5 Financial Reasons You Should Never Buy A Home

September 7, 2018 Posted By: growth-rapidly Tag: Buying a house

5 Financial Reasons You Should Never Buy A Home. Thinking about buying a home for the first time?

Many people think that at a certain age or because they are married and start a family, they have to buy a house. They believe that it’s what they are expected to do or it’s the next step. But that can be a financial mistake. Even if you can afford a mortgage, there’s more to owning a home.

For example, after you buy a home, you will also need extra cash to account for repairs, property taxes, insurance. You also have to make sure you can keep a job in order to make the mortgage payments. So before you buy a home, make sure you are ready to do so. In this article, we will provide some of the common financial reasons you should never buy a home.

If you are interested in comparing the best mortgage rates through LendingTree click here. It’s completely free.

Related Articles on Buying A House

5 Financial Reasons You Should Never Buy A Home

1. Homes are very expensive.

Homes are costly to buy. The average sale price for a home in the United States in 2018 is $394,300. That means that you will have to come up with a large down payment (usually 20 percent of the home purchase price) plus closing costs and fees.

In addition, you have to make sure you can cover the monthly mortgage payments once you buy the house. There’s also property insurance, taxes, homeowner associations fees (if you own a condo), water bill, electricity bills you have to think about.

If you feel you have enough money saved for a down payment on a house and you have a stable job, then buying a home might be a good option for you than renting.

You know you can afford a mortgage? Start shopping today for a mortgage.

2. You’re not handy.

When you own a home, you also have to keep up with the place, including painting, cleaning, making repairs, mowing the lawn, etc.. If you’re not a handy person, you will have to pay for professionals to do these things. And the cost of home maintenance can eat up your savings. So if you’re not a handy person and don’t have the money for these maintenance costs, you’re better off renting a home rather than buying a home.

Shop today for the best mortgage deal.

3. You’re too busy.

Similar to reason number 2, you should not buy a home if you’re too busy in your day-to-day job and paying for someone to do the yard work for you can be costly.

4. You don’t have a stable job or a stable source of income.

If you don’t have a stable job or stable source of income, you may not be able to make on time payment. And late mortgage payments can have serious consequences. The great thing about renting rather owning a home is that you don’t have any real obligation, besides the lease. If you can’t make your monthly rental payments, the worst thing that can happen to you is eviction from the property. But with owning a home, if you make late mortgage payments, the bank can foreclose on your property.

5.  You’re planning on moving.

If you know you’re planning on moving to another state or country, or that your job might transfer you to another location, you are better off renting a home than buying a home. The rule of thumb is that you buy a home if you are going to live in it for at least 5 years.

In conclusion, although there are some great benefits in buying a home, a lot of times it just doesn’t make sense. If any of these financial reasons above apply to you, you may be better off putting off buying a home.

Click here to compare mortgage rates through LendingTree. It’s completely FREE.

Related Articles on Buying A House

Work with the Right Financial Advisor

You can talk to a financial advisor who can review your finances and help you reach your saving goals Find one who meets your needs with SmartAsset’s free financial advisor matching service. You answer a few questions and they match you with up to three financial advisors in your area. So, if you want help developing a plan to reach your financial goals, get started now.

Source: growthrapidly.com

How To Pay Off Your Mortgage Early

September 28, 2018 Posted By: growth-rapidly Tag: Buying a house

Are you looking to pay off mortgage early? Or as early as in 5 years? If so, then follow these tips. Your monthly mortgage payment might your biggest monthly expense in your budget right now. So the sooner and quicker you can pay off your mortgage, the sooner you can start experiencing true financial independence.  Follow the following six steps to learn how to pay off your mortgage faster.

Wondering how paying off your mortgage early can affect your overall financial plan? Talk to a local financial advisor.

1. Refinance your mortgage.

One of the steps you can take to pay off your mortgage faster is to refinance your mortgage loan. In the simplest term, refinancing your mortgage means that you get a new loan to replace your current mortgage loan. Refinancing can help you pay off mortgage early in two ways.

The first way is that you can get a mortgage loan for a shorter term and make higher payments and thus reduce the number of years it would take you originally to pay off your mortgage. Second, when you refinance your mortgage, you can get a loan with a way better and lower interest rate, provided that you have a good credit score.

So if you’re looking to refinance your mortgage loan to get a lower interest rate, it might be worth looking into learning how to improve your credit score.

A mortgage, like any debt, is something that you have to pay. So, in addition to making your monthly mortgage payments on time, make extra payments whenever possible. Making extra mortgage payments is one of the easiest ways to pay off mortgage early.

When you make extra payments on your mortgage loan, not only will you get rid of your debt faster, you will also save tons in interest payments. The logic behind it is this: the more money you owe, the more interest you’ll pay.

If you don’t make extra payments, the interest in your mortgage loan will build up and you will end up paying interest on interest. By making extra mortgage payments, you will be able to pay off your mortgage early. 

One word of caution though, before you start making extra payments, check with your loan to see if you’re allowed to do so without incurring any extra fees. You may not be allowed to make extra payments on a mortgage loan with fixed rates.

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3. Set a pay off mortgage early date.

Use an online mortgage calculator to have an idea when you can pay off your mortgage loan. The mortgage calculator will tell you when you can expect to pay off your mortgage and how much you need to pay every month to reach that goal.

Your paycheck from your current job may not be enough to consider making extra repayments on your mortgage.  With your monthly expenses, you may not have any money left at the end of the month.

So making extra money by doing side hustles or completing surveys can help pay off mortgage early. Here are some ways to make some extra cash.

