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What is a Collateral Loan?


Getting approved for a loan can be difficult when you don’t have a great credit score. Luckily, there are other forms of collateral you can use to secure a loan.

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What is a Collateral Loan?


In order to understand collateral loans, how they work, and how you can use them, you need to understand,


What is Collateral?


Collateral is a personal asset when it is being used as financial security. For example, you might need to use something you own that has monetary worth in order to secure a loan.


These types of loans are called collateral loans. Auto loans are the most common type of collateral loan.


If you own your car completely (meaning you aren’t still paying for the car), then you can use your car’s title to secure a loan.


This helps lenders mitigate the risks of lending money to their customers. It also makes it easier for borrowers with low credit scores to get the loans they need.


Secured Loan vs Unsecured Loan


When a loan has a type of security attached to it (like the title of your car or a high credit score) then it is also known as a secured loan.


When a loan doesn’t have any type of security attached to it, then it’s known as an unsecured loan. The risks the lender takes on when issuing an unsecured loan are higher because the chances the borrower will fail to repay the loan are higher.


Pros and Cons of Secured Loans vs Unsecured Loans:

  • Unsecured loans usually have much higher interest rates and fees
  • Secured loans include using your own property or assets to secure the loan


Types of Secured Loans:

  • Personal loans
  • Title loans
  • Mortgage
  • Pawn loans


Types of Unsecured Loans:

  • Signature loans
  • Student loans
  • Credit cards


How Do Collateral Loans Work?


In order to get a loan that’s backed by collateral, there are a few things you’ll need to do.


First, you need to own the property you want to use as collateral outright. You can’t use your personal property as loan security if you don’t own it completely.


If you are still paying off another loan on your house or your car, then you can’t use that asset as collateral.


Second, you have to find a lender that offers collateral loans. Check City is one of those lenders. At Check City, you can take out a collateral loan on your vehicle.


Once you get approved for the loan, you’ll sign the papers and allow the lender to take out a lien on your property.


What is a Lien?


A lien is a partial ownership of personal property given to lenders when securing certain types of loans.




Reasons to Get a Collateral Loan


Why would someone want this type of loan? There are many advantages. The main reason is to get a loan for bad credit.


Loans that are backed against a personal asset are less likely to need a perfect credit history from borrowers because the loan’s security is tied up with a personal resource instead. Just remember, if you fail to pay back the loan or fail to make payments on time, this will still negatively impact your credit score.


People need loans for many reasons every year. A survey found that in the past year as many as 114.4 million people in the US took out personal loans.


Personal loans are taken out for many reasons. They can help pay bills, pay for groceries, consolidate debts, fix your car, pay medical bills, renovate part of your house, or even help pay for a wedding.


Collateral Loan Examples


If something you own has monetary value, then there is a possibility it can be used to secure a loan that’s backed with collateral.


Your assets have worth and that worth can be used to your advantage when you need to borrow money.


Savings Account:


If you have a savings account that meets a lender’s requirements, you might be able to use it to secure a loan. The idea is that the funds in your savings account are security to back up the loan in the case you have trouble repaying the loan.


Having an adequate savings account also lets the lender know you have the ability to repay the loan, which strengthens your chances of getting the loan approved.


Residential Mortgages:


A residential mortgage usually refers to the type of loan someone gets in order to buy a house. When you sign up for a residential mortgage loan, you allow the lender to have a lien on the house you buy until you finish paying off your mortgage.


This type of loan is tying the property you are purchasing to the loan taken out to pay for the property.


Allowing lenders to have a lien


Home Equity Loans:


Home equity loans let you use the equity or financial worth in your real estate property to help get a loan.


If you have a house or a mortgage, there’s a possibility you can use it to apply for additional loans. Your home is a major asset with lots of lucrative value. In general, real estate property is a huge financial resource.


These loans can include single-family homes, townhomes, condominiums, multi-family homes, and even mobile homes. It all depends on the terms and conditions set up by your home equity loan lender.


Margin Trading:


Margin trading is a finance term in investing and stocks. A margin is an extension of credit so that someone can trade on the stock market even though they don’t have the funds required.


By using margin trading, you can trade and invest more than you could by yourself. These investments can then be enough to cover your credit and more so you still see a great profit.


The major disadvantage of using margin trading is if the investments don’t pay off or if you lose money because now you will owe the investment funds you borrowed as credit.


Car Title Loans:


Car Title Loans are the most common type of collateral loan. They work by allowing lenders to take out a lien on your vehicle. This means that the lender’s name is on the title of the car during the loan term. This will allow them to take your car away in the event you fail to repay the loan.


But lenders don’t want to possess your car. They want borrowers to successfully pay back their loans. Repossessing a vehicle is only a last resort that lenders will generally only use when no other option is available. Ideally, they’re going to make more of a profit if they can help their customers pay back their loans.


How to Get a Collateral Loan at Check City




To get a Title Loan from Check City, all you need to do is bring a few items to your neighborhood Check City location.


Bring These Items:

  • Your vehicle and title
  • Proof of registration
  • Your photo ID
  • Ability to repay


Once you have these items you can fill out a title loan application online, at a store, or over the phone at (800) 404-0254.



All you have to do after that is wait for your application to get approved and for the Title loan funds to come your way.


In Conclusion,


When you need funds you need them fast and you need them from a lender you know you can trust.


Check City takes the trust and privacy of our customers very seriously. At Check City, you can find security in knowing your working with licensed lenders who are here for you.


The Balance. “Collateral Loans,” by Justin Pritchard, “The Basics of Trading on Margin,” by John Russell.

Investopedia. “Loan Basics: Collateral,” by Julia Kagan.

finder. “Personal loans statistics,” by Anna Serio.

What is a Money Order and How Do They Work?

counting money

Money orders are a great way to make purchases and pay bills regardless of whether you have a checking account or not.

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Some people do not understand how useful this financial tool can be.


They are an extremely useful money management tool that can help people send and receive money safely and successfully.


Additionally, if you don’t have a checking account, an order can be the most secure way to send money to someone else.


What is a Money Order?


They are similar to checks. They are a paper document that can be used as a form of payment. The main difference is that money orders are paid for in advance while checks are not.


Checks are a paper document allowing the recipient to take money from your account. Money orders are a paper document saying that money has already been taken out by the money order provider and is ready to be received right away.


Go to Get Western Union Money Orders from Check City.


Money Order vs Checks


Though they are very similar, there are some key differences between money orders and checks.


Money Orders Are More Immediate Than Checks


Money orders are paid for in advance while checks are paid for on a later date when the check receiver finally gets around to cashing the check.


But money orders are paid for in full the moment someone purchases them.


Since money orders are prepaid, those funds leave your account the moment you purchase the money order.


But checks are not prepaid.


When you use a check, the check funds aren’t taken out of your account until the check receiver manually deposits or cashes the check.


Money Orders Are More Secure Than Checks


Money orders are often a preferred form of payment because they are more secure.


Part of what makes them so secure is that they are a prepaid form of payment.


Since they are prepaid, the receiver will have their funds right away and the sender won’t have to wait for those funds to get pulled from their account.


It’s also very difficult for the wrong person to cash a money order. When you take out a money order you outline who should receive the money so only the correct recipient can cash that money order.


How Do Money Orders Work?



Many people are already familiar with checks and how checks work. But are you familiar with how to use a money order?


If not, have no fear.


The process is incredibly simple and will leave you with a more secure and more immediate payment option in the future.


Find a Money Order Location


First, you have to find a location that offers this financial product.


You can find this financial service at financial institutions and at some grocery stores and supermarkets.


Check City is an agent location with Western Union and offers Western Union money orders.


Find a Check City Store Near You to purchase a money order today!


Be Prepared


Don’t forget to bring what you need to send and receive money through a Western Union agent location.


Whether you’re purchasing a money order or receiving one, there are a few things you’ll want to have with you and some information you’ll need to have handy.


A form of payment. You can use cash or a debit card.


The name of the person or organization receiving the money.


The amount of money you want to send.


Valid government-issued identification may be required.


Fill Out the Money Order


Filling out an order is very similar to filling out a regular paper check.


There are only 5 sections you’ll need to fill out.

  1. The “pay to the order of line.” This line is for the person or company you are sending the money order to.
  2. The “payment for” or “account number” line. This line is optional. Some people use money orders to pay bills. On this line, you can put your account number to make sure whatever bill you have gets paid to the correct account.
  3. The “purchaser’s address” line. This line is for your contact information.
  4. The “purchaser’s signature.” This line is for your signature.
  5. The dollar box. This section is for you to write down the amount of money you want to put on the order.


For more details on filling out orders, go to How To Fill Out A Money Order.


Track Your Order


When you purchase an order you’ll get a receipt. Make sure to keep the receipt in a safe place.


This receipt has all the basic information about the order, including a tracking number.


Go to Track Your Money Transfer at and type in your tracking number or MTCN.




After you click continue you can track your order to make sure it gets where it needs to go safely.


If you send an order in the mail, you should request a mail tracking number so you can keep tabs on the envelope.


How Much Does a Money Order Cost?


Just like many financial services, money orders come with some rates and fees.


If you send the money by mail, then you might also have to pay for postage, extra tracking precautions, mail security, and any other mailing services.


The cost of a money order will vary slightly depending on where you go to get the money order.


Some places also have maximum or minimum limits on the funds you can put on one order.


You can always call a financial institution first, or visit their website, to find out their rates and fees before you use them.


What Are Money Orders Used For?


There are many instances where this financial service can be useful.


Being able to both send and receive secure payments is really important. Especially when those payments are important like rent and utility bills.


Send a Secure Payment


If you really need to make sure a payment goes through, send the funds through a money order.


You’ll be able to make the payment immediately and you’ll ensure the payment receiver has those funds right away.


Receive a Secure Payment


If you are expecting a payment and want to make it extra secure, ask the payee to send you a money order. That way you’ll receive the payment the moment you get the money order.


Don’t Have a Checking Account


Not having a checking account makes transferring money more difficult. If someone doesn’t have any online bank accounts, then they can’t send funds electronically.


Every year the Federal Deposit Insurance Corporation (FDIC) comes out with new survey reports about the finances of US households. In 2019, they found that around 7.1 million US households didn’t have bank accounts.


All of these people still need a safe way to send and receive money. Money orders are one of the primary ways unbanked people can send and receive money securely.


