Questions to Ask Before Applying for a Personal Loan

Personal loans are a popular alternative to credit cards, because like credit cards – they are paid in monthly installments and come with a low interest rate if you have a good credit score. From debt consolidation to paying for life events, personal loans give borrowers money which can be paid back over time. Typically, payments are the same amount each month – as opposed to credit card payments that might vary depending on your balance. Keep reading to get all your questions about personal loans answered, and find out if this is the best financial option for you before you apply.

Is a personal loan right for me?

Personal loans are a way to consolidate high-interest debt at a lower rate. A personal loan can be used for just about anything – a home improvement project, wedding, debt consolidation, or other costly undertaking when you don’t have cash on hand or in the bank. Personal loans give borrowers money up front to be paid back in monthly installments over a fixed period, usually at a rate much lower than a credit card would have.

How much can be borrowed with a personal loan?

This amount will be based on your income, employment, financial history, and how much debt you currently have.  A lender will look closely at your debt-to-income (DTI) ratio, which is the percent of debt you currently have in relation to your before tax income. A favorable DTI is 43% or less, typically.

How much should I borrow?

Just because you get approved for a certain loan amount, doesn’t mean you should accept it. You also need to look at the other items you spend money on each month. Borrow the amount you know you will need to fund what you need the loan for, and don’t acquire extra debt. For help deciding what amount you should borrow or what your monthly payments might be, check out our financial calculators. Make sure your personal loan gets factored into your monthly budget and that you can comfortably afford the payments.

How can I get the best loan rate?

Do your homework ahead of time, and shop around. Often a loan with a shorter term will cost you less over the life of the loan, than one with a longer term will – though your monthly payments will be less on a loan with a longer term. Your credit score (the number that tells lenders if you are credit worthy and the financial risk you would pose) is another important component in receiving a competitive rate. The higher your score, the better your rate will be.

Is there a way to pay off my loan faster?

If you have room in your budget, it’s always a good idea to make extra loan payments when you can. Perhaps you can make bi-weekly payments instead of just once per month, or an extra payment every so often. This will only help you pay your loan off faster and you’ll also pay less in interest. Even rounding your monthly payment up can also help you pay your loan off quicker. For example, say your monthly payment is $173. If you round this amount up to $200 you’ll continue to pay the loan down and will ultimately pay less in interest over the life of the loan. Just be sure your loan doesn’t include any pre-payment penalties before you begin making extra payments.

Can a personal loan help my credit rating?

Part of your credit score is based on credit utilization, and lenders usually like to see that you’re not using more than 30% of your available credit. If you’re planning to use a personal loan to pay off credit card debt, you can actually lower your credit utilization – which should boost your credit score. Because a personal loan is considered an installment loan, whereas credit cards are considered revolving debt – adding it to your credit profile can demonstrate that you can successfully handle other loan types.

How can I apply?

If you live, work, worship, volunteer or attend school in Monmouth or Ocean Counties in New Jersey – check out our personal loan options! Our personal loans have a fixed rate, start at $500, have flexible terms up to 60 months, and no pre-payment penalties.* You can apply over the phone or right online, and we even have electronic closings available.

A personal loan is a great option that can help you save money instead of going through the high cost of retail financing or racking up high-interest credit card debt. Do your research and find the best option for your budget!

*APR = Annual Percentage Rate. Actual rate will vary based on creditworthiness and loan term. Subject to credit approval. A First Financial Federal Credit Union membership is required to obtain a Personal Loan, and is open to anyone who lives, works, worships, volunteers or attends school in Monmouth or Ocean Counties. A $5 deposit in a base savings account is required for credit union membership prior to opening any other account/loan. Federally insured by NCUA.

Article Source: Gobankingrates.com

More Ways to Make the Most of Your Coronavirus Stimulus Check

If you already received your stimulus payment directly deposited into your bank account, or even if you are still awaiting a paper check in the mail – it’s a good idea to have a plan on how you will use this payment. Everyone’s financial situation is different, but here are four additional ways to consider spending your coronavirus relief check.

