their presence in the attendance registrar, before starting work.

Execution of Documents

1. A bank officer must adopt a strict professional approach in the execution of documents. The ink and the pen used for the execution must be maintained uniformly.

2. Bank documents should not be typed on a typewriter for execution. These should be invariably handwritten for execution.

3. The execution should always be done in the presence of the officer responsible for obtain them,
4. The borrowers should be asked to sign in full signatures in same style throughout the documents.

5. Unless there is a specific requirement in the document, it should not be got attested or witnessed as such attestation may change the character of the instruments and the documents may subject to ad volrem stamp duty.

6. The paper on which the bank documents are made should be pilfer proof. It should be unique and available to the banks only.

7. The printing of the bank documents should have highly artistic intricate and complex graphics.

8. The documents executed between Banker and Borrowers must be kept in safe custody,

CHANGES IN LEGISLATION AFTER ELECTRONIC TRANSACTIONS

1. Section 91 of IPC shall be amended to include electronic documents also.

2. Section 92 of Indian Evidence Act, 1872 shall be amended to include commuter based communications

3. Section 93 of Bankers Book Evidence Act, 1891 has been amended to give legal sanctity for books of account maintained in the electronic form by the banks.

4. Section 94 of the Reserve Bank of India Act, 1939 shall be amended to facilitate electronic fund transfers between the financial institutions and the banks. A new clause (pp) has been inserted in Section 58(2).

RECENT TRENDS OF BANKING SYSTEM IN INDIA

In the banking and financial sectors, the introduction of electronic technology for transactions, settlement of accounts, book-keeping and all other related functions is now an imperative. Increasingly, whether we like it or not, all banking transactions are going to be electronic. The thrust is on commercially important centers, which account for 65 percent of banking business in terms of value. There are now a large number of fully computerized branches across the country.

A switchover from cash-based transactions to paper-based transactions is being accelerated. Magnetic Ink character recognition clearing of cheques is now operational in many cities, beside the four metro cities. In India, the design, management and regulation of electronically-based payments system are becoming the focus of policy deliberations. The imperatives of developing an effective, efficient and speedy payment and settlement systems are getting sharper with introduction of new instruments such as credit cards, telebanking, ATMs, retail Electronic Funds Transfer (EFT) and Electronic Clearing Services (ECS). We are moving towards smart cards, credit and financial Electronic Data Interchange (EDI) for straight through processing.

Financial Fraud (Investigation, Prosecution, Recovery and Restoration of property) Bill, 2001

Further the Financial Fraud (Investigation, Prosecution, Recovery and Restoration of property) Bill, 2001 was introduced in Parliament to curb the menace of Bank Fraud. The Act was to prohibit, control, investigate financial frauds; recover and restore properties subject to such fraud; prosecute for causing financial fraud and matters connected therewith or incidental thereto.

Under the said act the term Financial Fraud has been defined as under:

Section 512 – Financial Fraud

Financial frauds means and includes any of the following acts committed by a person or with his connivance, or by his agent, in his dealings with any bank or financial institution or any other entity holding public funds;

1. The suggestion, as a fact, of that which is not true, by one who does not believe it to be true;

2. The active concealment of a fact by one having knowledge or belief of the fact;

3. A promise made with out any intention of performing it;

4. Any other act fitted to deceive;

5. Any such act or omission as the law specially declares to be fraudulent.
Provided that whoever acquires, possesses or transfers any proceeds of financial fraud or enters into any transaction which is related to proceeds of fraud either directly or indirectly or conceals or aids in the concealment of the proceeds of financial fraud, commits financial fraud.

513(a) – Punishment for Financial Fraud

Whoever commits financial fraud shall be: (a) Punished with rigorous imprisonment for a term, which may extend to seven years and shall also be liable to fine.

(b)Whoever commits serious financial fraud shall be punished with rigorous imprisonment for a term which may extend to ten years but shall not be less than five years and shall also be liable for fine up to double the amount involved in such fraud.

Provided that in both (a) and (b) all funds, bank accounts and properties acquired using such funds subjected to the financial fraud as may reasonably be attributed by the investigating agency shall be recovered and restored to the rightful owner according to the procedure established by law.

CONCLUSION

The Indian Banking Industry has undergone tremendous growth since nationalization of 14 banks in the year 1969. There has an almost eight times increase in the bank branches from about 8000 during 1969 to mote than 60,000 belonging to 289 commercial banks, of which 66 banks are in private sector.

It was the result of two successive Committees on Computerization (Rangarajan Committee) that set the tone for computerization in India. While the first committee drew the blue print in 1983-84 for the mechanization and computerization in banking industry, the second committee set up in 1989 paved the way for integrated use of telecommunications and computers for applying technogical breakthroughs in banking sector.

However, with the spread of banking and banks, frauds have been on a constant increase. It could be a natural corollary to increase in the number of customers who are using banks these days. In the year 2000 alone we have lost Rs 673 crores in as many as 3,072 number of fraud cases. These are only reported figures. Though, this is 0.075% of Rs 8,96,696 crores of total deposits and 0.15% of Rs 4,44,125 crores of loans & advances, there are any numbers of cases that are not reported. There were nearly 65,800 bank branches of a total of 295 commercial banks in India as on June 30, 2001 reporting a total of nearly 3,072 bank fraud cases. This makes nearly 10.4 frauds per bank and roughly 0.47 frauds per branch.

An Expert Committee on Bank Frauds (Chairman: Dr.N.L.Mitra) submitted its Report to RBI in September 2001. The Committee examined and suggested both the preventive and curative aspects of bank frauds.

The important recommendations of the Committee include:

o A need for including financial fraud as a criminal offense;

o Amendments to the IPC by including a new chapter on financial fraud;

o Amendments to the Evidence Act to shift the burden of proof on the accused person;

o Special provision in the Cr. PC for properties involved in the Financial Fraud.

o Confiscating unlawful gains; and preventive measures including the development of Best Code Procedures by banks and financial institutions.