Avoid Carrying Cash


If someone doesn’t have a bank account then they also don’t have checks or debit cards. This makes it difficult to make large purchases without carrying large amounts of cash.


Carrying a lot of cash on you can be dangerous and insecure. If you get robbed or lose that cash there is little that can be done to get that money back.


Money orders are protected from theft because only the intended recipient can cash or deposit them. If you lose a money order you can contact Western Union and cancel it.


So if you need to make a big purchase, but you don’t want to carry lots of cash with you, get a money order instead.


Money orders are accepted by almost any business. You can also use money orders at the bank or any government agency.


Send Money Safely Through the Mail


Many people purchase money orders when they need to send money through the mail.


Sending cash through the mail isn’t the safest way to send money to someone. If someone sees that an envelope contains cash, there’s a higher risk of it getting stolen.


But money orders are just a regular piece of paper that can safely go unnoticed and are harder for thieves to successfully cash.


Avoid Bounced Checks and Overdraft Fees


One of the biggest downsides to using checks is that the payments don’t fall right away.


Instead, you have to wait on another person or organization to get around to processing the check for those funds to come out of your account.


When you live on a tight budget, this wait can really upset your financial plans for the month.


By using a money order instead of a check, you can avoid bounced checks and overdrafts on your account because the money will get taken out of your account immediately instead of later.


Where Can I Get A Money Order

money order store building at check city


The most common place to get a money order is at a financial institution, like a bank or credit union, or at some major stores like Walmart.


Any Western Union location or Western Union Agent location will have the ability to send and receive money orders.


Check City is an agent location with Western Union. Click on your state below and get connected with your local Check City store. Our representatives are friendly and ready to help our customers get the financial services they need.


In Conclusion,


Money orders are a key financial tool for many people. If you haven’t already used a money order, you might be missing out on some great benefits.

Sources “How America Banks: Household Use of Banking and Financial Services.

What is a Personal Loan?


Personal loans are an important loan type to remember when considering your loan options.

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Personal Loan Definition


Personal loans are a type of flexible loan. They usually come with short to medium repayment lengths that last a matter of weeks or months rather than years.


Because these are a smaller, shorter, and more flexible type of loan, they often provide a quicker funding option for borrowers who need money fast.


Personal loans can also be used for many purposes. Borrowers can use them to consolidate debt, start a small business, pay bills, or get your car fixed.


How Do Personal Loans Work?


Loans that come with a specific purpose will most often pay the loan sum accordingly rather than sending the money directly to you. When you take out a car loan it goes right to the car dealership, because that money only has one purpose.


This loan type is more flexible because borrowers receive those funds directly and can spend the money how they choose. They also come with a quick and easy application process:


Step 1


First, visit your local Check City store or go to Check City online to fill out an application.


Step 2


Check City loan representatives will review the application.


Step 3


If the application is accepted, you can pick up your personal loan in cash at a Check City store or have the funds direct deposited into your bank account.



Borrowers receive their personal loans in one lump sum and then pay back the loan in smaller increments over time. That way you can have the cash amount you need upfront rather than having to wait to save over long periods of time.


How to Qualify for a Personal Loan


As with any financial product certain qualifications need to be met by each applicant. One of the perks of this loan type is that there are often fewer requirements because they are a smaller, short-term loan type. Still, there are a few items and qualifications you will need as a loan applicant.


Government Issued ID


The first thing you’ll need is a government-issued form of identification. The lender needs this in order to verify who you are. A few examples of acceptable forms of ID are driver’s licenses, state IDs, or passports.


Open and Active Bank Account


Loan applicants who want to use direct deposit will need to have an open and active bank account that allows direct deposit transactions. Without this, there would be no way for the borrower to receive their loan funds.


Lenders will need to see proof that you have an available bank account for direct deposit. You can show you have a bank account with a bank statement, a blank check, or an online bank statement.


Direct Deposit


You can’t receive your funds through direct deposit if you don’t have direct deposit enabled on an available bank account. To prove you have direct deposit, bring a bank or online bank statement into the store when you apply.


Proof of Income


Lenders need to verify that borrowers can afford the loan they are taking out. You can prove that you have a source of income to make loan payments with pay stubs, job offer letters, or a bank statement showing the direct deposits from your paychecks.


Phone Number


Lenders would be remiss if they did not make sure they can get a hold of their customers. Many loan applications will ask for basic customer contact information like your phone number, email address, and mailing address.


What Can a Personal Loan Be Used For?


The great thing about personal loans is that they can be used for almost anything! You get to decide how to use your funds because you receive the money directly.


Pay Bills


Get all your bills paid on time and in full by taking out a small, short-term loan. Being late on bill payments, utilities, or rent can be detrimental to your credit score and overall finances.


Not only will your credit score go down but you’ll also have to pay high late fees. But if you just take out a small loan instead, you can pay everything on time and completely avoid the hassle of fees.


Fix the Car


Car problems never happen when it’s convenient. When car problems do arise, you need to be able to fix your car so you can keep driving. After all, we depend on our vehicles to run important errands and get to and from work.


Not everyone can afford to have an emergency car fund set aside. That’s where easy small term loans come in. A small convenient loan can give you the cash you need to get your car fixed so you can keep driving.


Consolidate Debt


Do you have a lot of high-interest debt? Multiple forms of debt with multiple high-interest rates can quickly add up to an overwhelming degree. That’s why many people elect to consolidate different debts into one loan with one interest rate.


Start a Small Business


1099 employees, self-employed workers, entrepreneurs, and small business owners need funds to successfully do their work and run their businesses.


Maybe you work from home and need help purchasing a computer or office supplies. Or maybe you have your own business but need some help paying for materials.


Don’t let your business falter or slow down for a second. Take out a small, affordable loan and pay whatever you and your business need to keep working and be successful.


Make Important Purchases


While it’s true that shopping can be a fun and luxurious pastime, sometimes shopping is essential too. If an item you’re shopping for is essential to your professional or personal life then it may be worth getting a small loan to help you make that purchase.


For example, maybe you’re moving to a new place and need help paying for basic household furniture. Or maybe your lawn is overgrown and you could really use a new lawnmower.


Purchases like these easily fall under the category of essential items rather than luxury items and are worth a small, short-term loan if you need help getting these items now.


Take Advantage of Sales


Sales don’t come every day. Some sales only come once a year! When a really good sale comes along for items you know you need, it might be necessary to consider a small loan so you can get the items on sale and save money in the long run.




What is a Secured Personal Loan?


A secured loan is a loan that has some other form of security to help back up the loan. For instance, car title loans are a secure loan that uses the title of a vehicle to help secure the loan funds. That way, the lender can have a form of security in case the borrower can’t pay the loan back.


What is an Unsecured Personal Loan?


An unsecured loan doesn’t have a form of security attached to the loan. That’s why unsecured loans often have higher interest rates and fees to help make up for the added risk the lender is taking.


Personal Loans at Check City


Check City offers loans that are both convenient and affordable. Personal loans at Check City also offer a lower APR than Check City’s payday loans.


The application is quick and there’s no origination fee. All that’s standing in your way is a few minutes of your time to visit a store or fill out an online application.



In Conclusion,


Loans don’t have to be a big hassle and they don’t have to be expensive with repayment periods that seem to last forever. By choosing a personal loan you can enjoy greater loan flexibility along with easier to manage loan terms.

What is a Payday Loan? Debunking the Myths

payday loan cash

Have you ever wondered, what is a payday loan? Keep reading to learn about what payday loans are and payday loan myths.

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If you search for payday loans online, you might find contradictory articles about whether payday loans are bad or useful. In actuality, what you want to stay clear from when searching for a payday loan is indirect lenders, not payday loans themselves.


There are many payday loan myths out there that make it hard to answer the question, “are payday loans bad or not?” We hope to clear up these misconceptions and better explain what payday loans really are and how they work.


What is a Payday Loan?


Payday loans are small loans that borrowers take out usually for a few hundred dollars. Payday loans are also short-term loans that usually get repaid in full in a few weeks.


The purpose behind the design of a payday loan is to help borrowers who need smaller loans than other lenders typically provide. Those arguing that payday loans are bad, don’t understand that payday loans are simply small, short-term loans.


Payday Loan Definition


Payday loans are consumer loans, small loans, and short-term loans. They are primarily designed to help borrowers get to their next paycheck.


Payday loans are not unsecured loans. They are secured loans that are secured with a post-dated check that is scheduled to be deposited on the borrower’s next paycheck.


Payday loans are also known for being high-interest loans. Payday lending often comes with high Annual Percentage Rates (APR) because these lenders take on more risks and because borrowers don’t repay the loan over several years.


How Do Payday Loans Work?


Payday loans work very simply. Many payday lenders even offer payday loans online now.


Here’s how payday loans work:

  1. When someone decides they want a payday loan, they can go online or to a payday loan store.
  2. Then they’ll fill out an application with some basic information.
  3. Next, the payday lenders will overview their application and determine whether their application can be approved or not.
  4. Once the application is approved, the borrower can write a post-dated check for the amount of the payday loan. The date on the check will be scheduled for the day the small loan is due. This date is usually on the borrower’s next scheduled pay date.
  5. Now the borrower can get their payday loan funds and rest assured that their loan payment is already automatically set up to be taken care of.


Reasons People Use Payday Loans


Payday loans, like all loan types, exist for a reason. Since payday loans are smaller, they can help borrowers with smaller, short-term financial needs.


Here’s a deeper look into the many reasons why people choose to take out a payday loan:


Unexpected Expenses


Unexpected expenses can take many forms. Your car could break down, your water pipes could burst, or your basement could flood.


About 28% of US adults can’t afford to put enough money aside for an emergency fund. About 59% of US adults say they are living paycheck to paycheck.


This demographic of people need somewhere to turn when they suddenly need to pay $300+ to fix their car so they can keep going to work.


Help with Expected Expenses


When you are living paycheck to paycheck, budget overlap occurs more frequently.


You can be the strictest budgeter, but when your budget is tight, there are bound to be times when you’ll need a little extra help getting to that next paycheck.


After all, it can cost up to $300 a week just to get groceries to feed a family of four.


Avoid Paying Fees


Fees can really upset your monthly budget if you aren’t careful. There are late fees for credit card payments, bounced check fees, and overdraft fees to be aware of, just to name a few.


Some late and overdraft fees can cost up to $30, which adds up quickly with each accidental overdraft transaction.


Avoid Utility Disconnections


Being late on bills, rent, and utility payments can also stack up high fees. Fees to reconnect your utilities after they’ve been disconnected can cost over $100.


Payday Loan Myths


Why are payday loans bad? There are a lot of payday loan myths, misconceptions, and controversies around whether payday loans are bad or not, what they are, what their purpose is, and how they work.


Payday loan misconceptions are important to understand because they sometimes create regulations and judgments against payday loans that make it harder for borrowers to get the small, short-term loans they need that they can’t get anywhere else.


Here are a few of the major payday myths and misconceptions about payday loans:


Payday loans target people of low-income households and minorities.


Many people have the idea that payday loan lenders are a predatory type of lender. This means that they are lenders who are unfairly targeting a certain demographic or taking advantage of vulnerable people or people in need.


They think payday loans are designed to take advantage of people in the lower-income brackets or that payday lenders don’t fully disclose their payday loan terms.


The truth is, payday loans and payday loan lenders are some of the most regulated loans and lenders in the country in order to ensure no one is taking advantage of anyone.


Payday loan lenders still have to be licensed and registered in order to operate, meaning they must comply with strict guidelines and regulations that keep borrowers safe.


Payday loan lenders even have rules and requirements that may not apply to other lenders who offer bigger loans, like verbally disclosing loan term agreements so borrowers understand exactly what loan terms they are signing up for.


Payday lenders are dishonest and hide fees.


Some people try and say that payday lenders charge hidden fees. But just like any lender, licensed lenders like Check City aren’t allowed to hide their fees.


Just like any other loan lender, licensed payday lenders outline all of their fees in the loan terms and even go over them verbally with customers taking out a payday loan.


This helps payday loan customers always understand exactly what they are paying.


Payday loan interest rates are inflated to gouge the borrower and make a huge profit for the lender.


Another major concern people have about payday loans is that they are expensive and have high rates and fees.


It’s true that payday loans have high APRs, but what people don’t realize is how APRs are calculated. APR measures interest for a whole year, but payday loan customers don’t usually pay more than 10 weeks of interest on a loan.


Payday loans aren’t supposed to be paid back over the course of an entire year but over the course of a few weeks or until your next pay date. Measuring payday loan interest rates with APRs is similar to measuring hotel room rates or car rental rates by year instead of by day.


For example, the average hotel room costs about $180 a night, not $65,700 a year. Likewise, a car rental typically costs $45 a day, not $16,425 a year.


Payday loans are only supposed to be used for short-term purposes and not as long-term financial solutions.


payday loan disclaimers


When used accordingly, payday loans can keep borrowers from incurring other types of fees (like returned check or late rent fees) and avoid potential negative marks on their credit score. For some borrowers, obtaining a short-term payday loan is a quick and easy solution to an unexpected expense.


Payday loans are impossible to pay back.


Payday loans are much smaller than other traditional loans. A typical personal loan can range anywhere from $1,000 to $50,000 depending on the lender.


Other loans also come with longer payment terms that can sometimes span years instead of a few weeks or a few months.


Because payday loans are a much smaller amount (ranging closer to a few hundred dollars than a few thousand) and are paid back in a shorter amount of time, payday loans are arguably easier to pay back than other traditional loans.


Payday loans trap people in a cycle of debt.


Many people think that payday loan borrowers end up in a financially destructive debt cycle because of payday loans. But this isn’t actually possible.


Check City won’t lend to a customer who already has a debt. Plus, the vast majority of Check City customers pay their short-term loans back on time, on their next payday.


It costs less to pay overdraft fees than to choose a payday loan.


Many payday loan borrowers use payday loans to avoid paying late and overdraft fees. This is because fees add up quickly and can cause incredible havoc on a person’s financial wellbeing.


For example, credit cards have an average late fee of $36.34, an average returned payment fee of $34.01, and an average penalty APR of 27.54%. If you’re late paying rent you could be charged up to $50 a day or evicted from your home. If you’re late paying the utility bills you get your heat, water, or power shut off and get charged late fees along with high reconnection fees that can be up to $100 on top of everything else.


Late fees, overdraft fees, and bounced check fees might not be too expensive by themselves, but when you have nothing else left in the budget until the next payday arrives, and your next payday isn’t for another week or two, those fees can add up quickly.


Good credit is required to get a payday loan.


Most lenders will have some credit score requirements. But payday lenders are typically more lenient on the credit scores they accept in their applications in order to make their loans more accessible.


The Truth About Payday Loans


If you really want to know the truth about payday loans and whether payday loans are bad or not, take a look at these fundamental truths about payday loans.


Payday loans are an essential credit option in times of need.


People who are against payday loans often think payday loans prey on people who are in tight circumstances. In fact, the opposite is true.


Payday loan lenders are some of the only financing options many people in tight spots can turn to for emergency credit. Payday loan lenders are some of the only loans that offer instant funds with short wait times when you have a sudden financial emergency and need funds quickly. Payday loan lenders also don’t have the heavier requirements that borrowers have to meet at banks.


Other lenders and banks simply don’t offer loans as small as payday loan lenders. But sometimes borrowers only need a few hundred dollars, not a few thousand. Some borrowers don’t want to have to take out a giant loan they’ll spend their whole life paying off. They just want to take out a few hundred dollars to take care of an emergency need.


In fact, 96% of payday loan borrowers believe that payday loans are useful and that they understood the finance charges outlined in the payday loan terms. 94% of payday loan borrowers believe payday loans are a sensible option when unexpected expenses arise.


The average payday loan is $388.


Payday loan lenders adhere to many compliance regulations in order to be responsible lenders and protect their customers. Here are some of the many things payday lenders go through with each customer:

  • Require a checking account
  • Rescind a loan at no cost within 24 hours
  • Require a steady source of income
  • Allow loan repayment over two months with no additional fees or interest
  • Verify consumer’s ability to repay before approving their application
  • Stop the interest on one payday loan annually
  • Verbally disclose terms and conditions
  • Only pay interest for actual duration of loan if repaid before due date
  • Present extended payment plan option in bolded font in loan paperwork


Payday loan lenders also use information from credit bureaus to make sure their borrowers won’t be overextended. Credit bureaus are able to see an applicant’s financial debts, loans, and obligations so payday loan lenders can deny and approve applicants accordingly.


The truth is, payday lenders have many things in place to help payday loan borrowers pay off their small, short-term loans successfully.


Payday loan lenders often provide many other essential financial services to their community.


Payday lenders often offer many other financial services that are essential to their customers as well, like personal loans, title loans, money orders, check cashing, and tax services.


Many payday loan customers are also a part of the unbanked, underbanked, or cash-only demographics. They need a secure and accessible place to cash their checks quickly so they can pay bills and stay on top of their monthly budget.


In Conclusion,


So are payday loans bad? In actuality, payday loans don’t deserve many of the negative preconceived notions they have. Payday loan lenders are some of the only lenders who offer smaller loans in the $300 range for people who only need a small, short-term loan.


Payday lenders also offer many other important financial services to members of their community. Cashing checks and sending money orders are just a few of the many services payday lenders like Check City provide.


Visit your local Check City today to experience our fast and convenient financial services for yourself!


Charles Schwab. “2019 Modern Wealth Survey.”

Bankrate. “A growing percentage of Americans have no emergency savings whatsoever,” by Amanda Dixon.

Car MD. “2019 CarMD Vehicle Health Index.”

USDA. “Official USDA Food Plans: Cost of Food at Home at Four Levels, U.S. Average, January 2020.”

US News and World Report. “2019 Credit Card Fee Study: What’s Normal and What’s Not?”

TalGov. “Utility Deposits and Connection Fees.”

Community Financial Services Association of America (CFSA). “Borrower and Voter Views of Payday Loans.”

Official USDA Food Plans. “Official USDA Food Plans: Cost of Food at Home at Four Levels, U.S. Average, January 2020.”

Bankrate. “Survey: Rising ATM and overdraft fees leave consumers paying much more than they did 20 years ago,” by Amanda Dixon.

Department of Financial Institutions (UDFI) Annual Report (2019). “Report of the Commissioner of Financial Institutions STATE OF UTAH.”

Business Travel News. “Demand Drives U.S. Hotels,” by Dawit Habtemariam.

Bankrate. “How much does it cost to rent a car?” by Allison Hache.

Avail. “Late Rent Fees and Grace Periods,” by Kasia Manolas.

USA Today. “Bank fees rise for 15th straight year,” by John Waggoner.

Consumer Financial Protection Bureau (CFPB). “List of Consumer Reporting Companies.”

NerdWallet. “Personal Loan Calculator.”

What is an Adverse Action Notice?

person clicking an email button

If you’ve received an adverse action notice in the mail, you might be wondering what it means.

Explore this Guide:


What is an Adverse Action?


An adverse action is a notice that lets someone know their application was denied. You could receive this notice in the form of a letter or an email.


When you apply for credit, a job, an installment loan, or insurance coverage and that application is denied, the person or business that received your application might send you a formal “adverse action” notice or letter. This formal letter lets the applicant know their application did not get approved.


An adverse action notification can apply to many instances of denial or termination. You can receive an adverse action if you were denied a job, if your loan application was denied, or if you are being dropped from any other kind of contract or benefit.


The person or business that sends the adverse action will often have their own requirements that applicants must meet. The adverse action will often outline which requirements you lacked or any other reasons why you weren’t approved for the job, raise, promotion, or loan.


For instance, if you apply for a loan, your application might be denied because your credit score isn’t high enough to meet the lender’s credit score requirements.


Likewise, a job application might be denied due to something in your background check like a criminal history. In both instances, the company might send an adverse action as a way to let you know your application was denied.


What Does an Adverse Action Notice Mean?


An adverse action means your application or request didn’t get approved. An adverse action will also outline the reasons your application or request was denied.


An adverse action is helpful because now you know what you need to work on to get approved next time. You might need to work on decreasing debt or increasing your credit score to get approved for a loan, bank account, or credit card.


What is on an Adverse Action?


The content of your adverse action includes information about why your application was not approved.


Companies might not list every single reason you were denied, but they will list a few of the main reasons you were denied.


Here are some examples of reasons your application might not get approved resulting in an adverse action notice:

  • the application you submitted was incomplete
  • your application for credit was denied
  • special credit terms you requested were denied
  • the lender has a counteroffer
  • something in your credit history doesn’t meet their requirements
  • something in your background check doesn’t meet their requirements
  • you don’t meet minimum age requirements
  • you don’t meet minimum income requirements
  • your overall debt is too high
  • you have too many recent credit applications
  • you don’t have enough credit history
  • your credit score is too low
  • you have a history of late payments


The adverse action will have some other basic information on it as well:

  • applicant’s name and address
  • applicant’s credit score
  • official reasons for the application’s denial
  • contact information for the consumer or credit report agency that was used
  • explanation that the credit agency was not responsible for the denial and thus doesn’t have answers about why the application was denied
  • explanation that the client has a right to get a free copy of the consumer or credit report
  • explanation that the client also has the right to dispute any inaccuracies of any kind in the report


With the information found on an adverse action, you can now better understand where your credit score stands and how you might be able to improve your credit.


Examples of an Adverse Action


You can receive a notice of adverse action from many places and for many reasons. Here are a few examples of an adverse action:

  • a landlord denies your rental application or is evicting you from the premises
  • a lender denies your application for a loan or line of credit
  • an employer denies your application for employment


The adverse action will look different based on who is sending it.


If the adverse action is from your landlord then the notice will have the name of the property, the landlord, the landlord’s signature, and bulleted lists outlining why your rental application was denied.


If the adverse action is from a financial institution, it will look similar, but the bulleted items will be financial requirements that applicants must meet, and not rental requirements that tenants must meet.


Pre Adverse Actions


What is a pre adverse action letter?


A pre adverse action is a notice that comes before the official decision has been made. Pre adverse actions are used most often during the hiring process to let an applicant know that something failed in their background check.


A pre adverse action is not an official denial though. It simply informs the applicant that the company is considering denying or withdrawing their job offer and why that is the case.


Just like an official adverse action, a pre adverse action notice contains the following information:

  • explanation that a full adverse action is being considered
  • a copy of the report that contains the information causing an adverse action to be considered
  • the contact information for the reporting agency
  • an outline of all the applicant’s rights from the Fair Credit Reporting Act (FCRA)


The reason some employers will send a pre adverse action is to give the applicant time to dispute the application denial before the denial is official. This is especially helpful in the case of a failed background check.


When Do You Get an Adverse Action Notice?


There are many reasons you might receive an adverse action. When you get an adverse action you will most likely receive it electronically or in writing.


For example, many adverse actions will come to you in the mail or via email.


When you get an adverse action, you can expect to get it anywhere around 7 to 10 business days after you’ve been denied.


Here are just a few examples of the instances when you might get an adverse action:

  • when you want to get a loan
  • when you want to get a credit card
  • when applying for a new apartment
  • when applying for a job


There are also some rules and guidelines for applications set by the Equal Credit Opportunity Act (ECOA) and the Fair Credit Reporting Act (FCRA) that businesses must follow when approving and denying applications.


Be aware of your rights so you know when a denied application was justified or not.


For example, no one can deny you credit or employment because of your race, color, religion, national origin, sex, marital status, age, or because you get public assistance.


FCRA Requirements


If you are wondering whether your credit score meets FCRA requirements, you can learn more about them on


On this website, you’ll find all the legal details about the FCRA, its purpose, and its requirements.


What to Do if You Get an Adverse Action Notice


So you got an adverse action. You’re probably wondering what to do now.


The first thing you need to do when you get an adverse action is understand your rights.


For example, when an application of some kind gets denied based on your credit, consumer, or criminal history then the party that denied your application is legally obligated to send you a formal adverse action, outlining why you were denied.


They also need to provide the contact information of the agency they used to get your credit, consumer, or criminal history so you can also access that information.


Once you understand your rights, get your own credit report to see your credit score and credit history for yourself.


Now that you have your own credit report in hand, check your credit history for any errors. If you do find an error, an inaccuracy, an instance of fraud, or an incomplete area, dispute it directly with the credit agency to get it fixed.


After taking care of any potential errors on your credit report, you can use insights from your credit report to work on improving your credit score.


A typical credit report includes your payment history, amounts owed, the length of your credit history, credit mix, and any new credit. So if you are frequently late making payments you’ll see this information here and can work on making this part of your credit history better.


By working to better your credit score, you can eventually apply again with more confidence, knowing that the reasons you were denied have improved.


How to Avoid an Adverse Action


An applicant’s credit history is very informative for the people and company’s processing your application.


By looking at a credit report, they can know if you will make payments on time, if you can handle this amount of debt, and how responsible you are overall with your finances.


The best way to avoid an adverse action is to prevent negative marks on your credit report in the first place. The following are a few examples of negative actions you want to avoid getting on your credit report:


Late or Missed Payments


Avoid late or missed payments first by living within your means.


If you are currently living paycheck to paycheck, find a way to increase your monthly income or downgrade your lifestyle to better fit the budget you have. This will make it a lot easier to keep up with all your payments.


You can also make use of autopay options wherever you can. Autopay is a great way to automate your budget and never miss or be late on a payment again.


Defaulting on Credit Accounts


What does it mean to default on a credit account?


Defaulting on credit is when you’ve missed multiple payments on a debt or fail to make payments on that debt at all. Avoid defaulting on credit accounts by avoiding going into debt you can’t afford.


Each time you take on a debt, it should be carefully planned into your current monthly budget. If it won’t fit into your budget, then seek out other options.


Overall Debt is Too High


Your total debt becomes too high when it goes over a certain debt to income ratio. The ideal debt to income ratio is under 36%. This means that ideally, you would only have 36% of your monthly income going toward debts.


Typically, 43% is the highest many lenders will accept when processing an application for a loan or line of credit. But you want to keep your debt to income ratio lower than this whenever you can.


If your overall debt payments are higher than 40% of your income, then make a strict budget and payment game plan to start reducing your debts.


Stay Updated on Your Credit Report


You can also help prevent these negative marks on your credit history by keeping tabs on your credit report yourself.


Don’t wait for an application to get denied to check out your own credit history.


Once a year, go through your consumer and credit history for accuracy and to see how you are doing.


This way you will be aware of any financially unhealthy habits you need to work on and you’ll be able to catch and take care of mistakes before submitting applications that will look at your credit history.


Get Good Credit Where Credit is Due


Not all financial actions get counted in your credit score unless you do something to make them count.


For instance, make sure your on-time utility or phone payments are going toward boosting your credit score by contacting your credit agency and allowing them to add that information to your credit file.


If you plan responsibly, you can also use credit cards to make all these payments, then pay off your credit card immediately in order to make this positive payment history impact your credit history for the better.


Experian. “What Is an Adverse Action Letter?” by Ben Luthi.

The Balance. “What Is an Adverse Action Notice? Use this disclosure to understand and overcome a credit denial,” by Latoya Irby.

Investopedia. “Adverse Action,” by Jason Fernando.

Examples. “What Is an Adverse Action Notice?”

Hire Safe. “What is Adverse Action?” “Credit reporting requirements (FCRA)”

Confidence with Licensed Direct Lenders

direct road

The first things you need to know before shopping for a loan are the difference between direct vs indirect lenders and the importance of using a licensed lender.

Explore this Guide:


What are Licensed Lenders?


Licensed lenders are lenders who have a specific license to lend with the federal and state government.


Licensed lenders have to follow both state and federal government requirements. If a lender is licensed, then you know they follow important regulations to keep their borrowers safe.


How Do Lenders Get Licensed?


To get a license, lending companies need to meet specific requirements, apply and get approved, and keep their services up to date with state and federal regulations.


Lenders apply for this license with the Nationwide Mortgage Licensing System (NMLS), the Department of Business Oversight (DBO), the Department of Financial Institutions, or the Residential Mortgage Lender License (RML).


To meet the strict approval process’s requirements lenders need the following:

  • A detailed business plan
  • Disclosures
  • Certificates of authority
  • Organizational charts
  • Financing requirements
  • Background checks for everyone involved in the lending
  • Application fees ranging around $400
  • Surety bonds


Lenders who specialize in dealing with mortgage loans have added special requirements like getting approval from the following organizations:

  • Federal Housing Administration (FHA)
  • Veterans Administration (VA)
  • Farmers Home Administration (FmHA)
  • Government National Mortgage Association (Ginnie Mae)
  • Federal National Mortgage Association (Fannie Mae)
  • Federal Home Loan Mortgage Corporation (Freddie Mac)


Licensed lenders also have to deal with regular state and federal audits that routinely make sure licensed lenders are following all laws and regulations. This means they have to keep very detailed and organized financial statements and documents.


When a lender is licensed, you know as a borrower that the lender is being held by a higher standard.


What are Direct Lenders?


Direct lenders offer loans directly.


Some examples of direct lenders include banks, credit unions, and financial institutions like Check City.


At a direct lender, borrowers apply and receive loan funds all with the same company. This includes payday loans online, bad credit loans, personal loans, cash loans and more.


What are Indirect Lenders?


Indirect lenders offer loans indirectly.


Another term for indirect loans and indirect lenders is dealer financing. This is because working with indirect lenders is like going to a loan dealership where lots of different loans are available and a salesperson is going to try and sell you a specific one.


At an indirect lender, borrowers apply for a loan with the indirect lender, who then gives that application to many other third-party lenders in order to get a client their loan.


Direct Lenders vs Indirect Lenders


Like with all lending options, there are pros and cons to both direct and indirect lenders.


Indirect Lenders have the interest of many different lenders to take their attention away from you and your needs as a borrower.


Payments and interest rates for indirect loans are often higher because you’re paying for the extra work of the loan intermediaries and the actual lender.


Your creditworthiness will be a higher priority to get a loan with an indirect lender since indirect loans are higher risk loans than direct loans.


Borrowers who seek indirect lenders are often stumped on what lender to use and thus seek the help of a loan intermediary.


Direct Lenders often have lower interest rates and payments than indirect lenders do.


They also often come with better payment plan options because they can offer more flexibility since they are the actual lender.


Customers often experience less pressure from direct lenders because direct lenders don’t have to make loan sales for other lenders the way indirect lenders do.


You also won’t have to deal with loan negotiations that can get messy and complicated with a direct lender. Everything is just written out clearly ahead of time so you know the kind of loan you are signing up for before you even apply.


Your private and personal information is also more protected with a direct lender since direct lenders don’t send your application information to multiple lenders like indirect lenders do.


Instead, your application information just goes to the direct lender.


Business Lending vs Consumer Lenders


Business Lenders lend funds specifically to businesses while Consumer Lenders lend funds to individuals.


Some lenders offer loans to both businesses and consumers while other lenders only offer one or the other.


Direct Lender Loans


A direct lender loan is the best type of loan because you’ll be dealing directly with the lender instead of with a third-party loan intermediary.


A direct lender loan may be able to get you better interest rates, better payment options, more flexible loans, more personal customer service, and more transparent loan terms.


Direct Lender Installment Loans For Bad Credit


Direct lenders who offer installment loans are more likely to approve loans for borrowers with bad credit.


Because they have a direct relationship with the borrower, they can offer other forms of loan security, like with signature loans or title loans. That way, borrowers with bad credit still have loan options available to them too.


Guaranteed Payday Loan Direct Lender


Payday loans are a type of loan designed to help borrowers get to their next paycheck sooner.


Payday loans are a quick and small loan designed to be paid off quickly. The purpose of a payday loan is to give customers quick, emergency finance options for when they need them most.


The payday loan process is much faster with a direct lender. A speedy approval and funding process for payday loans is essential to getting customers the funds they need right when they need them.


Direct Lender Online Installment Loans Instant Approval


When you work with a direct lender you can sometimes get instant approval or preapproval for loans.


That’s because you are working directly with the actual lender so they can quickly make those loan application decisions for you.


Indirect lenders don’t usually have the power to grant instant approvals or preapprovals for loans because they are not the lender.


Check City is a Direct Lender


Is Check City a direct lender? Yes!


Since Check City is a direct lender you can take all your loan questions and concerns to us directly. You can also get some of our loans as quickly as the same day with direct deposit or by coming into your nearest Check City Store.


Check City is a Licensed Lender


Is Check City a licensed lender? Yes!


You can take a look at Check City’s lending licensing by visiting our Responsible Lending Statement Page or our State Licensed Lender Page.


Because Check City is a licensed lender we have to meet all the important requirements set to keep our lending secure and safe. And we’re glad to do it!


In Conclusion,


The best loans come from lenders who are both direct lenders and licensed lenders who comply with both the state and federal rules and regulations.


This is the best way to make sure your loan comes with the best terms and the most security.


The Balance: Small Business. “What Is Lending? Definition and Examples of Lending,” by Jean Murray.

Utah Department of Financial Institutions. “Consumer Lending.”

Investopedia. “Mortgage Broker vs. Direct Lender: What’s the Difference?” by Zina Kumok. “Loan Officer License Information: Everything you need to jump start your career and earn your Loan Officer License!”

What is ACH Payment?

making an ACH payment online

You may not realize it, but you probably use ACH payments more than you know.

Explore this Guide:


If you’ve never heard of ACH then this article is for you.


Most likely, it’s a network you use a lot without even realizing it.


What is ACH?


The term ACH stands for Automated Clearing House. It is run by the National Automated Clearing House (NACHA), which is where it gets its name.


It is an electronic system that transfers funds. This electronic money transferring system is most commonly used for payroll, direct deposit, tax refunds, online bill pay, tax payments, loan payments, and other payment or electronic money transfers.


It is how we move money digitally. In fact, it is so essential to modern-day finances that almost 93% of Americans use the Automated Clearing House to get paid.


What is Automated Clearing House?


Automated refers to the fact that it’s an automated system. This is what makes ACH ideal for transferring electronic funds because the system does it automatically and no one has to manually process each transaction.


The Clearing House is the electronic network that electronic transactions go through to get processed safely and securely. This way each electronic transfer doesn’t have to go through lots of other channels to get to where it needs to go.


The Automated Clearing House network can handle our electronic money transfers in the fastest, most secure, and most direct way.


It is used by US financial institutions, businesses, government organizations, and individuals.


What is ACH Number?


An ACH number is an ACH routing number unique to a financial institution. Banks and credit unions use this number to transfer funds from bank to bank.


This 9-digit number can also be referred to as the routing number for electronic deposits or direct deposits.


The ACH routing number may be different than the routing number on your checks or the routing number used to wire funds to or from your financial institution. It’s important to ensure you have the correct ACH routing number when providing this to the transmitter.


ACH Number vs Account Number


An ACH number is the financial institution’s account number for electronic deposits and transfers.


An account number is the routing number of someone’s personal financial account, whether that’s a bank account or credit union account.


Each bank account number has a unique account number with 8 to 12 digits. Think of it as a unique identification number for your personal financial account. Meanwhile, the ACH number is the unique identification number for financial institutions.


What is ACH Payment?


An ACH payment is an electronic payment. Electronic payments use the Automated Clearing House system in order to process the electronic money transfer.


If you make an online payment to pay a bill or a loan payment, it might get referred to as an ACH payment.



ACH Payment Examples:

  • Credit card bills
  • Debit card payments
  • Other bills
  • Subscription payments
  • Sending money using Venmo or Paypal


What is ACH Transfer?


When you transfer money online you are making an ACH transfer. Whether you’re moving money from one account to another or sending money to a friend with PayPal or Venmo, you’re using the Automated Clearing House to transfer those funds.



ACH Transfer Examples:

  • Sending money using Venmo or PayPal
  • Transferring money from bank account to another
  • Transferring money from your checking account to your savings account
  • Direct deposits like paychecks or tax refunds


What is an ACH Transaction?


When you buy something online or use an electronic payment method like a debit card or your phone, you’re making an ACH transaction.



ACH Transaction Examples:

  • Direct deposit
  • Paychecks
  • Automatic bill payments
  • Making electronic purchases
  • Transferring money to an online bank account


What is ACH Credit


A credit to your account is when funds are added to your account.


An ACH credit is when funds are given to an account through an electronic deposit.


When you receive a direct deposit of some kind you can refer to that online transfer as an ACH credit because the Automated Clearing House is the system the funds went through to get to your account.



ACH Credit Examples:

  • Paychecks
  • Government benefit checks
  • Tax refunds
  • Depositing money into your online account
  • Getting a refund


What is ACH Debit


A debit is when funds are subtracted from your account.


An ACH debit is when funds are sent from your account through an electronic withdrawal.


Anytime you make an electronic payment you are using the Automated Clearing House to securely transfer those funds from your account to somewhere else.


These debits are often scheduled to be paid automatically on scheduled dates. Using ACH to set up automatic payments is a great way to make sure you always pay your bills on time.



ACH Debit Examples:

  • Utility bills
  • Rent
  • Mortgage payments
  • Credit card bills
  • Loan payments
  • Subscriptions
  • Making purchases online


What is an ACH Deposit


ACH deposits are when funds are added to an electronic account through electronic means. These deposits allow companies and individuals to send and receive money from their online accounts.



ACH Deposit Examples:

  • Paychecks
  • Interest payments
  • Social security
  • Tax refunds


What is an Originator?


An originator is a word often used for the person who starts the electronic transfer. So if account A is sending money electronically to account B then account A is the originator and account B is the receiver.


The originator’s account might also be referred to as the Originating Depository Financial Institution (ODFI), while the receiver’s account might be referred to as the Receiving Depository Financial Institution (RDFI).


How Does ACH Work?


First, the originator makes the first move to begin the electronic transaction. The originator will have to provide accurate information like the account and routing number of the receiver for the electronic ACH file.


Second, the file with all the necessary information for processing is electronically sent to the Automated Clearing House network.


Third, the Automated Clearing House will automatically and electronically go through, verify, organize, and schedule the files they receive.


The ACH network holds the electronic transactions and sends them out in groups or batches at scheduled periods throughout the day. This makes the deposit system faster so it doesn’t get overloaded at any one time.


Is ACH Secure?


Using the Automated Clearing House to handle your online transactions is one of the safest ways to manage your electronic funds. Since it is operated by the National Automated Clearing House Association you can rest assured knowing your electronic transactions are being handled with the utmost security.


The only real risk in using this electronic money handling network is that you’ll need to use your bank account number to send and receive funds. Some personal information is almost always required in any financial transaction though. So long as you are careful to only give this sensitive information to legitimate people, businesses, and employers your risks are low.


How Long Does it Take for ACH to Deposit?


Because of the batch processing system the Automated Clearing House uses to process electronic transactions faster, deposits can take as little as 1 to 4 business days to fall into the receiver’s account.


If you send a deposit during a weekend or holiday, then those funds might not drop until 1 to 4 business days after the holiday is over.


But many times funds can be deposited into an online account that very same day.


ACH vs Wire Transfers


Though very similar, Automated Clearing House transfers and wire transfers have a few key differences.


Wire transfers are electronic transfers between bank accounts and Automated Clearing House transfers are direct deposits.


ACH transfers are usually free, processed in batches instead of one by one so they get processed faster, and are automatically processed instead of manually processed by a bank teller.


Wire transfers can be sent and received internationally though, while ACH transfers are a network that only operates in the US.


Reasons to Use ACH


  • Get your funds faster
  • Cheaper way to send and receive money without the fees you would have for transactions like cashing a check
  • Secure way to send and receive money from your account
  • Can schedule regular payments
  • Paperless money transfers are better for the environment and less hassle for you
  • Won’t miss payments if your payments are electronic and automated
  • Electronic ACH payments can’t get lost in the mail


One downside is that since the Automated Clearing House is an automatic payment you do run the risk of accidentally not having enough funds in your account when the scheduled payment occurs.


You still need to be aware of when you have payments scheduled so you can make sure you have enough in your account.


In Conclusion,


The ACH network is something many of us use every day without even knowing it.


But understanding more about what it is and how it works can help you make better decisions when sending and receiving money and can help you understand your personal finances on a deeper level.


Bureau of the Fiscal Service. “Automated Clearing House.” “What is ACH: ACH Almost Certainly Touches your Life.”

The Balance. “What Does ACH Stand For?” by Justin Pritchard.

Investopedia. “ACH Transfers: What Are They and How Do They Work?” by Rebecca Lake.

Investopedia. “Automated Clearing House (ACH),” by Will Kenton. “History of Nacha and the ACH Network: A Proud Past and a Vision for Tomorrow.”

Loan Terminology You Should Know


Check your knowledge of basic loan terminology.

