How to Become a Good Loan Candidate

From car purchases to mortgages, almost everyone needs loans throughout their life. When you need a loan, you’ll want to ensure you are able to get the loan you need, at a desirable interest rate. That’s why you should do everything you can to make yourself a good candidate for a loan.

How to become a good candidate for a loan:

• Pays your bills on time—every bill, every month.
• Maintain a good credit score.
• Save for a down payment or find a source for down payment funds.
• Have a good source of collateral (i.e., your home or business) 

Your Credit Score

A credit score is primarily based on credit report information typically sourced from credit bureaus (see below). Maintaining a good credit score is a key factor in determining your suitability for a loan. If you are just starting out establishing credit, or need to improve your credit, here are a few things to keep in mind:

•  Avoid maxing out credit lines on cards or loans.
• Avoid applying for excessive credit (numerous department store credit cards can add up).
• Consistently make payments on time.
• Pay down the balances currently on credit cards or loans.
• Satisfy any “past due” bills.
• Request and review copies of your credit report and verify the information for accuracy.

Obtaining a Credit Report

You are entitled to one free credit report—within a 12-month period—from each of the three major credit bureaus. The bureaus run AnnualCreditReport.com where you can get your free credit report. Your credit score is available for an extra $10 fee. If you dispute something on your report you can request an investigation and/or ask that a note be included in your file. The FICO credit score is the most common. It ranges between 300 and 850. As a rough rule of thumb, ideal loan candidates—those with the easiest time getting a loan at the lowest interest rate and associated fees—usually have scores above 740. Bank of Luxemburg will work with each customer on an individual basis to find the best loan option for you, even if your credit score is not ideal.

If you have questions about obtaining a loan, contact your local Bank of Luxemburg for information and advice.

Loan Consolidation

When is Loan Consolidation a Good Idea?

Do you feel that you’re drowning in debt? In some cases, individuals with a large amount of high-interest debt may see a benefit from a debt consolidation loan. Usually a debt consolidation loan is a single, lower-interest loan used to to pay off your other, higher-interest loans. This allows you to make only one monthly payment, pay off what you owe more quickly and take advantage of a lower interest rate.

Debt consolidation isn’t a free pass though. It takes the willpower to follow through on paying off current debt and changing your spending habits.

1.     Calculate your debt load by listing of all of your current debts (excluding your mortgage) and determine what you owe in total. For discussion purposes today, let’s say it’s $20,000.

2.     Next add up the monthly payments you’re making on these accounts. (For credit cards this can vary. Use an average of your last several payments.) Again, let’s use a figure just for our discussion and say your monthly payments total $1100.00.

3.     Seek the best loan for consolidating your debt. Usually this means looking at one of the following:

•  Home equity loans & lines of credit can offer lower interest rates and, because they’re a type of mortgage, the interest you pay may be tax-deductible.
• Cash-out refinancing is taking out a new mortgage on your home that’s larger than your current one. For example, if you have a $100,000 mortgage and your house is worth $200,000, you could take out a new mortgage for $120,000 and use the extra $20,000 to pay off your credit cards or higher-interest auto loan. Even if your monthly mortgage payment increases your total monthly payments (current mortgage payment plus the $1100.00 we mentioned above) will decrease and you’ll pay much less interest in the long run.
• A personal loan offers interest rates that can be higher than a home equity loan, but usually lower than credit cards.

When comparing loans, don’t forget to include upfront fees and points as well as the interest rate and use each loan’s annual percentage rate (APR) for comparison purposes.

Make a plan and stick to it!
Look at the time it will take you to pay off your debt. Home equity loans and personal loans have a fixed term, so you’ll know exactly how long you will be paying.

If you’ve decided to consolidate with a home equity line of credit you’ll be making a small minimum payment every month—but this will not usually reduce your debt. In this case, determine how much you can afford each month on top of the minimum payment. Setting up automatic payments can help you keep on track.

Controlling spending is key.
This final step is key… Debt consolidation only works if you change your spending and don’t incur significant debt again. If you don’t change your habits you’ll end up in trouble again in a short while.

There are numerous companies that offer loan consolidation services for a FEE. Make a smart choice if you decide consolidation is your best alternative—contact your local Bank of Luxemburg for advice and assistance you can trust!

Refinancing

Mailboxes have been overflowing with mailings from mortgage companies telling homeowners, "Now is a great time to refinance your home…and do it with us!" Anyone who"s following current events knows that mortgage rates are historically low, but is refinancing now the right choice for everyone? Bank of Luxemburg sorts it out for you.

There are several things to consider before deciding to refinance your home.