Thus it can be concluded that following measures should necessarily be adopted by the Ministry of Finance in order to reduce cases of Fraud.

o There must be a Special Court to try financial fraud cases of serious nature.

o The law should provide separate structural and recovery procedure. Every bank must have a domestic inquiry officer to enquirer about the civil dimension of fraud.

o A fraud involving an amount of ten crore of rupees and above may be considered serious and be tried in the Special Court.

The Twenty-ninth Report of the Law Commission had dealt some categories of crimes one of which is “offenses calculated to prevent and obstruct the economic development of the country and endanger its economic health.” Offenses relating to Banking Fraud will fall under this category. The most important feature of such offenses is that ordinarily they do not involve an individual direct victim. They are punishable because they harm the whole society. It is clear that money involved in Bank belongs to public. They deposit there whole life’ security in Banks and in case of Dacoity or Robbery in banks the public will be al lost. Thus it is important that sufficient efforts should be taken in this regard.

There exists a new kind of threat in cyber world. Writers are referring it as “Salami Attack” under this a special software is used for transferring the amount from the account of the individual. Hence the culprits of such crimes should be found quickly and should be given strict punishment. Moreover there is requirement of more number of IT professionals who will help in finding a solution against all these security threats.

The PayDay Loan Web – Don’t Be a Needy Fly That Gets Caught in This Web

my personal payday loan story that can help you

the term payday loan starts with the letter “p” which is the same letter that starts off the words pain, penalty, poor and poverty. Both the internet and the physical world are full of places where you can get a loan with bad credit, no credit check, and no employment verification but what these modern day loan sharks don’t tell you is that their interest rates are so high that one day you may end up with the payday loan mafia coming after you!

Sure, these loans look very attractive to those in financial need that are unable to get a loan by conventional means but when the facts are presented what you have to pay back just isn’t worth it. This fictional character that we all refer to as “guido” which is the person that comes to break your arms and legs when you don’t pay a loan shark back is in existence in a different way when it comes to payday loans. Instead of your arms and legs the payday loan guido comes after your heart, soul and peace of mind.

Payday loan places make their offerings look so attractive but it is all an illusion because who can really see when they are desperate? What you don’t want to happen is for what appears to be a temporary solution to become a long term problem and many times that is exactly what happens.

I’ve been caught in the payday loan otherwise known as payday advance web many times. Sometimes life’s circumstances leave us very few choices and we decide to do what we feel like we have to do to buy gas and put food on the table. Like I said, I’ve been there before and as a survivor of payday loan debt I have knowledge that can help you.

I want you to ask yourself a question which is, “if you don’t have enough money to get by what makes you think you can payoff a loan with 300%- 700% interest?” You might as well sell your first born child. Payday loans may seem good in the short run and you may get instant gratification and even a rush when you hold that cash in your hands or see it in your bank account but in the long run it is a race that many can’t win.

My story, like many, was that I obtained payday loans to cover immediate expenses I needed cash for but didn’t have money to pay the loans back so I got extension after extension paying out ungodly amounts of money. Before long I was getting new payday loans just to pay the other payday loans I had received. I was trapped in a vicious cycle with no way out and a ton of stress upon me. I became a needy fly caught in the payday loan web, especially since most of my loans were online loans; I was literally in a virtual web. The payday loan spider sucked the life blood out of my bank accounts and I didn’t know what to do.

Please understand that you can’t solve a problem with a problem and you can’t come out debt by creating more debt. The solution to your debt starts with gaining additional income sources and paying off existing debt little by little so you can be free. In my own personal payday loan crisis I got up to almost $7, 000 worth of payday loans and when renewal payment time came my entire paycheck was gone. This is a miserable experience that I pray you can avoid. You might already be at this state but even if you are I have some suggestions for you that will offer hope.

The first thing you have to do is to make a conscious decision to get out of this situation. Decide to change and become a butterfly rather than a fly caught up in the payday loan web. When a caterpillar is going through the metamorphosis in the cocoon in order to become a butterfly there is a struggle. The struggle is in fact what makes the butterfly great because the struggle to get out of the cocoon transformed actually pushes fluid from the butterfly’s body into its wings so that it can emerge in beautiful flight. This process may be a little painful but it will help you fly and be what you were made to be.

One thing that I did was to become an affiliate for payday loan companies so that I could get paid from other people acquiring payday loans. Some people are just going to get them so there is no reason why you shouldn’t get paid from the process that made you pay so much. The second thing I did is what really helped me which was to get a payday loan consolidation company to take on my debt at a reduced amount and pay the payday loans back for me on my behalf. It was one of the best choices I ever made and it was a way out of the payday loan web.

You can do a Google search to find companies that will represent you in this way but do your research and make sure that the company you choose is credible. I used pdl assistance, inc. They require an upfront fee to take your case but they will work with you on paying it and it is around $200. Next you set up a plan to pay them a monthly amount on your payday loan debt and they pay your debtors directly. They will give you different term options to pay the debt off and they will deal with the payday loan companies for you. Doing this took a huge weight off of me. I got a 12 month term to repay my payday loan debt at 35% of what I owed the payday loan companies. The $400 a month I was paying on this plan was much better than the $700 plus every two weeks I was paying for all the loans I had.

One important thing to know when you start a payday loan consolidation program is that the payday loan companies are going to call you to collect. When they call just give them the information for the company that is representing you and let them know that the debt is going to be repaid to them as part of a loan/debt consolidation program you have initiated. I obtained the fax numbers to my payday loan companies and sent them notification on who to contact regarding the repayment of my loans. If you do this make sure to include your account number and social security number so they can properly locate your account.

