The following is a guest post. Enjoy!
For millions of American seniors, the very thought of retirement is enough to bring on a sense of panic. The reason is simple, multiple financial crises and the ever-increasing cost of living have rendered seniors financially vulnerable.
But what can they do? Try as you might, you can’t work forever and there is no guarantee that Social Security will survive the onslaught of millions of Baby Boomers entering retiring. Given this uncertainty, an increasingly popular retirement planning option is the reverse mortgage.
However, many people are still unfamiliar with reverse mortgages and when to get them. With that in mind, here are some answers to many of the questions you’ll need to ask when you are considering a reverse mortgage.
The eligibility requirements for most reverse mortgages is quite simple. First, you must be at least 62 years old and then the property must be your primary residence. While the amount you can borrow will depend on several factors such as your age, the value of your home, and the balance of your current mortgage; in most cases, you can borrow up to $625,500.
Other things that will come up when a lender looks at your eligibility is whether you can continue to pay your homeowner’s insurance property, taxes, and utilities. In addition, you will need to continue to maintain the property or run the risk of defaulting on the loan.
The best way to check out your eligibility to contact a lender and if you live in California search for lenders here.
While reverse mortgages are loans, they do not function in the same way as traditional mortgages and home equity loans. The key difference is that you won’t have to make regular monthly payments. Instead, the principal and interest due will accrue over time and then the loan will become payable once you no longer live in the home.
In addition, you have two options to consider when taking out a reverse mortgage. The first is a lump sum payment – this basically means you will get the entire loan amount at closing. The second is a line of credit and this option has its advantages as the interest accrual is only on the line that you have used. Another benefit of a line is that the amount available can grow over time as the value of your home appreciates.
You will need to repay the loan when you no longer living in the residence. As such, one good option is to take out a life insurance policy to cover all or most of the amount due when it comes time to repay the loan. This will help to protect your heirs from having to repay the bank out of their own pockets.
Obviously, the total cost of a reverse mortgage will depend on how much you borrow, the interest rate, and how long the loan accrues. Another aspect of reverse mortgages is determining the closing costs. This will include fees from the lender such as origination fees but will also include mortgage insurance, title insurance, state and local fees, and the cost of an appraisal.
In addition, most reverse mortgages are variable rate loans. As such, you can expect the costs to go up as interest rates increase.
The point here is that you want to look at all the costs when determining the cost of a reverse mortgage as this will help you to decide if this loan is the right fit for your retirement needs.
In some cases, a reverse mortgage is not the best option for you. One option might be to sell your home and then downsize by moving into a smaller home. The decision to take out a reverse mortgage is not something to be taken lightly and as you can see there are many pros and cons to consider.
When considering a reverse mortgage your best bet is to talk over the option with your family and your adviser. In the end, the decision is yours but you want to make sure you think through all the options before deciding.
The following is a guest post. Enjoy!
Dana at Tundra Mortgage Brokers recently shared her opinion on the benefit of hiring a mortgage broker to help with a home loan, instead of going directly to a bank. Whether you’re a first time buyer, a property developer, or an investor; could you really benefit by turning to a broker when it comes to borrowing money?
In this post, we’ll be diving into the advantages of using a mortgage broker instead of applying to a bank directly – and just how much you could save by doing so.
The Potential to Compare Interest Rates
Have you ever actually sat down and tried to compile a list of the different rates offered by banks? Not only do most of those in Australia (and other parts of the world) propose varying rates depending on the type of loans available; there are also fixed and variable ones to consider, too. As you might imagine this process can be quite time consuming and this is actually something that mortgage brokers typically specialize in.
Most will offer effective interest rate comparison services to those in need – and if you hire a great one, you could be looking at a selection of options in the space of a couple of days (or less!)
Recognizing a Great Deal
What’s the one thing that most borrowers will want to make sure they do when applying for a loan? Keep their costs as low as possible, of course. There aren’t many mortgages that won’t go on for at least a decade (or three) and so finding a great deal can make a lot of difference to your future finances.
A good mortgage broker should be able to compare the varying terms and conditions proposed with specific loan packages and hone in on the best available on behalf of a client.
