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If you’re staring down a to-do list full of DIY and landscaping projects, well, there’s no better time to start! Investing in the outside of your home does a few things for you. Some projects can bring more literal value to your home when it comes time to sell, but other upgrades and fixes will have buyers imagining themselves in your manicured backyard garden.

Not sure where to start? We’ve got the answers.

Types of Landscaping

There are so many ways you can make your yard look like a million bucks without spending a million bucks. Whether you’re into one trend or another, a well-maintained yard is key. Plan and decorate your yard in a way that will make it easy for you to care for. Start with deciding what kind of landscaping you want in your yard.

Xeriscaping

Sometimes people call this hardscaping. You know, cause most things in the yard are solid, non-living beings. Here are a few things you might find in a hardscape yard.

  • Patios
  • Wider walkways
  • Retaining walls
  • Drought resistant plants
  • More areas covered with small rocks
  • Large rock features
  • Small pools/ponds
  • Fountains

If you live in a hot, dry climate, you might want to explore xeriscaping. This allows you to cut down on water use and you don’t have to worry about maintaining anything lush and green.

Softscaping

Softscaping is the opposite of hardscaping. This is the yard you imagine when you think of a traditional home with a white picket fence. Grass, shrubs, trees, flowers, all of these things usually make up a softscape yard. For this type of yard, you’ll want to be aware of your climate and surrounding wildlife. If you live in an area with all four seasons, either option will be good for you. That just depends on whether or not you want to bring your lawn and plants back to life after winter. You should also be aware of what local animals might wander into your yard. Deer are notorious for eating plants, so think about deer proofing if you have to.

The Cost of Changing Landscaping

Initial cost for both types of yards will likely be similar. As with anything, it will depend on how much you want to do. With a softscaped yard, you can trim a topiary elephant. With a hardscaped yard, you can add more bricks and stones for patios, or perhaps install a fancy fountain or pond. However, if you aren’t intent on going wild, the initial cost will likely be well within reach.

Bring it to the Front (Yard)

When it comes to landscaping, the front yard is the grand showcase. It has to hit the mark with a solid dose of curb appeal. If your goal is to add value to your home, you’ll want to spend most of your time here.

What should happen in the front yard to make it a great attraction? The first thing to do is plan what you want the yard to look like with your soft or hardscaping. Take into consideration the space you have to work with and how hard it will be to get to the areas you need to maintain regularly. If you want your sun-loving flowers to get the rays they need, think about crafting or buying a planter you can place in an optimal area, or set up a beautiful flower bed that’s not in the shade of large trees.

Seeing Green

If you have mature trees and plants, think about transplanting them over removing them entirely. If you’re looking to sell in the near future, many buyers love vegetation that is already done growing so they know what to expect.

Pathways and curbing through the yard can create a unique look for your yard, but be thoughtful about where you’re placing them. They can create issues with lawn mowing, weeding, and sometimes walking.

Bring it to the Back (Yard)

While the front yard does the job of drawing people in, you don’t want to shortchange the backyard. While the front yard attracts buyers, the backyard can win them over. Many buyers want to hang out and host gatherings in the backyard. Design the back landscaping to be comfortable and full of fun, while still functional.

Shade is a key factor for many homeowners. Since backyards are a top hangout spot, you’ll want to make sure there are shaded areas to take a break in. Try picking trees that get large enough to create these spaces but not so large they take over. This is an especially important factor if you don’t have a covered deck or patio.

Should You Get a Pool?

To pool or not to pool? That is the question. Not all yards are made for a pool. You don’t want to walk into a backyard that looks like a water park. Not to mention, this leaves no room for entertaining. Ask around the neighborhood and see if pools are a popular choice in the area. This will help you determine whether or not pools are in demand.

Keep in mind that planning for kid-safety is a must if you’re going to own a pool. There’s far more to it than just putting up a fence. If you see a hazard in your backyard, a potential buyer likely will too.