Some companies will continue to try and collect from you in spite of this so I have another suggestion if this happens. If you get numerous collection calls after you have informed them about your debt consolidation you need to fax and/or send them a cease and desist letter. You can get a template off the internet and submitting this letter will stop the collection calls while your debt consolidation program is in the works.

Another tip is to close the bank account you have the loan fees being deducted from if possible. You will want to start a new account before you close your existing account and under no circumstances get payday loans under the new account. You have to treat the payday loan habit like an addiction. If you are going to stop it then stop it because replicating the mistake will only make things worse for you.

If you need money then get bad credit credit cards and pay them on time to build your credit. Pay more than the minimum payment and use them to pay bills so you can pay what you need to pay while building your credit. No debt consolidation company can legally advise you to close your account but sometimes it is the only way to keep the payments from being processed and causing you hundreds or even thousands of dollars in overdraft fees. For me this was the easiest way because I had so many loans and it would have cost me a $25 fee for every stop payment processed plus the bank could have missed some.

I also want you to know that the cease and desist letter can be used for any type of debt collection and not just payday loans. It is important to know your rights and you can find them out online at the federal trade commission’s website where you can learn about the fair debt collection act. You will learn what creditors can and cannot do regarding the collection of your debts and how to stop inconvenient and harassing behavior.

I do not encourage anyone to get a payday loan because it can get out of control so easily. If you must get a payday loan be sure to get one with low fees well below the normal $30 per $100 borrowed.

Cheap Loans – How To Reduce What They Cost You

With the rising commodity prices throughout the globe, everyone needs some kind of legal financing when they purchase something big like a home or a car. There are all kinds of financing options available in the UK. Only getting a loan that helps you meet your financial needs is not enough. You also need to save considerable amount of money on your loans so that you can repay them in simple affordable monthly payments. Getting a cheap and affordable loan in accordance with your financial affordability is not as simple as it may seem. Have a look at the ways in which you can easily secure loans at a cheap rate.

  • Make a comprehensive market research: Comparison shopping is the most important step that can help you save a lump sum amount of money. If you’re in the market for credit of any kind, stay sure that there will be hundreds of companies that are waiting for selling their financial products to you. Therefore, you need to take a step after considering the rates and charges offered by all lending companies. If you’re taking out a home loan or a debt consolidation loan, you need to make sure that you compare the services offered by various companies.
  • Check your credit rating: Today’s lending industry is entirely based on your credit score. As your credit report reflects your financial history, the lenders always check the score before lending you a new line of credit. A person with a good credits core will certainly secure a better rate than a person who has a poor credit score. Therefore, if you want to obtain loans at a cheap rate, make sure you repair your credit before applying for a loan. Order a free copy of your credit report and dispute all errors and negative listings so that you can boost your credit score.
  • Take the loan out for a short term: When taking a loan out it is important that you first calculate the monthly amount that you can afford to repay each month.  If you are armed with this information you are then able to reduce the term of the loan until the repayments meet what you can afford. Taking a loan out for a shorter term will make quite a big difference in the amount of interest that you are charged.
  • Look for bad credit lenders: If you have exhausted all the above mentioned options and have no other option left to secure a cheap loan for yourself, you can look for a bad credit lender. Bad credit lenders usually lend loans to people with bad credit and therefore they will give you a loan at a low rate. If you want to get a cheap loan, go and apply to a bad credit lender.

The entire process of getting cheap loans will become fuss-free if you follow the points mentioned above. Gain peace of mind while getting your loan so that you need not worry about the monthly loan obligations and lead a life free of financial burden.

How a Home Equity Loan Refinance Can Save You Money – Should You Refinance Your Texas Home Loan?

In Texas you can refinance your home as well as your investment property. And with today’s low mortgage rates, lots of people are doing just that using home equity loans

Plus some are doing the two-birds-one-refinance-approach: Refinance the home and pull cash out.

When it comes to refinancing, you have two options. A “rate and term” refinance or a Texas home equity loan “cash out” refinance.

With a home equity loan you pull equity out of your home or investment property.

Most people refinance to get a lower rate; this is called a “rate and term” refinance. One is keeping the same loan amount, they are just lowering or changing the rate or term of the mortgage.

Maybe they are moving out of a 30 year note to a 15 year note. This is called a rate and term refi because they are just changing the rate or the term of the original loan.

Lower mortgage rates do mean lower payments. But some clients choose a “cash out” refinance (Home Equity loan)- which means they pull equity (cash) out of their homes or investment properties for other purposes …like paying off debt or buying additional property.

For example, let’s say a family has a $450 car payment where they owe $15000. If they have enough equity in their home, it’s common for a family to refinance the home and pull enough cash out of their home to pay off other costly debt; like credit cards, cars, etc. The house payment might go up $50 but the car payment is eliminated. So a family has $400 more each month.

Some suggest against home equity loans to pay off debt stating it’s not wise to take a 3-5 year debt and spread it across 15-30 years. And these people are right. However, when I help a client save $400-500, sometimes $1000/month now these families can afford to pay extra on their 30 year mortgage and pay it off in 12-15 years.

In fact, most of the time a family will pay their home off earlier-after a home equity loan-than they would have before.

You can always call us to see if Texas home equity loan cash out refinance makes sense for you.

Home Equity Rules

Home equity loans have slightly higher rates than traditional rate and term refinances because one is raising the original loan amount. Plus when one pulls cash out of a home or investment property this is a higher risk loan. Higher risk = slightly higher rate.

And in Texas you are limited to 80% of your home’s value. Meaning if your home is worth $200,000, the most your new loan could be is $160,000. If you owe 100K, you could take out 60K or up to 80%

Then there’s the 3% home equity rule: This means the total fees associated can’t exceed 3% of the loan amount. This mostly effects those with smaller home loan balances. For example, if your home is only worth 75,000 and we are limited to 80%-your loan could only be 60K. 3% of 60k is $1800. So if your title company charges $700 for the title policy and your appraiser charges $325 and the bank charges $500 to underwrite your loan it’s not hard to be over 3%. This would mean the mortgage company could only charge $275 to be under the 3% rule.

