Are you looking for the best car insurance for your vehicle? We compare car insurance companies to make sure you can find the best policy available for your needs.
Car Insurance
For Over 50s
Comparison Sites
For Young Drivers
This is a list of car insurance companies.
You can visit each insurer's website to view policy details and get quotes. How our site works.
Sorted by:
1. Aviva Car Insurance
Cover Available
Courtesy car & Windscreen
Types of Policy Available
Comprehensive , TPFT & Multi car
Discounts
20% Online, Multi car & No claims
5 Star Defaqto rated car insurance from £185 - 10% paid this for standard cover. Save up to 20% online - 16% of customers are expected to receive the maximum saving.
Discount depends on individual circumstances and doesn't apply to optional extras. Minimum price applies. T&Cs apply.
2. Direct Line Car Insurance
Cover Available
Courtesy car & Windscreen
Types of Policy Available
Comprehensive & TPFT
Discounts
Second car & No claims
3. Saga Car Insurance
Cover Available
Courtesy car & Windscreen
Types of Policy Available
Comprehensive & TPFT
Discounts
Second car & No claims
4. Admiral Car Insurance
Cover Available
Courtesy car & Windscreen
Types of Policy Available
Comprehensive , TPFT, Multi car & Blackbox
Discounts
Up to 10% Online, Multi car & No claims
Save up to 10% by quoting online. Plus, many other benefits as standard.
5. LV= Car Insurance
Cover Available
Courtesy car & Windscreen
Types of Policy Available
Comprehensive & TPFT
Discounts
Online, Second car & 79.5% No claims
75% no claim discount with five years claim free. 98% of customers would consider using LV= again (Reevoo). Tailor the cover to suit you with optional extras and try LV= telematics app to save even more on your car insurance.
6. Nationwide Car Insurance
Cover Available
Courtesy car & Windscreen
Types of Policy Available
Comprehensive & TPFT
Discounts
Online, Second car & 75% No claims
Nationwide car insurance, provided by Liverpool Victoria Insurance Company Limited (LV=) and can be tailored around you, to cover exactly what you need. Offering high quality insurance at a competitive price, with UK only based call centres.
7. Churchill Car Insurance
Cover Available
Courtesy car & Windscreen
Types of Policy Available
Comprehensive & TPFT
Discounts
10% Online, 15% Multi car & 80% No claims
Protect your claim free years from uninsured drivers. Terms and conditions apply. 80% off for 8+ years No Claim Discount, an introductory discount to reward safe drivers.
8. John Lewis Insurance Car Insurance
Cover Available
Courtesy car & Windscreen
Types of Policy Available
Comprehensive & TPFT
Discounts
15% Online & 75% No claims
Save 15% when you buy online. For new customers purchasing online. Discount is automatically applied when you get a quote. See T&Cs.
9. Allianz Car Insurance
Cover Available
Courtesy car & Windscreen
Types of Policy Available
Comprehensive & TPFT
Discounts
Second car & No claims
Comprehensive car insurance from £288*, UK call centres & no admin fees. 51% of all customers paid £288 or less from 1/10/14-31/12/14. Source: Allianz Insurance plc. The premium will depend on individual circumstances, cover chosen & payment method.
10. M&S Bank Car Insurance
Cover Available
Courtesy car & Windscreen
Types of Policy Available
Comprehensive & TPFT
Discounts
Second car & No claims
11. Adrian Flux Car Insurance0800 081 4900
Cover Available
Courtesy car & Windscreen
Types of Policy Available
-
Discounts
Second car & No claims
Over 40 Years Specialist Insurance Experience, tailored insurance policies featuring £100,000 of free fully insured legal cover
This is an insurance broker.
12. Swiftcover Car Insurance
Cover Available
Courtesy car & Windscreen
Types of Policy Available
Comprehensive & TPFT
Discounts
Second car & 63% No claims
With Swiftcover Comprehensive Insurance you get as standard: 24 hour claims line and UK based help teams.
13. AA Car Insurance
Cover Available
Courtesy car & Windscreen
Types of Policy Available
Comprehensive
Discounts
No claims
Buy AA Car Insurance by 31 March 2015 and receive a £20 shopping voucher. Receive 12 months' free breakdown cover for non AA members and protected No-Claims for existing AA members. T&Cs apply.
The AA offer car insurance via a panel of insurers.
14. The Co-operative Insurance Car Insurance
Cover Available
Courtesy car & Windscreen
Types of Policy Available
Comprehensive & Blackbox
Discounts
up to 70% No claims
Free £50 worth of Co-operative food vouchers when you buy Co-op Car Insurance between 29th Dec 2014 and 31st March 2015. T&Cs apply. Get a quote today.
15. AXA Car Insurance
Cover Available
Courtesy car & Windscreen
Types of Policy Available
Comprehensive & TPFT
Discounts
Online, Second car & No claims
Little things mean a lot with AXA. One of the world’s largest insurers. Uninsured driver promise with comprehensive cover, gives you extra reassurance on the road. You will need to provide details of the other car. Applies to non-fault claims.
16. Hastings Direct Car Insurance
Cover Available
Courtesy car & Windscreen
Types of Policy Available
Comprehensive , TPFT & Blackbox
Discounts
up to 65% No claims
Hastings Direct competitively priced 5-Star Defaqto rated insurance was voted by the public in 2013 and 2014 as Consumer Moneyfacts Car Insurance Provider of the Year.
18. Quotezone Car Insurance
Cover Available
Courtesy car & Windscreen
Types of Policy Available
Multi car
Discounts
Multi car & No claims
Compare from over 100 Insurance providers
This is a comparison website.
19. Privilege Car Insurance
Cover Available
Courtesy car & Windscreen
Types of Policy Available
Comprehensive & TPFT
Discounts
10% Multi car & 65% No claims
10% multicar discount
20. Endsleigh Car Insurance
Cover Available
Courtesy car & Windscreen
Types of Policy Available
Comprehensive , TPFT & Learner driver
Discounts
up to 77.5% No claims
Reliable cover for young and new drivers from Endsleigh. Plus, you can earn one year's no claims discount in just 6 months with a bonus accelerator policy.
This is an insurance broker.
21. Diamond Car Insurance
Cover Available
Courtesy car & Windscreen
Types of Policy Available
Comprehensive & TPFT
Discounts
Second car & No claims
Car insurance shaped for women. You could get £300 Handbag & Contents cover, 24-hr accident helpline and a Courtesy Car when yours is repaired at an approved garage.
We provide an independent comparison service free of charge but we may receive a commission from some of the companies we refer you to. These are indicated with purple buttons.
Related Products
Vehicle Insurance: Bicycle InsuranceBoat InsuranceBreakdown CoverCar InsuranceCaravan InsuranceExcess InsuranceGap InsuranceMotorbike InsuranceVan InsuranceWarranty Insurance
Property Insurance: Building InsuranceContents InsuranceGadget InsuranceHome InsuranceLandlord InsuranceMobile Phone InsuranceMortgage Protection Insurance
Lifestyle Insurance: Business InsuranceCritical Illness CoverGolf InsuranceHealth InsuranceIncome Protection InsuranceLife InsurancePet InsuranceTravel InsuranceWedding Insurance
How to Get Cheaper Car Insurance
Everything you need to know about making your car insurance premium more affordable.
If you drive, shelling out for car insurance is inevitable (not to mention a legal requirement). While it can represent a significant expense there are some steps you can take to make insuring your car more affordable.
Insurance companies work with risk statistics that calculate how likely you are to make a claim given your personal circumstances.
The more 'risky' you are deemed, the higher your insurance premium - this is why car insurance for new drivers and performance car insurance tends to be more costly.
Thankfully this also works in reverse, so by making yourself appear less of a financial risk, the more likely you are to get the cheapest car insurance. Here's how:
The car you drive...
Car insurance providers classify cars into different groups based on factors such as engine size, top speed, repair costs, likelihood of theft and so on. This bands similar cars together and provides generic levels of insurance sufficient to cover likely claims.
You'll find car insurance groups range between 1 (very low risk) and 20 (very high risk), with cars in lower groups attracting significantly reduced premiums. Judging your car's group accurately is every bit as important as actual car insurance comparison.
An obvious starting point for lowering your car insurance is buy a car classified in a low insurance band - your car dealer or vendor should be able to tell you this before you buy. It's always worth investigating your options as there can be significant differences in grouping even between models in the same range.
Modified cars tend to attract higher premiums as they are seen as more attractive to thieves and more likely to be involved in accidents. For this reason high performance car insurance also tends to be more expensive to insure.
Avoid modifying your car if you want to get cheap car insurance quotes; this is especially the case for young drivers. The more you modify your car the higher your insurance will be, so keep this in mind before modifying your vehicle further.
Insurer approved alarm and immobiliser systems are also likely to attract a discount as they make your car statistically safer. So if you are looking to save in the long run, consider purchasing a car that has one already intact or consider installing one to save on a longer term basis.
How you drive...
Your personal driving history and the motoring history of any other individual included on your policy will affect the price you pay. Any claims, driving offences or convictions are likely to significantly increase the cost of your policy. In short, the safer you are on the roads, the more likely you are to get a cheaper deal on your car insurance.
Factors such as the way you use your car and the number of miles you drive are also likely to affect your car insurance premium.
Low mileage discounts are often available but are only worthwhile if you estimate your annual mileage honestly. You're likely to find cheap car insurers and the cheapest car insurance quotes if you only use your car a couple of days a week, rather than for commuting to work. But be sure to completely truthful with your estimates as if not your policy will be sure to go up after this.
Where you drive...
Where you live and park your car also impact your insurance premium. While moving house just to reduce your car insurance is a little extreme, there are certain things you can do to lessen the impact of your postcode.
If you have a garage you should always use it as it is seen as more secure storage - and is likely to attract a discount.
Additionally, parking on a private driveway or secured car park is seen as more favourable than simply leaving your car parked on the side of the road.
Again, it pays to be honest about where you tend to park your car.
But considering where to park can help to reduce the price you pay by quite an amount so where possible always go for the secure parking option.
Who drives...
Statistically the older you are the less likely you'll need to make a claim; similarly girls are much less likely to claim than boys.
While little can be done about your age or sex, it can pay to avoid insuring younger drivers on your policy if they won't regularly be using the car.
Many parents are tempted to insure their newly qualified children as a named driver on their car. While this can be cheaper in the short term, it doesn't usually pay off in the long term as a younger driver could go for years without starting to build up a no claims discount on their own insurance policy.
Generally, it is better for young people to take out their own car insurance for 1st time drivers as soon as they are regularly driving their own car. Third party, fire and theft can be the very cheapest car insurance to start off with.
Alternatively quoting with a company that offers an accelerated no claims discount scheme (whereby a year's no claims discount is earned in 9 months or so) can make a huge difference over time.
Discounts...
Building and protecting a no claims discount is the best way to make your auto insurance cheaper year on year as this can save up to fifty percent of your premium price - sometimes more!
You always hear the subsequent cost of car insurance rocketing when someone makes a claim. However while the cost of insuring your car is likely to increase after making a claim, the main reason for a huge increase is because you are no longer eligible for the no claims discount.
For this reason protecting your acquired no claims discount is one of the best ways to make sure your insurance premium stays low even after a claim, even if this costs a little extra.
A cheap car insurance company will usually offer reductions to new drivers who have completed their Pass Plus, and some also offer named driver discounts, helping to reduce premiums significantly.
While it's not technically a discount, many insurers charge interest on monthly premium payments as they see the total figure as a loan. If you can afford it you should therefore try and pay for your car insurance in a lump sum annual payment, keeping it interest free.
Some providers offer interest free monthly payments so it can be well worth comparing their overall costs to those of their interest charging counterparts. Most insurance providers offer significant discounts for buying online. So be sure to shop around not only for the best provider but the best way to purchase from the provider.
Your car insurance policy...
When you insure your car you have three main insurance options, 'Third party', 'Third Party, Fire and Theft' and 'Fully Comprehensive'. The latter tends to be most expensive but provides you with complete protection.