Taking the Stress Out of Applying
Another frequently overlooked advantage of hiring a broker is the fact that they can actually take care of the technicalities, to minimize the stress that you feel when applying for a home loan. As they’ll be the middle-person when dealing with a bank you will often be able to submit your documentation to them directly, so that it can be forwarded to your chosen bank.
This can make it easy for you to minimize the formal activities associated with applying for a mortgage and allow you to focus on what really matters; getting approval.
You might need to cover a small cost when hiring a brokering agency up front, although some are happy to offer their services free of charge to you for commission from a bank, but just imagine the long term financial savings that you could enjoy. For a relatively small fee at first, you could save yourself thousands of dollars by ensuring that you sign up to a cheaper deal than you would have when applying to a bank directly.
The following is a guest post by Vera. Vera is a blogger trying to lead a frugal (but not frustrating) lifestyle. For her, frugal living does not mean living a life you dread waking up to, or thinking that money controls you, when in fact, it’s the other way, you control the money. You can find her at Frugal Frogs.
When it comes to the holidays, most people spend more money than they intended to. Of course, that cuts into other bills, savings or something else that you didn’t intend to be affected by your holiday shopping. But you can make your holiday budget work for you with these smart ideas to stretch your budget. You may even have some money left over after the holidays have passed.
The first thing that you have to do to make sure that your money stretches far enough to cover your holiday shopping is to set a realistic budget. This is something that many people have trouble with, and it is a common cause of running out of money before the holiday shopping is done.
Make a list of everyone that you have to buy for, and then take a few days to ensure that you have remembered everyone. You will probably have to add a few more names to the list. Once you do that, set a limit on how much you are going to spend for each person.
Some people will have a higher limit than others, and that’s fine, but make sure that you don’t regard the limit as an “about” amount but as an actual limit. Then you’ll know that you won’t go over your budget. If you do find the perfect gift for someone and it is a little over the limit, then make sure that you reduce the limit on someone else on your list to keep your budget the same.
You also want to shop online more often, particularly with the site-to-store feature that many department stores are now offering. You can often find a much lower price this way and always check Amazon before you buy anything because they will often have a lower price and if you are a Prime member ($10 a month), you won’t have to pay for your shipping ever.
This doesn’t necessarily mean scouring the local paper and physically clipping coupons. These days, with Groupon and other money-saving websites, coupons are more likely to be found online. There are apps for your phone that give you coupons, even those that check which store you are in and offer you coupons for that store as you shop, as well as member websites that give discounts on most of the well-known chain stores.
Saving money on travel is just as important as saving money on gift purchases and other holiday expenses. First, if you are traveling somewhere by plane for the holidays, make sure that you get your ticket far, far in advance and at as much of a discount as you can.
Even if you are not traveling any farther than around town to buy gifts, you can still strategize your travel and save money. Figure out which stores you are going to hit and then put them in order by creating a route that will take you to all of them without wasting any gas – which also allows you to spend your time wisely and avoid wasting it running all over town.
If you want to make your holiday budget stretch a little further a great way to do that is by getting a seasonal job. There are some great part-time gigs out there that last just throughout the holiday season like playing a mall Santa or elf, working at a gift-wrapping counter or hiring on at a store that needs extra help during the holidays. Holiday jobs are easy to find, and the employer usually doesn’t care that you plan to quit after you have earned enough extra money to complete your Christmas shopping.
Believe it or not, you can get gift cards, with the full balance still on them, for pennies on the dollar. There are a few websites out there like Raise.com that allow users to buy and sell their gift cards for any price that they want, even some that hook up local buyers and sellers so that you can instantly get the gift card in your hands when you fork over the cash.
You want to keep an eye out for rewards and always buy with earning some type of reward in mind. You don’t want to go out of your way or spend more money than you would somewhere else, but try to earn credit card rewards, rewards from websites that pay you to shop and rewards from apps that offer everything from prizes to actual cash.
You can visit any of the multitudes of discount websites that offer anywhere from 50% to 90% off the purchase price (and in some cases, have free items that you only have to pay to ship) like Wish.com. These websites sell new items, so you aren’t getting something that is used and the person that you are getting the gift for will never know that you got it at a discount.