12 day Home Equity Rule, 3 day wait-until-we-fund rule:

In Texas we have to wait at least 12 days from mortgage application to close. I even have to get a special 12 day letter signed. Then once we close, we then can’t fund the home loan for 3 days. Texas has weird home equity refinance rules so you want to work with an experienced mortgage company who does a lot of these type of loans. If you have additional questions, please call us at 512-996-8194, we help people all over Texas.

For many people home equity refinances can be a great way to jump start a new financial plan. I offer them to my clients to help them: Get out of debt, pay off bills, have more money to save and invest. My clients have saved hundreds each month by paying off high interest credit cards. My personal record is saving a family $1000/month using a home equity loan.

Once they save this money they plan to pay extra on their mortgage so they pay a 30 year note in 15 years. So used correctly, a home equity mortgage is a great way to move forward financially.

After 5 years in the mortgage business I’ve come up with my personal lending philosophy. Because anyone can do a home loan. However, my business is helping move people forward financially-starting on the mortgage level; the biggest expense for a family.

Most of my clients know my personal philosophy with mortgage lending. There are lots of mortgage people out there who promise “the lowest 30 year mortgage rate or the “best Texas 15 year mtg rate”-but this isn’t really my approach. I tend to favor what is best for the client’s short and long term. If one needs a 15 year mortgage with low closing costs, let’s use this program. Need to consolidate debt, let’s use a home equity loan.

I just don’t believe in one-size fits all mortgage plans. As soon as my clients all look the same, have the same income/debt, goals, then I’ll become a one-size fits all mortgage guy. But for now, I work with low income people, millionaires, investors, first time home buyers, second home mortgages, etc.

One’s mortgage can be either a debt instrument or a better financial tool, it’s really up to you and your mortgage professional. And in today’s economy where the realities of $5 gas aren’t really unreasonable you should work with a professional who will take the time to listen and bring the right mortgage plan to the table. Because once a mortgage is in place you must live with it.

Some questions you should ask yourself when buying or refinancing a home or investment property:

1) How much debt do I currently have? How much debt am I currently servicing each month?

2) How much in liquid savings do I currently have? Could I choose a mortgage that will help (a) lower my bills and (b) help me to save more money each month? Rate is important but now the only thing to consider. Who cares if the 15 year mortgage rate is the best rate, if it’s not affordable to you-it’s not the wise loan. Go with the 30 year rate.

3) How long do I plan to keep this home? Is this home appreciating?

4) What is my long term financial plan, and how does this new mortgage help me accomplish this plan?

#4 is where the rubber meets the road. And this is where I spend the most time with my clients; constructing the long term plan and then customizing the mortgage to fit this plan. Most people chase the lowest rate when getting into homes however without a mid-long range goal they usually end up paying more in the long-term.

Take the sub-prime meltdown. There’s nothing wrong with sub-prime loans. Sometimes things happen that cause people’s credit to go in the trash. Divorces do happen and sometimes medical bills come out of no where and people have a lot of collections. Jobs are sometimes lost and savings are use up before they were originally intended. The problem with sub-prime loans is not that they are bad, but that they need to be on Fixed rates. Not adjustable. This country has lost billions of dollars during the sub-prime meltdown for one reason: People chased the lowest rate when they bought the home and ARMs have lower rates than FIXED rates. And since ARMs had lower rates people chose ARMs over Fixed rates.

So thousands of people with bad credit bought homes on ARMs and today we have a major problem: Because people chased the lowest rate.

Having a long term financial plan. Example, let’s say you’re self employed and don’t have a company retirement plan-401k-to rely on. One approach in solving the “no 401K/IRA” problem is to own real estate. The goal is to own a few choice properties so when you do retire you will have these properties paid off and creating passive retirement income. Imagine if your mortgage broker took the time to understand your long-term goals and structured the new loan around these goals. Funny thing, most people are 15-30 years from retirement and the typical home loan is paid off in 15-30 years. Bottom line: The home you buy today could help you retire tomorrow-and you need the right home loan to go along with it.

Remember, most mortgages are based on a 15 or 30 year basis, why not structure your first home to help you retire in 30 years. I know this seems unrealistic because most people don’t keep homes that long, but going into a mortgage with a plan is better than just going into a mortgage.

Most people don’t want to take the time to think about money-but in the end-the lack of money causes a lot of other challenges in life.

This is how I’m different from the other Texas Mortgage Loan people. I believe I can either help people move forward financially or I can just get them into debt. Sure it’s easier to “sell low rates” but not at the expense of helping a client in the long term.

PMI (just so no-or at least try to get out of it.)

My clients avoid PMI when possible. But to do an 80/15 or 80/10 or an 80/10/10 one’s mortgage rate is slightly higher but the benefit is avoid pointless PMI and having lower closing costs. This is another example of why “chasing the lowest rate” isn’t always the best. Loans with PMI are better than loans without. But the benefit of not have PMI is huge. Not only will you pay less when your home loan doesn’t have PMI but your closing costs are less too.

Right now I want to touch briefly on these 3 issues and why one should be thinking of them when you buy or refinance a home. Actually, your mortgage person should customize your loan around these three points for you. If they don’t-run. If all they sell is a mortgage rate did they really serve you?

Mortgage brokers and banks love to advertise low mortgage rates. “We have the lowest rates in Texas!” But let’s think about the loan like this: “How much did it cost you to get this rate.” Because low mtg rates are one thing, but how much did it cost to get the rate?

Let’s look at one of Today’s Mortgage ads. (April 17) They are advertising a 4.87% rate.