First and Foremost: Cover Your Needs

If there were ever a time to prioritize needs over wants, it’s right now. This is especially important if you’ve lost income due to unemployment, reduced hours or slow business. If this is the case for you, your stimulus money should go toward making sure you have a roof over your head and food on the table.

Create a budget and add up the cost of your essential expenses. Then look at how much money you have in your bank accounts as well as your stimulus check, to get a good picture of how long your money will stretch. Feeling overwhelmed? Create a budget that works for you with our budgeting guidebook.

If you are having trouble paying your bills, reach out to your financial institution or lender as soon as possible. Many are offering payment deferments and other relief options during this time.

Increase Your Savings

If you’re still working and bringing in enough money to cover your essential needs, look to using your stimulus check to boost your emergency fund.

No one can predict how long this pandemic will last and shelter-at-home advisories have forced many industries to change how they do business or temporarily shut down.

While the typical advice is to have at least three months’ worth of living expenses in an emergency fund, you might want to increase that if you can. Your emergency fund should help you feel financially secure. You will also want to separate your emergency savings from your spending money. A higher yield or money market account will earn interest while your money is sitting in the bank.*

Think About Your Future

If your finances are in good shape and you have an emergency fund, consider spending the money you’ll get from your stimulus check to set yourself up for a better financial future (i.e. going toward that side or start up business you’ve always wanted to get off the ground).

Making a dent in your debt up front could also help you save money in the long run. You also might want to think about using your stimulus money to cover initial expenses that’ll help you save money over time (i.e. buying gardening supplies so you can grow your own produce and cut costs on groceries while also staying out of the store right now).

Help Others

If you’re in a financially stable situation with a healthy emergency fund, another good use of your stimulus money could be to help others who need it.

Use the extra cash to help a family member or friend in need, or donate to a reputable charity. You could also spend your money to support local businesses and restaurants — whether that’s through online orders or purchasing gift cards for future in-person visits.

*A $5 deposit in a base savings account is required for credit union membership prior to opening any other account. All personal memberships are part of the Rewards First program and a $5 per month non-participation fee is charged to the base savings account for memberships not meeting the minimum requirements of the program. Click here to view full Rewards First program details. A First Financial membership is required to open an account or loan and is available to anyone who lives, works, worships, volunteers, or attends school in Monmouth or Ocean counties.

Article Source: Nicole Dow of The Penny Hoarder

6 Ways to Spend Your Stimulus Payment Responsibly

Did you receive your COVID-19 stimulus payment on April 15th? Have you started thinking about how you should spend it?

It’s tempting to think about all of the ways you could spend an extra $1,200 or $2,400 – depending your filing status and the number of dependents you claim. Before you get that list finalized, we want to give you some tips to help your money stretch as far as possible.

Prioritize. Look at your bills. Which ones are essential (rent or mortgage, car payment, utilities), and what bills are non-essential (entertainment, streaming services, unusable memberships)? Make a list of what you need and what you can live without. Focus on paying the essential bills first.

Save. Save. Save. Don’t miss an opportunity to pad your savings account with some of your stimulus money. It’s a one-time payment, so think of your stimulus as a mini emergency fund. You may want to set aside some of the payment as “just in case” money.

Divide and Conquer. You only get one stimulus payment, but your bills will still come monthly. If you’re currently unemployed, it’s especially important to be strategic in how you spend your stimulus payment. Take this opportunity to divide it up into smaller chunks to help cover some of the essential bills you pay each month. Also, talk to your landlord or mortgage lender, your utility company and internet service provider, if you’re having trouble meeting your monthly obligations. Many companies are finding ways to help their customers defer payments during this unprecedented situation.