***Photo courtesy of https://www.flickr.com/photos/gotcredit/33887741275/sizes/l
The following post is by MPFJ staff writer, Laurie Blank. Laurie is a wife, mother to 4 and homesteader who blogs about personal finance, self-sufficiency and life in general over at The Frugal Farmer. Part witty, part introspective and part silly, her goal in blogging is to help others find their way to financial freedom and to a simpler, more peaceful life.
There’s a certain appeal about owning and managing rental properties as a source of semi-passive income. Brick and mortar book stores, online websites and late night infomercials boast a luxury life where rental property owners do very little work and spend all day cruising around in their yachts, heading off to exotic destinations while the money just magically appears in their bank accounts.
The truth about rental property ownership is that there’s a little more to it than just buying a house and collecting rent checks. Before you jump into purchasing a rental property, it might be a good idea to ask yourself some questions such as the ones listed below.
Before purchasing a rental property, it’s smart to educate yourself on how the rental property business works. What are the laws regarding tenants and evictions? What responsibility does a rental property owner have in terms of keeping the property in good condition? How can a property owner proceed legally if rent isn’t paid?
There are many legal and financial obligations surrounding rental properties that you should know about before jumping head first into this popular business venture. Checking out books by experts on the subject and reading past the benefits and discovering the risks will help ensure you don’t go into rental property ownership with rose-colored glasses or without an understanding of what your legal rights are – and what the legal rights of tenants are.
In other words, does the property “cash flow”? Will the property net you an income each month after the mortgage and taxes are paid, and additional money is subtracted for potential repairs and to cover potential vacancies?
One mistake many first time rental property owners make is that they buy a property based on potential appreciation of that property and don’t consider the cash flow aspect. However, assessing the cash flow potential of the property will help you avoid getting into a situation where a rental property is costing you money instead of making you money.
As you assess the price and maintenance costs of a property, it’s a smart idea to balance that with average rental costs in the area the home is located in so you have a good idea of what a reasonable monthly rent expectation is. Knowing what rent you can expect for the location, size and condition of the property will help you better determine whether or not the property will cash flow. If it won’t, you might want to offer a lower bid or avoid the property altogether.
Purchasing a rental property will cost money out of your pocket if you don’t have an investor waiting in the wings to cover the costs. Most mortgage lenders require 20% to 25% down on rental property purchases.
Also, many properties require upfront repairs and modifications to make the home ready for tenants. If the home has a homeowners association (such as a condominium or townhome) there will be monthly HOA costs and potential larger costs for replacement items such as roofs. And let’s not forget the aforementioned vacancy costs and home repair costs. If the home is vacant for any length of time, the monthly mortgage payment on the property comes out of your pocket. If the water heater goes out, you as the property owner are responsible for paying for a replacement.
Knowing all of the financial responsibilities before you buy will help you be prepared to shell out the cash needed to buy and maintain the property.
Many investors have bought into the real estate rental game only to discover they weren’t cut out for the business. If that happens to you, what is your plan? Will you have a rental management team take over? If so, how will that cost affect your bottom line? Will you sell to another investor? If so, how will realtor’s fees and closing costs affect you financially?
It’s good planning to have an exit strategy mapped out before you purchase your first rental property so that you can work to absolve yourself of the property with minimal financial and other ramifications.
Rental property investments can be a great way to grow your wealth, provided you know what you’re getting into before you buy that first property. Spend plenty of time educating yourself on the ins and outs of rental property ownership before you invest, so that your experience as a real estate investor will be a good one.
How about you all? Do you think owning a rental property would be right for you?
Share your experiences by commenting below!
***Photo courtesy of https://www.flickr.com/photos/gold-beach-real-estate/4641338334/sizes/o/
The following post is by MPFJ staff writer,Laurie Blank. Laurie is a wife, mother to 4 and homesteader who blogs about personal finance, self-sufficiency and life in general over at The Frugal Farmer. Part witty, part introspective and part silly, her goal in blogging is to help others find their way to financial freedom and to a simpler, more peaceful life.
Real estate experts say spring is the busiest home buying season, with June being the peak month for home sales. However, simply listing your house for sale during the busy season won’t necessarily get it sold quickly. Appearance and marking still play a part.
Here are 7 things you can do to help your home sell fast no matter what the market.