Funny. The real 30 year rate is around 6% but they know people want “low rates” so they advertise a great rate. But when you look at the points it will take to get this rate, you’ll see there’s more to getting a mortgage than just rate. Closing costs.

For example, if you’re buying a $200K home should you really “buy the rate down” with points to get a good rate? To buy this low, low rate, it will cost $6,000 just for discount points. And yet people do this all the time. Mortgage people advertise low rate because people want low rates.

Sorta reminds me of when I bought my Toyota Tundra. I wanted to save a nickel so I went for the 2×4 instead of the 4×4 all-wheel drive. I was so proud of getting the “lowest price in town” but when it snowed or iced I had to ask my wife to drive her front-wheeled drive Honda Accord.

This is one reason why I suggest working with a mortgage broker (like me) who approaches mortgage lending from a total financial planning perspective. Because if I notice a client has a ton of credit cards and misc. debt-this 6K should not go towards a new (tax deductible) debt but towards paying off old, high interest debt that’s not tax-deductible.

Or to use real numbers, if you have the $6000 to pay towards debt, retire 15% interest debt that’s costing you $500/month instead of trying to save $200 on your mortgage. Then pay $100 extra and you’re still saving $300. Use this $300 for savings, investing or having fun.

But what about all the interest I’ll save by having a low rate? Shouldn’t I try to get the best rate so I can have lower monthly bills? Yes. Once you’re out of consumer debt-and you no longer have to pay $500 out, begin to apply $100-$200 extra on your mortgage payment. This will take years off your mortgage, usually taking a 30 year mortgage to a 12-15 year. This will save you tons in interest and give you lower payments.

When you buy or refinance any property take the time to look at the bigger picture because a mortgage or refinance can either help move you forward financially or just get you into debt.

Payday Loans

Paysaver Payday Loans makes Internet Lending “Easy”

Paysaver Payday Loans offers payday loan, cash advance loans and fast cash services for whatever you need.

At PaySaver Payday Loans we promote honesty and integrity and we were proud to have been named as “The Australian Payday Loans Specialists” by our peers. We were given this title because we were one of the first to perfect the payday loans business in Australia.

We recognised the need for people to have a safe, secure, simple & fast way of obtaining payday loans of small amounts of money without the hassles, delays and costs associated with formal bank applications.
We then developed a unique system of lending exclusively via the Internet and Fax which has proven to be the most cost effective, efficient and fastest way of obtaining payday loans to date.

Our slogan is “Your personal ATM on the net” because you now have the convenience of applying for payday loans from the safety, privacy and comfort of your computer.

Simply send us your payday loans application and 30 minutes later, upon approval, your money is sent directly to your account!

Can Paysaver Payday Loans it get any better than that? – Yes it can!

After your first loan is successfully repaid your payday loans you are promoted to PaySaver Express where your approval time is reduced to only 15 minutes.

PS. We have kept our payday loans prices the same since we started trading back in early 2004 and that is why we have the lowest payday loan fees in Australia!

Paysaver Payday Loans gets you the funds you need ASAP. Why wait for your cash advance when you can get it overnight? Our loans are 100% safe, fast and completely online – so think of us for your payday loan fast cash needs.

It keeps getting better! We’ve made it incredibly easy to qualify for payday loans by offering our industry-leading application process to you at no additional expense to you.

There are no credit bureau reports on your payday loans, never an application fee, and of course, no credit checks. If you are at least 18 years of age, receive a regular source of income, and have direct deposit enabled on your bank account, you’re practically approved for Paysaver Payday Loans – don’t wait any longer apply for payday loans as you can apply for these unsecured payday loans today!

We specialize in providing overnight payday loans for individuals who are in need. We strive to bring people of all types pay day loans that are reasonably priced, quickly deposited, and managed by a professional lending team – why settle for less when you get an advance on your payday loans today!
Need short term payday loans cash advance to take care of that emergency, that unforeseen bill or just to reward yourself? Paysaver Payday Loans is a fast and secure way to get payday loans from the privacy of your own home!

Applying and qualifying for a payday loans advance loan is quick and easy, and confidential and requires minimal faxing.

Once you’re approved for our payday loans cash advance, we will electronically deposit the money directly into your checking or savings account. We offer flexible payment options and a discrete service that gets you the cash you need right now.

It’s that easy, why not apply and make Paysaver Payday Loans your loyal partner today.
Ever run a little short of cash before your next payday?

It happens to most of us at some stage. A night out with friends, registering your car or maybe just paying a couple of bills? Nothing a few hundred dollar payday loans won’t fix.

However, it can be frustrating if the cash is days away and you need it earlier. whatever the reason a Paysaver Payday loans is always there.

It’s even harder if you’ve had a minor, bad credit mishap, are too busy to get away from work or don’t want to commit to paying off a large, long term loan or credit card then try a Paysaver Payday Loans.
Paysaver Payday Loans has helped thousands of Australians in your situation with a convenient, clear and secure alternative. Quick turnaround times mean that you can be paid in as little as 20 minutes.

Beware of Tax Preparers Who Promise Large Refunds But Won’t Sign Your Tax Return

In my experience as President of SmartServ Solutions, I come across many new clients each year. Most new come to us as a result of my snazzy advertising or through a referral from one of our existing clients. Still others come because they are looking to get a bigger tax refund. I am all for getting the most money back from Uncle Sam. That is, the most legal money. In recent weeks, I have come across a large number of previously filed fraudulent tax returns from 2005. It is a very disturbing trend occurring in the tax preparation business. Before I explain what is going on with the fraudulent tax returns, I would like to give a brief overview of the different types of tax preparation companies. I would classify the tax preparation business into three major categories:

The large faceless tax franchises

Most of the large franchise tax places hire seasonal part time workers who are moonlighting for extra money. They receive training each year from their corporate offices on the new tax laws, but tax preparation is not their primary profession. This leads to in many cases sloppy work and missed deductions. Most of the franchise tax places close down after April 15th.