Don’t Hoard Cash. Hoarding cash is a bad idea in general. Your money is much safer at your financial institution than it is in your home. So, bring it to us and let us safeguard it for when you need it!*

Pay Down Debt. Paying off debt is almost never a bad financial move, but think about it and prioritize carefully. Even in these uncertain times, paying off any highest interest debt isn’t a bad idea. However, don’t feel like you need to be in a hurry to spend all your stimulus money to pay off debt. Look at your options for forbearance, payment deferrals, or even the option to skip a monthly payment. If you can get some relief on your debt in the coming months, let your stimulus payment sit in your savings account.

Splurge Smartly. We’re all feeling the weight of stress and uncertainty as we wonder when this pandemic will end, and life will return to normal. No matter how you decide to spend your stimulus check, see if you can set aside a little bit to spend on something fun for yourself. Maybe even shop at some of your favorite local businesses to offer support. Remember: the government is hoping these stimulus payments will put some cash flow back into the economy to stimulate it.

Over the past couple of months, we’ve faced a situation no one could’ve possibly prepared for. We know that our members have been affected in some way by the COVID-19 pandemic. While the stimulus payments will certainly help and offer some relief to most, please know that First Financial is here for you. We want to help you stretch your stimulus payment as far as can go. Give us a call and let us figure out a way to help you!

*A $5 deposit in a base savings account is required for credit union membership prior to opening any other account. All personal memberships are part of the Rewards First program and a $5 per month non-participation fee is charged to the base savings account for memberships not meeting the minimum requirements of the program. Click here to view full Rewards First program details. First Financial membership is available to anyone who lives, works, worships, volunteers, or attends school in Monmouth or Ocean Counties in NJ.

Financial Do’s and Don’ts During the Coronavirus Outbreak

Q: What steps should I be taking to protect my personal finances during this time?

A: The coronavirus outbreak has already generated consequences for the national and global economy — and experts say we’re only seeing the beginning of the pandemic’s financial fallout. The virus ended one of the longest bull markets in history, as the stock market plunged by a full 25 percent in one volatile month. More than that, businesses have been adversely affected by the outbreak in many ways: production lines have been put on hold, the global-wide halt on travel has caused tremendous losses for the tourism and airline industries, sports and entertainment have taken huge hits, countless other businesses have been negatively impacted, there has been decreased spending and also a shortage of personnel due to quarantines or school closures.

With all this uncertainty, it’s easy to fall into a panic and wonder if there are some concrete steps you should be taking to save your personal finances right now. Here are some practical do’s and don’ts to help you maintain financial stability and peace of mind during this time.

Don’t: Panic by selling your investments 

Both seasoned investors and those simply worried about their retirement accounts can find it nerve-wracking to see their investments drop in value. It may seem like a smart idea to sell just to spare investments from further loss, but financial experts say otherwise. According to The Motley Fool, most sectors of the economy will recover as soon as the outbreak clears. For example, consumers may not be shopping for clothing or booking vacations right now, but they will likely do so when it is safe to shop and travel again.

Do: Trim your spending

The thriving economy the country has enjoyed for a long time has prompted a gradual lifestyle inflation for many people. As the economy heads toward a probable recession, this may be a good time to get that inflation in check. Work bonuses, raises, and promotions will most likely not be handed out during a recession. Some may even find themselves without a job if companies are forced to lay off employees in an effort to stay solvent. Trimming discretionary spending now is a good practice for making it through the month on a smaller income. It’s also a good idea to sock away some of that money for a rainy day.

Don’t: Put your money before your health 

Financial wellness is important, but physical health should always take priority. If you’re feeling unwell, and especially if you’re exhibiting any symptoms of the coronavirus — such as fever, coughing and shortness of breath — stay at home. Do the same if you’ve been exposed to someone who has tested positive for COVID-19 in the past 14 days. Don’t let financial considerations come before your health and the health of those you come into contact with each day.

Do: Consider a refinance

The silver lining of an economic environment such as this are historically low interest rates. Refinancing an existing mortgage at a lower rate can potentially save homeowners several hundred dollars a month. That extra breathing room in a budget can be a huge difference maker during a recession. Be sure to work out the numbers carefully before considering this move and decide if it makes financial sense for you, since a refinance isn’t cost-free. If you would like to speak to a representative in our Lending Department to weigh your options, contact us today!*

The coronavirus has already impacted the economy, and may likely continue to do so for awhile. Keep your finances safe by remaining calm, putting your health first, and taking some of the practical steps mentioned above. If you have questions about your finances – just ask! We are here for you.

