Lifestyle

How to Make Ends Meet in the Most Expensive U.S. Cities

most expensive cities

I live in one of the most expensive cities in the U.S. In fact, San Francisco is arguably the most expensive city in the United States. Manhattan is the only other city where rent and mortgages compare to those in San Francisco. It isn’t uncommon to see $15 cocktails on a menu here.

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Housing Risks During the Winter Months

As the weather changes and the temperature in the northeastern coastal areas turn cold, more people move indoors to stay warm. This means your heating system will be run more often and many people turn their heat way up to keep warm. This is a natural reaction to the blustery outside air, but there are a few precautions you should take no matter what type of heat system your home has. Below are five tips to staying safe when the weather turns cold this winter, and remember this rule: stay warm but stay safe!

Heating System Safety

When running your heating system, it’s not a good idea to run it on high for too long. Always select the “auto” option rather than the “fan” to get the evenest heating and turn it to around 68 degrees when you leave the house. Check pilot lights to make sure they are all working. If your heat does not start up for the first time this winter, you may want to check the pilot light. Sometimes the pilot light can go out over the summer or early fall months when it is not in use, or strong wind can blow it out. There is a specific technique you should follow for lighting your pilot light with most electric furnace systems. There are various videos on this procedure, but the basic process is the same. It’s also a good idea to vacuum out your furnace once in a while to keep dust and debris from collecting around it.

Fireplace Safety

Many people enjoy starting up their fireplaces during the winter months, especially in the eastern locations where it is typically colder. Fireplaces are a wonderful asset to a home, and they create a warm and inviting atmosphere. But you should take care to make sure the flue is clean as this is the cause of many house fires, so on the east coast ensure you have adequate home insurance coverage in Ontario and other parts of Canada, where the winter wind blows colder than in other locations.

Radiators and Standalone Heaters

One of the greatest dangers when heating your home inside is the use of standalone electric heaters and radiator units. These units can overheat quickly and, when left alone, they can catch fire. The key to avoiding this disaster is to make sure there are no blankets, clothing items, or flammable materials within at least 10 feet or more of the unit. Also, never keep these standalone units burning by themselves or run off and leave them running when you leave the house.

Watch Christmas Trees

Christmas is near and it is a time many people enjoy with the introduction of a real tree. The disadvantage to real trees is that they can catch fire from the Christmas lights. This is especially true if you use the bare larger light bulbs that increase in heat as they are used. They can overheat if they are next to a tree branch and catch your tree and house on fire. Don’t risk this. Use smaller more contained lights and keep your real tree moist by watering it daily. This may reduce your chance of fire from a Christmas tree.

Burning Leaves: A Hazard Waiting to Happen

In addition to the potential for fires in your home due to heating units or Christmas trees, you should be careful when burning leaves near your home as well. Never burn your leaves on a windy day and watch for “no burn warnings” in your area.

10 Best Debt Consolidation of 2018

top debt consolidation

 

Debt consolidation is a debt refinance method used to consolidate unsecured debt like student loans and credit cards into a single monthly installment. There are different ways to consolidate debt, the most typical one being an unsecured debt consolidation loan usually offered through major banks or debt consolidation companies. Other loan options are home equity lines of credit, credit card balance transfers, and direct or private student consolidation loans. As with any other debt instrument, there may be substantial pros and cons to taking out a debt consolidation loan. Before seeking debt consolidation, inform yourself about this and other alternatives such as debt management programs or debt reduction strategies. Debt settlement programs differ from debt consolidation as they negotiate directly with creditors on your behalf to reduce the overall amount owed. Deciding on the right debt reduction option depends on one’s financial goals and credit situation.

Debt consolidation could be a good option for those struggling with several types of debt like student loans, mortgages, car loans, overdue credit card payments, or medical bills, and who are looking for a way to pay off what they owe while avoiding bankruptcy. While consolidating multiple high-interest loans into a single, low-interest one could be beneficial for those able to obtain a better rate, lower monthly payments or both, this type of personal finance process could end up being costlier in the long run. When choosing a debt consolidation loan, make sure you are not substantially exceeding the duration of your previous loans, which could make you end up paying more towards interests than you would have done otherwise. If you have an inordinate amount of debt or have been in debt for a long period of time, then you may want to look at credit counseling programs or alternatives that could help you correct the behaviors that led you into debt in the first place.