Independent tax preparation and accounting firms

Independent firms are typically small firms where tax preparers work year round and additional support staff is hired during tax season. Many of these types of firms stay open all year and supplement the rest of the year after tax season with related financial service businesses like accounting, mortgages, investments or insurance.

The “guy” or “girl” who gets big tax refunds

These people are everywhere. They typically work out of an apartment or small store. Their reputation for getting extremely large tax refunds has spread like wildfire. Everybody either knows this person or someone who goes to someone like it. Their offices or apartments are usually standing room only and people will wait hours and hours just for a chance to get their taxes prepared here. There is an unfortunate reality about this type of outfit. An income tax return can be easily manipulated to create a large “temporary” tax refund. I will get in to the reason why I say “temporarily” shortly. Some people actually get and deserve tax refunds upwards of $10,000, $15,000 or even $20,000. The right combination of children, babysitting, mortgage interest and taxes, large withholdings and education expenses will in many cases create such a large tax refund that is legitimate. However, there are many unscrupulous tax preparers in this category who illegally add some or all of the above deductions and credits to anyone’s tax return.

The sad truth is that the IRS will send you the money if you file a fraudulent return claiming an undeserving refund. The IRS is a slow moving big government bureaucracy. They may move slowly, but they do move. They have the capabilities of catching up with most of the tax fraud that is out there. It usually takes them a year or two or three after a tax return like this is filed, but they do catch those involved. What most people who utilize these types of tax preparers fail to realize is that they are completely responsible for the tax return that they file. A defense of “my tax preparer did it” or “I didn’t know” isn’t good enough for the IRS. Once you are caught filing such a tax return, you will be subject to pay back all of the money that you received illegally plus penalties, plus interest and possibly fines. And the IRS will get their money. They will use their power to place a tax levy against fraudsters which will give them the right to freeze assets like bank accounts and garnish salary. This is why I call an undeserving tax refund a “temporary” one. The IRS or State Department of Taxation also has the power to seek jail time if they find that there was fraud committed. Obviously, the unscrupulous tax preparers don’t tell this to their unsuspecting clients. I truly feel bad for these people. Most of them don’t understand the implications of filing a false tax return. I have met many people who have had their lives ruined by such circumstances. Life is too precious and it is not worth ruining your life for an extra couple of thousand dollars on your tax return that you don’t deserve. One tell tale sign that your tax preparer may be committing fraud on your tax return is that they refuse to sign the preparers part of your return. A tax preparer is required by the IRS to sign your tax return if they prepared it for you.

I want to personally caution all taxpayers of filing such a fraudulent tax return in order to receive an unjust refund. There are many legitimate deductions and credits that are available that can be found if you look hard enough. Please choose a tax preparation company who will go the extra mile for your interests while not putting your financial future in jeopardy by getting you in trouble with the IRS.

The Facts About FHA And VA Home Loans & Refinancing

Government-Backed Loans – Government loans refer to those loans that are guaranteed by one of two federal agencies. The two types of government loans are: Federal Housing Administration (FHA) loans, and Veterans Administration (VA) loans. The advantage of financing using FHA loans are that they are easier to qualify for and allow a borrower to finance more of the loan amount than non-government loans. Whereas with a Conforming loan a borrower may only be able to finance 80% of the loan amount, a FHA loan allows a borrower to finance 97% of the loan amount. FHA loans are recommended for those borrowers who are first-time buyers, have little money to put down, have a short credit history, or are having trouble qualifying for a Conforming loan. The two main advantages of financing using VA loans are that the VA allows borrowers to finance 100% of the loan amount, and that, the VA only requires proof of veteran status to qualify for the loan. The only drawback to government loans is that mortgage insurance is required at all loan to values (LTV), unlike Conventional and Jumbo loans where payment of mortgage insurance is determined by the amount of equity a borrower has in his home.

VA Loan Information

VA loans are designed to provide assistance in purchasing a home for United States Veterans. A benefit of a VA loan is that you can purchase a home with no down payment. In addition, it is slightly easier to qualify for a Veterans Affair loan when compared to a regular loan.

Many people for who actually qualify for a VA Loan are not aware of it.

Who qualifies for a VA Loan?

The following table shows what type of service (and for what duration is required in order to be eligible for a VA Loan:

Wartime

Service during:WWII-09/16/40 to 07/25/47 Korean-06/27/50 to 01/31/55 Vietnam-08/05/64 to 05/07/75 Persian Gulf-8/2/90 to undetermined. You must have at least 90 days on active duty. Plus, you must have been discharged under other than dishonorable conditions. If you served less than the standard 90 days, you may be eligible if discharged for a service connected disability.

Peacetime

Service during periods:-07/26/47 to 06/26/50 & 02/01/55 to 08/04/64 & 05/08/75 to 08/01/90To qualify for a VA Loan, you must have served at least 181 days of continuous active duty. Plus, you must have been discharged under other than dishonorable conditions. If you served less than the standard 181 days, you may be eligible if discharged for a service connected disability.

Other questions about VA Loans:

1) Is the spouse or children of a veteran eligible?A spouse is eligible if the veteran died as a result of a service connected disability or died while on active duty. The children are not eligible. 2) Who makes the loans?Private lenders make the loans. However, the VA guarantee protects these lenders against loss. The guaranty will allow lenders to make loans without other requirements (for example, a down payment). 3) Can I get a VA loan if I have been foreclosed on in the past?Yes. The best way to find out how to qualify for this is to contact a mortgage specialist. They can give you advice on what you can do to ensure you can qualify for a loan.If you are considering a VA Loan, remember that there are still a variety of different mortgages. A mortgage broker can be a useful tool to help find the most appropriate mortgage for your purchase. If you plan on living in your home for a long period of time, you may want to consider the traditional fixed-rate 15- or 30-year loan. Another option is to choose an adjustable rate mortgage and consider refinancing again in a few years. Short-term mortgages include balloon mortgages and one-year adjustable rate mortgages.