As with any other profession, not all realtors are good at what they do. Ask for referrals from friends and family, and interview at least three realtors before choosing the one who will help you sell your home. A good realtor can mean the difference between a pleasant home selling experience and a not-so-pleasant one.
Staging your home means making it look as much as possible like a model home you would see in a new housing development. Staging well involves taking special care to make your home shine using the following techniques.
Do Some Serious Decluttering & Depersonalizing
The goal with staging is to enable those who view your home at showings to be able to see themselves living there. Put away all items that personalize your home, such as family photos, monogrammed items and stuffed animals.
Also, minimize the amount of stuff that is in your home, even in closets and storage areas. You want your home to appear as if there is plenty of room in it and as if it is well taken care of and kept super clean. This might mean needing to rent a storage garage or having to give away lots of “stuff” to local thrift stores. Your home should look its very best, being clean, shiny and uncluttered.
Remove Overly Worn and Tacky Furniture and Accessories
That singing fish you got from Uncle Joe last Christmas? Yeah, that needs to go while your house is on the market. So does any overly worn furniture or accessories. If you need to replace overly worn items, do so by buying stuff you were going to purchase anyway or by getting super good deals on replacement items at thrift stores or on Craigslist. Make sure any new items you bring into your home match the current décor and don’t carry with them any odd smells or stains.
Update the Interior
If you’re still boasting mint green and peach walls and bedding, now might be the time to change things up. Paint where necessary using modern and neutral colors that appeal to a large variety of tastes on your walls and for your bedding, etc.
Don’t Forget Curb Appeal
The last but possibly most important part of staging your home to sell is to make sure your lawn looks neat and attractive. Make sure that the lawn is mowed, weeds are eliminated and any flowers or bushes are well trimmed. Remove and clutter from the yard and be sure the entrance area appears welcoming by adding a small mat, sitting bench, flowers or other accessories. Your house should shine on the outside as well as on the inside.
Your realtor should be able to show you comparable sales and listings that can give you an idea of what price you should list your house for. Use your own research too, checking online for similar sizes and conditions of homes in similar areas to help determine what you should price your house at. Pricing too high will result in a longer market time, and pricing too low will mean you lose out on thousands in cash.
Be accommodating to prospective buyers and be ready to leave your home for showings on short notice, keeping it clean and organized at all times. Prospective buyers who have to try two and three times to see your house may just give up and shop elsewhere.
Where possible, remove all pet paraphernalia such as litter boxes, pet toys and feeding bowls. Also, make sure your house is thoroughly vacuumed and get the carpets cleaned if necessary, so that pet evidence is minimal to none.
Photos on your listing should be of good quality, accenting the best features of your home. Have a large kitchen? Make sure your realtor takes the picture from the view that will best highlight that. Does your master bath have a Jacuzzi tub? If so, include that in the pictures. The photos on your listing should help your home put its best foot forward.
When buyers make an offer on a home, they will often ask for perks such as seller paid closing costs or the inclusion of furniture or other items. Your home will sell faster if you are flexible on your price and/or other aspects that make potential buyers feel like they are getting a good deal.
By taking the steps above you are creating an environment that will help your home sell quickly and easily.
How about you all? What features attract you when you are home shopping?
Share your experiences by commenting below!
***Photo courtesy of https://www.flickr.com/photos/cloneofsnake/727899051/sizes/l
The following is a guest post. Enjoy!
In Bob Dylan’s memorable song Mr. Tambourine Man there are some interesting verses such as, ‘How many roads must a man walk down before you can call him a man…’. The path to growth and enlightenment, and certainly to financial independence is education. Wisdom is the sum total of our life experiences – both theoretical and practical, while success comes from a clearly formulated plan. Very little comes from haphazard behavior, unless of course it’s a windfall payday off a lucky lottery ticket.
For most of us, achievement is the result of working intelligently towards an objective. With this in mind, it’s important to formulate a blueprint for academic excellence. In the United States, tertiary education is a major expense item. By the time a young adult enters high school it is important to start planning for college. Unbeknownst to many students, the federal government offers many programs to assist students in paying for their schooling. These include grants, work-study initiatives, and loans. This federal aid is often what makes the difference between being able to pay for college education or not.
