Financing Moving Expenses with a Relocation Loan

A relocation loan, also referred to as a bridging loan, is basically a personal loan used to pay for moving expenses.

Getting a relocation home loan can be genuinely efficient when you’ve found the place you wish to move to, but you might be lacking the extra cash to pay for movers, rent a truck, or pick up certain expenses.

How Can a Relocation Loan Help You?

As we already indicated above, a relocation loan can provide you the funds you need for moving. Still, as you might expect, there are significant costs associated with this type of financing. Nevertheless, the good thing is that the competitive market has slightly diminished the overall expenses linked to this type of loan.

What Are the Expenses Associated with It?

Aside from the interest and the principal balance of a loan, there are additional fees, which vary by the lender. Many a time, the fees might result in thousands of dollars. Truthfully, the additional fees are much more important than the actual interest rates, especially if we were to consider that the duration of the loan is short. Fees you should be aware of include: origination fees, late fees, and prepayment penalties.

How Can You Get a Loan for Relocation?

Each lender’s eligibility criteria are different. The first and foremost criterion to keep in mind is your credit history or credit score. If you have decent credit, then you should be able to get a personal loan with most lenders.

You should analyse the different lenders’ eligibility criteria before filing an application, and try to anticipate your chances of approval.

What’s the Alternative?

The alternative to getting a relocation loan would be covering the expenses with out-of-pocket money. Therefore, if you don’t have the financial means to do that, you’ll be in difficulty. Paying out of pocket is cheaper for sure, but it might not be viable.

Nonetheless, a relocation loan allows you to get to a new property quickly. You may receive your loan in a matter of days, which can be time-effective. Additionally, in comparison with other forms of financing, a relocation loan has shorter terms, so you can try to pay it off quickly if desirable.

What Are the Drawbacks of a Relocation Loan?

Although we said that a relocation loan’s short term accounts for an advantage, it also serves as a drawback. If you can’t manage to repayment, every missed payment will garner more interest. Additionally, associated fees add to the cost of the loan, making it rather pricey.

Additionally, if the borrower makes the mistake of overestimating the value of their existing home, they might be unable to make the necessary repayments in a timely manner. This would negatively affect their credit score in the future.

Knowing What a Cosigner Is and How It Can Help You

Have you struggled to get a loan in the past? Despite having a good credit rating and reasonable income you weren’t ticking some of the boxes that the banks required. Or maybe you have a great credit rating and poor income, or vice versa. A cosigner can help you get over this hurdle and back on your feet.


Mortgages are the most likely place you’ll go searching for a cosigner. A mortgage is one of the biggest loans you’ll ever take out, and banks like to make sure that you have the ability to pay them back before the lend you hundreds of thousands of dollars. If you fail to tick even one of the boxes for a mortgage, a cosigner may be the only way you can go to get the paperwork over the line.

A cosigner is equally responsible for the loan. While you might agree with one another that you will be fully responsible for the payments, the banks can knock of the cosigners door if payments start to fall through. However responsibility goes both ways, the cosigner may come along many years later and demand their rights to the property, either to live in or perhaps a portion of the value.

Cosigners may be used for other loan types as well. If you want to take out a car loan, personal loan, student loan or even a business loan –you can have a cosigner in any case.

Risks for the Cosigner

Cosigners are at a large risk with loans. While they have rights to any assets purchased through the loan (such as a home, or a car) the risks to the cosigner are likely to outweigh the benefits.

While the primary signer of the loan has primary responsibility, the cosigner agrees to take on all those debts if the primary signer of the loan defaults. Not only will the cosigner need to cover repayments, they can also be slugged with late fees and collection fees. In this case their credit score will suffer as well.

Even if you make all the payments, the cosigner will still have their finances affected. If the cosigner wants to take out a loan of their own, then this loan will be taken into account when calculating their liabilities.

Releasing a Cosigner

A cosigner for your loan shouldn’t be there for the life of the loan. A cosigner is needed to get you past the first hurdles of taking out that loan. Once you have been repaying it for a few years, you should have built up a better work history, better income, or a more stable job history. Even if you haven’t improved your situation dramatically, the loan balance should be reduced after a few years.

Once you have cleared these hurdles you can and should release the cosigner. In most cases this can be done directly with your creditors, sometimes you will need to finance, but other times the cosigner can simply be removed from the loan.

At this stage the cosigner will no longer be on the hook if you default from the loan, but they will also forfeit any claims to your assets. It’s a win win, and a good way to thank them for their support in the early days.

How to Choose the Right Mortgage for You

If you’re shopping for a home mortgage loan, you can definitely save time and money by choosing the right lender and loan terms. First, you need to spend time looking for that right lender.