Is an FHA loan the best home loan for my situation?

You have many decisions when choosing which type of loan is best for your situation. Is the FHA loan the best? What about a VA loan? When is a Conventional loan better than an FHA loan?

A mortgage specialist can analyze your situation, and help you determine which loan is best for you. In many cases, there are other loans more beneficial than an FHA loan. Although in some situations, FHA loans are the best choice.

About the FHA Loan program. With an FHA Loan, your home loan is insured by HUD. The FHA Program is designed to help give home buyers the opportunity to qualify for a mortgage, when they may not otherwise qualify. HUD assumes some of the risk on the loan. The requirements are not as high for an FHA loan as they are for Fannie Mae or Freddie Mac Loans. Plus, a borrower can purchase a home with only 3% down. In some cases a borrower can qualify for gift programs which allow them to purchase a home with no money out of pocket. There are a variety FHA loan programs that you can take advantage of. A mortgage specialist can give you advice as to which is best for you.

Cheap Loans – Dirt Will Seem Costlier!

Loans culture has grown considerably in recent times. Like any growing industry, loans industry has healthy competition. This competition has furthered the cause of finding cheap loans in UK. Cheap loans are not offered on platter. There are tricks to the trade of finding cheap loans.

Though borrowing money is not always an easy decision but there are times when loans are a necessity. Cheap loans are provided for every circumstance and reason – Personal loans, secured loans, unsecured loans, mortgage, car loans…….

When looking for cheap loans pay attention on various aspect of loans – interest rates, loan term, monthly payments are all instrumental. Interest rates are an obvious way to start your cheap loan search. Find out the lowest interest rates that are offered for your particular loan. Cheap loans are not the first loan you stumble upon while searching for loans or the first loan that is offered to you. There is always a scope for finding a cheaper loan than the one you found in loans market.

You will have to research for finding cheap loans. This may not be your favorite job but will be certainly active in locating cheap loans. For cheap loans you will have to go to various lenders and ask for quotes. Quotes give an idea of the loan cost to the borrower. After taking quotes compare the loan quotes to settle on cheap loans. Online the chances of finding cheap loans are doubled.

The terms and conditions for cheap loans are quite flexible. This has lead to those with imperfect credit also qualifying for cheap loans. In fact a separate category of bad credit loan ensures that cheap loans are a viable possibility for every borrower.

Getting cheap loans also depend on collateral and equity. Secured loan will always be a cheaper option than unsecured loans. Equity will sanction the amount you can borrow. If you have ample equity than you can qualify for larger amounts at cheap interest rates.

Your employment record will also affect your chances of finding cheap loans. A borrower can qualify for cheap loans if he or she has a stable income with a good employment record. You can find cheap loans for bad credit history but a good credit score is integral in finding cheap loans. Every lender will be looking at credit score before extending cheap loans. A good credit score will make you a primary contender for cheap loans.

If you want to borrow large amounts then mortgage is the best and cheapest loans option. Mortgage will be available at the lowest interest rates and terms at all the leading finance companies. It is a cheap way of borrowing money and considerable types of mortgages exist keeping in mind the requirements of borrowers.

If you are having more than two unpaid debts then debt consolidation is a cheap loans option. Debt consolidation loans are cheap way of uniting unpaid debt at low interest rates and low monthly payments. It is a cheap way of becoming debt free.

Student loan is an extremely cheap way of paying for college education. All students are eligible to apply for student loans and it is in fact the cheapest loan in the market. The interest rate for student loan is fixed. But you obviously have to go to a university for it and there is a limit to how much you can borrow.

Another way of procuring cheap loan is shortening the loan term. Shorter the loan term is the lesser will be what you pay as interest rate and it will be prove cheaper to your pocket. A shorter loan term will be less expensive and it is always such a pleasure to pay the loan in shorter time span.

There is no single cheap loan for everyone. In fact cheap loans are in accordance to your financial condition. If you are looking for cheap loans then you can get extensive information on the net. Read it all, explore your options and then settle on cheap loans. Cheap loan is all about finding a loan and then finding another one to beat that loan.

Fulfill Your Dream of Owning a Home With the Home Loan

Staying in own home is a dream of everyone. People see dreams of owning home at their own choice, but everybody doesn’t able to afford that. Nowadays in the country like India, money is not a barrier of the dream of owning a home. Because all the government and on-government banks in India offer Home loan. These loans are specially given to those people who wants to build-up their own home or purchase a home.

Indian banks offer home loan under different categories, these include:-

Home Purchase Loans – This kind of basic loans are being provided for purchasing a new home.

Home Construction Loan: Banks provides this kind of loan for construction of home.

Home Extension Loan: One can get the loan for expanding or extending his existing home.

Home Improvement Loans: People can avail these loans if they have the requirement for implementing repair works and renovations of their existing home.

Bridge Loans: This loan is the best loan for those people who wants to sell his existing home and wish to purchase a new home. Banks help people by giving this loan to finance the new home.

Balance Transfer Loans: This kind of loan is given to pay off an existing home loan and avail the option of a loan with a lower rate of interest..

Home Conversion Loan: Banks provide this kind of loan to those people who has already purchased home by taking home loan and then wants to move on to another home and for that he requires some extra money. Under this category of loan the existing loan is being transferred to the new home and the extra amount is to be included.

Land Purchase Loans: One can avail these loans for purchasing land. The bank will give the loan without checking whether the borrower taking the loan for construction his home or using it for some other purposes.

Refinance Loans: Those who have taken loans from their friends or relative to purchase their homes, this kind of loan helps them a lot to repay that debt amount to them.