5. Watch your spending habits.

Start watching your spending habits, including avoiding impulse buying. See if you can cut back on unnecessary expenses like monthly cable bills, subscription magazines, stop eating out and buying new things. That extra money can go towards your mortgage payments.

6. Make a lump sum payment.

If you receive a bonus at work, or a tax refund, use some or all that cash towards your mortgage. 

In conclusion, paying off your mortgage early can save you thousands. So it’s a good idea to work on it.

Click here to compare mortgage rates through LendingTree. It’s completely FREE

Working With The Right Financial Advisor.

You can talk to a financial advisor who can review your finances and help you reach your goals (whether it is paying off debt, investing, buying a house, planning for retirement, saving, etc). Find one who meets your needs with SmartAsset’s free financial advisor matching service. You answer a few questions and they match you with up to three financial advisors in your area. So, if you want help developing a plan to reach your financial goals, get started now.

Source: growthrapidly.com

How To Save For A House

September 2, 2018 Posted By: growth-rapidly Tag: Buying a house

How to save for a house! For many people, saving to buy a house can be hard. This is because they don’t know how to save money or they’re not willing to limit their spending. This article will provide you with tips for saving for a house.



Determine how much money you need.

Before you decide to save for a house, you need to determine first how much money you’ll need to get started.

Typically, you need to come up with 20 percent of the property’s purchase price as a down payment and borrow the 80 percent from lenders.

In some cases, especially if you’re a first time home buyer, you can come up with way less money down as low as 3.5% thanks through FHA loans, but your interest rate might be higher. And you might be required to pay private mortgage insurance.

If you are interested in comparing the best mortgage rates through LendingTree click here. It’s completely free.

Related:

In addition to the down payment, closing costs and fees are also factors to consider in determining how much money you need to save for a house.

For example, let’s say you’re looking to buy a house for $250,000. You will need to come up with 20 percent of that price, i.e. $50,000, as the down payment. And 5 percent for closing costs, i.e., $12,500.

So in order to buy a house for $250,000, you will need to come up with $62,000.

To learn how much house you can afford, use LendingTree for the best mortgage loan rates and quotes for free. Here are some tips on how to save for a house:

Click here to compare mortgage rates through LendingTree. It’s completely FREE.

1. Increase your income.

If your monthly paycheck is not enough to save money because of monthly bills, debts, and personal expenses, then the best way to save for $62,000 is to boost your income. There are several ways to boost your income.

One is to work more by working over time at work. Another way is to have a side hustle to make extra cash on the side. A third way to boost your income is to take a part-time job.

Tip: If you want to make extra cash, I suggest that you take surveys online. I recommend, Pinecone Research (earn minimum $3 per survey), Swagbucks ($5 sign up bonus + get paid to take surveys), InboxDollars ($5 sign up bonus + get paid to take surveys), Ebates (earn up to $40 cash back), YouGov US Males ($2 bonus + $8 – $10 per hour), MySurvey ($2 sign up bonus + 5 per survey). See this blog post for a complete list. 

2. Reduce your spending.

One of the best ways to save money fast for a house is to reduce your spending. You can substantially increase your savings by living below your means.

To do so, figure out how much you spend a month on food, clothing, grooming, transportation and entertainment. See where you can cut back a little. See if there is a much cheaper alternative. Can you eat out less? Can you take public transportation rather driving your car?

Are there things that you pay for on a monthly basis that you can cut? For example, cable TV, magazine subscriptions, a gym membership that you barely use. Indeed, there are several ways to reduce your spending.

3. Pay off your debt. 

Paying off debt, such as credit card debts, is another way to save for a house. Credit card debts are high interest debts. Once you get rid of these debts, you will have more money left to save. Also, paying down your credit card debts helps your credit score.

In conclusion, if you’re in the market to buy a house, you need to come up with the down payment including the closing fee. This can be a big chunk of money that you may not have. So it’s important to follow the above tips to save money for your dream home.

Get pre-approved for with a mortgage lender to figure out how much house you can afford.

Related:

Working With The Right Financial Advisor.

You can talk to a financial advisor who can review your finances and help you reach your goals (whether it is paying off debt, investing, buying a house, planning for retirement, saving, etc). Find one who meets your needs with SmartAsset’s free financial advisor matching service. You answer a few questions and they match you with up to three financial advisors in your area. So, if you want help developing a plan to reach your financial goals, get started now.

Source: growthrapidly.com

Buying A House Checklist For First Time Homebuyers

Buying a house, especially if you’re a first time home buyer can be daunting. And searching for a buying a house checklist online can also be annoying.

From finding a real estate agent or broker to assist you in the purchase of a property to start house hunting, the process can be overwhelming if you don’t know what you’re doing.

In order of importance, here’s a ‘buying a house checklist’ we put together to make the process as smooth and as easy as possible.

Number 4 of this checklist is extremely important, so make sure you get to it.


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Check out: 5 Signs You’re Not Ready To Buy A House

In brief summary, this buying a house checklist includes checking your credit score, shopping for a mortgage lender, assembling your team – including hiring a real estate agent, gather important documents, making an offer on the house, etc…

Buying a House Checklist for First Time Home Buyers:

Related Resources

Step 1. Review your credit report.

The 1st thing to do when buying a house is to review your credit score.

In fact, your credit score plays a major role in whether a mortgage lender will qualify you a for a loan. And even if you qualify, the interest rate you will get depends on how good your credit score is.

Anything above 700 is considered a good credit score in the eyes of mortgage lenders. If you have something below that, don’t lose hope yet.

A 580 credit score will qualify you for a FHA loan. Or you can always take steps to improve it. So, don’t procrastinate – start working on this step right now.

So review your credit report from an online monitoring service like CreditSesame. It’s completely free. And correct any errors.

Check out: How To Raise Your Credit Score to 850

Step 2. Make a budget.

The best thing about following this buying a house checklist is the fact that it covers the most important aspect of the home buying process, which is making a budget.

Before looking at homes, you need a budget. There is a good reason for that.

Buying a house will most likely be the biggest purchase you will ever make.

Not only will you need to come up with a down payment and have enough of a stable job to make mortgage payments, you will also have to have extra cash related upfront costs.

These costs include inspection costs, renovating costs, closing costs, maintenance costs, taxes, property insurance, etc…

So you will have to make a budget, taking into consideration all of these costs and expenses associated with buying a house.

Related: Apply for a Mortgage Loan Today

Step 3. Gather your documents.

A mortgage lender will need some paperwork from you before they offer you a mortgage loan.

They include your income tax returns, w-2 forms, current pay stubs, bank statements, asset statements and any other financial statements. So, start gathering them now.

Step 4. Get pre-qualified for a mortgage loan

Unless you will buy your home with cold cash, you will need a home loan. So, consider getting pre-qualified for a home loan before you start house hunting.

There are lots of reasons why getting pre-qualified for a mortgage loan is a good idea. For starters, it tells the sellers that you’re serious when you start shopping for your house.

Additionally, getting pre-qualified for a mortgage gives you an idea of how much house you can afford. Mortgage lenders will pre-qualify you based on how much loan they will be able to offer you once everything is done.

So it’s worthwhile to know the limits of your borrowing power. The worst thing that can happen to you is to find a house that you fall in love with, and find out later that you cannot afford it.

Click here to compare mortgage rates through LendingTree. It’s completely FREE.

Step 5. Build your team.

Some first time home buyers make the mistake of ‘doing it alone’, of looking for a property without the help of a professional, like a real estate agent.

This mistake can cost you dearly.

Simply looking at properties on Zillow, Redfin, or on Google isn’t enough. Some of the best deals don’t even make it to these sources.

Real estate agents or brokers have insider knowledge that you don’t have. A good real estate agent understands the current market conditions and knows how to evaluate a property.

Also a home inspector can give you advice and information on the property so you can make an intelligent decision.

A home buying inspection checklist will be important in that regard.

A financial advisor is also a professional that you need to consider in your team.

Although a financial advisor may not be the first person you think to consult before buying a house, but a financial advisor can advise you whether now is a good time for you to buy a house.

They can help you understand how buying a home fits with your overall financial situation and goals. Of course, make sure your financial advisor has experience with real estate investment. See, 5 Mistakes People Make When Hiring A Financial Advisor.

Step 6. Begin looking for properties.

This ‘buying a house checklist’ will help you find the home of your dream.

With a pre-approval letter in hand, at this point you’re pretty much have an idea how much house you can afford.

And with working with a real estate agent, who can tell you where to look, all you need to do is to start the process. In addition to working with a real estate broker, look at online listings, and visit open houses

You also need to start researching the neighborhood. This is incredibly important. You want to know whether you would want to raise a family in that neighborhood. Are there schools nearby? Is it a quiet or noisy neighborhood?

Step 7. Make an offer and prepare for closing.

Once you find a property that you fall in love with, work with your real estate broker to make an offer.

Your real estate agent should be able to give you prices of comparable homes and you should use these numbers to make your initial offer.

Also, start getting ready to start the closing process. Find out with your broker how the closing process works – it may vary depending on your city or state. Also, make sure you know all of the deadlines.

In conclusion, follow these steps to buying a house checklist to help you find the home you’ve always dreamed about.

Click here to compare mortgage rates through LendingTree. It’s completely FREE.

Buying a House Checklist: Summary

1) Review your credit report – check your credit score to make sure they are good. If not, take steps to improve it.

2) Make a budget – that will let you know how much house you can afford.

3) Gather your most important documents, including your bank statements, pay stubs, tax returns, etc.

4) Get pre-qualified for a mortgage.

5) Build your team, including getting a home inspector. We don’t have a ‘home buying inspection checklist, but we have found a great home inspection checklist here for more information.

6) Start looking for properties.

7) Make an offer and prepare for closing.

Read More:

Related Resources

Not All Mortgage Lenders Are Created Equally

When it comes to getting a mortgage, rates and fees vary. LendingTree allows you to view and compare multiple mortgage rates from multiple mortgage lenders all in one place and at the same time, so you can choose the best rates for your needs. LendingTree makes getting a loan faster, simpler, and better. Get started today >>>

Source: growthrapidly.com

Existing Chase ‘Pay Yourself Back’ Categories Appear Slated to End on April 30

A while back, Chase extended the Pay Yourself Back categories through April 30th. It wasn’t known whether it would continue getting extended or not, but early indications are that – indeed – after April 30th the existing categories will no longer be valid:

Reader Peter shares a screenshot from within his Chase login (taken on February 26th) which shows all eligible PYB transactions from February to have a 62 day expiration, meaning that the transactions can be redeemed PYB through April 30th. That’s less than the typical 90-day allotment, presumably because after April 30th these categories will not be eligible.

Last time around, people were wondering why Chase showed the full 90 days, despite the entire PYB benefit expiring in less than 90 days; then, Chase extended the benefit and it all made sense. This time, they took the pains of changing the number of days left which would seem to indicate that the existing PYB categories will not be extended beyond April 30th.

