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• Tips to Avoid Credit Card Fraud
  

  Today, it seems as if credit and credit card fraud is occurring more and more. Credit card fraud costs both cardholders and issuers a great deal of money and heart ache. What is most upsetting is that fraud is not always possible to prevent because an intruder can use your card number without your knowledge. Here are a few pointers to help keep your accounts yours!

  • Keep account records in a safe and secure place. For example, make sure to note expiration dates, phone numbers, and addresses of each provider.
  • Sign the back of your cards upon arrival.
  • Carry your cards separately from your wallet.
  • Be watchful of your card during every transaction.
  • Keep receipts to compare with monthly billing statements.
  • Open bills timely and shred account information before disposal. Moreover, void incorrect receipts and destroy carbons.
  • Report any dubious charges right away.
  • If you plan to move, notify your credit card companies well in advance.
  • If you suspect fraudulent activity, contact your card issuer immediately.
  • Only give out account numbers over the phone to reputable companies.
  • Do not lend your card(s) to anyone.
  • Do not put credit cards, account numbers, or receipts in plain view.
  • Do not write account numbers on the outside of envelopes to be mailed.
• Home Equity Line of Credit (HELOC)
  

  Home Equity Line of Credit: When deciding to purchase a home it is essential to first calculate what your monthly payments will be. Once you have determined a monthly figure, it is best to find out whether or not you can afford to set up a mortgage or a line of credit. A home equity line of credit (HELOC) is different than traditional mortgages in a few ways. First, a home equity line of credit typically requires the borrower to disburse monthly payments of interest only. In comparison, traditional mortgages require fixed monthly payments of both principal and interest. Second, because a home equity line of credit does not include a fixed interest rate, the monthly payments may change, thus resulting in an adjusted balance and variable monthly payments.

  Security for HELOC: Home equity lines of credit will require property to be used as collateral in security for the loans. In this way, borrowers may be incurring larger risks if you default on a loan or if you are delinquent on monthly payments. Moreover, a loan with a sizeable payment at the end of the loan term may result in additional borrowing to pay off the debt. It could also put your home in jeopardy if you become ineligible for refinance. Another reason to heed caution involves the selling of property. If you decide to sell, the loan will require that you pay off all debts on your credit line at that time.

  Benefits of a Home Equity Line of Credit (HELOC): To begin, a home equity line of credit is a practical way to borrow funds. In addition, a home equity line of credit provides borrowers a large sum of cash with a comparatively low interest rate. Furthermore, a HELOC may give you some tax benefits not associated with other loans.
  Alternatives to HELOC: Second mortgage loans are an alternative to home equity lines of credit. Second mortgage loans certainly entail an extra monetary obligation, but the money borrowed is given as a lump sum with a fixed interest rate and monthly payments rather than constant charges to a credit card or checking account. Another option to HELOC is a credit line without collateral. Overall, it is best to determine what loan is right for you and your financial needs.

• Mortgage Rate Fluctuations
  

  Have you ever wondered who or what determines mortgage rate fluctuations? To most people, mortgage rates move without explanation. In fact, the authority behind mortgage rate fluctuations may surprise you. Whether you are buying a home for the first time or you are interested in refinancing an existing mortgage, the true force behind the interest rate is not determined by the lenders offering them. Rather, the actual force of mortgage rate fluctuations is indicated by investors in the secondary market.

  Here is how it works…The mortgage lender that initiates, approves, and finances your loan is called the originator. A loan originator is not a person, but rather a type of financial institution such as a bank or credit union. On the date of closing, a simple exchange of money occurs; the funds are allocated to you from a financial institution and you then give that money to the seller of the home for purchase.

  But wait, this is what you may not know…Once the loan is funded, the financial institution, also known as the originator, makes a decision to either keep the loan in its portfolio or to sell it on the secondary market. If the loan remains intact, it accrues money in the interest you pay each month. Conversely, if the loan is sold, the funds must be replenished by the originator so additional loans can be financed to other homebuyers. Secondary market investors are critical to the process because they distribute funds so financial institutions never run out of money for new mortgages.

  Who are secondary market investors? They are comprised of insurance companies, pension funds, securities dealers, and government-chartered companies. All of these secondary market investors can purchase mortgages and can also assemble mortgages together for resale in what is termed mortgage-backed securities. Mortgage-backed securities are liquid investments that can be easily bought and sold.

  How does the secondary market affect you as a home buyer? The condition of the economy is an important indication of mortgage rate fluctuations. In other words, investors want to earn the best return possible. When the economy is booming, future earnings are expected to be better than current ones. As a result, investors will wait purchase until higher earnings occur. In this way, lenders cannot sell their loans at lower yields and mortgage rates go up. Alternatively, when the economy is in a slump, investors buy as much as possible as to avoid declining yields later. When this happens, mortgage rates go down. Therefore, locking in the best interest rate possible could be in a period of economic downturn. The key to obtaining the best mortgage rate is to stay focused and be informed about market trends.