Stamp Duty Loans: To purchase a property, stamp duty is essential. This kind of loan helps people to pay for the stamp duty.

In India, banks provide home loans against fixed and floating rate of interest. Under the fixed rate home loans the interest rate remains fixed for the whole period of the loan. By taking loan under this category the borrower will get the facility of getting a fixed interest rate. But in this case they have to pay a higher rate of interest. On the other hand, under the floating rate loans the rate of interest fluctuates accordingly. The borrower will get the facility of getting a low interest rate. But the interest rate can rise any time and the borrower has to pay a much higher interest rate than the fixed rate of these loans. The repayment of home loans are to be given through Equated Monthly Installment (EMI). The home loan EMI depends on the amount and the repayment period one takes.

In this age of technology, one can apply for the home loan Online. By applying online one gets relief from the lots of hassle like visiting to the lenders, seeking for the best home loan deal, do the huge formalities and fulfill the long paper works. By availing these loans online one just has to sit on a Internet enabled computer, make a search for the best home loan deal and after choosing one just has to fill a form, that’s it. By doing some simple procedures you dreams can come true.

10 Steps to Launching a Green Business

In the summer of 1989 I was taking a subway home with some friends that I co-founded an environmental non-profit with here in Brooklyn. I remember complaining about how tired I was of having to search and buy eco products in mail order catalogs (this was pre-internet days).

Basic eco-products like toilet paper made from recycled and non-chlorine bleached paper.

Back then there were no stores in NYC that sold it. In order to get it, you had to buy a case via mail order. A case of 96 rolls.

I remember complaining, “What am I going to do with 96 rolls of toilet paper in my small apartment!”

And that is when it hit me. What about having a retail store that screened all its products for their environmental impact? The task of researching and learning about the environmental (and social) issues that go into making products can overwhelm most customers.

I asked them, “So what if we created a store that did that for the customer? And you did not need to buy 96 rolls of something to get it.”

At the age of 25, that was the beginning of Earth General, which opened two years later in 1991.

Within six years Earth General grew to being one of the largest environmental retail stores in the country with over 3,000 products all screened for their environmental impact. Things like organic cotton clothing, natural body care, green cleaning products, recycled office supplies and stationery, all natural gardening products and so on.

Yet while our stores were popular in New York City, the concept was a bit ahead of its time and my investors and I closed them in 1998. Today, 10 years later, they would probably do quite well.

In fact today, most things (authentically) “going green” are looking very promising. For example, one of the mainstream issues on everyone’s mind is energy. And of the many things being developed in the energy sector, one segment to really watch in the very short term is nanotechnology.

If you are not familiar with nanotechnology, you need to be, as it looks likely to be dramatically changing our lives within the next couple of years.

According the Center for Responsible Nanotechnology (CRN) Nanotechnology is the engineering of functional systems at the molecular scale. It is all about building things and using materials at a very small level. From this things like new, lighter, yet sturdier materials can be built.

For example, imagine cars made from materials as light as plastic, yet sturdier than steel. Lighter materials in our automobiles mean more energy efficiency, which in turn means more miles per gallon.

For more about this as well as a sense of the many, many applications currently being researched in nanotechnology, read “GreenBiz” recent article, Sweating the Small Stuff: A Market Opportunity.

Still need convincing that going green is a wise choice? On May 12th, The Wall Street Journal published an excellent story, Does Being Ethical Pay?

While the authors found consumers would be willing to pay a premium for ethical products, they also found consumers would also punish an unethical company… to a much greater degree (by only buying that company’s products at a steep discount.)

Perhaps it’s time for you to consider ramping up your green factor?

10 Steps to Determining Your Green Product / Service:

1. Pick your passion- what about the environment are you most passionate about? What do you notice really “burns your bacon”? For help, refer to January 30th’s Power Boost: Top 10 Business Issues into Environmental Opportunities.

2. Define your target-who is your market? What customer base are you most comfortable serving?

3. Get in their head-what is the need of that customer base? What are their pains? Remember to relate this to what you are most passionate about in the environment (remember my frustration that created Earth General?)

4. Relief is on the way!-what is your solution to your target market’s pain and to their needs? Especially if they do not even know they have it! Be clear as possible on this one. Make it really stand out.

5. Support is the key-who is on your team? What expertise do you need and who will have it? What are these people’s motivations for working with you (hint: your vision on where you would like to take your business.)

6. Name the players-who is your competition? How are you better and/or different? How can you authentically show your strengths over them? No competition, then your product/service niche is too small!

7. Be a hurdle jumper-what are the barriers to entry for competition to join you down the road? Is it difficult to gain entry? If not, how can you make it difficult or how will you retain customer loyalty (hint: focus on the green/social impact of what you do!)

8. Keep clearing those hurdles-how to keep in front of the barriers to entry. As the market continues to develop, what new, cool, authentic green (and social) components can you add to the mix? Stay ahead of the pack. Stay on top of your market research.

9. It’s all in the girth-and how scalable your product/service is. Compare it with how big you want to go with this idea. Look to balance the two. It’s OK if you want to stay small, just get clear before you take off.

10. Review your passion-how do you feel about your product/service? If you feel something is off, you must address it before moving forward. If not, it will bite you in the butt later. Don’t step over this. Find solutions to what is keeping you from really playing full out.

Once you’ve worked through these 10 steps, you should be ready to rock. I’d love to hear what cool, unreasonable green business you’re ready to launch.

Action Steps for the Week:

Whether you’re working for the man or the man is working for you, it might behoove you to examine your green business game plan.

If you have one, review it again and see what of the 10 steps (from above) might need some refining. And if you’re new to the subject, really take inventory on how and what to implement into your business.

The more thought you put into this, the more likely you’ll be whistling Dixie later on.