Before the current mortgage crisis sent banks and homeowners scrambling to protect themselves from mortgage losses and plummeting real estate prices, it was not uncommon for LTVs to be as high as 97 to 100 percent. Last summer most of them fell to 90 percent, as banks began to anticipate the damage from the subprime mortgage mess. But lenders did not predict how widespread the damage would be, and now they are cutting LTVs even more to avoid lending money for property that might lose much of its current value.

Bank of America and Chase recently adjusted their LTV guidelines on many mortgage loans down to 80 percent, and other financial institutions are expected to do the same. That means that consumers wanting to take out a mortgage or refinance a home can expect to get less – and they may also be required to pay more. In this kind of tight-money environment, lenders typically raise loan fees and interest rates while required higher amounts of collateral.

So those planning to borrow in the coming months should anticipate that they will get no more than 80 percent of what their property is worth. As is normal, that valuation will be arrived at through a professional appraisal. But appraisal numbers are now much more conservative than those conducted before the housing crisis began, because appraisers are not sure how much more real estate prices might fall.

• Plan Ahead
  Forget the way business was done in the past. Expect to borrow less, pay a larger rate and higher closing costs, and have credit scores scrutinized more closely. Plan ahead and give yourself plenty of time to prepare for passing the loan application process with flying colors.
• First Do Research
  If you apply for a loan and get turned down it damages your credit score. Instead do your homework, talk to lenders about what they are willing to do for you, and don’t fill out an application until they give you a vote of confidence that your loan – in the amount they recommend – will succeed.
• Tune Up Your Credit Score
  Get copies of your credit history, challenge any errors and update any old info that is not included. Then take steps to beef-up credit and allow about three months for the new information to be incorporated into your credit history file. Then apply with stronger credit and greater chances of getting approved.
• Start Saving
  Lenders require larger down payments for home loans, so start saving as much cash as possible. If necessary, sell items like extra cars that you don’t really need. You can always buy them back after the loan goes through, but without adequate cash you’ll never get the mortgage in the first place.
• Look for Mortgage Assistance
  Many government-backed mortgage programs are available to help Americans including military veterans and low-income families. The FHA lets you borrow with a smaller than normal down payment, for instance, so ask lenders to tell you about all of available mortgage assistance programs in your area.

By planning and taking the steps to improve your chances of getting approved you will avoid wasting time and getting disappointing news from banks. Then you can focus on home shopping with confidence and take advantage of today’s super low real estate prices.

The downside of HELOC loans, however, is being experienced by many homeowners who took them out a few years ago when real estate values were much higher than they are now. Because home prices have fallen, so has equity, and now banks are cutting back on the lines of credit for HELOC loans. That leaves many homeowners without their former line of credit. Hundreds of thousands of credit lines have been either shrunk or completely revoked this year, as banks reevaluate home equity limits based on today’s deteriorating real estate values.

Another risk with HELOC loans is that the collateral for these loans is the borrower’s own home. Take out a HELOC loan and fail to repay it, and the bank can start foreclosure proceedings to sell your house and get their money back. Under the circumstances, it is recommended that only homeowners with exceptionally large amounts of equity use HELOC loans in today’s volatile market. When borrowing against a HELOC, limit the loans to manageable amounts and only use the funds to do things like home improvements that will actually add to your equity instead of diluting or diminishing it.

Now the idea of micro loans – which often amount to $100 or less – has caught on in the USA via the Internet. By combining online banking systems with the popularity of cyber-based social networks like Facebook and MySpace, a new breed of unconventional lenders is cropping up on Web sites such as Prosper.com or Zopa.com. The fast-growing sites are populated by registered members who borrow money or make loans to each other, through a type of bidding process not unlike the bid systems used to trade items on eBay.

The way it works is that a member will post a description of their loan needs, along with the interest rate they are willing to pay. Those who want to loan that amount at the desired rate can then agree to the transaction, send the money, and await repayment – which includes interest charged.

Before offering a loan users can check out a borrower’s credit, income, and other financial data – which is collected by the company that runs the site. Because of the potential risk involved in this untested type of loan market, rates charged are usually higher than those available at large banks. But it is much harder to qualify for a loan from a bank; so many consumers are now turning to these new micro loan sites for an easy solution to their borrowing problems.

Scores are still based on a point system that ranges from 300 to 850, and they are calculated based on factors such as payment history, length of credit history, amount of outstanding debt, the ratio of debt to credit, and the type of credit most frequently used. But there may be new categories of debt.

But one of the biggest changes is that those consumers who are authorized users on someone else’s account – like joint signers on a credit card account, for instance – will not longer be considered. In other words the person who originated the account or loan will be considered, but any other persons they authorize to use the account – or credit card, for example – will not be plugged into the credit scoring formula. Authorized second party users typically include spouses or the primary cardholder or children using their parents’ credit card accounts.

Persons who have been paying their credit card bills on time as authorized users (but not primary cardholders) may have accumulated years of excellent credit history. Now that history will be wiped off their score, and that is expected to have a negative impact on the credit of about 75 million people.

• Start a Coin Jar
  Although it may seem like a silly idea, dropping coins into a piggy bank or coin jar can be a great way to start saving. Accumulate enough coins during the year and it is possible to save a significant amount that might otherwise be dribbled away unconsciously. Many major grocery store chains have machines in the lobby that will automatically count coins for a fee, and when the time it takes to count and roll coins into wrappers is factored in; the added small cost may be worth it. Drop the coins into the machine, take a receipt to the cashier, and walk away with paper money.
• Open a Savings Account
  Almost everyone has a checking account, but the value of a savings account is that once the money is deposited, it is slightly harder to get to and spend. Without the easy convenience of an ATM card or checkbook, it usually requires an extra step or two to withdraw the funds, and that may be all it takes to create a new saving habit. Plus, money in an interest bearing savings account can grow with interest, so leaving it in the bank adds to the long term savings.
• Pay Yourself First
  Those who are serious about saving should get in the habit of paying themselves first. Set up an automatic withdrawal system with your bank, so that each month a specific amount of money is deducted from your normal checking account and swept into a savings account or retirement account.

Accumulating money does not have to be difficult, especially when done in painless small steps and with easy money-saving strategies and techniques.

Here are three ways to save gas and spend less at the pump:

• Auto experts tell us that the easiest and most effective way to save on gas is to keep tires properly inflated according to the tire manufacturer’s recommendations. When tires have too little air they slow down driving and waste gas, and when they are inflated too much they reduce traction and performance. Check tires every few days, keep them properly inflated, and save money without having to spend anything.
• Another cheap and easy path to savings is to drive a little slower on the highway. When speed limits on interstate highways, for example, were capped at 55 miles per hour, Americans saved millions of gallons of fuel. Now that they are as high as 70, cars go faster but burn fuel less efficiently. Stay in the slow lane, drive around 55, and you’ll automatically save money.
• In city traffic, avoid acceleration. When approaching a stop sign, for instance, start slowing down ahead of time to gradually reduce speed. When starting off from a stop, accelerate gradually, not fast, and the engine with consume less gas.

While driving less aggressively saves gas, it is also safer and usually better for the car and its engine. So adjusting driving styles to be more economical can pay off in many ways with multiple benefits.

So do yourselves a favor and check your Credit Report before you head out to the AT&T or Apple store. If you see any discrepancies take care of them first as they may save you at least $400 dollars.