The process of buying a house can be confusing to many first-time homeowners. It’s not only about choosing a good real estate agent, a pleasant neighborhood, and a home you’d enjoy. It’s also about securing a home loan that will give you a solid financial foundation.

Working with a reputable mortgage lender and getting good loan terms will make a big difference to your finances. It could also mean the difference between paying off and keeping your home or being trapped in a house you can’t afford.

In this post, we’ll look at how to choose the right mortgage before you look for a home, so you can make a smart loan decision and eventually become financially independent.

What is the Best Type of Mortgage Lender?

When you’re looking to borrow money to buy a home, one of the first things you should do is find the best people to loan you the money.

You have choices when you’re shopping for a home loan. Here is a general list of the types of companies to help with your loan:

  • Big Bank. The industry classifies banks like Chase, Wells Fargo, and Bank of America as direct lenders. Pros of dealing with a big bank are that there are plenty of people who can get your questions answered. Large direct lenders like these are also more likely to have resources and be a one-stop shop. However, working with a large staff isn’t always good. Your file could end up on several desks, and this could increase your closing time.
  • Small Local Lender. You may want to use this type of direct lender if your home purchase requires special attention. They may offer more flexible lending or approve an irregular income situation such as self-employment. A small local lender may be more willing to work with you if you have unusual needs.
  • Mortgage Broker. A mortgage broker acts as a middleman between you and the lender. He or she will gather information about your budget, credit score, how long you intend to own the house, and other details. A mortgage broker may be able to find you a lower rate than normal because they’re shopping for you with experience. The downside is that using a third party could mean that your file will get passed through several hands, and you may experience a lack of control. You might also find a less-than-reputable broker.

Ultimately, you want to choose a reliable lender who will give you the best rate. Contact each of these types of companies for a rate quote and to get a feeling of how they treat you as a customer. Make sure they’re organized and that they specialize in residential properties. You’ll want someone who can help you understand the application process and who won’t take longer than 45 days to close.

Should You Choose a Fixed or Adjustable Rate?

One of the first questions that will arise is whether you want a fixed or variable interest rate. The answer depends on how long you intend to live in the house.

Fixed rate mortgages have only one interest rate that will not change for as long as you have the loan. These loans are excellent for people who plan to live in the home long term. The fixed rate loan carries no surprises and is easy to work into a budget and retirement plan.

Variable rates can vary during the life of the loan. They may offer an attractive low rate at the beginning of the loan, but they could grow higher and leave you in financial distress. These types of loans are best for people who don’t intend to live in the house very long. If you think you’ll sell the house by the time the rate rises, this loan could be a good option for you.


The type of lender and the terms you choose have a major effect on your financial future. If you consider that the money you put toward your housing cost is about 30%, you’ll want to have the cheapest loan possible from the most reliable lender.

Having control over your house payment and getting terms that fit your budget is a major step to becoming financially secure. Signing a loan with the right terms can save you from being behind on bills and being able to save for other things like your children’s education.  It also means you can rest assured knowing you can make payments without risking repossession of the home you’ve worked hard to get.

Are you thinking about buying a home soon? Which kind of mortgage and lender will you choose to finance your home?

The Easiest Budget Known to Man: the 80/20 Budget

Budgeting can suck.

I have tried budget and budget and end up just abandoning most of them. Usually, they are just too damn complicated.

This is why I moved onto the 80/20 Budget – what I believe is the simplest budget known to man (aside from no budget, of course).

How the 80/20 Budget Works

The 80/20 Budget is almost too simple. It only includes 2 categories. Here is how it works:


The 20 part of the budget is what put towards savings. You should automatically take this money out of your paycheck and other forms of income so you know that this money is hitting savings. 20% really isn’t that much but if you don’t make absolutely sure that you are putting this money aside, there is a good chance you might end up dipping into it when you’re not supposed to.

Note: 20% is only a guideline. You don’t have to only save 20%. Feel free to save as much as you want – this is just a general recommendation.


So what’s left for the remaining 80%?

Well…everything else!

That’s what makes the 80/20 Budget so great – you only have 2 categories that are both very simple.

The 80% includes rent, food, clothes, utilities, and everything else you can spend that hard earned money on.

If you aren’t too big on tracking where every dollar goes, you may find that this budget works for you. As long as you aren’t late on rent, miss your credit card payments, or anything like that, then you should be fine.

Just take out the amount you have designated as savings from your checking account and leave the rest. If you can keep it positive, then you are doing alright! If not, you may want to set up a few more categories (such as necessities and luxuries) to track your spending a bit better.

Last Word

I really love the 80/20 Budget. It is the first budget that I have been able to stick to and don’t feel restricted by.

How about you? What kind of budget do you like to use?