1. How long do you plan to be in your current home?

The longer the length of time you plan to be in your current home, the better, when it comes to refinancing. Reason being? With a longer stay in your current home, you may recoup expenses that could arise from the re-fi. If you’re planning a move in the near future, the costs associated with a re-fi might not offset the costs associated with moving.

2. Have you or your spouse had a recent change in job, schooling, or life in general?

A job change could mean a salary cut. Going back to school and the expenses associated with it might negatively affect those monthly expenses. Other changes like having a child or an elderly parent to care for could also cause a spike in expenses. With all these instances, having a reduced mortgage payment for the long haul might be worth the up-front expenses incurred with refinancing.

3. What is the current rate you are eligible for?

Take a look at the mortgage rate you currently have, and contact a mortgage lender to see what your new rate could be. The mortgage lender can advise you as to whether or not the rate difference is significant enough to benefit you.
Drum roll please…If you decide based on the above criteria that now IS the right time to refinance, here’s“the work” involved on your end.

1. Check your credit score (and your spouse’s credit score if you’re refinancing jointly).

Your mortgage lender will do this when determining your rate, but it doesn’t hurt to check in advance and make sure you are aware of your score and the reasoning behind it.

2. Request copies of (or locate) paperwork ahead of time.

In a paperless age, you’ll still need to locate hard copies of your (and your spouse’s) last two pay check stubs, your last two checking account statements, and if applicable, your last two savings account statements. You’ll also need your existing mortgage paperwork and property tax information. Keep all documentation clearly labeled and organized to make the refinancing process smooth and simple.

Refinancing can be a great choice for some people right now, but it’s important to ask the correct questions and make sure it’s the right thing for you. It’s also smart to be prepared for the legwork involved on your end, so there are no surprises once you get embroiled in the refinancing process. Speak with a mortgage lender you know and trust before beginning the process, and we at Bank of Luxemburg are always willingto help.

Bank of Luxemburg in Your Community

April is Community Banking Month, and it’s the perfect time to highlight the many advantages of community banks, including local decisions, a focus on families and bank employees who are active in their neighborhoods.

Dyckesville Parade in August 2011

At Bank of Luxemburg, we always celebrate community banking! We support our local communities with a variety of partnerships, sponsorships and events.

Join us for the Luxemburg Chamber of Commerce annual Easter Egg Hunt this Saturday, April 7, 2012, at the community center in Luxemburg. We’ll have games, face painting and a special appearance by the Easter Bunny, so remember your camera! Registration is at 9:00a.m. and the “hunt” officially begins at 9:30a.m. We have so much fun volunteering at this event!

2011 Easter Egg Hunt

2012 Mardi Gras was a fun night!

Bank of Luxemburg is a corporate sponsor of the Mardi Gras fundraiser for the Farm Market Kitchen in Algoma, a regional shared-use food processing business incubator. This year’s Cajun-style cocktail party was in February at The Marq in De Pere. Farm Market Kitchen clients provide samples of their food and beverage items; raffles and a silent auction raise additional funds. 


Two Bank of Luxemburg teams participated in the “Minute 2 Win It” challenge in January and dominated the competition based on the popular game show! The Retail Reapers took first place and the Algoma Educators took second place. All proceeds benefited the Door Kewaunee Business & Education Partnership.

Our Minute 2 Win It teams in January 2012

Bank of Luxemburg is a gold fork sponsor for the Kewaunee County Buy Local Network’s “Taste of the County” in October. The event features restaurants and beverage merchants from throughout the county serving samples of their specialty cuisine and beverages.

Taste of the County in October 2011

Bank of Luxemburg also celebrated the first “October is Buy Local Month” by participating in Kewaunee County’s “Buy Local Cares Day.” Local companies came together to help people and nonprofit organizations within the community.  Bank of Luxemburg had ten volunteers working several projects, including gardening work for Algoma Long Term Care; cleaning and organizing for the Kewaunee County Food Pantry; hosting a game day for seniors and disabled residents at Grand View Terrace Apartments in Algoma; and photographing and blogging tourism attractions for VisitKewauneeCounty.com.

Bank of Luxemburg Buy Local Cares volunteers

Throughout the summer, you’ll see Bank of Luxemburg at your community parades, the Kewaunee County Fair and the cookouts we hold at branch locations to benefit local organizations.

Proceeds from 2011 Bellevue cookout

Collecting food items and school supplies for needy families, sponsoring youth sports, donating to local charities, sponsoring the senior meal site in Luxemburg -- Bank of Luxemburg is Local. Loyal. Lasting. It's no surprise local consumers voted us as the Best of Kewaunee County's "Most Active in the Community" in 2011.