*APR = Annual Percentage Rate. Subject to credit approval. Credit worthiness determines your APR. Rates quoted assume excellent borrower credit history and are for qualified borrowers. Your actual APR may vary based on your state of residence, approved loan amount, applicable discounts and your credit history. Higher rates may apply depending on terms of loan and credit worthiness. Available on primary residence only. The Interest Rates, Annual Percentage Rate (APR), and fees are based on current market rates, are for informational purposes only, are subject to change without notice and may be adjusted based on several factors including, but not limited to, property location, loan amount, loan type, occupancy, property type, loan to value, debt to income ratios, FICO credit scores, refinance with cash out and other variables. Mortgage insurance may be required depending on loan guidelines. This is not a credit decision or a commitment to lend. If mortgage insurance is required, the mortgage insurance premium could increase the APR and the monthly mortgage payment. See Credit Union for details. A First Financial membership is required to obtain a mortgage and is open to anyone who lives, works, worships, or attends school in Monmouth or Ocean Counties. Nationwide Mortgage Licensing System & Registry ID #685814

Article Source: CUContent.com

How to Prioritize Bills During a Financial Crisis

Our vibrant, animated country has basically been put on pause. Busy streets are now empty and previously crowded malls are eerily vacant, as millions of Americans shelter in place to slow the spread of the coronavirus.

If you have been affected financially by the COVID-19 pandemic, you may be getting worried about incoming bills and wondering where you’ll find the money to pay them. Let’s take a look at what financial experts are advising now so you can make a responsible, informed decision about your finances going forward.

Triage Your Bills

Financial expert Clark Howard urges cash-strapped Americans to look at their bills the way medical personnel view incoming patients during an emergency. “In medicine it’s called triage,” Howard says. “It’s exactly what’s happening in the hospitals right now as they decide who to treat when. You have to look at your bills the same way. You’ve got to think about what you must have.”

Times of emergency call for unconventional prioritizing. Clark recommends putting your most basic needs, including food and shelter, before any other bills. It’s best to make sure you can feed your family before using limited resources for other bills. Similarly, your family needs a place to live – so mortgage or rent payments should be next on your list. And continue down the line after that. If you are not sure that you can make full payments on your other bills, call that particular lender or company as soon as possible. Many are offering extended grace periods without penalties during this time.

Housing

It’s one thing to resolve to put your housing needs first and another to actually put that into practice when you’re working with a smaller or no paycheck. The good news is that some rules have changed in light of the financial fallout of the pandemic.

President Donald Trump announced he’s instructing the Department of Housing and Urban Development (HUD) to immediately halt “all foreclosures and evictions” for 60 days. This means Americans will have a roof over their heads for at least the next two months, no matter what.

The Federal Housing Finance Agency also offered payment forbearance to homeowners affected by COVID-19, allowing them to suspend mortgage payments for up to 12 months. These loans, provided by Freddie Mac and Fannie Mae, account for approximately 66 percent of all home loans in America. Some lenders are allowing delayed payments to be tacked onto the end of the home loan’s term, while others will collect the total of missed payments when the period of forbearance ends.

In the state of New Jersey, a 90-day grace period on mortgage payments should also be provided by most financial institutions. Details can be found here.

If you are having trouble making your mortgage payments right now, talk to your lender about your options before making a decision. Suspending your housing payments during an economic shutdown can be a lifesaver for your finances and help free up some of your money for essentials.

If you’re a renter, be open with your landlord. “Consumers who are the most proactive and say, ‘Here’s where I stand,’ will get a lot better response than those who do nothing,” says Lynnette Khalfani-Cox, CEO of AsktheMoneyCoach.com and author of “Zero Debt.” Your landlord should also be willing to work with you.