Most likely there will be new eligible categories beginning May, but we don’t know what they’ll be – it’s worth cashing out now if you find the Grocery and Dining categories easily usable. Grocery also works out now with the 3x Sapphire Reserve grocery multiplier.

Source: doctorofcredit.com

Alternatives to 529 Plans – Other Ways To Save For College

Many parents want to help their children get the best start in life — and for some that includes helping them, to some degree, with college. One way to save up for your child’s post-secondary education is with the help of a 529 plan. However, a 529 isn’t always the right move for every family.

Looking for a safe place to grow your college savings? Open an account with CIT Bank

As you consider how to save up for your child’s future, don’t forget to consider alternatives to 529s, as well as the plans themselves. Here’s what you need to know about the 529 and its alternatives.

What’s Ahead:

What is a 529 plan?

An investment account for your educational expenses

A 529 plan is a special investment plan designed to help you save for qualified education costs. With a 529, you set money aside in an account and it grows tax-free — as long as it’s used for eligible expenses. 

There are limits on what the money can be used for

While some states offer tax deductions for contributions made to a 529, it’s important to note that you won’t receive a federal tax break for your contributions.

Additionally, there are limits on what the money can be used for penalty-free. If you don’t use the money in a 529 for a qualified expense, you’ll end up paying taxes on the withdrawal, along with a penalty.

For some families, a 529 makes sense because it allows you to grow money in an efficient way. Investment choices often include index funds, so if the market does well, your child could benefit from the tidy amount involved. However, it’s also important to note that if the market drops just before you need the money, you might not have as much as you’d planned on to help your child pay for school.

You’ll face penalties if the money isn’t used for education

On top of that, if your child decides not to attend an eligible program, you’ll need to either name a new beneficiary for the account or accept the taxes and penalties on withdrawals. For some, the idea of all that uncertainty is enough to look for alternatives to 529s.

If you aren’t sure a 529 plan is the right approach for you, or if you want something else in addition to a 529, there are other options.

Here are some alternatives to 529 plans:

High-yield savings accounts

Alternatives To 529s - High-yield savings accounts

Alternatives To 529s - High-yield savings accounts

With a high yield savings account, you don’t have to worry about what the money is spent on. There are no restrictions on how the money is used and it will even grow while it is waiting to be spent.

On top of that, you don’t have to worry about market gyrations. Your principal is protected, no matter what happens.

Some accounts that might work well for high yield savings include:

CIT Savings Builder

Alternatives To 529s - CIT Savings Builder

Alternatives To 529s - CIT Savings BuilderCIT Savings Builder is one of my favorite choices for building my savings. With an APY of 1.45%, there is no wondering whether or not your long-term college savings will grow. 

To get started, you will be required to set up monthly deposits of $100 or maintain a minimum balance of $25,000. The $100 minimum is the perfect kick in the pants you might need to start really saving.

Discover Online Savings

Alternatives To 529s - Discover Online Savings

Alternatives To 529s - Discover Online Savings

With the Discover Online Savings, you can earn up to 1.40% APY with no account minimums and no fees.

You won’t be able to build your college nest egg as quickly as with a 529, but you will have peace of mind and flexibility. That way, in case your child decides not to attend college, you can still use your savings to help support them.  

Roth IRAs

Alternatives To 529s - Roth IRAs

Alternatives To 529s - Roth IRAs

Normally, you wouldn’t be able to tap into a Roth IRA until you reach age 59 ½. However, if you want to take advantage of the tax advantages of a Roth IRA, you can do so for education. Education is one of the ways you can access Roth IRA money early.

Additionally, with a Roth IRA, you can withdraw your contributions at any time without being subject to a penalty. This adds additional flexibility to your account. However, you do have to be careful not to dip into your earnings. If you do, be prepared to pay a penalty for non-approved purposes. 

A Roth IRA offers a little more flexibility than a 529 while providing you with access to funds. You can open a Roth IRA with a robo-advisor like Betterment or Wealthfront.

Betterment

Alternatives to 529s - Betterment

Alternatives to 529s - Betterment

Betterment makes setting up a Roth IRA ridiculously easy. You’ll tell them what your dream retirement looks like. That’ll give Betterment a sense of what you’re really looking for. Then they’ll give you personalized IRA recommendations.

You’ll need to set up recurring auto-deposits, that way Betterment can rebalance your account when needed.

Betterment also makes retirement account rollovers easy. In fact, you could rollover everything in about 60 seconds.

Wealthfront

Alternatives to 529s - Wealthfront

Alternatives to 529s - Wealthfront

Wealthfront lets you set up a retirement account in just a few steps. You start by linking your financial accounts, which eliminates the need for all the pesky paperwork you’ll fill out for other companies.

Then Wealthfront will show you what your future could like with their recommended retirement accounts. For IRAs, you can choose to go with a Traditional or Roth IRA through Wealthfront.

Coverdell ESA

Alternatives To 529s - Coverdell ESA

Alternatives To 529s - Coverdell ESA

Some 529 plans offer limited choices when it comes to investing, mostly focusing on index funds. If you want something a little more flexible, but still with tax benefits, a Coverdell ESA can be an option.

You can invest in almost any stock, bond or fund, and the earnings grow tax-free as long as you use them for qualified education expenses. With the Coverdell ESA, you have more options and still get the tax benefit.

There are some restrictions, however. You can only contribute up to $2,000 a year to a Coverdell ESA, and the beneficiary must withdraw all the money in the account by the time they are 30. 