Third Party, Fire and Theft can be an economical option for those with little driving experience, a number of previous claims. Third Party tends to only be a viable option for those with a particularly low value vehicle as the cover it provides is minimal although it is the cheapest option by far.
When you compare car insurance and are choosing which option to go for you will need to weigh affordability with the value and condition of your vehicle. This way you will not end up paying more on insurance than your vehicle is actually worth.
Add ons...
Most insurance providers also offer add-ons such as family legal protection or a courtesy car. While these can be useful they are likely to come at an additional cost. Opting out can save you some money if you don't think that you'll use them and this is something to consider when you compare car insurance quotes.
Voluntary excess car insurance
When insuring your car you are also likely to have the option to increase the level of voluntary excess, this is the amount you will have to contribute to repairs or replacement in the event of a claim. Increasing this will attract a subsequent decrease in premium price; however you should always ensure that you will be able to afford the excess if necessary.
Find the right car insurance policy
You also need to make sure that value you insure your car for is representative of the replacement cost of your vehicle. Too low and you'll be under insured if your car is written off and too high and you'll be paying for cover you don't need. Looking at the current resale cost of vehicles similar to yours can give you a good idea and help to make sure that you aren't paying more than necessary.
Finally, if you compare quotes both on price and the level of cover they offer you should be able to find the best car insurance companies and policies that meet your needs - without costing you the earth!
Showing posts with label business. Show all posts
Showing posts with label business. Show all posts
Monday, 27 April 2015
Shopping For Auto Insurance
The Role of Agent, Broker or Company Representative
You can seek the aid of any licensed insurance agent or broker when buying insurance, or you may obtain coverage from an insurance company that deals directly with the public, either through exclusive agents or through its own sales representatives, or through the Internet: 'How to Shop For Auto Insurance' for more information on Shopping For Auto Insurance.
Insurance agents and brokers must pass licensing examinations given by the Department, which require knowledge about insurance rules, policies and practices. The distinction between insurance agents and brokers is that an agent represents one or more insurers for the purpose of writing policies, while a broker represents consumers to assist them in obtaining coverage from one of the companies which that broker has a contractual relationship. Any of these "producers" (as they are known in the insurance trade) can give you information about the kinds of policies available and how to best protect yourself. In addition, your agent or broker usually will be able to assist you in the settlement of any claims.
If you are declined coverage by an insurer for any reason, be sure to ask for a clear explanation. If coverage can be secured, make sure you determine whether it is on a voluntary or residual market basis, understand which auto insurer is providing the policy, and request a detailed breakdown of the policy's different coverages, deductible and premium components. Your agent or broker should provide a written itemization of any quote.
Insurance agents and brokers typically receive a commission from the insurer. Insurance brokers are not permitted to charge you any fee for services without a written memo, signed by the insured/applicant, which specifies or clearly defines the amount of compensation (fee). The memo should also specify the services that are provided.
If the placement is through the Auto Plan, a maximum fee of $50 may be charged in addition to reimbursement for actual expenses for other services provided, such as using certified mail, or electronic policy binding. However, insurance brokers are not permitted to charge you a fee for obtaining a Department of Motor Vehicles driving record printout for a policy through the Auto Plan.
If the placement is in the voluntary market, fees are permissible as long as you agree in writing, as noted above. An agent or broker is not permitted to offer you cash, or anything of value over $15, as an inducement to purchase insurance.
We always encourage consumers to shop around for auto insurance to obtain the best available coverage and service at the most reasonable price. Contact several agents, brokers or insurers when shopping for auto insurance. Sometimes the best way to find a qualified agent, broker or company sales representative is a referral from a satisfied relative, friend or neighbor. But remember that some insurance brokers may not have auto insurance markets outside the Auto Plan. In such cases, it will be in your best interest to approach other agents or brokers. Please note that exclusive or captive agents of an insurer cannot refer you to another insurer if you do not meet the insurer's underwriting guidelines.
Shopping for Auto Insurance | Next Topic | Consumers - Insurance Products
You can seek the aid of any licensed insurance agent or broker when buying insurance, or you may obtain coverage from an insurance company that deals directly with the public, either through exclusive agents or through its own sales representatives, or through the Internet: 'How to Shop For Auto Insurance' for more information on Shopping For Auto Insurance.
Insurance agents and brokers must pass licensing examinations given by the Department, which require knowledge about insurance rules, policies and practices. The distinction between insurance agents and brokers is that an agent represents one or more insurers for the purpose of writing policies, while a broker represents consumers to assist them in obtaining coverage from one of the companies which that broker has a contractual relationship. Any of these "producers" (as they are known in the insurance trade) can give you information about the kinds of policies available and how to best protect yourself. In addition, your agent or broker usually will be able to assist you in the settlement of any claims.
If you are declined coverage by an insurer for any reason, be sure to ask for a clear explanation. If coverage can be secured, make sure you determine whether it is on a voluntary or residual market basis, understand which auto insurer is providing the policy, and request a detailed breakdown of the policy's different coverages, deductible and premium components. Your agent or broker should provide a written itemization of any quote.
Insurance agents and brokers typically receive a commission from the insurer. Insurance brokers are not permitted to charge you any fee for services without a written memo, signed by the insured/applicant, which specifies or clearly defines the amount of compensation (fee). The memo should also specify the services that are provided.
If the placement is through the Auto Plan, a maximum fee of $50 may be charged in addition to reimbursement for actual expenses for other services provided, such as using certified mail, or electronic policy binding. However, insurance brokers are not permitted to charge you a fee for obtaining a Department of Motor Vehicles driving record printout for a policy through the Auto Plan.
If the placement is in the voluntary market, fees are permissible as long as you agree in writing, as noted above. An agent or broker is not permitted to offer you cash, or anything of value over $15, as an inducement to purchase insurance.
We always encourage consumers to shop around for auto insurance to obtain the best available coverage and service at the most reasonable price. Contact several agents, brokers or insurers when shopping for auto insurance. Sometimes the best way to find a qualified agent, broker or company sales representative is a referral from a satisfied relative, friend or neighbor. But remember that some insurance brokers may not have auto insurance markets outside the Auto Plan. In such cases, it will be in your best interest to approach other agents or brokers. Please note that exclusive or captive agents of an insurer cannot refer you to another insurer if you do not meet the insurer's underwriting guidelines.
Shopping for Auto Insurance | Next Topic | Consumers - Insurance Products
Best And Worst Home Insurers
A new ranking of home insurance companies shows that just focusing on what you pay in premiums isn't necessarily the smartest idea.
A March 2014 update of Consumer Reports names the best and worst home insurers in the business. Now, keep in mind that the best does not necessarily mean the one with the most affordable premium.
Which home insurers are highly ranked?
In the top spot, you have Amica Insurance followed very closely by USAA Property & Casualty, two of my longtime favorites. Just a hair behind them are Auto-Owners Insurance and Erie Insurance Group, two companies that have never much been on my radar.
Amica and USAA Mutual may not have the best premiums. But remember my rule, homeowners insurance is only for use in a catastrophic situation.
To lower the cost of going with a top-rated insurer, I recommend you take as high of a deductible as you can swallow and your mortgage holder will allow you to have. Do not go with the $500 deductible of yesteryear.
On the flipside of the rankings, the lowest rated insurers in the country are Allstate Insurance and Farmers Insurance, in a tie. Just a hair above them were American Family, California State Auto Group, Liberty Mutual, and Travelers.
Firmly in the middle of the pack you have State Farm, Hartford Financial Services, Metlife Auto & Home, and Nationwide Mutual Insurance Company.
Meanwhile, here's some info on the best and worst auto insurers.
What things won't your homeowners policy cover?
Yahoo! Finance recently had a list of weird exclusions some insurers are now doing. Some make sense – like dog attacks. But other things are unexpected, like trampolines not being covered.
Other exclusions include expensive jewelry (you will need additional rider if you have a large amount of jewelry). On the question of mold, that’s no longer covered by many homeowner insurance policies. Mold became a big issue, particularly in Florida, and it's been cut out of the picture step by step, insurer by insurer.
Sewer backup is often not included in homeowner insurance policies. I always recommend that you buy the inexpensive rider from your insurer and add it to your policy. If it does happen to you, you want to know you are in fact covered.
Fire is still covered. But that's why people sometimes refer to homeowners policies as "fire policies."
Best insurance companies
: 2014 customer satisfaction rankings
By Amy Danise, Insure.com - Last updated: Mar. 28, 2014
USAA, State Farm and Farmers earned the highest scores from both auto and home insurance customers in Insure.com’s annual customer satisfaction study. It is USAA’s third year as the highest-rated auto and home insurer in the survey.
State Farm and Farmers also garnered strong scores in all auto insurance measurements but were outpaced by USAA in renewal and recommendation ratings.
USAA core values
Eric Vaith, assistant vice president at USAA, credits the company’s core values for its top rankings. “All employees live by our core values of service, honesty and integrity. These core values are also key influencers for every interaction our employees have with our members,” he says.
Vaith notes that USAA keeps its finger on the pulse of customer satisfaction at many points of contact. “We focus heavily on member satisfaction scores, where members rate the experience they had with our member service representatives and claims representatives,” he says. “At the end of a phone call, our members are able to provide voice response feedback on their experience with USAA.
Also, “throughout the life of a claim, our members are proactively ‘pinged’ via email to ensure they are receiving the level of service that they expect,” says Vaith.
Making decisions
We also asked customers their reasons for deciding to buy from their insurers. Flo is paying off: Progressive has the highest number of customers who made their decision based on seeing a TV commercial (18 percent), followed closely by Allstate (17 percent) and Geico (16 percent). USAA had the lowest percentage of customers (4 percent) who chose the company based on a commercial.
In the home insurance category, USAA was slightly dinged in price satisfaction but made up the difference with strong scores for customer service and recommendations. AIG and The Hartford, while not in the top three, had the highest percentage of customers who say they will renew, at 96 percent each.
Life & health insurance scores
Life insurance: Jackson National, Prudential, New York Life and State Farm Life topped the rankings. The high number of customers who would recommend Jackson Life helped propel it to the top.
Health insurance: Kaiser Permanente, Humana and BCBS of Florida are the favorites this year. Kaiser Permanente also held the No. 1 ranking last year.
Methodology
Insure.com conducted surveys of 3,835 insurance customers nationwide in February and March 2014 to collect 9,586 company reviews. Only current customers of the insurers on our lists were surveyed. The survey was not open to the general public on the Insure.com website. We collected reviews for auto, home, health and life insurance carriers. Consumers answered questions about their levels of satisfaction with their insurers, and each answer was assigned a point value. Points were then averaged and totaled for each company.
A.M. Best ratings do not affect the scores but are provided as a supplementary resource. The “discounts” and “coverage options” information for auto insurance carriers also does not affect the scores.
We collected data for 15 large companies in each category, so not all companies are represented in the study. The companies for which we collected data were then ranked. The top three companies in each category earned Insure.com's "People's Choice Award." In the life insurance category, a tie for third place resulted in four insurers receiving the award.
Insure.com makes these ratings freely available via this site. The views and opinions expressed by users do not reflect the views and opinions of Insure.com. Insure.com expressly disclaims any and all liability in connection with the ratings.
By Amy Danise, Insure.com - Last updated: Mar. 28, 2014
USAA, State Farm and Farmers earned the highest scores from both auto and home insurance customers in Insure.com’s annual customer satisfaction study. It is USAA’s third year as the highest-rated auto and home insurer in the survey.
State Farm and Farmers also garnered strong scores in all auto insurance measurements but were outpaced by USAA in renewal and recommendation ratings.
USAA core values
Eric Vaith, assistant vice president at USAA, credits the company’s core values for its top rankings. “All employees live by our core values of service, honesty and integrity. These core values are also key influencers for every interaction our employees have with our members,” he says.
Vaith notes that USAA keeps its finger on the pulse of customer satisfaction at many points of contact. “We focus heavily on member satisfaction scores, where members rate the experience they had with our member service representatives and claims representatives,” he says. “At the end of a phone call, our members are able to provide voice response feedback on their experience with USAA.