Bank of Luxemburg's KCYSA 2011 team

Visit Bank of Luxemburg on Facebook to keep up with even more ways we’re getting involved in our communities!

We appreciate your local support and thank you for your trust and confidence in us. Stop by any of our branches in April for a chance to win a stadium seat and basket of tailgating goodies to enjoy while watching your favorite team. You can also get treats in our lobbies and great experiences with our employees. 

Donations for Kewaunee Co. Food Pantry

We look forward to seeing you soon!

Get the Most Out of Your Money

Money is tight for many people these days. Although it would be great to have more money to invest and spend, a more realistic option is to do more with the money you already have.

Here are some ways to start getting the most out of your money:

Save for Retirement. Start setting money aside for your retirement early, so there will be more time for your money to grow. The longer your money is left untouched, the greater its chance to compound. Try to put as much as you can toward your 401(k), and check with your employer about matching contributions. If you’re already retired, plan your withdrawals wisely to make sure your retirement fund lasts.

Create a Budget. Tax time is a good time to look back at your expenses from the past year. Make sure your spending is in line with your financial priorities. Are there any expenses you can cut to ensure you’re using your money the way you need to?

Avoid Fees. This may seem straightforward, but unnecessary fees can quickly add up and send you into debt. Pay your bills on time and in full. That way, you won’t spend money on late fees or finance charges. It’s also a good idea to plan out your cash withdrawals to avoid paying fees at unfamiliar ATMs.

Invest in a Home. Consider growing equity by purchasing a home instead of renting, if you plan to stay put for several years. Interest rates are still low, so talk with a loan officer at your local Bank of Luxemburg -- you may learn that a house payment will be lower than your rent! If you’re already a homeowner, invest in your current home with regular upgrades and improvements.

Watch the Rates. Try to be on top of loan interest rates, so you can save money on interest over the life of the loan. We can help you determine if refinancing your auto or home loan is a good option. Even a small reduction in your loan’s interest rate would add up to significant savings.

If you’ve been stuck in a financial rut, getting the most out of your money can help you get back on track. Rebecca Edler, Chief Operating Officer at Bank of Luxemburg, recently talked with Amy Hanten about money-saving ideas on FOX 11’s Living With Amy.

Take a look:

Supporting Area Students With the Bank of Luxemburg Scholarship

2012 marks ten years since we created our Bank of Luxemburg Scholarship program, and we’re eager to continue our commitment to the education of future business leaders. Bank of Luxemburg has already awarded $159,000 in scholarships to our customers’ children and grandchildren over the years.

Our scholarship is designed for graduating high school seniors planning to continue their educations at a university, college, or vocational school. The selected students will each receive a $1,000 scholarship annually for up to four years of fulltime enrollment. We’ll award several scholarships to students attending high schools in our Bank of Luxemburg market area.

Scholarship applications will be available at all Bank of Luxemburg locations and in the guidance offices at Luxemburg-Casco and Algoma High Schools.

To submit your application by the April 1, 2012 deadline, please mail it to:

Bank of Luxemburg
630 Main St.
Luxemburg, WI 54217

A Bank of Luxemburg representative will announce the selected students at their school banquets or ceremonies at the end of the school year.

If you’d like more information about the Bank of Luxemburg Scholarship, please call (920) 845-2345.

4 Quick Fixes to Save Money

Saving money can be a slow process. Little by little, you increase your funds until you finally reach your goal. Fortunately, there are also some faster ways to jumpstart your savings efforts.

Here are four “quick fixes” to save money:

1. Take a look at your bank accounts.
Some banks charge maintenance fees. Make sure your bank is giving YOU something! Look for interest, account perks and other benefits you’ll use and enjoy.

2. Shop smarter.
Use cash or your debit card. That way, you can only spend what you have, so you’ll save money on finance charges and credit card fees.
Here’s a good tip for online shoppers: Don’t save your card information with websites. It’s too easy to click and buy without making sure you can pay for that new item. If you have to take the time to dig out your card to buy something from a website, you may think twice about spending that money!

3. Escrow your property taxes.
Instead of trying to save for your property taxes on your own and having the temptation to use those funds for other items, consider an escrow account.
Here's how it works: You make an automatic payment into the account monthly or with every paycheck. When tax time comes around, the bank will send the money in your account to your municipality. Since you were diligent about saving each month, you won't have to worry about having enough money when your property taxes are due.

4. Consolidate debt.
Is all that holiday spending finally catching up with you? The bank can help you consolidate your debt, and this should give you a better interest rate.

Bank of Luxemburg’s Chief Operating Officer, Rebecca Edler, shared her “quick fixes” to save money in a recent segment on FOX 11’s Living With Amy: