Financial Quiz Helps Canadians to Dig Their Way Out of Debt

A new quiz challenges Canadians to test their financial IQ and work on improving it.

Toronto (PRWEB) June 27, 2012

Art Branch, Inc., the parent company of CanadaBanks.net announced today the publication of a new financial quiz (http://www.canadabanks.net/Financial-Quiz.aspx).

Designed by the web development team at Art Branch Inc., the quiz is intended as a helpful tool for Canadians who want to improve their financial fortunes. Given the substantial growth of consumer debt in Canada, indebtedness has become a major issue of public concern. The new quiz aims to help people improve their financial literacy and thus become more aware of the dangers of excessive borrowing.

“Canadian personal debt levels have been going through the roof in the last couple of years, while incomes have not gone up enough to match that. Of course this is unsustainable, however many Canadians don’t realise that. We created the financial quiz to help Canadians improve their financial literacy in a simple and entertaining way,” said Peter Todorov, President of Art Branch Inc.

The absence of financial literacy often leads to bad financial decisions, excessive debt, and financial hardship. This makes it even more difficult to put one’s finances in order. Many people will experience a huge improvement in their financial lives once they acquire a basic understanding of how budgeting, interest rates, and borrowing work. The new financial quiz introduces some common financial concepts and helps people learn how to make wise money management choices. It allows visitors to gain better knowledge of finances and offers a fun way of doing so.

Challenging Canadians to test their knowledge of financial matters may encourage them to improve their financial IQ. To help achieve this, CanadaBanks.net provides a wealth of financial information, from saving, borrowing, and budgeting to more complex financial concepts.

The 10-question quiz is followed by a score card and links to relevant readings that elaborate on a given concept or topic. The quiz can be done multiple times, with a set of 10 questions displayed on a random basis and out of a pool of over 300 questions.

About CanadaBanks.net: CanadaBanks.net is an informational resource created by Art Branch Inc., focused on the Canadian banking industry.

About Art Branch: Art Branch Inc., located in Toronto, Ontario, is the parent company of CanadaBanks.net and has produced many consumer oriented websites targeting Canadian audience. The goal of Art Branch is to provide visitors to company sites with free, practical guides, helping consumers make educated financial choices.

Canadian Money

Pros and Cons of Piggyback Loans

A piggyback loan involves the borrower taking out a HELOC or a home equity credit line for certain percentage of the value of a property. The cash advance is used as a down payment, and the primary mortgage covers the remainder. The main advantage of this borrowing instrument is that home owners are not required to pay mortgage insurance. This is an ideal option for borrowers who have cash on hand to make the down payment.

Furthermore, when more than one financial institution is involved in a single transaction, the two loan providers take less risk. Borrowers with a small down payment have a better chance of qualifying than they would if applying for a conventional mortgage. At the same time, the combined rate on this type of loan is usually higher than on conventional mortgages. The financial institution that finances 80 percent of the loan may agree to lower the interest rate. The second lender, however, finances 20 percent or even 5 percent and doesn’t benefit much from lending a small amount of money. This is why, the second loan provider may offer a higher interest rate. In addition, piggyback loans usually go with a substantial balloon payment at the end of the repayment period. The payment can be considerably larger compared to regular mortgage payments.  

Note that this type of financing is extended in the form of a dual mortgage. Thus, if an emergency were to arise, obtaining a home equity loan or a second mortgage could be close to impossible.

Borrowers who apply for a piggyback loan should compare different programs and consider a number of factors. Among these are monthly payments, interest rate, and the type of interest rate (adjustable vs. fixed) on the second mortgage. Other important factors are the maximum loan-to-value limits and the monthly insurance premium. Consider the fees, penalties, and any qualification limitations that may apply. When doing the math, keep in mind that you will have expenses such as the closing cost for the transaction, earnest money, and others.

For more information on loans and credit visit this site or this guide.