Transportation

When normal life resumes, many employees will need a way to get to work. Missing out on an auto loan payment can also mean risking repossession of your vehicle. This should put car payments next on your list of financial priorities. If meeting that monthly payment is impossible right now, communicate with your lender and see if they offer skip-a-payment or a deferment program during this time.

Household Bills

Utility and service bills may be another area of difficulty right now. First, don’t worry about shutoffs. Most states in the U.S. have outlawed utility shutoffs for the time being. Second, many providers are willing to work with their clients. Visit their websites or give them a call and check to see what kind of relief and financial consideration they’re offering to their consumers at this time.

Unsecured Debt

Unsecured debt includes credit cards, personal loans and any other loan that is not tied to a large asset, like a house or vehicle. When it comes to these loans as well, consumers are advised to communicate with their lenders about their current financial reality. Credit card companies and lenders may be able to extend payment deadlines, waive a late fee, or occasionally allow consumers to skip a payment without penalty.

Have you been affected by COVID-19 and are having trouble making your First Financial loan payments? We are here for you! Click here to learn more about your options and fill out an online request form.

Article Source: CUContent.com

How to Create a Budget and Make Your Money Work for You

Budget. Did you just get cold chills reading that word? It’s not a popular word, and it’s certainly not a popular idea. Typically, the idea of a budget is enough to take away any sense of fun you might have when thinking about spending your money. But, it doesn’t have to be.

There are several benefits to creating a monthly budget. When you have a budget in place, you instantly:

  •     Make your money work for you
  •     Assign each dollar in your account a job
  •     You get 100% control of your money
  •     You can track your expenses
  •     You’ll relieve some of the stress that finances can bring
  •     You will create a “safety net”

There are obvious benefits to creating and maintaining a budget, and there are just as many tools to help you budget as there are benefits.

So, where do you start?

First, figure out how much you make each month. Then, figure out how much you spend. Once you figure out what you’re bringing in vs. what you’re spending, you can start creating specific categories for your money. This is where you get to tell your money what to do.

Now, you’ve got a basic budget in place. You know what you’re making, what you’re spending, and your money has a specific goal. But, how do you keep track of all that information in a manageable way?

Budget apps! The great thing about budget apps – not only do they keep track of your budget, but you can take them with you everywhere you go. Check out some of the best budgeting apps for 2020.

Wally — Get the details of all your financial activity in an easy-to-digest template. Categorize spending destinations, set goals, and create charts. Wally provides you with the full picture of your account in a simple and colorful template. Easy to look at and easy to understand, Wally makes tracking and analyzing your financial habits easy.

Acorns — You know how it’s hard to overcome the mental hump of setting money aside? Well, Acorns removes that struggle from the equation. By rounding up each of your transactions to the nearest dollar, it puts the funds into an investment portfolio. This app looks out for “future you” and makes sure you always have a few acorns hidden away for a rainy day too.

Mint – Create budgets, track bills and receive a free credit report when you use Mint. However, it’s the budgeting feature that really makes Mint shine. It allows you to link your bank, loan, and credit card accounts and then uses the information from those accounts to suggest a budget for you based on your spending. Mint takes it a step further by breaking that spending down into categories like “entertainment,” “food and dining,” and shopping. The best part? You’ll be able to see how much you can save by cutting back in each category.

Mvelopes – A popular budgeting method is the envelope system, a style of budgeting, where you put cash in envelopes for different spending categories and when the envelope is empty, that budget category is spent for the month. This is great for people who like a cash only system, but for people who use credit and debit cards, this can be challenging. Enter Mvelopes, an app that makes it easy to follow cash style budgeting in a digital world.

Of course, while you’re downloading apps, make sure you’re using our mobile app! At First Financial, our app allows you to check your balances, transfer money, pay bills, review your spending and deposit checks remotely. Still have questions about budgeting and financial planning? Check out our handy budgeting guide, or make an appointment with one of our member service representatives and let us help get your budget on track!