Explore this Guide:


There are many reasons to get a loan.


Loans can help you get the things you need now instead of waiting years to save up.


They can help get you the car you need to get to work, a home to call your own, or even help you pay your bills on time to avoid hard-hitting late fees.


Before you take advantage of what different loan services can do for you, you should take a moment to test your knowledge of basic loan terminology.


Automated Clearing House (ACH)


The Automated Clearing House (ACH) is a program designed for processing online financial transactions. It can help with credit transfers, direct debits, direct deposits, and fee charges.


This is the program that allows borrowers to select auto payment options and direct deposit.




The term amortization means to gradually pay off a debt through making planned payments on the principal and interest over time. This is similar to installment loans where you make loan payments in installments rather than all at once.


Amortization is when you spread out the cost of a loan or debt over a period of time. Amortization calculators are then used to figure out how much each installment payment should be.


Annual Percentage Rate (APR)


Annual Percentage Rate (APR) is the interest rate of a loan over the course of one year. It’s how much interest would be applied to your loan over the course of an entire year.


APR also includes more than just the interest rate. It includes all of the extra rates and fees you would pay for a loan.




The person who fills out the application for a loan is called the applicant. The applicant can also be referred to as the borrower.




Another term for the applicant is the borrower. This term is used to refer to an applicant who is applying to borrow funds through a loan service.




A co-signer is someone who also signs the loan application.


They aren’t the main applicant or borrower but they are helping the main borrower secure the loan by also signing the application. This additional signature helps secure the loan because the cosigner takes on responsibility for the loan as well, helping the applicant look more secure in the eyes of the lender.


Debt Consolidation


Debt consolidation is an important type of debt refinancing for people with high consumer debts.


To consolidate means to bring many things together into one. When you consolidate debts, you bring many debts into one loan. This allows you to pay off debts and start fresh with one single loan.


For example, if you have debts on several different credit cards, you could use debt consolidation to pay them off and stop paying all those different interest rates.




When you default on a loan, you fail to meet an obligation on your loan contract. This could mean you didn’t make a payment or were late making a payment.




When something is deferred it is put off or delayed.


You can apply for a loan deferment if a loan company offers deferments and you meet their deferring requirements. Then you can defer, delay, or reschedule your loan payments.


Deferments are helpful when something like a late paycheck makes it difficult to repay the loan.




A downpayment is the first payment you make on a large purchase that requires a loan.


Often, the higher initial payment you can make, the less you’ll have to pay off later via the loan, and you can sometimes get better payment options and interest rates too.


Fixed Rate


A fixed rate is a type of interest rate that remains the same during the life of the loan. Other loan types might change the interest rates at certain points during the loan’s life depending on what’s outlined in the loan agreement.




The interest is an extra percentage that accumulates during the life of a loan. This is what helps pay the lender for issuing the loan in the first place.


Each lender has different practices for how interest percentages are applied and how interest payments are made.




A lien is what you grant a lender when you give them partial ownership of one of your assets during the life of a loan.


Liens are often used in Title Loans, also frequently referred to as auto loans. A lien gives the lender partial ownership on the title of your car to secure the loan while you pay it off.


Using collateral like a lien on the title of your car can help borrowers who have low credit scores and need another method to insure the loan.


Loan Approval or Loan Commitment


When your loan application gets approved it might be called a loan approval or a loan commitment.


Loan approval might also differ from your loan commitment, because there could possibly be a final step involved in the loan approval process that is for you to actually commit to the loan agreement upon accepting your loan approval.


When your loan application gets approved, you’ll most likely receive a notification from the lender through the contact information you provided them on your loan application.


Loan Denial


When your loan application gets denied you’ll receive a formal loan denial often in the form of a letter or email. This formal loan denial notification will often tell you the reason your loan was denied.


This could be due to something on your credit report like high debts or a low credit score. It could also happen because the lender just needs some more information from you or something was incorrect on your loan application.


Loan Underwriting


Loan underwriting refers to the loan terms and application and approval process of a loan.


During the loan approval process, a lender needs to look at certain things to see whether you qualify for the loan. A lender will look at an applicant’s credit score and any other financial information like your financial capacity and collateral.


The loan’s underwriting includes all the qualifications a borrower needs to meet before they can get approved for that loan.




A mortgage is a type of loan used for purchasing a home.


Real estate has its own loan type because mortgages come with unique requirements and characteristics because property and ownership are involved.


Learn more about mortgages and the process of buying a home in, “How Much House Can I Afford?


Origination Fee


Loan agreements often come with fees. An origination fee is one of the first fees you pay when getting a loan.


This fee pays for the loan company’s handling and managing of the loan.


The origination fee is meant to cover the costs of processing your new loan. Hence the reason it’s called an origination fee, because it pays for creating a new loan.




When a lender offers pre-approval, this means that they offer the ability to apply before applying.


They can quickly tell if you would get approved for a loan and let you know if you are pre-approved. Then you can decide whether you want the loan or not.


Pre-approval is a quick way to know early on what loan products you qualify to take out.


Preliminary Disclosures


A preliminary disclosure is a brief overview of your financial assets and standing.


It lists your general assets and liabilities or the things you have financially working for and against you. It’s a financial inventory that helps lenders understand where you stand financially.


There’s also a final disclosure that gives more details about your financial inventory.


Preliminary Title Report


A title report is a report that outlines all the details of ownership on a title, like liens. A preliminary title report might be a briefer overview for the sake of time and efficiency when applying for a title loan. It goes over the basic property records.


Primary Residence


Your primary residence is the main place where you live. Some people might frequently stay with family members, but your main place where you live the most is your primary residence. It’s where your bedroom and most of your things reside.


Lenders need to know your primary residence so that they can send any important mail to the correct address where you will be the most likely to get it.




The principal balance is the initial starting amount of the loan. For example, if you take out a loan for $100 then $100 is the principal.


But by the end of the loan, with all the accumulating interest, rates, and fees added, the loan amount might grow beyond $100.


Promissory Note


A promissory note can also sometimes be called a note payable.


This note is a legal promise in writing to pay a certain sum at a certain time. Promissory notes might be used when someone is indebted to someone else and will outline all the terms of that debt.




Refinancing is when you take an existing loan contract and adjust it. Often refinancing is used to help stretch out payments over a longer period of time in order to lower your monthly payments.


It can also be used when you need a bigger loan and want to refinance for a larger loan sum.




The title of a car is what tells you who owns the vehicle. The title to a house or property also outlines the ownership of that property.


If you are still paying off a car or home loan then the lender will also be on the title.


If you take out a title loan then the loan company will also temporarily take out a lien and appear on the title of the car during the life of the loan.


Variable Rate


A variable interest rate can also be called an adjustable rate or a floating rate. This type of interest is not fixed and becomes higher or lower depending on a benchmark interest rate or market index.


In Conclusion,


If you’re going to get loans you should know what different loan terminology means. This will help you be more aware of the loan process and know you’re getting the best loan product around.


Find the best loan products around at your nearby Check City or by visiting Check City’s online loan services!


US News. “What Is Loan Underwriting?” by Ben Luthi.

Investopedia. “Principal,” by James Chen.

Real Estate Lawyers. “What is the Preliminary Title Report?” by AUTHOR.

Credit Karma. “What is APR and why is it important?” by Lance Cothern.

Investopedia. “Variable Interest Rate,” by James Chen.

Investopedia. “Amortization: What is Amortization?” by Alicia Tuovila.

Cashier’s Check vs Certified Check

cashier's checks and certified checks

When you need to make a secure payment, certified checks and cashier’s checks are the financial product you want.

Explore this Guide:


What is a Cashier’s Check?


A cashier’s check is a check that is paid for by you, but written and secured by the bank.


This is why it’s called a cashier’s check because a cashier or teller is the one who writes and signs the check. Funds are drawn from the bank, after you pay for the cashier’s check at the bank branch.


You can purchase a cashier’s check from a bank or credit union.


What is a Certified Check


Certified checks are personal checks that are written by you, secured and guaranteed by the bank, and paid for with your personal bank account.


Certified checks are still personal checks and are signed by you, not the bank. But with a certified check, the bank verifies that the check signer can pay for this check with their personal bank account.


Certified Check vs Cashier’s Check


Certified checks and cashier’s checks are similar in that they are guaranteed, prepaid checks.


In both cases the bank employees can help you set up the check and you are responsible for paying the check amount.


But with a cashier’s check, you pay the bank for the check using a payment form like a debit card or credit card.


With a certified check, you use the funds in your personal checking account with the bank to pay for the check. Bank account holders will then have the easiest time getting a certified check.


Because cashier’s checks and certified checks are guaranteed by the bank, they are often used when the check sender and receiver need to be extra sure the check will successfully go through.


Where to Get a Cashier’s Check


You can get a cashier’s check from a bank or credit union.


If you have an account with the bank or credit union, you might be able to order a cashier’s check with them online. This just depends on whether they offer online cashier’s check services.


Where to Get a Certified Check


You can get a certified check from a bank or credit union where you have a personal account like a checking account.


Because certified checks are secured against the funds in your personal account, you need to have a personal account with that financial institution.


That personal account also needs to have sufficient funds to pay for the amount you want to put on the certified check.


How to Get a Cashier’s Check


Step 1: Have your payment ready


The bank uses its own funds to pay for the cashier’s check. This means you’ll have to pay for the cashier’s check at the teller window.


Be prepared to pay for the amount you want to put on the cashier’s check and for any cashier check fees the financial institution might have.


Step 2: Have the check information ready


The bank will print off the completed cashier’s check with all the details. So you need to have all the check details ready for them.


They’ll need to know the name of the check recipient and the amount of money you want to put on the check.


Step 3: Don’t forget the receipt


Once the financial institution prints out your cashier’s check, make sure you ask for a receipt.


This will allow you to track your cashier’s check if you need to. It will also give you documentation for your end of the check transaction.


How to Get a Certified Check


Step 1: Make sure your personal account has sufficient funds


It’s also a good idea to call your financial institution and make sure they offer certified checks and ask about any certified check fees.


Step 2: Make an appointment at your bank or credit union


Bring your checkbook and personal identification with you.


At the bank appointment you’ll write out the check, pay the certified check fees, and wait for the teller to certify and stamp your check.


Step 3: Deliver your certified check


Deliver your certified check personally or send it in the mail with a certified mail receipt and tracking options.