Before opting for a debt consolidation loan, make a detailed list of how much you owe, how long it will take you to pay off those debts, and how much you will have paid towards overall interests. After determining these amounts, shop around for debt consolidation loans and compare how much you would pay in interest towards your current loans versus what you would pay for a consolidated loan. If a debt consolidation loan is right for you, pay off your other accounts as soon as you are able to and modify unhealthy spending behavior by, for example, limiting or ceasing credit card spending for the duration of your loan. Once you have opted for debt consolidation, you will have to make timely payments towards your loan in order to avoid further damage to your credit. Although it may not be an easy process, keeping a positive outlook and taking responsibility for your actions can be the most empowering way to regain your financial freedom.

Another important factor to consider when comparing debt consolidation options is whether the loan will be unsecured or secured by a form of collateral—which can be easier to obtain if your credit is affected. Opting for a secured loan, however, will put your assets in jeopardy and may result in a precarious fiscal situation if you are not able to keep up with your scheduled payments. Also, consider the interest rate you will qualify for as well as possible costs and fees such as early repayment penalties. Remember that if the principal is paid off quicker than it would have been without the loan, then debt consolidation can help boost your credit score in the long term. However, this may also extend the loan’s term significantly, in which case the potential savings are offset by paying more interest over time. Most importantly, there’s no shortage of questionable debt resolution services around these days. Make sure the company you choose is certified by the AFCC, IAPDA accredited, and FTC compliant, and always beware of providers that seem too good to be true.

HOW WE COMPARE DEBT CONSOLIDATION

Reputation

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According to statistical data collected by the Federal Reserve Bank of New York, as of October of 2017 U.S. household debt increased to 13 trillion in revolving and non-revolving credit, a 16% increase since 2013. Considering that credit cards and loans are now more accessible than ever and that the great majority of Americans earn barely enough to maintain their standard of living, it’s not surprising that debt in the United States has skyrocketed to an all-time high since the Great Recession. As the number of people with student loans, credit card, and subprime auto loan debt increases, so does the number of families living under the weight of financial hardship. If you are among the millions of people currently struggling to keep up with monthly payments, one of the options available to you is debt consolidation.

If you have already weighed the pros and cons of debt consolidation and have informed yourself about the credit implications of defaulting on this type of loan, the next step on your list should be to look for a lender or debt consolidation company that upholds consumer financial laws and meets certain minimum qualifications. For that reason, our editorial team has compared debt consolidation companies based on several factors, including compliance with federal regulations, employee certifications, and average consumer ratings and reviews.

BBB Rating

The Better Business Bureau (BBB) is a nonprofit organization promoting ethical business behavior and monitoring compliance by their 400,000 Accredited Businesses. Consumers wanting to make better-informed decisions and identify trustworthy businesses can find over 4 million unbiased customer reviews and complaints on BBB.org

AFCC Membership

The American Fair Credit Council (AFCC) is a leading association of professional consumer credit advocates promoting and enforcing best industry practices among member companies. Through a strict code of conduct that upholds transparency and compliance with the Federal Trade Commission Regulation of 2010—that which prohibits debt relief services from charging up-front fees before settling consumer debt—, the association seeks to change the negative public perception of debt settlement companies.

IAPDA Accredited

The International Association of Professional Debt Arbitrators (IAPDA) is the leading certification program ensuring debt consultants, credit counselors, and consumer debt relief specialists receive proper training and meet a minimum standard of excellence. The company’s training and certification programs are recognized in all states and are in compliance with the Uniform-Debt Management Services Act (UDMSA).

FTC Compliant

The Federal Trade Commission (FTC) works to protect consumers by preventing deceptive and unfair business practices and promoting public access to accurate information. Through an amendment made to their Telemarketing Sales Rule prohibiting debt relief companies from charging fees before settling their customers’ debt, the FTC seeks to deter debt relief providers from targeting consumers in financial distress.

Qualification

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Most companies offering debt consolidation loans set requirements with regard to the amount of debt the client must have accrued before requesting a loan, the types of debt they are willing to work with, and, in most cases, the borrower’s ability to meet their financial obligations. While some debt relief companies set minimum amounts for debt consolidation—typically between $5,000 to $10,000—some merely require the debt to be unsecured. Unsecured debt refers to money you borrowed with no collateral, such as student loans, credit cards, and medical bills. Secure debt, on the other hand, requires collateral in the form of personal assets like your home or automobile.

Regardless of the type of lender you choose, whether a major bank or credit union, there will likely be certain minimum income and credit requirements such as a good debt-to-income ratio, sufficient monthly income, and other assets. Those with less-than-perfect credit scores may still qualify for a debt consolidation loan by offering the lender security through savings, assets or equity. If you have a poor credit score and your debt outweighs your income, you may need to resort to other alternatives like enrolling in a credit counseling program through a private service provider or nonprofit organization, or employing the services of a debt settlement/debt resolution provider.

Pricing & Fees

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The Federal Trade Commission (FTC) has taken steps to protect consumers against companies that charge fees prior to settling or reducing a client’s unsecured debt. The 2010 FTC Telemarketing Sales Rule (TSR) amendment states credit counseling and debt settlement companies selling their services over the phone cannot collect fees or charges unless they successfully settle or resolve at least one of the consumer’s debts. They must also disclose the basic aspects of their services including how long it will take for the program to yield results, how much the consumer will have to pay for the service, how dedicated accounts work, and the potentially negative implications of using debt management services. It is illegal for a debt settlement company to misrepresent their services or make false claims about what those services are intended to accomplish.

FDIC Insured Deposits

Again, it is illegal for debt settlement and credit counseling companies to charge upfront fees as they can only be collected upon the settlement of the debt. However, some debt companies will ask their clients to place monthly fees—which typically amount to a percentage of the client’s total enrolled debt—into a dedicated account they can access once they have rendered their services. These funds are intended for negotiating with creditors and making a lump sum payment once a settlement is reached. FTC guidelines include a provision that states dedicated accounts can only be created if the account is maintained at an insured financial institution, the consumer owns the funds and interest and is able to withdraw them at any time without penalties, and the provider does not own or have any affiliation with or exchange referral fees with the company administering the account.

Services

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There are many kinds of debt relief services one can take into consideration before bankruptcy. The majority of the companies we feature will fall into three major categories: debt consolidation, debt settlement, and credit counseling. Each program will have different lengths, estimated debt reductions, and additional services offered.

Debt Consolidation

Debt consolidation involves taking different debts and consolidating them into a single loan or monthly payment. This option makes sense for people who want to simplify the process of making payments to several different lenders and those able to secure a lower interest rate or monthly payments through a debt consolidation loan. Consolidating debt does not diminish what is owed, so debt can return with a vengeance if the underlying problems that drove the individual to incur debt are not addressed.

Debt Settlement

Unlike debt consolidation, debt settlement allows consumers to lower the amount of their debt by negotiating with lenders and creditors. If you have fallen significantly behind on payments, lenders may be willing to reduce your debt and settle for a lower amount out of fear of losing their entire investment. Some potential downsides, however, are having to pay service and penalty fees as well as being required to pay taxes on the amount that was forgiven. Most notably, though, is debt settlement will always negatively impact your credit score.

Credit Counseling

Credit counseling services provided by professional credit counselors or debt specialists offer guidance and support for consumers needing help managing their debt. Credit counselors can also assist in the development of a budget and offer advice with regard to income and expenses, credit repair, debt consolidation, and bankruptcy.

How does debt consolidation work?

When you consolidate debt, you reduce the number of your monthly obligations to more than one creditor. Most of the time, this is done by taking out a debt consolidation loan, which you use to pay off other debts. This way, you only have to make one payment every month to your new lender instead of keeping track of several different debts. A debt consolidation loan can be secured, like a home equity loan, or unsecured, like a personal loan. With a debt consolidation loan, you may be able to get a lower interest rate than the rates owed on the debts you want to eliminate. Therefore, you may end up paying less for a debt consolidation loan than you would have if you tried to pay off all your debts separately.

Debt consolidation can also refer to a type of debt relief program. Under a debt consolidation service, you make a single monthly payment to the program, which then pays your creditors. The provider charges fees for the service, which will be added to your monthly payment. Keep in mind that certain kinds of debt are not eligible for management under these programs, such as secured loans, like mortgage and auto loans, or back taxes.

What is debt settlement?