Taxable investment accounts

Alternatives To 529s - Taxable investment accounts

Alternatives To 529s - Taxable investment accounts

With a taxable investment account, you have total control over how you spend the money. You can grow the college fund rapidly, with the help of investing, without the restrictions that come with how you can spend the money.

If you go this route, however, it’s important to pay attention to when you sell your assets. You want to sell older assets first so that you can take advantage of the favorable long-term capital gains rate. You’ll have to pay taxes on your earnings, so it’s a good idea to plan for that.

Here are a couple of the best investment accounts on the market today:

Wealthsimple

Alternatives To 529s - Wealthsimple

Alternatives To 529s - Wealthsimple

As their name states, Wealthsimple wants to make investing…well, simple. You can have Wealthsimple create a low-fee portfolio for you, and they’ll manage it as well. All you have to do is tell them what your risk level is and what your goals as an investor are.

When needed, Wealthsimple will automatically rebalance your portfolio, so you’re always maintaining the risk level you want. To make things even easier, you can set up automatic deposits, which Wealthsimple will invest for you.

Wealthsimple really is the set it and forget it platform most young investors have been looking for.

E*TRADE

Alternatives to 529s - E*TRADE

Alternatives to 529s - E*TRADE

E*TRADE offers a brokerage account where you manage your own investments while using E*TRADE’s helpful platform. But, E*TRADE also offers managed portfolios. You will need $500 to start investing, but that’s a low minimum, especially compared to E*TRADE’s competition.

E*TRADE has a low annual advisory fee of 0.30%. Their managed option works much the same way as Wealthsimple’s. You tell E*TRADE how much risk you can take on, and they get to work building a portfolio that works for your investment needs.

Prepaid tuition plans

Alternatives To 529s - Prepaid tuition plans

Alternatives To 529s - Prepaid tuition plans

Some states and colleges are starting to offer prepaid tuition plans. If you sign up for one, you can buy tuition credits at today’s prices. By buying these credits ahead of time, you can potentially save thousands of dollars over time, especially when you consider how quickly tuition can rise.

However, it’s important to understand that you might be limited as to where you can use the funds. If you get a prepaid tuition plan through a state, you can usually only use the balance to pay for specific in-state public schools. When you buy tuition credits at a specific school, you run the risk that your child won’t actually get into the school later.

If it works out, though, a prepaid tuition plan can be a smart way to pay for your child’s schooling in increments while saving thousands of dollars.

Summary

Due to the rising cost of college, you’re probably going to need to save up some money ahead of time to help your child pay for their higher education. If you want to reduce the amount of student debt they end up with, it can make sense to find a way to save up as much as possible.

A 529 plan can be a good tool for college savings, but don’t forget about other options that might work just as well — or even better. 

Read more:

Source: moneyunder30.com

4 Mistakes Millennials Make When Buying a House

June 8, 2019 Posted By: growth-rapidly Tag: Buying a house

Many millennials start the home buying process without a real understanding of what it takes be a homeowner.

In fact many of them don’t even know the many upfront costs when buying a house — including coming up with a down payment, moving costs, closing costs, renovating costs, and so many others.

They think that if they have a sizable down payment and a stable job, the hard yards are over. Well, not quite…

Wondering how these mistakes can affect your overall financial plan? Talk to a local financial advisor.

That lack of knowledge can lead them to make costly mistakes, including paying thousands of dollars in loan interests, defaulting on their home loan, or going bankrupt. Here are some of the biggest mistakes millennials make when it comes to buying a house — and what can be done instead.

Check out: 5 Signs You’re Not Ready to Buy a House.

1. Not understanding the importance of a good credit score.

One of the most important things a mortgage lender looks at when deciding to pre-qualify or qualify you for a mortgage loan is your credit score.

Yet, many millennials don’t know the importance of maintaining a good credit score. Lacking that fundamental knowledge could cost them a lot. One is that you will have a hard to get qualified for a loan.

Second, even if a mortgage lender offers you a mortgage loan, you will likely get a high mortgage rate. A high mortgage rate can cost you thousands of dollars in interest – money that you could contribute towards your retirement savings.

Get Matched With 3 Fiduciary Financial Advisors
Answer a quick question to start your matching process with advisors in your area.
When would you like to retire?
Select an answer

To avoid this mistakes when buying a house, millennials should first figure out their credit scores through a free monitoring service like MyFreeScoreNow. A good credit score is around 730.

Once you have an idea of what your credit score is through your credit report, take steps to improve it. One way to raise your credit score is not to max out your credit limit.

Maxing out your credit cards can hurt your credit score significantly. So keep your credit utilization rate under 30 percent.

Another way to improve your credit score is to pay your bills on time. Payment history accounts for 35% of your overall credit score. So it’s very important to pay your bills promptly.

Check out: How To Raise Your Credit Score to 850.

2. Not understanding how much down payment is enough.

A down payment on a house is the single most important factor when it comes to buying a house. Unless you are so wealthy that you can buy a house with outright cash, you will need to come up with a down payment.

The recommended down payment is 20% of the home purchase price. But many first time home buyers can be qualified for a FHA loan, where the down payment is 3.5%.


Feeling Overwhelmed With Your Finances?, You have options and there are steps you can take yourself. But if you feel you need a bit more guidance, simply speak with a financial advisor. SmartAsset’s free tool matches you with fiduciary advisors in your area in 5 minutes. If you are ready to meet your goals, get started with Smart Asset today.


However, the disadvantage of putting less than 20% is that you will have to pay Private Mortgage Insurance (PMI). A PMI is extra fee added to your monthly mortgage payment.