Also, “throughout the life of a claim, our members are proactively ‘pinged’ via email to ensure they are receiving the level of service that they expect,” says Vaith.
Making decisions
We also asked customers their reasons for deciding to buy from their insurers. Flo is paying off: Progressive has the highest number of customers who made their decision based on seeing a TV commercial (18 percent), followed closely by Allstate (17 percent) and Geico (16 percent). USAA had the lowest percentage of customers (4 percent) who chose the company based on a commercial.
In the home insurance category, USAA was slightly dinged in price satisfaction but made up the difference with strong scores for customer service and recommendations. AIG and The Hartford, while not in the top three, had the highest percentage of customers who say they will renew, at 96 percent each.
Life & health insurance scores
Life insurance: Jackson National, Prudential, New York Life and State Farm Life topped the rankings. The high number of customers who would recommend Jackson Life helped propel it to the top.
Health insurance: Kaiser Permanente, Humana and BCBS of Florida are the favorites this year. Kaiser Permanente also held the No. 1 ranking last year.
Methodology
Insure.com conducted surveys of 3,835 insurance customers nationwide in February and March 2014 to collect 9,586 company reviews. Only current customers of the insurers on our lists were surveyed. The survey was not open to the general public on the Insure.com website. We collected reviews for auto, home, health and life insurance carriers. Consumers answered questions about their levels of satisfaction with their insurers, and each answer was assigned a point value. Points were then averaged and totaled for each company.
A.M. Best ratings do not affect the scores but are provided as a supplementary resource. The “discounts” and “coverage options” information for auto insurance carriers also does not affect the scores.
We collected data for 15 large companies in each category, so not all companies are represented in the study. The companies for which we collected data were then ranked. The top three companies in each category earned Insure.com's "People's Choice Award." In the life insurance category, a tie for third place resulted in four insurers receiving the award.
Insure.com makes these ratings freely available via this site. The views and opinions expressed by users do not reflect the views and opinions of Insure.com. Insure.com expressly disclaims any and all liability in connection with the ratings.
Improve Your Credit Score
For Better Mortgage RatesTurning a Bad Credit Score Good to Get a Low APR Home Loan
A consumer’s credit score directly influences their opportunities to be approved for loans or establish revolving credit accounts. It is also important to consider that credit scores have a profound impact on interest rates in terms of what a bank or lender might offer a consumer. They are a foundational aspect of how credit works. A consumer having a low credit score could be denied credit or be considered high risk, meaning if you are approved for credit, you will experience considerably higher interest rates than a person having an outstanding credit score. During the term of any loan, the amounting fees from interest can cost many thousands of dollars.
A person who currently has a good or outstanding credit score must do their best to properly maintain their score. It is also very important for a consumer having a poor or fair credit score resulting from past misuse of credit to attempt to rectify the poor credit score as soon as possible. There are many processes in which a person can rebuild their credit score, potentially enabling them to get better interest rates on revolving credit and loans.
Verify There Are No Outstanding Errors
Many people have issues on their credit report which they are unaware of. Identity theft is a common problem in the United States & consumer debts are frequently sold into a shady industry. The first step in determining if you have any outstanding issues is to get a copy of your credit report. AnnualCreditReport.com allows you to see your credit reports from Experian, Equifax & TransUnion for free. While many other sites sell credit reports and scores, a good number of them use negative billing options and opt you into monthly charges which can be hard to remove. If you find errors in your credit report, you can dispute them using this free guide from the FTC.
Visit AnnualCreditReport.com for your report & Credit Karma for your score.
Paying Bills On Time
Most certainly, it seems common sense for a consumer to pay their debts in a timely manner, but it is often overlooked. Undoubtedly, late payments are commonly the source of serious drops in reported credit scores. Late payments are the most frequently occurring negative information on credit reports. Merely making the minimum payment before the due date every month without exception will help to rebuild and maintain the consumer’s credit score.
Without a doubt, any kind of a late payment can be incredibly detrimental to one’s credit score. Simply skipping or accidentally missing a mortgage payment can extensively damage a consumers credit score, taking up to seven years for the impact of the late payment to lessen.
Even more damaging to a consumer’s credit score than late payments, would be having an account that is in arrears be sent to a collections agency. If an account has been sent to a collections agency, the creditor has gone without receiving minimum monthly payments many consecutive months. After an account has been sent to a collection agency, damage to the consumer’s credit report is unavoidable, regardless of whether the account ever gets rectified. Often, once an account is sent to a collections account, even if the balance is paid, the negative mark stays on the consumer’s account for at least seven years.
Avoid Excessive Inquiries To The Credit Report
Another thing to keep in mind is inquiries will be made on a consumer’s credit report any time the consumer makes an application for revolving credit or any type of loan. When these inquiries are made, they are typically through TransUnion, Equifax or Experian credit reporting agencies. Once an inquiry has been recorded to a credit report, it typically stays on the report for no less than two calendar years. Most often, those inquiries being a year old or less, affect the credit score slightly in a negative way. Too many inquiries over a very limited time span can significantly impact one’s credit score.
In the event of seeking out the best car loans or mortgages, it is inevitable to have multiple inquiries on one’s credit report. However, in this case, multiple inquiries, as long as they are for the same reason and within a timeframe of 40 to 45 days will not adversely affect a consumer’s credit rating. Typically, several inquiries of this type in this situation are only counted as one single inquiry. It is essential, if one is to maintain a good cre
Keep Credit Card Balances Low
Strange as it may seem, just the fact that a consumer has credit cards affects their credit score. Also, it is important to consider how the payment history on those cards can affect one’s credit score. Not to be left out, the balances on these credit cards are also calculated into one’s score. When the available credit on a card drops below 65%, the consumer’s credit score could be damaged as this reflects a high balance to credit limit ratio. Regardless of payments are made on time or if more than the minimum payment has be paid, having a high balance to credit limit ratio adversely affects one’s score. Essentially, a credit card with a high limit of $2000 should not carry an average daily balance exceeding $700. By keeping the used credit limit below 35%, debt to income ratios stay within a good range. It is also imperative to make each payment on time, and it is always a good idea to pay more than the required minimum payment.
Another good rule of thumb is to actively pay down high balances while using credit cards in a responsible and proper manner. Taking one’s life situations in to account, it may be a good idea to disperse your credit card balances over several cards, keeping the available credit at 65% or above on each card, rather than pushing one card’s balance to the credit limit. If the consumer opts to do this, it is essential that payments be made in a timely manner, and all accounts remain listed as having a positive status. Doing this will not only maintain one’s credit score, it could also potentially improve it.
The idea of spreading credit card balances over many different cards could potentially help a consumer’s credit score. It is important to consider, however, that the interest being paid toward the balances be accounted for. It may be beneficial to the consumer to consolidate current balances to one card with a low interest rate, rather than split up the total amount owed over many cards having higher interest rates. It is essential to take these interest rates into consideration if one is to make the best decisions toward improving credit history and credit scores.
Keep Unused Accounts Open
Another point of consideration in determining a consumers credit score is how long the revolving account has been open. A positive credit score is a reflection of a good, positive standing with every creditor the consumer deals with, regardless of the account activity. Simply put, the longer a positive credit history is maintained, the greater the positive influence on the score.
In essence, it is a good idea to keep old accounts that are no longer in use open. If a consumer has credit that is not currenty in use, rather than terminating the account these cards should be put away and the consumer should refrain from using them. Having several open accounts but only using a few can be a positive factor in raising a credit score, but too many cards overall can have an adverse affect.
A consumer’s credit score directly influences their opportunities to be approved for loans or establish revolving credit accounts. It is also important to consider that credit scores have a profound impact on interest rates in terms of what a bank or lender might offer a consumer. They are a foundational aspect of how credit works. A consumer having a low credit score could be denied credit or be considered high risk, meaning if you are approved for credit, you will experience considerably higher interest rates than a person having an outstanding credit score. During the term of any loan, the amounting fees from interest can cost many thousands of dollars.
A person who currently has a good or outstanding credit score must do their best to properly maintain their score. It is also very important for a consumer having a poor or fair credit score resulting from past misuse of credit to attempt to rectify the poor credit score as soon as possible. There are many processes in which a person can rebuild their credit score, potentially enabling them to get better interest rates on revolving credit and loans.
Verify There Are No Outstanding Errors
Many people have issues on their credit report which they are unaware of. Identity theft is a common problem in the United States & consumer debts are frequently sold into a shady industry. The first step in determining if you have any outstanding issues is to get a copy of your credit report. AnnualCreditReport.com allows you to see your credit reports from Experian, Equifax & TransUnion for free. While many other sites sell credit reports and scores, a good number of them use negative billing options and opt you into monthly charges which can be hard to remove. If you find errors in your credit report, you can dispute them using this free guide from the FTC.
Visit AnnualCreditReport.com for your report & Credit Karma for your score.
Paying Bills On Time
Most certainly, it seems common sense for a consumer to pay their debts in a timely manner, but it is often overlooked. Undoubtedly, late payments are commonly the source of serious drops in reported credit scores. Late payments are the most frequently occurring negative information on credit reports. Merely making the minimum payment before the due date every month without exception will help to rebuild and maintain the consumer’s credit score.
Without a doubt, any kind of a late payment can be incredibly detrimental to one’s credit score. Simply skipping or accidentally missing a mortgage payment can extensively damage a consumers credit score, taking up to seven years for the impact of the late payment to lessen.
Even more damaging to a consumer’s credit score than late payments, would be having an account that is in arrears be sent to a collections agency. If an account has been sent to a collections agency, the creditor has gone without receiving minimum monthly payments many consecutive months. After an account has been sent to a collection agency, damage to the consumer’s credit report is unavoidable, regardless of whether the account ever gets rectified. Often, once an account is sent to a collections account, even if the balance is paid, the negative mark stays on the consumer’s account for at least seven years.
Avoid Excessive Inquiries To The Credit Report
Another thing to keep in mind is inquiries will be made on a consumer’s credit report any time the consumer makes an application for revolving credit or any type of loan. When these inquiries are made, they are typically through TransUnion, Equifax or Experian credit reporting agencies. Once an inquiry has been recorded to a credit report, it typically stays on the report for no less than two calendar years. Most often, those inquiries being a year old or less, affect the credit score slightly in a negative way. Too many inquiries over a very limited time span can significantly impact one’s credit score.
In the event of seeking out the best car loans or mortgages, it is inevitable to have multiple inquiries on one’s credit report. However, in this case, multiple inquiries, as long as they are for the same reason and within a timeframe of 40 to 45 days will not adversely affect a consumer’s credit rating. Typically, several inquiries of this type in this situation are only counted as one single inquiry. It is essential, if one is to maintain a good cre
Keep Credit Card Balances Low
Strange as it may seem, just the fact that a consumer has credit cards affects their credit score. Also, it is important to consider how the payment history on those cards can affect one’s credit score. Not to be left out, the balances on these credit cards are also calculated into one’s score. When the available credit on a card drops below 65%, the consumer’s credit score could be damaged as this reflects a high balance to credit limit ratio. Regardless of payments are made on time or if more than the minimum payment has be paid, having a high balance to credit limit ratio adversely affects one’s score. Essentially, a credit card with a high limit of $2000 should not carry an average daily balance exceeding $700. By keeping the used credit limit below 35%, debt to income ratios stay within a good range. It is also imperative to make each payment on time, and it is always a good idea to pay more than the required minimum payment.
Another good rule of thumb is to actively pay down high balances while using credit cards in a responsible and proper manner. Taking one’s life situations in to account, it may be a good idea to disperse your credit card balances over several cards, keeping the available credit at 65% or above on each card, rather than pushing one card’s balance to the credit limit. If the consumer opts to do this, it is essential that payments be made in a timely manner, and all accounts remain listed as having a positive status. Doing this will not only maintain one’s credit score, it could also potentially improve it.