Understanding What Options Are Available for FAFSA
Depending on what type of education a student is looking for, costs can vary from a couple of thousand dollars a year to tens of thousands of dollars per year. Community colleges offer an alternative path to regular college, after completing 2 years before credits can be transferred over. This is an affordable option for many folks, and a workaround to the high costs associated with traditional colleges. There are several ways that students can enjoy federal aid, including the Free Application for Federal Student Aid. Otherwise known as FAFSA, this determines your personal eligibility for different types of student aid. The form can easily be completed online and can translate into free money for a college education. Students who apply for these forms of government aid may be enrolled in work/study programs or approved for different types of loans.
The bureaucratic red tape surrounding many federal aid programs is a disincentive to many folks. Fortunately, there are services out there that make it relatively easy to determine qualification for student aid, given specific criteria. The application process is 100% free, since there is an official federal government site available. Even universities and colleges across the United States use FAFSA applications to determine a student’s eligibility for non-federal student aid. Once the low-interest loans have been approved, students can use that as a tool to build their credit scores. The competition to enter US colleges is fierce. Students who show initiative by actively applying for student aid often fare better in admissions than others. Since the application process can typically be completed in under 30 minutes, it is an easy way to begin taking meaningful steps towards a college education.
Facts and figures:
There are many benefits to receiving one of these loans, including no payment until graduation. It is also possible to temporarily postpone payments, or even lower payments accordingly. If a graduate works in public service, a significant chunk of the loan may be foregone. In an era of rising interest rates, such as the present, FAFSA loans are offered at a much lower rate than credit cards and personal loans.
The following is a guest post. Enjoy!
You can make a significant difference to your financial success by making use of the services of a good, independent financial advisor. Financial advisors help you make decisions that are tailored to your circumstances.
Perhaps, like most people, you feel you don’t need professional help. This might be fine in the short term, but could severely impact your success further down the line. All financial advisors, however, like all professionals offering services, are not equal.
Here is a list of questions that you can ask yourself when reviewing your current or prospective financial advisor:
Are they independent?
Financial planners are either tied agents or independent agents. Tied agents work for a particular product provider(an example of this would be a retirement annuity offered by a certain company) and may be incentivized to sell certain products. Independent agents earn no commission off of products they sell and do not work for a particular provider.
Independent advisors tend to be more objective and use their experience to create a path to your financial goals. They help you make sense of all the products that are available to you and can help you pick ones that best suit your financial needs and circumstances.
What are their qualifications?
All financial advisors are required by law to be licensed by the Financial Services Board or FSB. In order to get the license, an advisor needs to pass the regulatory exams and fulfill the Fit and Proper requirements defined by the FSB. These requirements include honesty, competency and integrity. All financial advisors need to prove to the FSB, on a continuous basis, that they are maintaining and developing their professional competency.
In addition to these basics you should enquire about the advisor’s academic or other credentials. Reading the disclosure document provided to you will give you an idea of all the products the financial advisor is licensed to recommend and advise on.
What is the fee structure?
Full disclosure and transparency are very important. It is best to that your financial advisor explains to you exactly what kind of fees you will need to pay and how they would work.
Fees are generally charged as a percentage of the value of an investment. There could be initial and ongoing fees, thus it is important to identify the costs. Some advisors use a different fee structure. They charge directly for advice provided, usually at an hourly rate. Any fees should not be charged or paid without an agreement upfront.
How can they help you grow your wealth?
Good advisors take the time to understand your needs and help to put a plan in place that reflects your financial goals and risk appetite. They can help you invest with more discipline and can offer rational guidance before your emotions lead you astray.
Investors often buy and sell investments or switch between products at the wrong time due to an emotional reaction to the market. This can potentially destroy the value of your investment. A financial advisor helps you to remain focused on your goals. They play a huge role in helping you grow your wealth. By growing and nurturing your relationship with a financial advisor you can rest assured that your investments are adjusted to your needs rather than your emotions.
Where can you find a financial advisor?
Trust is very important in this relationship, therefore a good starting point for your search for an advisor would be to get a recommendation from someone whose opinion and judgment you can trust. Another option would be to consult the Financial Planning Institute of Southern Africa (FPI) for help.
The following is a guest post. Enjoy!