Another disadvantage is that it will take you longer to pay off your mortgage. And your monthly mortgage payments will be much more.

One way to not have to worry about a PMI is to save for a 20% down payment before starting the home buying process. Saving for a down payment should not be that hard if you have a savings strategy in place.

See: What is a Typical Down Payment on a House?

Taking out a mortgage loan to purchase a house is the most expensive financial decisions you can ever make in your life. So it’s important to have the best mortgage rates possible so you don’t end up paying thousands of dollars in interest over the life of the loan.

Yet, most millennials only speak with one lender when buying a home. That is a big mistake. When you speak with one lender, you don’t know what other mortgage rates are available to you. A good mortgage rate means less interests. So not speaking with multiple lenders is one of the mistakes to avoid when buying a house.

4. Not knowing other upfront costs associated with buying a house

You might think that just because you’ve found a home and you have been approved for a loan, that your hard work is over. Well, not quite. In addition to coming up with a down payment, there are several other upfront costs when buying a house.

There are inspection costs. Before you buy a house, it’s always a good idea to inspect the house for defects. In fact, it is mandatory. Lenders will simply not offer you a loan unless they have seen an inspection report.

There are loan application fees. Some lenders may charge you a fee for applying for a loan. This fee typically covers tings like credit check for your credit score or appraisal.

There are repair costs. Unless your house is perfect from the very first time you occupy it, you will need to do some repair. Depending on the condition of the house, repair or renovating costs can be quite significant.

There are moving costs. Depending on how far you’re moving and/or how much stuff you have, you may be up for some moving costs.

So avoid these mistakes when buying a house, and your home-buying experience should go as smoothly as possible.

10 First Time Home Buyer Mistakes to Avoid

How Much House Can I afford

5 Signs You’re Better Off Renting

7 Signs You’re Ready to Buy a House

How to Save for a House


Not All Mortgage Lenders Are Created Equally

When it comes to getting a mortgage, rates and fees vary. LendingTree allows you to view and compare multiple mortgage rates from multiple mortgage lenders all in one place and at the same time, so you can choose the best rates for your needs. LendingTree makes getting a loan faster, simpler, and better. Get started today >>>

Source: growthrapidly.com

One-Tap Online Shopping Savings Compared: Capital One Shopping Vs. Honey

There’s no sense in paying full price when shopping online — not when there are two truly legit discount apps that will save you money: Capital One Shopping and Honey.

The question is, which one to go with? Since I do at least 75% of my shopping exclusively online, I decided to run some tests to find out which coupon app was going to come out on top.

If you’re ready to save some serious cash on your next shopping trip, read on.

What’s Ahead:

Capital One Shopping vs. Honey summary

Features Capital One Shopping Honey
Format App
Browser extension
Website
App
Browser extension
Website
Partners Not specified, but most major name brands, plus Amazon 30,000 participating merchants including Amazon and
Watchlist Yes Yes (called Droplist)
Automatic coupon codes Yes Yes
Lowest Amazon price No Yes
Membership required No, except for credits No, except for Gold program
Local offers Yes No

About Capital One Shopping

One-Tap Online Shopping Savings Compared: Capital One Shopping Vs. Honey - Capital One Shopping

One-Tap Online Shopping Savings Compared: Capital One Shopping Vs. Honey - Capital One ShoppingCapital One Shopping is a discount and savings app owned by Capital One. It bills itself as the best option for discounts, loyalty perks, and deals.

To use Capital One Shopping, simply download the app, install the browser extension, or just visit the web site. Using Capital One Shopping gets you better prices on your online shopping, automatic discount codes at checkout, and tracks your must-have items to find the best price.

About Honey

One-tap Savings Compared: Wikibuy Vs. Honey - Honey

One-tap Savings Compared: Wikibuy Vs. Honey - HoneyHoney is an app dedicated to finding you the best deals and promos on all your online shopping. Installing the browser extension or downloading the app gets you great discounts and automatic coupon codes when you’re shopping online.

You don’t even have to lift a finger, Honey will add the best coupon they find right to your cart, or they’ll let you know that you have the best deal. 

Capital One Shopping vs. Honey savings

As major players in the discount code space, it may be tough to tell what sets Capital One Shopping and Honey apart. They’re both extremely effective at finding deals and applying codes. So let’s compare them in terms of savings. 

Capital One Shopping savings

Capital One Shopping helps you save in two main ways. First, it runs a comparison for the item you’re looking at, showing you if there’s a better price somewhere else. So, if you’re browsing Walmart.com for a particular camera, Capital One Shopping checks Amazon, Best Buy, B&H Photo Video, and other stores to see if you’re really getting the best possible deal.

Capital One Shopping shows you who has the lowest price, so that you can make the best choice for your wallet. They even spell out how long to expect for shipping at each alternative store and how much it costs to ship — so you get the true total price.

Then, at checkout, Capital One Shopping will scan all available coupon codes for you — automatically. No more Google searches or saving endless store emails; just have Capital One Shopping work its magic and you get the savings.

A word of warning, though: sometimes the savings you get are just cash back credits, and you can’t cash those out immediately. They may need to be verified and then can be redeemed for gift cards at some of your favorite retailers. 

Honey savings

Honey also automatically scans and applies coupon codes for you when you shop online. You don’t have to waste time with coupons that don’t work, because Honey only applies valid promo codes. 

Honey also saves you money by notifying you when items in your Droplist have changed price. The Droplist is Honey’s version of a watchlist; it’s where you save items you’re interested in. Not only will the Droplist notify you when prices drop, but you can see the price history, too.