Debt settlement is another form of debt relief. Under this program, the service provider will negotiate with your creditors to accept a lower lump sum payment to settle your debt. The program will require you to deposit a certain amount each month into an account, which will eventually be used to pay off your debt. There are many risks associated with debt settlement. First, since most debt settlement programs will tell you to stop paying the bills you are trying to settle, your credit could take a serious hit. Also, committing to depositing a specific amount of money, which could be large, for a long period of time may be too difficult in your financial situation. Finally, some creditors aren’t even willing to negotiate with debt settlement programs and may even sue you for repayment of the debt.

What is debt management?

Debt management is a form of debt relief that does not require you to borrow money. Instead, you work with a credit counseling agency which will give you advice on how to manage your money to pay off your debts. These programs focus on changing the habits that made you fall into a debt trap in the first place. There are also debt management plans (DMPs), which are somewhat similar to debt settlement programs in that you are required to make deposits into an account with the credit counseling agency. The agency then helps you prepare a payment schedule and uses the money to repay your creditors. They may even negotiate with your creditors to change the terms of your debt so your interest rate and fees are lower. Before enrolling in a DMP, however, make sure your creditors are willing to work with your credit counseling agency to fulfill the plan.

Can you consolidate debt with bad credit?

It is possible to consolidate debt with bad credit. However, the number of options available to you is limited compared to someone with good credit. Qualifying for an unsecured debt consolidation loan may be difficult, for one, since creditworthiness is one of the first things lenders look at. You may be able to qualify if you apply with a co-signer with a higher credit score than yours. If you default, this person would be responsible for paying back the loan. You may also be able to qualify for a secured loan by putting up a property or a vehicle as collateral; however, if you fall behind on the loan payments, you could have your home foreclosed on or your car repossessed. If you can’t take out a debt consolidation loan, you may still be able to participate in debt management or debt settlement. Both programs have risks, but one of them may work for you.

What is the difference between secured and unsecured loans?

When you take out a secured loan, the lender’s investment—i.e., the money you borrowed—is protected by a piece of collateral. Most often, this is a house with a mortgage loan or a car with an auto loan. If you stop repaying the loan, or even if you’re late, the lender has the right to take possession of the collateral to recover their money. In contrast, an unsecured loan does not need a piece of collateral. Lenders use your creditworthiness—how likely you are to repay the loan, as determined by your credit history—to decide whether or not they will lend money to you and how much. Secured loans are easier to get, since they imply less risk for lenders than unsecured loans. Interest rates on secured loans are also usually lower than the rates on unsecured loans. Although an unsecured loan may have higher interest rates, the lender does not automatically have the right to take your property if you fail to repay the money according to the loan terms.

Do debt relief programs affect your credit score?

The way your credit score is affected depends on the type of debt relief you undertake. For starters, every time you open a new account, be it a credit card or a loan, your score goes down a few points. Don’t worry: this decrease is temporary and your score should go back up after a few months, so long as you stay current with your monthly payments. Therefore, a debt consolidation loan should not affect your score negatively in the long term.

Debt management plans (DMPs) are another matter. Enrolling in a DMP will show up on your credit history, and some creditors may take it into account when deciding whether or not they should lend you money. However, it is not factored into your score, so you should not see a drop in the number, so long as you continue to make full payments on time every month.

Debt settlement, on the other hand, does have a negative effect on your credit history and score, because it implies paying less than what you really owe on your account. The higher your FICO score is, the farther it drops if you miss a payment or settle an account. This means someone with a score of 780 can lose between 125 and 145 points when settling a debt, while a person with a score of 680 only loses between 65 and 85 points. If you settle on more than one account, this negative impact is multiplied. However, if your debt is especially overwhelming and you are trying to avoid bankruptcy—which can truly decimate your credit score—the pros of debt settlement could outweigh the cons.

What do I do if I cannot consolidate my debt?

If you need to reduce your monthly payments on outstanding debts but can’t consolidate those loans, there are several options to consider. If you have a mortgage, you can look into refinancing it using the cash-out option. In this scenario, you borrow against your home for more than the balance of your existing mortgage and use the excess funds to pay off your high-interest debts. You can also consider transferring your credit card balance to another credit card that has a lower interest rate or contacting a credit counseling agency to analyze your finances and provide debt management advice. If your total debt has reached a point where no repayment plan is effective, then bankruptcy, although extreme, is your final option.

This article was provided to us by Consumers Advocate.