Back during the summer of 2014, Facebook was “overflowing” with videos of people dumping buckets of ice water over their heads. The Ice Bucket Challenge was mentioned more than 2.2 million times on Twitter and over 1.2 million videos were posted to Facebook. There, some 15 million people either commented or “liked” the Ice Bucket Challenge. Meanwhile, all of the major TV news entities carried stories about it.
And, $220 million dollars were raised for the Amyotrophic Lateral Sclerosis (ALS) Association to help find a cure for Lou Gehrig’s Disease.
A brilliant example of ecommerce guerilla marketing done right, the campaign was easily doable, exceptionally social and highly flattering to the participants. People could take pride in doing something good, being “nominated” made them look important and they could do it without appearing narcissistic. After all, they were simply responding to a challenge—for a very worthy cause.
While it might look like the ALS Association captured lightning in a bottle — mainly because it did — this strategy is pretty easy to duplicate with a bit of outside-the-box thinking.
In 2010, James McDowell, MINI’s North American president, appeared in a You Tube video challenging Porsche to a race at Road Atlanta (Porsche’s home track in North America). A legendary sports car builder, Porsche’s 911 Carrera S of 2010 made 385 horsepower to the MINI Cooper S’s 172.
That Porsche would easily win the race was a no-brainer—or was it?
Ultimately, it didn’t matter, because Porsche refused the challenge.
When this happened, McDowell made another video and even hired a plane to tow a banner over the Porsche headquarters challenging them once again. Porsche still refused, so MINI got a 911 on its own and ran the race anyway.
In the end, over 300,000 people watched the videos on You Tube and MINI’s Facebook page spiked to 82,000 views on the day of the race. The MINI vs. Porsche Facebook tab generated 400,000 views, along with 15,000 petition signatures goading Porsche to race and nearly 8,000 new fans for MINI. Print, TV and online coverage earned MINI 3.3 million impressions. The company also made its mark as a builder of fun to drive cars and got them thought of in the same breath as Porsche.
Regardless of the outcome of the race, MINI had already chalked up a win.
Anyone who has ever been to an event like South by Southwest (SXSW) knows you come home with a bag full of swag. Water bottles, T-shirts, backpacks, hats—all sorts of stuff. Companies spend hundreds of thousands of dollars to produce these items, which they give away. People take them home, stuff them in drawers for a few years, then throw it all out to make room for more free stuff they’ll never use.
Medallia, a Silicon Valley tech company, teamed with Austin’s Foundation for the Homeless at SXSW to give convention swag to the homeless. Hats, book bags, water bottles, T-shirts and even food were collected and donated. Medallia had people stationed around the event wearing “Donate Your Swag” T-shirts, who directed people to drop the goods they’d collected at a Medallia booth in front of the Austin Convention Center.
In the process, Medallia created a significant presence for itself at the event, without spending tons of money. In fact, the company leveraged the spending of other companies to attract attention to its booth. Through finding a way to help other people, Medallia helped itself.
Ideas such as these are creative, fun and grab attention. They are also extremely cost-effective when you consider results garnered vs. dollars spent. Rather, “how will I go about spreading brand awareness in a cost-effective and fun way?
The following is a guest post. Enjoy!
Hopefully, you did everything right from the beginning: You were pre-approved by your financial institution for an affordable home loan; you researched your area extensively to find the perfect property for you; you hired a real estate agent you could trust to gain access to property details and help you navigate the complex seas of paperwork. Now, it’s time to close.
Whether you are buying your first family home or a commercial property for your business, closing is convoluted and seemingly interminable. Even with the help of an experienced real estate agent, you should learn about the closing process before you attempt to survive your first real estate deal. This guide will walk you through the most important steps of closing your deal, so you come through excited to finally own your own property.
Though it might seem unnecessary, performing a quick title search and obtaining title insurance will safeguard your investment from conflicts down the road. It’s possible that a previous owner of your soon-to-be home left the house in a will to a long-lost relative or failed to pay debts taken against the house. If anyone shows up trying to claim ownership over your home, your title insurance should reimburse you, so you won’t take a significant loss due to the state’s poor record-keeping.
“I’m in escrow!” is an exciting statement to shout, but before you do, you should know what “escrow” means. Escrow is an account held by a neutral third party to prevent you or the home’s seller from being scammed. Until both parties in the transaction finish the necessary paperwork, all the money involved will be stuck in escrow.