Like Capital One Shopping, Honey also offers a cash back program, called Honey Gold, which requires a sign-up. Similar to Capital One Shopping, you have to save up a certain dollar amount (in this case, $10 of “gold”) before you can cash out in the form of a gift card. 

Capital One Shopping vs. Honey savings summary

Both Capital One Shopping and Honey will show you deals and automatically apply promo codes. The real difference comes down to the way you shop. Are you mostly an Amazon shopper? Then Honey is going to help you out. Do you want to take a moment to compare prices across a bunch of different retailers and go with the lowest cost? Then Capital One Shopping is for you. 

Here’s an example: I am in the market for a new pressure cooker. I found one I liked on Amazon. The Honey extension notified me that I found the lowest price of all the sellers on Amazon. I could check out with confidence. But the Capital One Shopping extension showed me that I could actually save $5.99 by taking advantage of a 7% cash back deal at Macy’s. I never would have known about that offer otherwise. 

However, while I may technically be saving $5.99 by purchasing my pressure cooker at that particular department store, I do not actually see those savings immediately; I have to save up the credits and apply them to a gift card, choosing from 32 different stores. Sometimes, you’d just rather have the cash.

Capital One Shopping vs. Honey pros

Capital One Shopping pros:

  • Detailed price history and insights – You’ll get insights into each product you shop for.
  • Compare prices at multiple stores – You can find the best deal at a large number of big-box retailers. 
  • Shipping included in price comparison – Easily see how much you’ll pay for everything, including shipping. 

Honey pros:

  • Finds the lowest offers on Amazon – There are thousands of shops on Amazon, so knowing which has the lowest price can be a huge help.
  • The website is more pleasant and transparent to use – Honey is as simple as downloading a Google Chrome extension.
  • Honey Gold program rewards you with gift cards – After earning a set amount of gold, you can cash out for gift cards. 

Capital One Shopping vs. Honey cons

Capital One Shopping cons:

  • Discounts are sometimes in the form of cash back, not lower prices – Not everyone wants to deal with cash back, some folks would prefer straight cash. 
  • Local deals require linking a credit card – If you want local deals, you’ll need to link your credit card, which could be a problem for those worried about privacy issues. 

Honey cons:

  • “Cash back” is in the form of gift cards at select retailers – Just like Capital One Shopping, cash back comes in the form of gift cards, rather than just cash. 
  • Doesn’t always find a valid code to apply – Honey isn’t perfect, and sometimes they miss coupon codes. 

Why choose Capital One Shopping?

Multiple store comparisons

Since both Capital One Shopping and Honey automatically apply coupon codes, one of the biggest differences might be that Capital One Shopping compares prices across multiple stores. You can also use the Mobile Price Comparison tool if you’re on mobile; text an Amazon link to PRICE1 and Capital One Shopping will text you back if there are lower-priced options available.  

Effective discounts

Capital One Shopping frequently finds a way to save on shopping trips, whether it’s a promo code, cash back offers, or lower shipping. Based on my usage, it seemed to deliver lower prices in some format more often than Honey.

Detailed product pages

The product pages showed a great deal of detail. In addition to the price, you’ll also be able to see a detailed price history, 180-day price insights, price volatility ratio, YouTube reviews, related products, and top alternatives.

Why choose Honey?

Get the lowest Amazon price

Having to sort through all the different prices offered by different Amazon sellers on the same product can be a pain in the neck. Honey does a great job of reducing that workload for you, simply showing the lowest-priced Amazon seller for what you’re looking for. So if you do most of your online shopping with your Amazon Prime subscription, the Honey browser extension will be a big boon.

Or avoid Amazon altogether

If you’re more of a mobile shopper and you tend not to shop on Amazon, the Honey mobile app (as opposed to the desktop browser extension) is a way to find thousands of great deals when you’re on your phone — no Amazon required. In fact, the mobile app doesn’t show Amazon products at all, which could be a good fit for you if you’re not a fan of the behemoth site.

Summary

Overall, choosing either Capital One Shopping or Honey is better than shopping online without them. Each will scour the internet for valid coupon codes, which can save you lots of money. You don’t need a membership with either one unless you want to start earning credits (or “gold”) to be redeemed for cash back. Not to mention, signing up for cash back offers could be worth your while, especially if you don’t mind turning over some of your privacy and letting these extensions track where you shop in exchange for saving a little bit of dough.

However, all that being said, Capital One Shopping does edge out the competition by a nose if you’re looking for the overall lowest price. If you’re primarily interested in coupon codes and Amazon deals, Honey is your better bet.

Read more:

Source: moneyunder30.com

Buying A Foreclosed Home in 10 Simple Steps.

Buying a foreclosed home is probably one of the best financial decisions you can make as a first time home buyer (although it’s not without risk).

In fact, it’s one of the best ways to make a good return on your investment. That is because foreclosed homes usually have more value than a traditional purchase.

However, the process of buying a foreclosed home can be risky and is different than a traditional purchase.

Plus, it can be very competitive as other buyers (sometimes real estate investors with a lot of cash) are probably looking for the same opportunity.

If you are interested in comparing the best mortgage rates through LendingTree click here. It’s completely free

So, if you’re thinking of buying a foreclosed home soon, do your due diligence and act fast. And use the following steps below as a guideline.

What is a foreclosure?

Before we learn how to buy a foreclosed home, we need to define what a foreclosure is.

Simply stated, a foreclosure is a property where the owner has defaulted on his or her loan payments. It can be other loan requirements, such as not having proper insurance coverage for the property. It can also be keeping the property in a bad condition.