Take Inspiration Where You Can Find It

At the end of the day, spending time and a little money improving your yard will add value to your home, even if it’s not necessarily monetary. It’s the curb appeal that will attract people to take another look. Make sure potential buyers realize at first glance that indeed the grass is greener in your yard. If you’re ready to put in the work to improve your home’s landscape, or you already have, contact Homie if your next step is to sell!

Source: homie.com

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Our semi-regular series on motherhood is back today and I’m particularly excited about this post. While we’ve tackled weighty motherhood-related topics in past posts (breast feeding, co-parenting, self-care, the election) this post is touch different – because we’re talking about books!

Now some moms might be sharing their favorite parenting books, but since I’m always on the hunt for good children’s books (and haven’t found the time to actually read any parenting ones yet – whoops) I’m focusing on books for the littles. Because they really are books for us too. We’re the ones reading them after all!

Surely, the world of children’s books is nearly endless but some books really do stand out from the crowd. And my definition of good is not as straightforward as it sounds. To classify a kid’s book as worthy it has to be visually appealing with lovely illustrations, have a truly good story, be well written (for the most part) and not drive me absolutely bat-sh** to read it for the 1,000th time. I’m tellin’ ya, it’s a tough bar. Pete the Cat does not make the cut. But I’ve managed to begin building a collection of kids books that both I and my kiddo equally adore. To the point where he has half of them nearly memorized. And wants to read each a minimum of three times in a row, stretching evening storytime into a freaking hour, but I digress. Because these books don’t suck, I’m ready and willing to do it.

To remind, I now have a toddler one my hands, so these are not board books. He’s just trustworthy enough to flip through the pages on his own. While I’ve found some good board books I love, classics like Go Dogs Go and Brown Bear, Brown Bear, I haven’t found as many board books that I also find truly compelling. If anyone has any recs, I’d love to see them!

1. Almost an Animal Alphabet by Katie Viggers. This alphabet book takes the ABCs to another level. Charming illustrations, actually interesting information about animals and a hidden joke or two make me smile every time we read this book.

2. Ish by Peter H. Reynolds. Ish might just be my favorite children’s book I’ve read thus far. A truly sweet story about a little boy who loves to draw, but his joy is stymied when he’s teased. But through a lesson, from a younger sister no less, little Ramon finds his love of art again. Delightful illustrations and great life lessons make this book a true treasures.

3. Home by Carson Ellis  Home is a wonderful visual story about the definition of just that, home. Be it a nest, an apartment, a pasture or wigwams or boats, this book celebrates how and where all beings live. The illustrations soar above my bar and the diversity of places keep you guessing and the little delighted. It’s a winner.

4. I Want My Hat Back by Jon Klassen. If you’re looking for a book that will crack you up virtually every time you read it, I Want My Hat Back is certainly one. The humor is most definitely adult, but the illustrations keep the kiddos engaged. They might not get the joke in the end, but that almost makes it more fun. This one is also short. Always a bonus when wine is calling. (am I bad mom??)

5. Iggy Peck Architect by Andrea Beaty and David Roberts. If books that rhyme start to make you crazy after a while, Iggy Peck will save you. While written in verse, the story of a little boy who falls in love with architecture is witty, entertaining, and truly fun to read. You’ll love the pictures, you’ll love the message. There are also sister books, Ada Twist Scientist, and Rosie Revere Engineer are equally great.

6. I’d Know You Anywhere My Love by Nancy Tillman. This story is about a mother’s love for her children, but told through eyes of a child playing make believe. If your little loves animals this is a perfect book. It communicates a monther’s devotion while also empowering the child to use their imagination. It also introduces uncommon animals like the Blue Footed Booby. I just adore it.

7. We Found a Hat by Jon Klassen. This is the only book on my list from the same author that I mentioned before. The language in these books is so simple (would be good for early readers). The illustrations are a crack up. And there’s another wonderfully adult joke at the end. It’s a gem.