The idea of spreading credit card balances over many different cards could potentially help a consumer’s credit score. It is important to consider, however, that the interest being paid toward the balances be accounted for. It may be beneficial to the consumer to consolidate current balances to one card with a low interest rate, rather than split up the total amount owed over many cards having higher interest rates. It is essential to take these interest rates into consideration if one is to make the best decisions toward improving credit history and credit scores.
Keep Unused Accounts Open
Another point of consideration in determining a consumers credit score is how long the revolving account has been open. A positive credit score is a reflection of a good, positive standing with every creditor the consumer deals with, regardless of the account activity. Simply put, the longer a positive credit history is maintained, the greater the positive influence on the score.
In essence, it is a good idea to keep old accounts that are no longer in use open. If a consumer has credit that is not currenty in use, rather than terminating the account these cards should be put away and the consumer should refrain from using them. Having several open accounts but only using a few can be a positive factor in raising a credit score, but too many cards overall can have an adverse affect.
Bad Credit Mortgages
Obtaining Real Estate Financing With a Low Credit Score
The bad credit mortgage is often called a sub-prime mortgage and is offered to homebuyers with low credit ratings. Due to the low credit rating, conventional mortgages are not offered because the lender sees this as the homebuyer having a larger-than-average risk of not following through with the terms of the loan. Lenders often charger higher interest rates on sub-prime mortgages in order to compensate for the higher loan default risk that they are taking.
The following table displays current conforming rates for people with prime credit scores. If you have a poor credit score you can expect to pay a significantly higher rate of interest on your loan & the loan is more likely to be structured as an adjustable-rate rather than a fixed-rate. The table also offers a credit score filter which allows you to find offers matching your credit range.
Ways Subprime Mortgages Differ
Subprime have interest rates that are higher than prime loans. Lenders must consider many factors in a particular process that is called “risk-based pricing,” which is when they determine the terms and rates of the mortgage. Sub-prime rates will be higher, but it is the credit score that determines how high. There are also other determining factors like what kinds of delinquencies are recorded on the borrower’s credit report and the amount of the down payment. An example is the fact that the lender views late rent or mortgage payments as being worse than having credit card payments that are late.
Sub-prime loans are very likely to have a balloon payment penalty, pre-payment penalty, or penalties for both. A pre-payment penalty is a charge or fee that is placed against the homebuyer for paying off the loan before the end of the term. This early payoff can be because the borrower sells the home or they refinance it. A mortgage that has a balloon payment means that the borrower will have to pay off the entire balance in one lump sum after a specified period has gone by. This period is usually five years. If the borrower is unable to pay the whole balloon payment, they must refinance, sell, or lose the house.
A Closer Look At Credit Scores
Credit scoring is the method in which credit risk is assessed. It uses mathematics to determine a person’s credit worthiness based on their current credit accounts and their credit history. The system was created in the 1950s, but did not see widespread use until the last couple of decades.
Credit scores are numbers reported that range from 300-900. The higher the number is, the better the score. Creditors see this number as an indication of whether or not an individual will repay money that is loaned to them. The scores are determined by looking at the following data:
Late payments
Non payments
Current amount of debt
Types of credit accounts
Credit history length
Inquiries on the credit report
History of applying for credit
Bad credit behavior, which can be something such as writing bad checks
The score that creditors like to see is above 650, which is a very good credit score. Those who have credit scores of 650 and above will have a good chance of acquiring quality loans with excellent interest rates.
Scores between 620 and 650 indicate that a person has good credit, but does indicate there might be potential trouble that the creditors may want to review. A creditor may require the applicant to submit additional documentation before a loan will ever be approved.
When scores are below 620, the consumer may find that they can still acquire a loan, but the process will take longer and involve many more hurdles. Below this number indicates a greater credit risk, so more aspects have to be reviewed.
Verify There Are No Outstanding Errors
Many people have issues on their credit report which they are unaware of. Identity theft is a common problem in the United States & consumer debts are frequently sold into a shady industry. The first step in determining if you have any outstanding issues is to get a copy of your credit report. AnnualCreditReport.com allows you to see your credit reports from Experian, Equifax & TransUnion for free. While many other sites sell credit reports and scores, a good number of them use negative billing options and opt you into monthly charges which can be hard to remove. If you find errors in your credit report, you can dispute them using this free guide from the FTC.
Visit AnnualCreditReport.com for your report & Credit Karma for your score.
Candidates For Bad Credit Mortgages
Some people with poor credit profiles or a small down payment may have trouble borrowing from conventional lenders. One alternative to consider is obtaining a Federal Housing Administration loan. These loans have liberal underwriting requirements which allow people to purchase a home with a poor credit score and as little as a 3% down-payment. Some FHA borrowers have credit scores below 620.
Another common loan type among subprime borrowers is the 2/28 ARM, which offers a 2-year teaser rate and then adjusts yearly beyond that. Many of these loans have a sharp increase in rates at the 2-year point, with the home buyer planning on refinancing at that point. However if the homeowner still has outstanding credit issues or the mortgage market tightens up then they might not be able to refinance. The higher rate can cause a prohibitively higher monthly payment, & an inability to refinance can mean a loss of home ownership.
The below items are the general guidelines that can be used as a rough rule of thumb when determining whether a consumer may be a candidate for a bad credit loan:
A credit score below 620
Two or more delinquencies of 30 days on a mortgage in the past 12 months
One delinquency of 60 days on a mortgage in the past 12 months
A charge-off or foreclosure within the past 24 months
Bankruptcy within the past 24 months
Debt to income ratio is over 50%
Inability to cover family living expenses in the course of a month
However, overall creditworthiness is not determined exclusively by credit scores. A couple of missing credit card payments does not mean that a consumer is doomed to receive double-digit interest rates. The only way to know where one stands is to apply for the loan and speak to a professional specializing in mortgage loans.
Ways To Improve Your Credit Score
The following are simple ways to improve credit scores
The number one method is to pay bills on time. Delinquent bill payments can have a tremendous negative impact on credit and the longer a person pays bills on time, the better the credit score. For example: A person with a credit rating of 707 can raise their score another 20 points by paying all bills on time for a single month. Paying items such as mortgage and rent are especially important. Mortgage lenders like to look at payment trends on mortgage and rent payments.
Balances need to be low on credit cards. High credit card debt can hurt the credit score and lower the credit score as much as 70 points.
It is important to not open credit cards that are not needed. New accounts can lower the account age, which can lower the credit score by 10 points.
It is good to have credit cards, but it is very important to manage them well. Having credit cards and installment loans raise credit scores, especially if payments are consistently made on time. Someone who doesn’t have credit cards tend to be at higher risk than someone who hasn’t managed their cards well.
Accounts still stick around when they are closed. The account will still show up on the credit report and be factored into the score.
The bad credit mortgage is often called a sub-prime mortgage and is offered to homebuyers with low credit ratings. Due to the low credit rating, conventional mortgages are not offered because the lender sees this as the homebuyer having a larger-than-average risk of not following through with the terms of the loan. Lenders often charger higher interest rates on sub-prime mortgages in order to compensate for the higher loan default risk that they are taking.
The following table displays current conforming rates for people with prime credit scores. If you have a poor credit score you can expect to pay a significantly higher rate of interest on your loan & the loan is more likely to be structured as an adjustable-rate rather than a fixed-rate. The table also offers a credit score filter which allows you to find offers matching your credit range.
Ways Subprime Mortgages Differ
Subprime have interest rates that are higher than prime loans. Lenders must consider many factors in a particular process that is called “risk-based pricing,” which is when they determine the terms and rates of the mortgage. Sub-prime rates will be higher, but it is the credit score that determines how high. There are also other determining factors like what kinds of delinquencies are recorded on the borrower’s credit report and the amount of the down payment. An example is the fact that the lender views late rent or mortgage payments as being worse than having credit card payments that are late.
Sub-prime loans are very likely to have a balloon payment penalty, pre-payment penalty, or penalties for both. A pre-payment penalty is a charge or fee that is placed against the homebuyer for paying off the loan before the end of the term. This early payoff can be because the borrower sells the home or they refinance it. A mortgage that has a balloon payment means that the borrower will have to pay off the entire balance in one lump sum after a specified period has gone by. This period is usually five years. If the borrower is unable to pay the whole balloon payment, they must refinance, sell, or lose the house.
A Closer Look At Credit Scores
Credit scoring is the method in which credit risk is assessed. It uses mathematics to determine a person’s credit worthiness based on their current credit accounts and their credit history. The system was created in the 1950s, but did not see widespread use until the last couple of decades.
Credit scores are numbers reported that range from 300-900. The higher the number is, the better the score. Creditors see this number as an indication of whether or not an individual will repay money that is loaned to them. The scores are determined by looking at the following data:
Late payments
Non payments
Current amount of debt
Types of credit accounts
Credit history length
Inquiries on the credit report
History of applying for credit
Bad credit behavior, which can be something such as writing bad checks
The score that creditors like to see is above 650, which is a very good credit score. Those who have credit scores of 650 and above will have a good chance of acquiring quality loans with excellent interest rates.
Scores between 620 and 650 indicate that a person has good credit, but does indicate there might be potential trouble that the creditors may want to review. A creditor may require the applicant to submit additional documentation before a loan will ever be approved.
When scores are below 620, the consumer may find that they can still acquire a loan, but the process will take longer and involve many more hurdles. Below this number indicates a greater credit risk, so more aspects have to be reviewed.
Verify There Are No Outstanding Errors
Many people have issues on their credit report which they are unaware of. Identity theft is a common problem in the United States & consumer debts are frequently sold into a shady industry. The first step in determining if you have any outstanding issues is to get a copy of your credit report. AnnualCreditReport.com allows you to see your credit reports from Experian, Equifax & TransUnion for free. While many other sites sell credit reports and scores, a good number of them use negative billing options and opt you into monthly charges which can be hard to remove. If you find errors in your credit report, you can dispute them using this free guide from the FTC.
Visit AnnualCreditReport.com for your report & Credit Karma for your score.
Candidates For Bad Credit Mortgages
Some people with poor credit profiles or a small down payment may have trouble borrowing from conventional lenders. One alternative to consider is obtaining a Federal Housing Administration loan. These loans have liberal underwriting requirements which allow people to purchase a home with a poor credit score and as little as a 3% down-payment. Some FHA borrowers have credit scores below 620.
Another common loan type among subprime borrowers is the 2/28 ARM, which offers a 2-year teaser rate and then adjusts yearly beyond that. Many of these loans have a sharp increase in rates at the 2-year point, with the home buyer planning on refinancing at that point. However if the homeowner still has outstanding credit issues or the mortgage market tightens up then they might not be able to refinance. The higher rate can cause a prohibitively higher monthly payment, & an inability to refinance can mean a loss of home ownership.
The below items are the general guidelines that can be used as a rough rule of thumb when determining whether a consumer may be a candidate for a bad credit loan:
A credit score below 620
Two or more delinquencies of 30 days on a mortgage in the past 12 months
One delinquency of 60 days on a mortgage in the past 12 months
A charge-off or foreclosure within the past 24 months
Bankruptcy within the past 24 months
Debt to income ratio is over 50%
Inability to cover family living expenses in the course of a month
However, overall creditworthiness is not determined exclusively by credit scores. A couple of missing credit card payments does not mean that a consumer is doomed to receive double-digit interest rates. The only way to know where one stands is to apply for the loan and speak to a professional specializing in mortgage loans.
Ways To Improve Your Credit Score
The following are simple ways to improve credit scores
The number one method is to pay bills on time. Delinquent bill payments can have a tremendous negative impact on credit and the longer a person pays bills on time, the better the credit score. For example: A person with a credit rating of 707 can raise their score another 20 points by paying all bills on time for a single month. Paying items such as mortgage and rent are especially important. Mortgage lenders like to look at payment trends on mortgage and rent payments.
Balances need to be low on credit cards. High credit card debt can hurt the credit score and lower the credit score as much as 70 points.
It is important to not open credit cards that are not needed. New accounts can lower the account age, which can lower the credit score by 10 points.
It is good to have credit cards, but it is very important to manage them well. Having credit cards and installment loans raise credit scores, especially if payments are consistently made on time. Someone who doesn’t have credit cards tend to be at higher risk than someone who hasn’t managed their cards well.