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The lender (a bank, credit union, etc…) in the hope of getting some of their money back, takes legal possession of the property. The lender, in turn, will try to sell the house.

Foreclosed homes make buying a house a great opportunity for home buyers.

Why? The lender’s goal is to sell the foreclosed home as fast as possible. Holding on to a foreclosed, empty home costs the lender money.

So they are more concerned about selling it as quickly as possible rather than holding on to it for the highest price.

If you’re considering of buying a foreclosed home, follow these steps below.

Buying a foreclosed home in 10 Simple Steps:

If you’re a motivated buyer willing to buy a house in foreclosure, knowing these steps is important in order to buy a house at below market. It’s even more important if you’re buying a foreclosed home at auction.

Here are the 5 steps you need to take when considering buying a foreclosed home.

1. Get your finance in order

Remember you’re buying a foreclosed home from a bank that wants to get rid of the property as fast as they can. So time if of the essence.

Time is of the essence, especially if you’re buying the foreclosed home at an auction. Once your hand goes up, and you win the bid, be prepared to pay the down payment and sign the contract. Generally with buying a foreclosed home at an auction, there’s no cooling off period.

So organize your finance before you start looking.

That means knowing how much you can afford to borrow, making sure your credit score is in good shape, and having your down payment is ready, etc…

2. Secure a pre-approval letter from a lender.

Buying a regular house requires you to take out a mortgage loan to finance it (unless, of course, you have enough cash to buy the whole property).

Buying a foreclosed home is no different. The same concept applies.

Related: Apply for a Mortgage Loan Today

So before you start looking for a foreclosed home, make sure you can secure a mortgage. You can start doing that by getting pre-approved.

The process is not complicated, all you need is to find mortgage lenders. Then compile all necessary documents including your bank statements, pay stubs, or other forms of income.

Your credit score is one of the most important things, mortgage lenders look at to pre-approve you. So make sure your credit score is good.

Having a pre-approval letter can signal to sellers that you’re a serious buyer. It can also signal that you will be able to secure a loan.

3. Work with a real estate agent

A real estate agent will not only help you find current foreclosed homes listings, but can also inform you of those properties that will be listed soon.

This way, you are able to go through all of the foreclosed homes that are within your mortgage pre-approval range.

There are other reasons working with a real estate agent is important when buying a foreclosed home.

One is that, they may have experience helping other people finding foreclosed homes. Second, with that experience, they are able to tell you whether a foreclosed home will make a good buy or not.

4. Start your search: where to find foreclosed homes?

Finding a home in foreclosure can be very easy. Generally, your real estate agent can give you a list of them. You can easily find them listed on popular sites like Zillow, Redfin or Trulia.

Better yet, you can drive through any neighborhood, and you will likely see signs that say “bank owned”

Are you interested of buying a foreclosed home? Check out mortgage rates right now.

Additional steps in buying a foreclosed home

If you are in a hurry to buying a foreclosed home, these three steps above should suffice. But if you want to make sure your home buying process goes as smoothly as possible with no real surprises later on, continue on the following steps.

5. Compare prices

Before buying a foreclosed home, it’s always a good idea to compare prices of recent sales of similar foreclosed properties.

Again, your real estate agent can help you with that as well.

6. Get the right home loan

The number of home loans available to you can be mind-boggling.

However, LendingTree’s online platform has over 1500 home loans and can match you up to 5 mortgage lenders so you can choose the best mortgage rate.

So you should always do your due diligence to make sure you find a mortgage specific to your needs.

Not all loans are made equal. Rates and fees can vary from one mortgage lender to another.

So don’t make the mistake at looking at one lender only.

Use a free comparison website such as LendingTree to compare home loans side by side.

7. Inspect the property

Once you find the home and make an offer, make sure you hire an inspector to do a thorough inspection to determine the condition of the property and the overall cost of any repairs and renovations the property might need.

So even if you’re likely going to save money by buying a foreclosed home at below market, don’t try to save money by foregoing a physical inspection on the property.

No matter what the circumstances, always do an inspection.

8. Find a good lawyer

A lawyer should do all the legal work involved in buying a foreclosed home.

They will do a title search to see if the property has any liens, etc.

A lawyer can also guide your through the contract negotiation process.

9. Consider repair costs

Foreclosed homes are offered “as is.” So, you should expect some damage done to the house. Perhaps the previous owner was upset about losing their home and did real damage to the property.

And if they did not have the money to make their mortgage payments, it’s safe to assume they did not have any money to maintain the house.

It’s a good idea to also consider repair or renovation costs when buying a foreclosed home.

10. Consider other costs

In addition to the down payment and repair costs, closing costs, there are other costs involved in buying a foreclosed home. They include moving costs, maintenance costs, etc..

So make sure you consider these costs when making your budget.

In conclusion, property in foreclosures are properties where previous owners have failed to meet their loan requirements and the lenders take legal possession of the property. Although they can be risky, they are usually a better value than a traditional purchase.

So, if you’re a potential home buyer willing to do the due diligence to find rare opportunities, you can be significantly rewarded.

Click here to compare mortgage rates through LendingTree. It’s completely FREE.

Related:

Related Resources

Not All Mortgage Lenders Are Created Equally

When it comes to getting a mortgage, rates and fees vary. LendingTree allows you to view and compare multiple mortgage rates from multiple mortgage lenders all in one place and at the same time, so you can choose the best rates for your needs. LendingTree makes getting a loan faster, simpler, and better. Get started today >>>

Source: growthrapidly.com