Escrow isn’t free, but odds are you aren’t sure how much it should actually cost. Most escrow companies will try to take advantage of your ignorance and inflate their fees unnecessarily. By displaying your knowledge of the system (and using a few smart negotiating tactics), you can lower your closing costs and save some money. So-called junk fees to watch out for include:
Do you know the difference between a wall crack caused by foundation settling and one caused by water damage? Can you tell just by looking how old the pipes are in the master bathroom? Can you recognize black mold? Most likely, the answer to all these questions ― and any questions about home repair or construction ― is “no.” That’s why you need to hire a home inspector to survey your desired property before you close the sale: You should know exactly what you’re in for before laying down cash.
You should also consider hiring a pest inspector to look for signs of damage due to wood-eating insects. If an infestation is discovered, most mortgage companies require the seller to resolve the issue before closing.
Based on what your home and pest inspectors find, you might be able to lower the price you previously agreed to. Because you will likely need to complete some amount of repairs, you should ask that the seller to lower the cost by at least as much as the cost of the repairs ― or else request they complete the repairs themselves.
If you didn’t seek pre-approval ― which you should have, by the way ― it is time to lock down your interest rate. The best lenders will watch the market for a dip in rates, but you should avoid becoming too obsessed with obtaining the lowest possible number. Interest rates fluctuate several times every day, so your goal should be to obtain a reasonable rate that you can afford.
Finally, you can enter escrow. When you signed your purchase agreement, you likely deposited some earnest money into your escrow account to convince the seller that you do intend to buy the house. By now, both parties are certain about each other’s intentions, and it is time for you to move a more significant amount of money into your escrow account. You should deposit the full amount of your down payment (less the earnest money) and closing costs.
The last step of closing on your deal is signing the paperwork. In total, there should be about 100 pages worth of material, detailing the agreements of the sale, and you should read absolutely all of it. Because a home purchase will impact your finances for decades, you must know for certain that the contract says what it is supposed to. You don’t want any surprises in the way of rising interest rates or unknown fees down the road.
The following is a guest post. Enjoy!
Taking out student loans can provide you with the opportunity to earn a degree, learn a trade, and improve job prospects. In other words, the benefits you’ll gain in the long run make borrowing well worthwhile.
What’s even better is that there are myriad ways to save money when you take out student loans, as well as when you start to pay them back. Here are some money-saving hacks every student should know about.
It’s always best to borrow as little money as possible. There’s no shame in taking advantage of any student loan funds you’re eligible for, but the less you borrow, the less you have to repay down the road. Sure, it’s tempting to use your extra funds for a spring break vacation, but remember you’ll have to pay interest on that trip later on.
When you apply for and accept student loans to pay for college, you may end up with a combination of both federal and private loans at a variety of interest rates. If you can, it’s best to pay off the high-interest loans first to avoid extra expense.
However, you might also consider refinancing your student loans. You just have to make sure it makes sense to do so. This means crunching numbers to see whether or not the savings you’ll enjoy are worth the expense of refinancing.
Many lenders offer incentives to borrowers that set up an automated payment schedule and allow funds to be automatically withdrawn from their bank account each month (or more frequently). To find out if you’re eligible for any discounts associated with automatic payments, simply check in with your loan service. Then there are companies like Ameritech Financial that help you to lower and refinance your student loan debt which is gaining a lot of popularity with recent college graduates.
There’s absolutely nothing wrong with paying the minimum on your loan payments every month. This is the required amount to avoid delinquency and paying it diligently is essential to improving your credit rating.
You may not realize, however, that you can also apply additional funds to the principle owed in order to reduce debt faster and shave some money off your interest payments over time. You just have to make sure to note that any extra you pay should go toward the principle so that it isn’t mistakenly applied to your next payment due (including interest).
You may be able to take advantage of tax deductions based on your interest payments on student loans, so you should definitely discuss the prospect with your tax advisor or contact the IRS to ask if you are eligible.
You might also qualify for federal or state repayment forgiveness programs, depending on your major and where you live. In addition, many companies offer some form of education reimbursement as part of a benefits package. You may be surprised by the benefits available to you through government programs and employment opportunities, and all you have to do is look for them.