The federal government extends a Direct PLUS loan to a graduate and professional student as well as parents of dependent undergraduate students, but when they’re made to graduate or professional students, they’re called “grad PLUS loans.” With a grad PLUS loan, it’s possible to borrow up to the cost of attendance at your institution, minus the amount of other financial assistance you receive. And like other federal student loan programs, this type of loan has a fixed interest rate throughout the loan term that is indexed to long-term U....

Depositing money into a high-yield CD versus a traditional savings account may allow you to earn more interest. Learn more about how high-yield certificates of deposit work and what the alternatives are. Definition and Example of High-Yield Certificate of Deposit A high-yield certificate of deposit, or high-yield CD, is a type of savings account that pays higher interest on the money you’ve deposited. Acronym: High-yield CD For example, a high-yield CD may have a $500 minimum deposit requirement and pay 0....

For example, suppose you purchased a home and had a life estate recorded on the deed with your younger brother as the remainderman. You left the house in your will to your eldest son, who decides to sell it upon your death. However, he cannot sell the home, because interest has been passed on to your younger brother. How Does a Life Estate Work? The life tenant is responsible for maintaining the property during their lifetime....

When a customer pays for a product or service with a credit card, the funds are first deposited into the merchant account and from there eventually transferred to the business bank account. Transfers to the business account are normally done on a daily or weekly basis. If you are going to operate an e-commerce business and want to accept credit card payments online, you need at least one internet merchant account (even if you already have a merchant account, in many cases)....

For instance, if you want to purchase a home but don’t have the funds to purchase it in full at the time of the sale, you can ask a lender for a mortgage to buy the home. With this loan, you can buy the home, provided you make your monthly mortgage payment to the lender until the loan is paid off. Alternate name: Home loan How Does a Mortgage Work?...

Let’s take a look at what a mortgage constant is, how a mortgage constant works, and what it means for you. Definition and Examples of Mortgage Constants You can calculate a mortgage constant to figure out how much of your loan you’re paying off each year. This can be important information, not just for you, but for a potential lender. Banks can also use mortgage constants to decide whether or not to give you a loan....

“A pocket listing sells without publicly hitting the market,” Jason Gelios, a realtor at Community Choice Realty in Detroit, Mich., told The Balance by email. “Many times, a (pocket-listed) home is sold by ‘word of mouth’ either through the network of the home seller or a real estate professional.” According to a report by the National Association of Realtors (NAR), 88% of buyers purchased their homes through a real estate agent or broker....

Definition and Example of a Qualified Mortgage A qualified mortgage is a long-term loan for a home that meets all the consumer protection requirements outlined in the Dodd-Frank Act. This type of mortgage is the underwriting standard for the mortgage industry. Compared to other types of financial products, a qualified mortgage is fairly new. It was created in 2014 to increase the chances a borrower would be able to repay their loan....

S Corporations and Taxes The S corporation (S corp) is a special kind of corporation that passes corporate taxes through to its shareholders. Then, the shareholders report this income on their personal tax returns and pay taxes on their total combined income at personal tax rates. How S Corporation Employee Pay Works An S corporation officer (president, chief operating officer, etc.) is considered an employee and payments they receive for their services as an employee are considered wages....

Learn more about how a secured creditor works, and how it’s different from an unsecured creditor. Definition and Examples of a Secured Creditor A secured creditor typically refers to a financial institution that issued a loan backed by collateral, so it has added protection if the borrower defaults on the loan. Collateral is the asset or property you use to secure the loan. If you fail to pay, the creditor has the legal right to take your collateral as satisfaction of the debt....

Definition and Example of a Secured Loan A secured loan is one where the lender requires that you pledge collateral, such as a piece of real property, another asset, or money, to get funding. Examples of secured loans include: MortgagesHome equity loansCar-title loansAuto loans You can find secured loans with just about any lender that provides loans to consumers. Most lenders offer traditional secured loans, such as mortgages and auto loans, but there are alternatives....

FG Trade / Getty Images A long strangle lets investors profit when the price of a stock moves significantly, and a short strangle allows profit when the price remains within a specific band. Let’s explore how strangles work so you can determine whether they’re right for your investment strategy. Definition of a Strangle A strangle involves using options to profit from predictions about whether or not a stock’s price will change significantly....

The IRS is required to notify you by mail of any tax that you owe, so be sure to open your mail. Keep your mailing address up-to-date, and communicate with the IRS if you’re having financial problems. If you receive a document titled “Final Notice of Intent to Levy and Notice of Your Right to a Hearing,” a tax levy may be imminent; the IRS could seize the funds or your property in 30 days....

For suppliers to receive payment, they usually provide an invoice with details about the purchase to collect the funds owed. The invoice is based on information provided on the original purchase order (PO). Once the invoice is received by a business, it is added to the liabilities section of the balance sheet as a bill under accounts payable. Many companies have a department to manage the accounts payable process. These employees are responsible for processing invoices and making sure payments owed to other businesses are accurate and paid in a timely manner....

Alimony might be provided for in a marital settlement agreement reached between spouses, or one spouse might petition the court for an award of alimony. It’s up to the spouse who’s requesting alimony to prove to the judge that they need financial support and the other spouse has the ability to provide it. Alimony isn’t punitive; it’s all about financial need and the ability to pay. The alimony order would be incorporated into the divorce decree just as though the judge had ordered it if it’s agreed to in a settlement....

Klaus Vedfelt / Getty Images American Education Services Defined AES is owned by the student aid organization Pennsylvania Higher Education Assistance Agency, also called PHEAA, which is a major provider of student loan services at the national level. It includes a large federal student loan portfolio. As of June 2021, PHEAA serviced more than $400 billion federal student loans held by more than 8.5 million borrowers, according to the Office of Federal Student Aid....

EmirMemedovski / Getty Images For example, suppose you work full-time but can’t afford everything you want, so you decide to max out all of your credit cards. However, you also have a mortgage, two car payments, and student loan debt—it’s likely that you wouldn’t be able to meet your debt obligations. So you choose to petition a bankruptcy court and are granted a Chapter 13 bankruptcy, where the court creates a repayment plan for you....

The Origins of Communism German philosopher Karl Marx developed the theory of communism. He said it was, “From each according to his ability, to each according to his need.” In his view, capitalistic owners would no longer siphon off all the profits. Instead, the proceeds would go to the workers. To Marx, this meant that people would work at what they loved and did well. They would happily contribute these skills for the good of all....

Alternate names: Dealer-arranged financing Dealer financing is most widely used to buy and finance vehicles. Car dealerships will often advertise this convenient option to customers who come to look at cars on the lot and haven’t obtained financing elsewhere. How Dealer Financing Works During the dealer financing process, you work with the dealer to negotiate a deal. For example, the retailer can help you find a loan offer with an affordable monthly payment and desired loan length....

Most small corporations and new corporations don’t pay dividends. They retain their earnings, putting the money back into the company for growth rather than paying any portion out to shareholders. Older, more established corporations have slower growth, and they pay some of their incomes as dividends to shareholders. Another description of double taxation applies to shareholders who are also employees of the corporation. They might be paid a salary, which is taxable on their personal income tax returns, and receive dividends, which are also taxable on their personal returns....