Accounts still stick around when they are closed. The account will still show up on the credit report and be factored into the score.
What Is A Mortgage? What You Need to Know Before Buying a Home
A loan that is secured by property or real estate is called a mortgage. In exchange for funds received by the homebuyer to buy property or a home, a lender gets the promise of that buyer to pay back the funds within a certain time frame for a certain cost. The mortgage is legally binding and secures the note in giving the lender the right to have legal claim against the borrower’s home if the borrower defaults on the terms of the note. Basically, the borrower has possession of the property or the home, but the lender is the one who owns it until it is completely paid off.
Repaying A Mortgage: What Is Included?
The mortgage is usually to be paid back in the form of monthly payments that consist of interest and a principle. The principal is repayment of the original amount borrowed, which reduces the balance. The interest, on the other hand, is the cost of borrowing the principal amount for the past month.
A monthly mortgage payment includes taxes, insurance, interest, and the principal. Taxes are remitted to local governments as a percentage of the value of the property. These tax amounts can vary based on where the borrower lives and are usually reassessed on an annual basis. The insurance payments go toward mortgage and hazard insurance. The property mortgage insurance (PMI) protects the lender from loss incurred if a borrower defaults, whereas hazard insurance protects both the borrower and the lender from property losses. The funds may be held in escrow or the lender may collect the taxes and the insurance. PMI typically is not required if you put 20% or more down on your home. As long as you are not behind on payments, PMI payments are automatically terminated when either you are at the midway point of your loan in time, or when the loan-to-value (LTV) reaches 78%. You can request cancelation when you LTV reaches 80%.
Applying For A Mortgage: The Steps Involved
The process of applying for a mortgage loan can be a stressful. The first thing a borrower should do before going to their bank is acquire a copy of their credit report and check it for errors. If there is any incorrect information, it needs to be disputed as outstanding issues can cause a mortgage application to be rejected or lead lenders to charge a higher rate of interest.
Visit AnnualCreditReport.com for your report & Credit Karma for your score.
The borrower should know what type of home is desired, how much they qualify for and what their budget affords. Those constraints can determine the mortgage type and term.
The lender receives an appraisal of the property and this appraisal determines the market value of the home, which is used for collateral in the loan. The borrower is charged a fee for the appraisal service and is usually included in the closing costs.
When the mortgage application is complete, the borrower will be asked for a considerable amount of information. That is why the borrower should be prepared to give the lender the following information:
Bank information such as the name, address, account numbers, and three months of statements.
Three months of investment statements.
W-2s, pay stubs, proof of employment and two years worth of income.
Tax returns and balance sheets for the self-employed.
Debt currently owed, including amounts due and account numbers.
Divorce papers, if they apply.
Once the application is completed, the lender will review the application and decide whether to deny or approve it. If approved, the last step in the process is the meeting in which documentation is completed and the deal is closed. If denied, the prospective borrower should talk to the lender in order to devise a plan and find out why the application was denied. By law, the prospective borrower should receive a disclosure statement from the lender in writing that states why the application was turned down.
Employment History And Your Sources Of Income
The ability to pay is one of the primary decisions in considering a loan application for approval. All information regarding income and employment history must be submitted. This information includes:
Employer’s name, address, borrower’s job title, time on the job, bonuses, average overtime, salary, and students may be required to provide transcripts.
Two years of W-2 forms and most recent paycheck stubs.
For the self-employed, financial statements for two years and all tax forms must be provided, including a profit and loss statement for the current year.
If there are gaps in employment history, there must be a written explanation.
A VOE or Verification of Employment form may be sent to the current employer.
The Closing
The last step in the process of applying for a mortgage is the closing process. All parties sign the necessary papers and officially seal the deal. Ownership of property is transferred to the buyer, so the closing date makes for a great opportunity to make any necessary changes at the last minute. These procedures vary from state-to-state, but in most states the following people are present at the closing:
A closing agent that may work for the lender.
The Borrower’s and the Lender’s attorneys
Title company representative
Seller of the home
Real estate agent for the seller
The borrower (known as the mortgagor)
The lender (known as the mortgagee)
The borrower is required to sign a number of documents when closing. Below is a description of those documents:
The one selling the home must bring the deed with them to the closing. It must be signed and notarized so that the lender can have the deed filed at the county’s Deed Registrar since it is public record.
The HUD-1 Settlement statement itemizes the services by the lender that is related to the loan and charges both the seller and the buyer. This is required by federal law.
The mortgage note must be signed because it is the buyer’s promise to pay according to the terms. These items include payment due dates, amounts, and where the payments should be remitted to.
The statement that gives the actual rate of interest, APR, fees, and other costs is the Truth-In-Lending Statement.
Repaying A Mortgage: What Is Included?
The mortgage is usually to be paid back in the form of monthly payments that consist of interest and a principle. The principal is repayment of the original amount borrowed, which reduces the balance. The interest, on the other hand, is the cost of borrowing the principal amount for the past month.
A monthly mortgage payment includes taxes, insurance, interest, and the principal. Taxes are remitted to local governments as a percentage of the value of the property. These tax amounts can vary based on where the borrower lives and are usually reassessed on an annual basis. The insurance payments go toward mortgage and hazard insurance. The property mortgage insurance (PMI) protects the lender from loss incurred if a borrower defaults, whereas hazard insurance protects both the borrower and the lender from property losses. The funds may be held in escrow or the lender may collect the taxes and the insurance. PMI typically is not required if you put 20% or more down on your home. As long as you are not behind on payments, PMI payments are automatically terminated when either you are at the midway point of your loan in time, or when the loan-to-value (LTV) reaches 78%. You can request cancelation when you LTV reaches 80%.
Applying For A Mortgage: The Steps Involved
The process of applying for a mortgage loan can be a stressful. The first thing a borrower should do before going to their bank is acquire a copy of their credit report and check it for errors. If there is any incorrect information, it needs to be disputed as outstanding issues can cause a mortgage application to be rejected or lead lenders to charge a higher rate of interest.
Visit AnnualCreditReport.com for your report & Credit Karma for your score.
The borrower should know what type of home is desired, how much they qualify for and what their budget affords. Those constraints can determine the mortgage type and term.
The lender receives an appraisal of the property and this appraisal determines the market value of the home, which is used for collateral in the loan. The borrower is charged a fee for the appraisal service and is usually included in the closing costs.
When the mortgage application is complete, the borrower will be asked for a considerable amount of information. That is why the borrower should be prepared to give the lender the following information:
Bank information such as the name, address, account numbers, and three months of statements.
Three months of investment statements.
W-2s, pay stubs, proof of employment and two years worth of income.
Tax returns and balance sheets for the self-employed.
Debt currently owed, including amounts due and account numbers.
Divorce papers, if they apply.
Once the application is completed, the lender will review the application and decide whether to deny or approve it. If approved, the last step in the process is the meeting in which documentation is completed and the deal is closed. If denied, the prospective borrower should talk to the lender in order to devise a plan and find out why the application was denied. By law, the prospective borrower should receive a disclosure statement from the lender in writing that states why the application was turned down.
Employment History And Your Sources Of Income
The ability to pay is one of the primary decisions in considering a loan application for approval. All information regarding income and employment history must be submitted. This information includes:
Employer’s name, address, borrower’s job title, time on the job, bonuses, average overtime, salary, and students may be required to provide transcripts.
Two years of W-2 forms and most recent paycheck stubs.
For the self-employed, financial statements for two years and all tax forms must be provided, including a profit and loss statement for the current year.
If there are gaps in employment history, there must be a written explanation.
A VOE or Verification of Employment form may be sent to the current employer.
The Closing
The last step in the process of applying for a mortgage is the closing process. All parties sign the necessary papers and officially seal the deal. Ownership of property is transferred to the buyer, so the closing date makes for a great opportunity to make any necessary changes at the last minute. These procedures vary from state-to-state, but in most states the following people are present at the closing:
A closing agent that may work for the lender.
The Borrower’s and the Lender’s attorneys
Title company representative
Seller of the home
Real estate agent for the seller
The borrower (known as the mortgagor)
The lender (known as the mortgagee)
The borrower is required to sign a number of documents when closing. Below is a description of those documents:
The one selling the home must bring the deed with them to the closing. It must be signed and notarized so that the lender can have the deed filed at the county’s Deed Registrar since it is public record.
The HUD-1 Settlement statement itemizes the services by the lender that is related to the loan and charges both the seller and the buyer. This is required by federal law.
The mortgage note must be signed because it is the buyer’s promise to pay according to the terms. These items include payment due dates, amounts, and where the payments should be remitted to.
The statement that gives the actual rate of interest, APR, fees, and other costs is the Truth-In-Lending Statement.
What's the difference between a mortgage and a promissory note?
Learn the difference between a promissory note and a mortgage or deed of trust on your home.
When you take out a loan to purchase a home, you are required to sign two documents: a promissory note and a mortgage (or deed of trust). Read on to learn the difference between these documents and how they relate to your mortgage transaction.
(To learn more about mortgage terminology, see our Mortgage & Foreclosure Terminology topic area.)
Promissory Notes
Homebuyers usually think of the mortgage or deed of trust as the contract they are signing with the lender to borrow money to purchase a house, but it is actually the promissory note that contains the promise to repay the amount borrowed.
A promissory note is basically an IOU that contains the promise to repay the loan, as well as the terms for repayment. The note includes the:
name(s) of the borrower
property address
interest rate (fixed or adjustable)
late charge amount
amount of the loan, and
term (number of years).
Unlike a mortgage or deed of trust, the promissory note is not recorded in the county land records. The lender holds the promissory note while the loan is outstanding. When the loan is fully paid off, the note will be marked as paid in full and returned to the borrower.
Mortgages and Deeds of Trust
The purpose of the mortgage or deed of trust is to provide security for the loan that is evidenced by a promissory note.
Along with standard covenants between the lender and borrower, the mortgage or deed of trust will contain an acceleration clause that permits the lender to demand that the entire balance of the loan be repaid if the borrower defaults on the loan (by not making payments, for example). If the borrower does not pay the indebtedness due on the promissory note, then the real property can be sold to satisfy the debt.
Generally, the lender is must provide notice to the borrower before it can accelerate the loan. If the borrower does not cure the default, the lender may begin foreclosure proceedings. Foreclosure is the legal process where real estate secured by a mortgage or deed of trust is sold to satisfy the underlying debt as evidenced in the promissory note. (Learn more about foreclosure, options to avoid it, defenses to foreclosure, and more, in Nolo's Foreclosure topic area.)
The mortgage or deed of trust will also state the:
names of the borrowers
property address, and
legal description of the property.
The mortgage or deed of trust is recorded in the county land records, usually shortly after the borrowers sign it.
If the loan is fully paid off, the lender will record a release (or satisfaction) of mortgage or a reconveyance of deed (which is used in conjunction with deeds of trust) in the county land records.
Loan Transfers
Banks often sell and buy mortgages and deeds of trust from each other.
Assignments. An “assignment” is the document that is the legal record of the transfer of the mortgage (or deed of trust) from one bank to another. Each assignment is supposed to be recorded in the county land records.
Endorsements. When the loan changes hands, the promissory note is endorsed (signed over) to the new owner of the loan. In some cases, the note is endorsed in blank, which makes it a bearer instrument under Article 3 of the Uniform Commercial Code. This means that any party that possesses the note has the legal authority to enforce it.
(To learn more about the differences between assignments and endorsements, see our article What's the difference between a mortgage assignment and an endorsement (transfer) of the note?)
When you take out a loan to purchase a home, you are required to sign two documents: a promissory note and a mortgage (or deed of trust). Read on to learn the difference between these documents and how they relate to your mortgage transaction.
(To learn more about mortgage terminology, see our Mortgage & Foreclosure Terminology topic area.)
Promissory Notes
Homebuyers usually think of the mortgage or deed of trust as the contract they are signing with the lender to borrow money to purchase a house, but it is actually the promissory note that contains the promise to repay the amount borrowed.