8. The Wonderful Things You Will Be by Emily Winfeld Martin. This is another uplifting little tale about parents’ love for their children. I love the modern, dare I say hipster-esque illustrations. There are great messages for littles about caring, empathy, creativity and joy. There’s a fun little flip out section that makes my little guy say wow. It’s got all the pieces you need for a book both they and you’ll love.

I’m so excited to be raising a little reader. There is nothing more satisfying then seeing my little plop down and pick up a book all on his own. Or recite snippets of the books we read frequently. Books truly do open a child’s mind, inspire, teach and entertain.

I can’t wait to add even more to my little guy’s library with all the other Mamas’ recommendations! Check them out below.

The Refined Woman / Ave Styles / Sacramento Street / The Life Styled / The Effortless Chic / Freutcake / Sarah Sherman Samuel

For our entire Real Talk / Real Moms archive CLICK HERE.

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Source: apartment34.com

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When searching for a home there are several items on your new apartment checklist. You need a certain number of bedrooms. It can’t be too far from work. You may need a dishwasher and washer dryer hookups. The necessities you need can easily be researched, and a property manager can help you find a unit you like.

But what about less obvious factors? Questions like how well behaved are your new neighbors? Is it safe to go out at night? Is it too noisy or too bright for sleeping? There are many items that don’t pertain to the unit itself that need to go on your apartment checklist. ApartmentGuide walks you through them here.

What to look for in a neighborhood

There are a few things you need to see for yourself in a neighborhood.

What are the kids doing? Are they playing outside or hidden away during the summer? If you’re a social butterfly, you may prefer neighbors who share your social traits.

Is there a visible police activity? If you see the police patrolling your complex day and night, they are needed there. This should be a red flag.

Road maintenance

Are the roads filled with potholes, or are they maintained? Is there trash on the street? Does the city take good care of this neighborhood, and do the residents have pride in where they live? If you’re looking to live in an urban setting, you’re not as likely to see tree-lined streets, but you might think twice about an area that is visibly neglected.

Get to know the neighbors

Your property manager or landlord has a financial incentive to get you into the home. However, the neighbors are an impartial party. Talk with people in the apartment community before you take a tour. Ask the cashier at a nearby grocery or convenience store about the complex. Check with online sources, like Next Door. This will provide you with outside opinions of the neighborhood (and the management). If you hear something negative, be sure to ask when it happened. It may be old information.

Safety

This is a huge priority when it comes to places to live. It’s up to you to determine if you’re looking in a safe neighborhood. There are a few things to check that will help you gauge if a neighborhood is safe.

Street lights

Are there plenty of working lights? Do they cover your mailbox, parking lot and the walk to your door or fitness center? You want your walk outside to be completely lit by streetlights at night.

Crime statistics

Be sure to check out the crime rates in a neighborhood. Look into the registered sex offender list too, which shows where they live, and their previous crimes (especially important if you have children). If the rent price seems too good to be true, this may be why.

Convenience

A map may tell you work is only 5 minutes from the apartment you have your eye on. However, traffic can add more time to that number. Try taking your work commute from your prospective apartment during rush hour. How much time does it really take to get to and from work? Do a bit of research: are there back roads you can easily take to avoid traffic, and commute quickly?
Next, determine the nearest grocery, and don’t just drive by. Go inside and see if you like it. Ditto for the pharmacy, the dry cleaners, restaurants, the library … any type of business or service that you use regularly. These will be your neighborhood places, so you better like them!

Personal preferences

Your personal preferences for what you want in a neighborhood should make the apartment checklist. Take a walk around at night. It’s important to ask yourself a few questions to know what neighborhood is right for you.