Certified checks are a type of prepaid check, so they are difficult to cancel.


Cashier’s Check vs Money Order


Certified checks and cashier’s checks are checks that your bank helps secure, guarantee, and verify for the check recipient knows you can pay.


Money orders are a form of payment that aren’t backed by the bank but by the money order customer. You can also get money orders from many places including Check City Money Orders or your local post office.


Money orders can also be sent securely to their recipients through Western Union locations.


The money order recipient just needs to know the money order’s 10-digit tracking number or MTCN.


When to Use a Cashier’s Check


Cashier’s checks are most often used when you want to carry a large payment without carrying cash.


Many people choose to bring cashier’s checks with them to auctions so they can pay for their items with a certified check without having to bring large amounts of cash on their person.


Read more about how checks can keep your purchases safe in, “6 Advantages of Using Checks.”


Real estate deals are another instance when you might use a cashier’s check. You can secure the title to a house with a secure cashier’s check with less risk for you and the check receiver.


Cashier’s checks also help you have large amounts of money ready for larger purchases.


Financial institutions often have extra checks and balances involved when trying to make large payments. Using a certified cashier’s check will help you bypass these checks and balances so you can make large payments on time.


When to Use a Certified Check


Certified checks are great to use when you need a secure and certified form of payment.


They are especially useful for when you need to send a payment through the mail.


Check City Money Transfers are another great service for sending money safely.


Check recipients often prefer certified checks when the check writer and receiver don’t necessarily know each other. The bank guarantees the amount of the check so the check receiver doesn’t have to worry.


Some scenarios where you might need a certified form of payment are when you’re making a downpayment on a home, a vehicle, or sending money to someone in the mail.


Cashier Check Scams


There are 2 main types of cashier check scams.


Either you receive a cashier’s check that is fraudulent or a fraudulent person or organization tries to convince you to send them a cashier’s check.


If you receive a cashier’s check, verify that it’s genuine by contacting the financial institution that issued the check.


You also want to check that the financial institution itself really does exist and is a genuine financial business. You can check a business’ genuinity by looking it up on the Better Business Bureau’s website.


The check might have the name and contact information of the bank on it, but don’t trust the number written there.


Instead, look up the number yourself in case the check is counterfeit with a fraudulent number.


If you are sending a cashier’s check, make sure you are sending the check to a genuine person, business, or organization.


Do your research into the person, business, or organization to make sure they are legitimate and that the mailing address given to you is correct.


Learn more about how to avoid check scams in “How to Cash a Check.”


It’s always a good idea to keep and file all documentation involved in check payments so you have a record of everything that happened.


It’s also a good idea to always know who exactly you are doing business with when handling financial transactions.


Common Check Scams


Most check scams involve either fraudulent checks or fraudulent organizations trying to receive genuine checks from you.


Work From Home Check Processing Job Scams


Someone sends you a cashier’s check and you are supposed to “process” this check as a work from home job.


You’re instructed to deposit the check in your own account and then forward the money to someone in order to “process” the check.


This is not a legitimate check processing method. Only financial institutions are authorized to process checks, not personal checking accounts.


This cashier check scam is designed to use you for money laundering or trick you into processing a fake check and losing money.


Shopper Scams


Someone sends you a cashier’s check to use as a mystery shopper or as a coupon or prize.


They might instruct you to deposit the check into your account and spend or transfer the money in specific ways.


But the check is fraudulent and you end up losing money or getting into trouble.


Customers Paying In Fraudulent Cashier’s Checks


You have a business of your own where you sell products or services and a customer steals your goods or services by paying with a fake cashier’s check.


Lottery Scams


You get a letter that says you’ve received a large amount of money in some way. It might say you won a lottery, won a prize, or received an inheritance.


The letter includes a cashier’s check that’s supposed to be used for the taxes or fees involved in sending you the full amount later that you’ve supposedly gained.


What really happens is that you pay a scammer fake fees and never receive any of the fake prize money.


Property Rental Scams


Property rental scammers can happen to renters and rental owners alike.


A potential resident pays the security deposit with a cashier’s check but then backs out of the contract and asks for their refund.


You send them their refund, but try to cash the check and realize it’s fake.


Renters can also run into a similar problem. Scammers will pose as rental property owners and ask for you to send them a cashier’s check for the security deposit or rental applications. But there is no rental property.


In Conclusion,


Checks are far from a dead medium.


In fact, using checks can be the safest way to send and receive money, especially when making large, important purchases.


So long as you look out for the red flags of check scams, you’ll be able to take full advantage of all the ways check cashing can keep your money safe.


Visit your neighborhood Check City Store for more check cashing services, including Cashier’s Check Cashing.


Investopedia. “Certified Check,” by Julia Kagan, “Best Ways to Get a Cashier’s Check,” by Rebecca Lake.

Nerd Wallet. “What Is a Certified Check?” by Juan Castillo, “Cashier’s Check: When You Need One, How to Get It,” by Alice Holbrook.

Experian. “Cashier’s Checks: When and How to Get One,” by Ben Luthi.

Bankrate. “What is a certified check?” by Matthew Goldberg.

SmartAsset. “What Is a Cashier’s Check, and Where Can You Get One?” by Emily Zhu.

Department of Financial Institutions. “Cashier’s Check Scams.”

Investment Definition


Explore this Investment Guide:


Investment Definition


What is an investment? Investing is the process of when you spend money in an effort to grow that money. An investment is whatever you decide to spend your money on to achieve this goal of monetary growth.


Investing is one way to grow your wealth and make your money work for you. By putting a certain amount of funds into something, like a business, stock, or product, that initial investment amount can grow into much more.


Investments are also financial assets and resources. When you have financial assets, you have financial resources you can lean on in case of emergencies. For example, if you invest in a property, then you can later sell that property for more money, or to get a large amount of funds to help you through financial difficulty or need.


Return on Investment Definition


What is a return on investment? A return on investment is a calculation that helps show you how profitable an investment was. It is often referred to in shorthand as simply the “ROI.”


When looking into an investment, it’s a good idea to always calculate ROI first. That way you can determine just how much money you can earn through this investment.




ROI = (Value of the Investment – Cost of Investment) / Cost of Investment


ROI = (Net ROI / Cost of Investment) x 100%


If you don’t figure out ROI before putting money into an investment, then you run the risk of losing more money than you make.


Foreign Direct Investment Definition


A foreign direct investment (FDI) is when a company invests in another company from another country. For instance, American Company A decides to invest in Australian Company B or vice versa.


The most common form of foreign direct investment is when a company establishes some kind of official business relations or partial ownership in another country. FDIs might also include business trades in technology or provisions, and not just capital.


Capital Investment Definition


Capital investments are when companies seek out capital investments to help fund the business. Capital investments might also include when a company invests in assets like real estate. This also helps add to a company’s funds and assets to help fund the company’s current and future expenses.


Investment Banking Definition


Investment banking is a particular kind of banking. It is a branch of banking that specializes in all things related to investments.


This means investment banking includes things like creating investments, setting up investment accounts, underwriting investments, debts, loans, and stocks. There has to be a finance sector that specifically handles all the paperwork, legalities, and logistics of investments and that’s what investment banking does.


Portfolio Investment Definition


A portfolio investment is when an investor brings together one or more investments. Portfolio investments are how an investor can build a diverse financial portfolio of stock ownership, bonds, and other financial assets and resources for the future.


An example of a portfolio investment might be an investor who is the landlord owner of some rental housing and has bought some stocks in a successful company. Having these two items in their investment portfolio can give them profit and help grow their wealth.


Bond Investment Definition


Bond investments can also be called fixed-income investments. A bond is a type of IOU between loan lenders and loan borrowers. Bonds are usually used by the government or corporations when they need loans to finance their projects and operations.


When you invest in bonds, you become the lender of the loan or the owner of the bond. That means the borrower repays their loan through repaying you.


Equity Investment Definition


Equity investments refer to investments made in a company’s profits, like shares, bonds, and stocks. You are investing in a portion of a company’s value, also known as equity.


Investment Property Definition


Investment property refers to real estate you purchase as an investment. You might use your property investment to build rental housing, or you might renovate or build a home on the property to sell for a profit.


Investment Risk Definition


An investment risk is a measurement of how likely an investment is to succeed or not. An investment risk will weigh the pros and cons to figure out whether a specific investment opportunity is worthwhile or not. Investment risk also compares the return on investment (or the estimated potential profits) with the possible losses.


Investment risk assessments are all about calculating whether the benefits of an investment outweigh the risks involved.


Investment Calculator


There are many investment calculators you can find and use for free online. An investment calculator lets you input the starting amount, how long you want to watch your investment grow, the return rate or interest percentage it should build, and any additional contributions that might get put into the investment over time.


For example, some investments aren’t a one-time investment. some investments require you put money into them more than once, like once a month or once a year. With all this information you can then calculate how much you will profit off of this investment in the end.


The Dave Ramsey Investment Calculator


With Dave Ramsey’s online investment calculator you can calculate retirement savings to help you successfully plan for retirement. Retirement is one of the biggest things you can invest in during your life.


Basically, an investment calculator is trying to help you figure out the return on investment or the ROI.


Simple Interest


What is simple interest? Simple interest is interest set on the principal amount. Simple interest is also one interest rate set on a loan or investment.


Compound Interest


What is compound interest? Compound interest is interest on interest. This is different from simple that is only applied to the initial investment amount. Compound interest, on the other hand, is interest that is applied to the principal amount and again later as the fund grows.


Investment Bonds


There are two different kinds of investment bonds. Coupon bonds and zero-coupon bonds. A coupon refers to the intervals in which the borrower needs to repay the loan. A zero-coupon bond means that the bond’s interest and principal amount are both paid at the end, rather than in intervals.


Consider investing in bonds to diversify your financial portfolio. It never hurts to have several different kinds of investments in your financial arsenal.


Dividend Investing


Some shareholders of a company prefer to take out a portion of their stock on a regular basis. They use the stocks they hold to receive income every so often. Dividend stocks let stockholders share in a company’s profits now, rather than waiting for the right moment to sell your stocks for a profit. The stockholder also gets to keep the stocks they own, instead of losing ownership of your shares by selling them.


This makes dividend investing perfect for anyone looking for a passive form of regular income. This type of investing also benefits the company because they can then reinvest any remaining profits back into their business.