A promissory note is basically an IOU that contains the promise to repay the loan, as well as the terms for repayment. The note includes the:
name(s) of the borrower
property address
interest rate (fixed or adjustable)
late charge amount
amount of the loan, and
term (number of years).
Unlike a mortgage or deed of trust, the promissory note is not recorded in the county land records. The lender holds the promissory note while the loan is outstanding. When the loan is fully paid off, the note will be marked as paid in full and returned to the borrower.
Mortgages and Deeds of Trust
The purpose of the mortgage or deed of trust is to provide security for the loan that is evidenced by a promissory note.
Along with standard covenants between the lender and borrower, the mortgage or deed of trust will contain an acceleration clause that permits the lender to demand that the entire balance of the loan be repaid if the borrower defaults on the loan (by not making payments, for example). If the borrower does not pay the indebtedness due on the promissory note, then the real property can be sold to satisfy the debt.
Generally, the lender is must provide notice to the borrower before it can accelerate the loan. If the borrower does not cure the default, the lender may begin foreclosure proceedings. Foreclosure is the legal process where real estate secured by a mortgage or deed of trust is sold to satisfy the underlying debt as evidenced in the promissory note. (Learn more about foreclosure, options to avoid it, defenses to foreclosure, and more, in Nolo's Foreclosure topic area.)
The mortgage or deed of trust will also state the:
names of the borrowers
property address, and
legal description of the property.
The mortgage or deed of trust is recorded in the county land records, usually shortly after the borrowers sign it.
If the loan is fully paid off, the lender will record a release (or satisfaction) of mortgage or a reconveyance of deed (which is used in conjunction with deeds of trust) in the county land records.
Loan Transfers
Banks often sell and buy mortgages and deeds of trust from each other.
Assignments. An “assignment” is the document that is the legal record of the transfer of the mortgage (or deed of trust) from one bank to another. Each assignment is supposed to be recorded in the county land records.
Endorsements. When the loan changes hands, the promissory note is endorsed (signed over) to the new owner of the loan. In some cases, the note is endorsed in blank, which makes it a bearer instrument under Article 3 of the Uniform Commercial Code. This means that any party that possesses the note has the legal authority to enforce it.
(To learn more about the differences between assignments and endorsements, see our article What's the difference between a mortgage assignment and an endorsement (transfer) of the note?)
Mortgage Basics: What Is a Mortgage?
A mortgage – a loan to finance the purchase of your home – is likely the largest debt you’ll ever take on. A mortgage is actually made up of several parts – the collateral you used to secure the loan, your principal and interest payments, taxes and insurance.
Since most mortgages last 15 to 30 years of monthly payments, it helps to understand the working parts.
Collateral
When you agree to a mortgage, you’re signing a legal contract promising to repay the loan plus interest and other costs. Your home is collateral for that loan.
If you don’t repay the debt, the lender has the right to take back the property and sell it to cover the debt, a process known as foreclosure. In a foreclosure, you will lose your home and you will likely damage your credit rating, affecting your ability to buy a new home in the future.
Principal and Interest
The principal is simply the sum of money you borrowed to buy your home. To lower your principal amount upfront, you can put down a percentage of the home’s purchase price as a down payment. Typically, lenders require you to make a down payment equal to 20 percent of the home’s purchase price to get a mortgage.
Interest is what the lender charges you to use the money you borrowed, usually expressed as a percentage called the interest rate. In addition to the interest rate, the lender could also charge you points and additional loan costs. Each point is one percent of the financed amount and is financed along with the principal.
Principal and interest comprise the bulk of your monthly payments in a process called amortization, which reduces your debt over a fixed period of time. With amortization, your monthly payments largely go toward paying off the interest in the early years, and gradually reduce the principal later on.
Taxes
In addition to your principal and interest, your mortgage payment will likely include taxes. The taxes are property taxes your community levies based on a percentage of the value of your home. These taxes generally go towards financing the costs of running your community – for example, to build and maintain schools, roads and other infrastructure, and to provide certain public services.
Generally, if your down payment is less than 20 percent, your lender considers your loan riskier than those with larger down payments. To offset that risk, the lender sets up an escrow account to collect those additional expenses, which are rolled into your monthly mortgage payment.
Even if you don’t have an escrow account, you’ll likely have to pay property taxes as long as you live in your home.
Insurance
Lenders won’t let you close the deal on your home purchase if you don’t have home insurance, which covers your home and your personal property against losses from fire, theft, bad weather and other causes.
If your home is in a federally designated high flood-risk zone within a flood plain and you are signing for a federally insured loan, federal law mandates that you must buy flood insurance.
If you choose a conventional loan and put down less than 20 percent of your home’s total value at closing, your lender will likely require you to pay private mortgage insurance. PMI protects the lender from you defaulting on the mortgage. You will have to make PMI payments for two years or until your mortgage balance shrinks to 78 percent of the home’s original purchase price.
If you choose a loan backed by the Federal Housing Administration, you will have to pay mortgage insurance. Mortgage insurance works the same as PMI, however, you will have to make these payments for 11 years or for the life of the loan, depending on your loan terms and down payment amount.
—
Personal Unsecured Loan FROM ZIONS BANK
Get the funds you need today
A Personal Unsecured Loan* from Zions Bank lets you borrow without collateral. Your loan amount is $1,000 minimum with the total amount based on your income and ability to repay. Plus, when you apply for a loan online, check your application status anytime.
Lower Your Interest Rate
Receive a .25% rate reduction with automatic payment from a Zions Bank® deposit account. And get an additional .25% rate reduction from a Gold Checking Plus account or Gold Interest Checking account.
Loan Benefits
Enjoy predictable payments
Get a fixed rate
Enjoy the advantage of no collateral being required
Access your account information through Zions Bank Online Banking
Borrow as little as $1,000
Access flexible short-term options
Ways to Use Your Personal Loan
Car repair
Home improvement
Consolidating debt
Helping family
Unexpected expenses (medical, taxes, personal, etc.)
*Loans subject to credit approval; terms and conditions apply. Contact a Financial Center for full details.
A Personal Unsecured Loan* from Zions Bank lets you borrow without collateral. Your loan amount is $1,000 minimum with the total amount based on your income and ability to repay. Plus, when you apply for a loan online, check your application status anytime.
Lower Your Interest Rate
Receive a .25% rate reduction with automatic payment from a Zions Bank® deposit account. And get an additional .25% rate reduction from a Gold Checking Plus account or Gold Interest Checking account.
Loan Benefits
Enjoy predictable payments
Get a fixed rate
Enjoy the advantage of no collateral being required
Access your account information through Zions Bank Online Banking
Borrow as little as $1,000
Access flexible short-term options
Ways to Use Your Personal Loan
Car repair
Home improvement
Consolidating debt
Helping family
Unexpected expenses (medical, taxes, personal, etc.)
*Loans subject to credit approval; terms and conditions apply. Contact a Financial Center for full details.
Why foreign banks have lined up cheap loans for India Inc.
NRE Savings Account – 4% Interest,Tax-Free & Repatriable. Highest Return NRE A/c. Apply Now!
kotak.com/NRE-Account
More From Corporates
Ready to pay 'Reasonable' Royalty to Novartis AG: Cipla to High Court
Maruti to Invest Rs 4,000 Crore in FY16 on New Models, Marketing
Shree Cement Acquires Jaypee Cement Unit for Rs 358 Crore
Sebi Nod for Manpasand Beverages Rs 400 Cr IPO
Investors Question Deutsche Bank's Overhaul
Mukesh Ambani Regains Richest Indian Slot From Dilip Shanghvi
Foreign banks are fuelling India's recent burst of overseas takeover bids, offering cheap U.S. dollar loans to corporates hungry to expand beyond their home state.
The stream of financing offers from banks such as Standard Chartered, Citigroup and Deutsche Bank comes after some U.S. and European lenders pulled back from the Indian market last year as the country suffered through an economic slump.
Banks are now back, funding the entire amount of Apollo Tyres $2.5 billion bid for New York-listed Cooper Tire & Rubber Co, a company nearly three times the size of its Indian suitor.
Bankers said lenders were taking advantage of a window of opportunity that exists while monetary policy remains loose, before any scaling back of abundant liquidity by the Federal Reserve and other central banks raises their cost of funding.
Indian companies are bidding for at least $10 billion worth of deals and, if successful, the outbound M&A volumes this year would rise to $13 billion, the highest since a record year in 2010, Thomson Reuters data show.
At least one of these takeover attempts have hit roadblocks.
But the revival of M&A activity is good news for foreign investment banks operating in the country, which for years have struggled with wafer-thin margins. The aggressive lending from Wall Street is similar to the bank loans fuelling deals in Southeast Asia.
"The debt market is back today," said Venkat Anantharaman, South Asia Co-Head for wholesale banking at Standard Chartered. He was referring to the U.S. high yield market and opportunity to provide companies with the money needed to grow.
Indian companies are searching abroad with the economy growing at its slowest pace in a decade. A sharply weaker rupee, which touched a record low last week, is also forcing companies to try and boost dollar earnings.
Bankers are aware that India has been in this position before, only to see an outbound march quickly retreat after 2008.
"The outbound trend started a few years back, and took a pause when the macroeconomic environment worsened," Aisha de Sequeira, Morgan Stanley's<MS.N> India investment banking head told Reuters.
But funding is now available for the right deals, she said.
Deutsche Bank and Morgan Stanley advised Apollo on the latest bid, while Bank of America advised Cooper.
RETURN OF FOREIGN BANKS
Foreign lenders including Barclays, Morgan Stanley, HSBC Plc, Goldman Sachs and Bank of America Merrill Lynch have all along played a major role in funding overseas acquisitions by Indian companies, but a drop in outbound volumes in the past couple of years hit them hard.
Foreign currency loans from India dropped to $17.3 billion in 2012 from $24.1 billion a year earlier, according to Thomson Reuters LPC data. The volume is at $5.4 billion so far this year, excluding the loan for the Apollo-Cooper deal. The strong outbound M&A deal pipeline augurs well for the foreign lenders.
Foreign banks have larger balance sheets and a lower cost of funding in U.S. dollars and other foreign currencies, meaning they can lend to Indian acquirers at cheaper rates than Indian banks.
"The dollar loan market is now available in a big way if anybody wants to tap it, there are enough banks coming in now," said the corporate finance head at a leading European bank in Mumbai. "Foreign banks are more willing to take risk, banks are more willing to lend balance sheet. Things have improved in the last six months."
RESOURCES DEAL TO FOLLOW
Apollo's move to buy Cooper was fuelled by desire to reduce its dependence on the Indian auto market, where car sales fell 7 percent in the financial year that ended in March, the first annual fall in a decade.
Meanwhile, a slew of resources companies are hunting for assets from Australia to Africa, as growth in output at home has been stymied for years by delays in environmental and regulatory approvals for mining projects as well as supply bottlenecks.
"The current thinking of a typical Indian promoter today is 'it's very tough to do business in India. It takes forever to get an approval and the overall economy has also slowed down,'" Standard Chartered's Anantharaman said.
"If I want to expand my business looking overseas makes sense. Second, let me de-risk my portfolio, having more of global revenue than just India revenue."
ONGC and Oil India are in the race to buy a $5 billion stake in a Mozambique gas field, while Aditya Birla Group and Coal India are among companies considering bids for some of Rio Tinto Ltd's Australian coal assets, valued at an estimated $3.2 billion.
But the market reaction to the Apollo deal - the company's shares dropped by a third over two days on concerns about the level of debt it will take on - is unlikely to encourage more companies to strike 100 percent debt funded acquisitions by tapping into the easy money available in the U.S. market.
Adding to that concern would be the fact that some of the past debt-loaded deals, including Tata Steel about $13 billion purchase of Anglo-Dutch Corus Group in 2007, didn't pan out as planned as the commodity cycle turned.
Last month, Tata Steel announced a $1.6 billion writedown, and the company is saddled with nearly $10 billion of debt on its books.
Sunday, 26 April 2015
Demand for treasury bills remain high
DEMAND for Treasury bills remained high with government offering for sale 135bn/- that resulted into oversubscription despite cut in yield rates.
The Bank of Tanzania (BoT) summary issued on Wednesday shows further that a total of 55bn/- was sold in 364 days period, 45bn/- for 182 days, 32bn/- for 91 days tenure and 3bn/- for 35 days offer.
With the exception of 35-day treasury bills, the remaining offers were overly subscribed, an outstanding performance when compared to the previous session held early this month.
Similarly, a downward trend of yield rates was seen across all tenors but it did not discourage investors’ appetite for the short term government note.
The 364-day attracted bids worth 68.9bn/- but at the end only 8bn/- emerged as successful amount; for the 182-tenor, a total of 92bn/- was total amount tendered and 29bn/- was retained as successful bids. For the 91-day, the government accepted 10.2bn/- as successful bids although the amount tendered jumped to 67.2bn/-.
The weighted average interest rates on the 364 days declined to 10.20 per cent from 10.37 per cent of the preceding session. On 182 days, it slowed to 9.74 per cent from 9.78 per cent while the 91 days offer, it changed slightly to 6.85 per cent from 6.86 per cent.
Local participation in the short term treasury bills constitutes commercial banks, pension funds, insurance firms and some micro finance institutions.
According to analysts, the participation of foreigners will increase competitions and make short and long term securities post outstanding performance, for which the government may borrow from the public at the lowest cost.
Friday, 24 April 2015
THE CONCEPT OF STRESS AND HOW IT IS MANAGED
DISCUSS THE CONCEPT OF STRESS AND HOW IT IS MANAGED
INTRODUCTION
Stress is your body's way of responding to any kind of demand. It can be caused by both good and bad experiences. When people feel stressed by something going on around them, their bodies react by releasing chemicals into the blood. These chemicals give people more energy and strength, which can be a good thing if their stress is caused by physical danger. But this can also be a bad thing, if their stress is in response to something emotional and there is no outlet for this extra energy and strength. This class will discuss different causes of stress, how stress affects you, the difference between 'good' or 'positive' stress and 'bad' or 'negative' stress, and some common facts about how stress affects people today.
WHAT CAUSES STRESS?
Many different things can cause stress from physical (such as fear of something dangerous) to emotional (such as worry over your family or job.) Identifying what may be causing you stress is often the first step in learning how to better deal with your stress. Some of the most common sources of stress are:
Survival Stress - You may have heard the phrase "fight or flight" before. This is a common response to danger in all people and animals. When you are afraid that someone or something may physically hurt you, your body naturally responds with a burst of energy so that you will be better able to survive the dangerous situation (fight) or escape it all together (flight). This is survival stress.
Internal Stress - Have you ever caught yourself worrying about things you can do nothing about or worrying for no reason at all? This is internal stress and it is one of the most important kinds of stress to understand and manage. Internal stress is when people make themselves stressed. This often happens when we worry about things we can't control or put ourselves in situations we know will cause us stress. Some people become addicted to the kind of hurried, tense, lifestyle that results from being under stress. They even look for stressful situations and feel stress about things that aren't stressful.
Environmental Stress - This is a response to things around you that cause stress, such as noise, crowding, and pressure from work or family. Identifying these environmental stresses and learning to avoid them or deal with them will help lower your stress level.
Fatigue and Overwork - This kind of stress builds up over a long time and can take a hard toll on your body. It can be caused by working too much or too hard at your job(s), school, or home. It can also be caused by not knowing how to manage your time well or how to take time out for rest and relaxation. This can be one of the hardest kinds of stress to avoid because many people feel this is out of their control. Later in this course we will show you that you DO have options and offer some useful tips for dealing with fatigue.
HOW DOES STRESS AFFECT YOU?
Stress can affect both your body and your mind. People under large amounts of stress can become tired, sick, and unable to concentrate or think clearly. Sometimes, they even suffer mental breakdowns. If you are suffering from extreme stress or long-term stress, your body will eventually wear itself down. But sometimes, small amounts of stress can actually be good.
Understanding your stress level is important. If nothing in your life causes you any stress or excitement, you may become bored or may not be living up to your potential. If everything in your life, or large portions of your life, cause you stress, you may experience health or mental problems that will make your behavior worse.
Recognizing when you are stressed and managing your stress can greatly improve your life. Some short-term stress for example what you feel before an important job presentation, test, interview, or sporting event may give you the extra energy you need to perform at your best. But long-term stress for example constant worry over your job, school, or family may actually drain your energy and your ability to perform well.
HOW TO MANAGE STRESS
Use these tips to help keep stress at bay.
Ask yourself what you can do about the sources of your stress. Think through the pros and cons. Take action where you can.
Keep a positive, realistic attitude. Accept that although you can't control certain things, you're in charge of how you respond.
Stand up for yourself in a polite way. Share your feelings, opinions, or beliefs, instead of becoming angry, defensive, or passive.
Learn and practice relaxation techniques. Try breathing exercises, meditation, prayer, yoga, or tai chi.
Exercise regularly. You'll feel better and be more prepared to handle problems.
Eat healthy. Avoid too much sugar. Focus on fruits, vegetables, whole grains, and lean protein. When you're stressed, you'll probably want less-nutritious comfort foods, but if you overdo them, they'll add to your problems.
Try to manage your time wisely.
Say no, where you can, to things that would add more stress to your life.
Make time for hobbies and interests.
Get enough rest and sleep. Your body needs time to recover from stressful events.
Don't rely on alcohol, drugs, or food to help against stress. Ease up on caffeine, too.
Spend time with people you love.
Talk with a counselor or take a stress management class for more help.
CONCLUSION
Stress that continues without relief can lead to headaches, an upset stomach, high blood pressure, chest pain, problems with sleeping or sex, depression, panic attacks, or other forms of anxiety and worry.
On top of that, if you handle stress with food, alcohol, drugs, tobacco, gambling, overspending, or other things that don't solve the problem, you're going to end up with more stress.
REFERENCE
Fiona Jones, Jim Bright, Angela Clow, Stress: myth, theory, and research, Pearson Education,
Gibbons, C. (2012). "Stress, positive psychology and the National Student Survey". Psychology
Fullagar, C. J.; Knight, P. A.; Sovern, H. S. (2013). "Challenge/Skill Balance, Flow, and Performance Anxiety". Applied Psychology
Selye, Hans (1974). Stress without distress. Philadelphia: J.B. Lippincott Company.
INTRODUCTION
Stress is your body's way of responding to any kind of demand. It can be caused by both good and bad experiences. When people feel stressed by something going on around them, their bodies react by releasing chemicals into the blood. These chemicals give people more energy and strength, which can be a good thing if their stress is caused by physical danger. But this can also be a bad thing, if their stress is in response to something emotional and there is no outlet for this extra energy and strength. This class will discuss different causes of stress, how stress affects you, the difference between 'good' or 'positive' stress and 'bad' or 'negative' stress, and some common facts about how stress affects people today.
WHAT CAUSES STRESS?
Many different things can cause stress from physical (such as fear of something dangerous) to emotional (such as worry over your family or job.) Identifying what may be causing you stress is often the first step in learning how to better deal with your stress. Some of the most common sources of stress are:
Survival Stress - You may have heard the phrase "fight or flight" before. This is a common response to danger in all people and animals. When you are afraid that someone or something may physically hurt you, your body naturally responds with a burst of energy so that you will be better able to survive the dangerous situation (fight) or escape it all together (flight). This is survival stress.
Internal Stress - Have you ever caught yourself worrying about things you can do nothing about or worrying for no reason at all? This is internal stress and it is one of the most important kinds of stress to understand and manage. Internal stress is when people make themselves stressed. This often happens when we worry about things we can't control or put ourselves in situations we know will cause us stress. Some people become addicted to the kind of hurried, tense, lifestyle that results from being under stress. They even look for stressful situations and feel stress about things that aren't stressful.
Environmental Stress - This is a response to things around you that cause stress, such as noise, crowding, and pressure from work or family. Identifying these environmental stresses and learning to avoid them or deal with them will help lower your stress level.
Fatigue and Overwork - This kind of stress builds up over a long time and can take a hard toll on your body. It can be caused by working too much or too hard at your job(s), school, or home. It can also be caused by not knowing how to manage your time well or how to take time out for rest and relaxation. This can be one of the hardest kinds of stress to avoid because many people feel this is out of their control. Later in this course we will show you that you DO have options and offer some useful tips for dealing with fatigue.
HOW DOES STRESS AFFECT YOU?
Stress can affect both your body and your mind. People under large amounts of stress can become tired, sick, and unable to concentrate or think clearly. Sometimes, they even suffer mental breakdowns. If you are suffering from extreme stress or long-term stress, your body will eventually wear itself down. But sometimes, small amounts of stress can actually be good.
Understanding your stress level is important. If nothing in your life causes you any stress or excitement, you may become bored or may not be living up to your potential. If everything in your life, or large portions of your life, cause you stress, you may experience health or mental problems that will make your behavior worse.
Recognizing when you are stressed and managing your stress can greatly improve your life. Some short-term stress for example what you feel before an important job presentation, test, interview, or sporting event may give you the extra energy you need to perform at your best. But long-term stress for example constant worry over your job, school, or family may actually drain your energy and your ability to perform well.
HOW TO MANAGE STRESS
Use these tips to help keep stress at bay.
Ask yourself what you can do about the sources of your stress. Think through the pros and cons. Take action where you can.
Keep a positive, realistic attitude. Accept that although you can't control certain things, you're in charge of how you respond.
Stand up for yourself in a polite way. Share your feelings, opinions, or beliefs, instead of becoming angry, defensive, or passive.
Learn and practice relaxation techniques. Try breathing exercises, meditation, prayer, yoga, or tai chi.
Exercise regularly. You'll feel better and be more prepared to handle problems.
Eat healthy. Avoid too much sugar. Focus on fruits, vegetables, whole grains, and lean protein. When you're stressed, you'll probably want less-nutritious comfort foods, but if you overdo them, they'll add to your problems.
Try to manage your time wisely.
Say no, where you can, to things that would add more stress to your life.
Make time for hobbies and interests.
Get enough rest and sleep. Your body needs time to recover from stressful events.
Don't rely on alcohol, drugs, or food to help against stress. Ease up on caffeine, too.
Spend time with people you love.
Talk with a counselor or take a stress management class for more help.
CONCLUSION
Stress that continues without relief can lead to headaches, an upset stomach, high blood pressure, chest pain, problems with sleeping or sex, depression, panic attacks, or other forms of anxiety and worry.
On top of that, if you handle stress with food, alcohol, drugs, tobacco, gambling, overspending, or other things that don't solve the problem, you're going to end up with more stress.
REFERENCE
Fiona Jones, Jim Bright, Angela Clow, Stress: myth, theory, and research, Pearson Education,
Gibbons, C. (2012). "Stress, positive psychology and the National Student Survey". Psychology
Fullagar, C. J.; Knight, P. A.; Sovern, H. S. (2013). "Challenge/Skill Balance, Flow, and Performance Anxiety". Applied Psychology
Selye, Hans (1974). Stress without distress. Philadelphia: J.B. Lippincott Company.
TECHNIQUES FOR EFFECTIVE MANAGEMENT OF CHANGE
INTRODUCTION
Every organization aims at better service delivery to and for clients as it grows. Change is inevitable in such a quest as this may involve anything that is to be introduced into the production environment. This may affect the functioning of the environment or one of its components. Making changes in a planned and systematic fashion is not easy. This is why there is often a huge importance and relevance placed upon change management in an organization.
Changes within a business organization can be initiated from within or externally. Reactive and proactive responses to these changes are possible from any organization. The whole process of managing the changes in an organization includes: awareness for the need of change, planning the stages of the transition, achieving the transition, and the maintenance of the positive effects of the transition.
This entire process involves careful, thoughtful planning and sensitive implementation of the transition. Effective transition management has to include consultation and the involvement of people who will be affected. The prospected changes have to be realistic, measurable, and achievable. The goals of such a transition should be clearly understood together with why they should be achieved. For success, managers have to involve the staff, stakeholders or their representatives before effecting changes in order to discuss it and determine if they are able to cope or not.
Communication is essential for success in this mission for it enhances the progress and also strengthens the trust of employees towards the manager. Verbal communication, in particular, has been proven to be more effective in ensuring proper understanding than written notices and e-mails. This approach will cause your staff to realize the necessity of the change and they will be more likely to embrace it. A proper approach to change management will protect the manager from losing the best employees within the staff.
Change management services can be outsourced from many independent consultants with expertise in this field. These consultants help their clients manage the changes. A certain area that needs transition is established either by the consultants or the client, and the consultants propose models, methods, techniques, and tools that can be used to effect the changes in the particular organization.
Some people welcome transitions with mixed feelings, and some people have a strong resistance to transition. Tolerance and patience are required to make the resisting people see things at a different angle. Sometimes the people who resist transition see a risk of losing their jobs as a consequence of the change. Treat the people opposing the change with respect and do not keep them in the dark. Showing and explaining to them the reasons why things need to be different will help them see the light at the end of the tunnel. It will also help to ensure them that their careers are not in danger.
Managing transition in a business organization requires a broad set of skills such as analytical, financial, business, and social skills. Analytical skills will help you evaluate the financial and other implications associated with that transition. Without proper management, a transition can turn an organization into financial or social turmoil. Change Management plays an important role in any organization for it allows an organization to respond to external or internal issues effectively.
TECHNIQUES OF MANAGING CHANGE IN COMPANIES
Organizations undergo change regularly as technologies advance and businesses grow and develop. Businesses must adapt to changes in the market to remain competitive and profitable. The techniques businesses use to manage change can determine success or failure. Change causes anxiety among employees who are fearful of how organizational change will affect their place in the company.
Evaluating Areas for Change
Management must evaluate the organization to determine areas that require change. A practice of regularly evaluating the company to identify areas that need improvement can help the company maintain a competitive edge. For example, the organization may determine that the company is using outdated production methods. The change process can include updating the production process, exploring new technologies and training employees in new production techniques.
Planning Implementation
The company should develop a plan to implement an organizational change. Companies should determine the cost of implementing a change and budget accordingly. The cost of implementing a change can include retraining employees, purchasing advanced equipment or hiring consultants. A project manager can guide the change process and distribute assignments to key employees. Setting small goals during the transition can provide encouragement during the process.
Communication
Implementing a change to procedures and company policies can cause fear among workers. Communicating the change plan to workers can help alleviate the anxiety. Allowing workers to ask questions and voice concerns about a change in the organization can help explain how the process will affect workers. Worker fear occurs when employees are fearful about how a change will affect their day-to-day activities. Group meetings, presentations and training sessions are effective methods for communicating an organizational change.
Employee Involvement
Involving employees in the change process is also an effective management technique. Worker involvement provides a sense of control over the process, which can help allay employee fears. According to Reference for Business, when employees are involved in company decision-making and the process they will feel less fear and have commitment to the process.
REASONS FOR CHANGE
Globalization and the constant innovation of technology result in a constantly evolving business environment. Phenomena such as social media and mobile adaptability have revolutionized business and the effect of this is an ever increasing need for change, and therefore change management. The growth in technology also has a secondary effect of increasing the availability and therefore accountability of knowledge. Easily accessible information has resulted in unprecedented scrutiny from stockholders and the media and pressure on management.
With the business environment experiencing so much change, organizations must then learn to become comfortable with change as well. Therefore, the ability to manage and adapt to organizational change is an essential ability required in the workplace today. Yet, major and rapid organizational change is profoundly difficult because the structure, culture, and routines of organizations often reflect a persistent and difficult-to-remove "imprint" of past periods, which are resistant to radical change even as the current environment of the organization changes rapidly.
Due to the growth of technology, modern organizational change is largely motivated by exterior innovations rather than internal moves. When these developments occur, the organizations that adapt quickest create a competitive advantage for themselves, while the companies that refuse to change get left behind. This can result in drastic profit and/or market share losses.
Organizational change directly affects all departments from the entry level employee to senior management. The entire company must learn how to handle changes to the organization.
CONCLUSION
Regardless of the many types of organizational change, the critical aspect is a company’s ability to win the buy-in of their organization’s employees on the change. Effectively managing organizational change is a four-step process
Recognizing the changes in the broader business environment
Developing the necessary adjustments for their company’s needs
Training their employees on the appropriate changes
Winning the support of the employees with the persuasiveness of the appropriate adjustments
As a multi-disciplinary practice that has evolved as a result of scholarly research, organizational change management should begin with a systematic diagnosis of the current situation in order to determine both the need for change and the capability to change. The objectives, content, and process of change should all be specified as part of a Change Management plan. Change management processes should include creative marketing to enable communication between changing audiences, as well as deep social understanding about leadership’s styles and group dynamics. As a visible track on transformation projects, Organizational Change Management aligns groups’ expectations, communicates, integrates teams and manages people training. It makes use of performance metrics, such as financial results, operational efficiency, leadership commitment, communication effectiveness, and the perceived need for change to design appropriate strategies, in order to avoid change failures or resolve troubled change projects.
REFERENCES
Kotter, J. (July 12, 2011). "Change Management vs. Change Leadership -- What's the Difference?" Forbes online.
Filicetti, John (August 20, 2007). "Project Management Dictionary". PM Hut. Retrieved November 16, 2009.
Levin, GInger (2012). "Embrace and Exploit Change as a Program Manager: Guidelines for Success". Project Management Institute.
Phillips, Julien R. (1983). "Enhancing the effectiveness of organizational change management". Human Resource Management
Every organization aims at better service delivery to and for clients as it grows. Change is inevitable in such a quest as this may involve anything that is to be introduced into the production environment. This may affect the functioning of the environment or one of its components. Making changes in a planned and systematic fashion is not easy. This is why there is often a huge importance and relevance placed upon change management in an organization.
Changes within a business organization can be initiated from within or externally. Reactive and proactive responses to these changes are possible from any organization. The whole process of managing the changes in an organization includes: awareness for the need of change, planning the stages of the transition, achieving the transition, and the maintenance of the positive effects of the transition.
This entire process involves careful, thoughtful planning and sensitive implementation of the transition. Effective transition management has to include consultation and the involvement of people who will be affected. The prospected changes have to be realistic, measurable, and achievable. The goals of such a transition should be clearly understood together with why they should be achieved. For success, managers have to involve the staff, stakeholders or their representatives before effecting changes in order to discuss it and determine if they are able to cope or not.
Communication is essential for success in this mission for it enhances the progress and also strengthens the trust of employees towards the manager. Verbal communication, in particular, has been proven to be more effective in ensuring proper understanding than written notices and e-mails. This approach will cause your staff to realize the necessity of the change and they will be more likely to embrace it. A proper approach to change management will protect the manager from losing the best employees within the staff.
Change management services can be outsourced from many independent consultants with expertise in this field. These consultants help their clients manage the changes. A certain area that needs transition is established either by the consultants or the client, and the consultants propose models, methods, techniques, and tools that can be used to effect the changes in the particular organization.
Some people welcome transitions with mixed feelings, and some people have a strong resistance to transition. Tolerance and patience are required to make the resisting people see things at a different angle. Sometimes the people who resist transition see a risk of losing their jobs as a consequence of the change. Treat the people opposing the change with respect and do not keep them in the dark. Showing and explaining to them the reasons why things need to be different will help them see the light at the end of the tunnel. It will also help to ensure them that their careers are not in danger.
Managing transition in a business organization requires a broad set of skills such as analytical, financial, business, and social skills. Analytical skills will help you evaluate the financial and other implications associated with that transition. Without proper management, a transition can turn an organization into financial or social turmoil. Change Management plays an important role in any organization for it allows an organization to respond to external or internal issues effectively.
TECHNIQUES OF MANAGING CHANGE IN COMPANIES
Organizations undergo change regularly as technologies advance and businesses grow and develop. Businesses must adapt to changes in the market to remain competitive and profitable. The techniques businesses use to manage change can determine success or failure. Change causes anxiety among employees who are fearful of how organizational change will affect their place in the company.
Evaluating Areas for Change
Management must evaluate the organization to determine areas that require change. A practice of regularly evaluating the company to identify areas that need improvement can help the company maintain a competitive edge. For example, the organization may determine that the company is using outdated production methods. The change process can include updating the production process, exploring new technologies and training employees in new production techniques.
Planning Implementation
The company should develop a plan to implement an organizational change. Companies should determine the cost of implementing a change and budget accordingly. The cost of implementing a change can include retraining employees, purchasing advanced equipment or hiring consultants. A project manager can guide the change process and distribute assignments to key employees. Setting small goals during the transition can provide encouragement during the process.
Communication
Implementing a change to procedures and company policies can cause fear among workers. Communicating the change plan to workers can help alleviate the anxiety. Allowing workers to ask questions and voice concerns about a change in the organization can help explain how the process will affect workers. Worker fear occurs when employees are fearful about how a change will affect their day-to-day activities. Group meetings, presentations and training sessions are effective methods for communicating an organizational change.
Employee Involvement
Involving employees in the change process is also an effective management technique. Worker involvement provides a sense of control over the process, which can help allay employee fears. According to Reference for Business, when employees are involved in company decision-making and the process they will feel less fear and have commitment to the process.
REASONS FOR CHANGE
Globalization and the constant innovation of technology result in a constantly evolving business environment. Phenomena such as social media and mobile adaptability have revolutionized business and the effect of this is an ever increasing need for change, and therefore change management. The growth in technology also has a secondary effect of increasing the availability and therefore accountability of knowledge. Easily accessible information has resulted in unprecedented scrutiny from stockholders and the media and pressure on management.
With the business environment experiencing so much change, organizations must then learn to become comfortable with change as well. Therefore, the ability to manage and adapt to organizational change is an essential ability required in the workplace today. Yet, major and rapid organizational change is profoundly difficult because the structure, culture, and routines of organizations often reflect a persistent and difficult-to-remove "imprint" of past periods, which are resistant to radical change even as the current environment of the organization changes rapidly.
Due to the growth of technology, modern organizational change is largely motivated by exterior innovations rather than internal moves. When these developments occur, the organizations that adapt quickest create a competitive advantage for themselves, while the companies that refuse to change get left behind. This can result in drastic profit and/or market share losses.
Organizational change directly affects all departments from the entry level employee to senior management. The entire company must learn how to handle changes to the organization.
CONCLUSION
Regardless of the many types of organizational change, the critical aspect is a company’s ability to win the buy-in of their organization’s employees on the change. Effectively managing organizational change is a four-step process
Recognizing the changes in the broader business environment
Developing the necessary adjustments for their company’s needs
Training their employees on the appropriate changes
Winning the support of the employees with the persuasiveness of the appropriate adjustments
As a multi-disciplinary practice that has evolved as a result of scholarly research, organizational change management should begin with a systematic diagnosis of the current situation in order to determine both the need for change and the capability to change. The objectives, content, and process of change should all be specified as part of a Change Management plan. Change management processes should include creative marketing to enable communication between changing audiences, as well as deep social understanding about leadership’s styles and group dynamics. As a visible track on transformation projects, Organizational Change Management aligns groups’ expectations, communicates, integrates teams and manages people training. It makes use of performance metrics, such as financial results, operational efficiency, leadership commitment, communication effectiveness, and the perceived need for change to design appropriate strategies, in order to avoid change failures or resolve troubled change projects.
REFERENCES
Kotter, J. (July 12, 2011). "Change Management vs. Change Leadership -- What's the Difference?" Forbes online.
Filicetti, John (August 20, 2007). "Project Management Dictionary". PM Hut. Retrieved November 16, 2009.
Levin, GInger (2012). "Embrace and Exploit Change as a Program Manager: Guidelines for Success". Project Management Institute.
Phillips, Julien R. (1983). "Enhancing the effectiveness of organizational change management". Human Resource Management
Subscribe to:
Posts (Atom)