One thing to keep in mind when investing in dividend stocks is that your dividend payments get taxed twice. Once before you receive the payment when the company has to pay taxes on their earnings, and again when you receive the payment.


Another risk with dividend investments is that if a company falls on hard times, they might have to cut their dividends.


CD Investment


What is a CD? CD stands for Certification of Deposit. It is a type of investment account. You purchase a CD account and then that money is locked away for a certain amount of time to grow through high-interest rates.


CDs are similar to savings accounts except you can’t withdraw funds during the term of the CD. Not unless you are willing to pay an early withdrawal penalty. This might be anywhere between a few months to a few years.


CDs also have much higher interest rates than a typical savings account offers. They also often require a higher minimum balance or initial amount.


You can find CD accounts available at your local bank or credit union. CDs are also one of the safest forms of investing. Your money isn’t being put at risk at all, but is still being allowed to grow through interest much faster than it would in a regular savings account.


Investing Account


Standard Brokerage Accounts can also be referred to as taxable brokerage accounts or nonretirement accounts. They are open to holding many investment types, like stocks, mutual funds, bonds, and ETFs.


Retirement Accounts are financial accounts designed to hold, grow, and later distribute funds for retirement years. There are many different kinds of retirement accounts like IRAs and 401ks. Each retirement account type has different features for how they hold your retirement savings, how they let them grow, how they distribute them back to you when you do retire, and how they are or aren’t taxed.


For instance, some retirement accounts get taxed when you put money in them and others get taxed as you take money out of them.


Impact Investing


What is impact investing? Impact investing is when investing is done to grow financially and cause some kind of positive impact as well. Impact investing might be a nonprofit that helps the community, or investing in healthy and conscious products like clean technology or environmentally friendly.


How to Invest in Stocks


Step 1: Make an Investment Budget


When investing in stocks, you first need to figure out your investing plans, goals, and budget. What do you want your investment portfolio to achieve? Investing can serve a lot of purposes. It can help you save for a big purchase like a house, education, or retirement. It can also help you grow your wealth, earn extra income, or grow your business.


Every investor has different goals in mind for their investments. Be sure to know what your long and short term goals might be for your investments. Then, make a careful investment plan and budget with these goals and investment intentions in mind.


Step 2: Open an Investment Account


To open an investment account you’ll need to provide your name, date of birth, address, social security number, and potentially your bank name and account number. That is, unless you are setting up an investment account with your bank.


There are brokers you can create investment accounts with who can help manage your investments in varying degrees.


Step 3: Choose Stocks to Invest In


It’s smart to choose several different kinds of investments in order to have a diverse financial portfolio.


How to Invest Money


Investment opportunities are everywhere if you only know where to find them. There are many ways to make your money work for you and grow your personal wealth and expand your financial portfolio and resources.


1. Stocks


You can invest your money through buying stocks. Buying stocks gives you shares in a company. As that company does well, your initial investment grows.


2. Money Lending


Lend money to others and charge an interest so you make a profit by the time they finish paying back the loan. Lending money comes with risks, but you can mitigate these risks when you lend money to people and businesses you know you can trust.


You can also lend money to the government through buying bonds.


3. Certificate of Deposits (CDs)


CDs are the most secure form of investment you can make. CDs aren’t subject to risks and market changes the way other investments are. They also don’t depend on things like how successful the business is, or how well the economy is doing, or how well the real estate market is doing for investors right now. CDs are a simple and straightforward way to put some of your money away for a while and let it grow.


4. Real Estate


Investing in real estate properties is another really popular way to put your money to work. You can invest in real estate in several ways too.


You can own properties and rent them out to residents. You could buy, fix, and sell homes. Or you could take part in a Real Estate Investment Trust (REIT).


An REIT is a money pool that investors can take part in together. Rather than taking on the risks of real estate investing on your own, you can invest in an REIT account.


How to Invest in Mutual Funds


First of all, what are mutual funds? Mutual funds are some of the most popular forms on investing, especially for beginners. There are also two different kinds of mutual funds, passive and active. But this just refers to how the mutual funds are handled.


Active management means that you are paying for investment management services. Passive management means that you are managing your investments on your own. This makes active mutual funds more expensive because you are paying management fees, but you also won’t have to bear the burden of managing investments all on your own.


Step 1: Budget for Mutual Fund Investments


Investments are usually long-term financial goals. Keep this in mind when you sit down to make long-term plans for your mutual fund investment. Think about what you want to get out of this investment and how you want to go about achieving this goal.


Mutual fund accounts usually require a minimum amount to be put into the account when you first open it. This amount varies depending on the place, but you can expect to make an initial deposit anywhere from $500 to $3,000.


Step 2: Pick an account


When making your plans you’ll also need to figure out where you want to buy your mutual funds. Research different brokers and weigh their fees and services with each other.


Step 3: Continue to Manage Your Investments


It’s important to stay on top of your investments. You should try and rebalance your portfolio at least once a year. Think of this like rebalancing your checkbook or your budget. You might do it less often but it’s just as important.


Investment Management


Proper investment management is very important. In order to reach your investment goals, you’ll have to manage your investments wisely, purposefully, and responsibly.


Investment management is especially helpful if you have multiple investments and financial assets to keep track of.


Investment management can be done by yourself or by hiring professionals. Investment management might include handling sources of income, financial assets and resources, investments, buying and selling of stocks and other investments, planning short and long-term goals for your finances, managing your bank accounts and other accounts, budgets, and even your taxes.


Best Investments


When researching which stocks to buy there are a few key factors you should look for, like risk factor, volatility, and time horizon.


Volatility has to do with how much a stock or investment is expected to fluctuate in market price. A stock with a higher volatility will fluctuate up and down in price more while a stock with lower volatility will have a steadier price.


Risk factor is a combined assessment of an investment’s interest rate, exchange rates, commodity, volatility, and stock prices. Most investments come with a degree of financial risk involved but some investments have higher risks than others.


Time horizon can also be called a planning horizon. This is a planned time period for when the investor plans to end this investment. A time horizon is helpful because then financial planners can weigh how profitable an investment might be in a given time frame compared to other investment options.


Investments come in many forms, but the following are some of the best investment types you could choose from:

  • Savings accounts with high-yield interest rates
  • Certificates of Deposit (CD) accounts
  • Money market accounts
  • Bond funds
  • Small businesses, entrepreneurs
  • Nonprofit organizations
  • Stocks
  • Dividend stocks
  • Index funds
  • Real estate, properties, rental housing


Investing in Real Estate


There are many ways to invest in real estate. You could become a landlord, flip homes for a profit, or join a real estate investment group (REIG), a real estate investment trust (REIT), or an online real estate investment platform.


Investing in real estate comes with many risks, but also has the potential of providing a steady stream of income through renting, or big payouts when a home you’ve fixed sells for big profits.


Invest in Startups


Startups can be another risky business to invest in because you don’t know what startups will succeed and fail. But with some professional advice, it can be easier to guess which startups will make smart investments.


Investing in startups is also a great way to get involved in a kind of impact investing, because you’ll be supporting small businesses.


There are also safer ways now to invest in startups through organizations like SeedInvest, WeFunder, and FundersClub. These are like investment groups you can join that control the investments and you just participate.


Gold as an Investment


Gold is another investment you could go with! Gold has been valuable for a very long time. It’s a malleable metal that is easy to work with and has a beautiful luster that makes people want to use it to make things like jewelry. Gold is also difficult to obtain which also increases its value.


Monitor the current value of gold on the World Gold Council website. You can invest in gold primarily by either obtaining gold or investing in stocks that are gold-related.


Gold is also considered a highly volatile investment since the market price of gold can fluctuate dramatically at times. That’s why many professionals advise that investors only make gold 10% of their finance portfolio, at the most. Here are some examples of ways to invest in gold:

  • Jewelry
  • Bars
  • Coins
  • Bullion
  • Gold certificates
  • Perth Mint certificates
  • ETFs
  • SPDR shares in gold
  • Gold mining stocks
  • Streaming and royalty companies


Best Investment Apps


Can’t afford a finance portfolio manager? You’re in luck! Today there are numerous investment apps you can choose from that will help manage all your investments. Some of them are even free to use.

  • Merrill Lynch Edge
  • TD Ameritrade
  • E Trade Financial
  • Robinhood
  • Acorns
  • Stash
  • Sofi
  • Ally Invest
  • Charles Schwab
  • Fidelity
  • Wealthfront
  • Betterment
  • M1 Finance
  • My Wall Street


Best Investing Books


If you are new to investing, it might be wise to pick up a few books about investments before deep-diving into the world of stocks and trade. Lucky for you, there is an endless supply of helpful investment books that can teach you all you need to know about getting into investments.

  • Beating The Street
  • Common Stocks And Uncommon Profits And Other
  • The Wealth Of Nations
  • The Intelligent Investor
  • A Random Walk Down Wall Street
  • Antifragile
  • Security Analysis
  • Fooled By Randomness: The Hidden Role Of Chance In Life And In The Markets
  • The Little Book Of Common Sense Investing


Investing is a key component of any strong financial portfolio. Investments are how you can make your money work for you. It’s how you can plant funds and watch them grow.


There are also many different ways to invest with plenty of safer, low-risk investment options to choose from. At the very least, you can always invest in a savings account, retirement account, or CD that can help your money safely and securely grow into greater amounts of wealth.


Investopedia. “Investment,” by James Chen, “A Guide to Calculating Return on Investment (ROI),” by Andrew Beattie.

Fidelity. “Individual Bonds.”

SITE NAME. “7 Biggest Benefits and Drawbacks of Dividend Investing,” by Hung Nguyen.

The Balance. “CD Investment Basics: How to Use CD Investments,” by Justin Pritchard, “3 Ways to Invest Money as a Beginner,” by Joshua Kennon.

Nerd Wallet. “4 Types of Investment Accounts You Should Know,” by Dayana Yochim, “How to Invest in Mutual Funds,” by Kevin Voigt.

Go Banking Rates. “How To Invest In Stocks: A Beginner’s Guide,” by John Csiszar.

Dave Ramsey. “How to Invest Money in 5 Simple Steps,” by Chris Hogan.

The Motley Fool. “The Beginner’s Guide to Investing in Gold,” by Reuben Gregg Brewer.

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