  1. Are there wild parties in your neighborhood? If so, is this a problem for you?
  2. Are there lots of loud barking dogs? What about fences for those dogs? And are there leash laws for the county? If you like to take a nightly walk, these are things to consider.
  3. Do you want to be walking distance to grocery stores and restaurants? Or, do you prefer a neighborhood that is more secluded?
  4. Can you sleep in a room that’s not completely dark? Will you have to spend extra to block out light sited right outside your bedroom window?

Apartment hunting can be a gamble if you don’t have a well-thought-out plan. Do your research, and know what things you value in a neighborhood, and you can find a home you will be happy in for years to come.

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Savings

Compare rates and save on home insurance today!

What is renters insurance and why should I consider it?

As of 2019, roughly 36% of U.S. households were living in rental properties, meaning that a large percentage of the population opts to rent instead of own. While renters don’t own the property they live in, it’s still important to have some protection in place, which renters insurance, also referred to as an HO-4 policy, can provide.

A comprehensive renters insurance policy can help cover your personal belongings, liability exposure and additional living expenses, should your home become uninhabitable due to a covered event. Purchasing renters insurance is typically easy and the premiums are usually affordable compared to many other types of insurance. If you’re in the market for renters insurance, here’s what you need to know before purchasing a policy.

What does renters insurance cover?

Renters insurance can cover numerous situations, depending on the endorsements that you add to your policy. However, the main coverages on a renters insurance policy are:

  • Personal property coverage: This coverage is designed to pay for your damaged or destroyed belongings after a covered loss. Covered personal property generally includes your furniture, clothing, household items and some electronics.
  • Liability coverage: Your liability coverage may pay for medical bills and your legal fees if you are found at fault for someone’s injuries or damage to someone’s property.
  • Additional living expenses: If you are unable to live in your rented home or apartment after a loss, this coverage could help pay for the cost of a hotel and other expenses, like laundromat services or pet boarding. Living expenses coverage only covers the necessities. You should ask your insurance agent to see what exactly is covered when you purchase your policy.

You may also have the option to add additional coverages, like identity theft coverage, pet liability coverage and scheduled personal property coverage to your policy. If you are not sure what coverages you should consider, talking to a licensed agent could help.

Most renters policies also exclude damage to your personal items caused by earthquakes and flooding. While earthquake coverage can often be purchased as an endorsement, you may need to buy a separate policy if you live in a high-risk area. Flood insurance is most commonly offered as a separate policy, although a few companies offer endorsements or include this as a coverage option.

How much does renters insurance cost?

Renters insurance costs, on average, about $179 per year, per Triple-I. However, the cost of your renters insurance policy will vary based on several factors, including how much personal property coverage you purchase, the level of liability coverage you select, what additional coverages you choose and your claim history.

What states offer renters insurance?

Renters insurance is available in all 50 states and Washington, D.C. However, states that have a high density of renters, such as California, New York and New Jersey, may have more active renters insurance markets with more companies and endorsements to choose from.

Renters insurance is not just for those who rent apartments. Renters in condos and homes also have the option to purchase renters insurance. In warmer states like Florida and Georgia, homeowners may choose to rent their homes out for part of the year if they live elsewhere. The renters who occupy those homes can also purchase renters insurance policies to cover their belongings and liability exposure.

What companies offer renters insurance?

There are numerous renters insurance companies on the market, but your options will depend on what state you live in. Not all companies are available nationwide, and not all companies offer renters insurance in each state where they operate. If you are looking for the best renters insurance company, you may want to get quotes from these providers:

  • Geico: Renters who want to handle their policies digitally may want to consider Geico. The company has one of the most highly-rated apps in the industry.
  • Progressive: If you are looking for a highly customizable policy, Progressive could be a good choice. The company offers a long list of optional coverages, including water backup and personal injury.
  • State Farm: Renters looking for an in-person agency experience might want to get a quote from State Farm. The company has over 19,000 agencies across the country.

How do I save on renters insurance?

Although renters insurance is generally much less expensive than homeowners or condo insurance, there are still ways to reduce your premium.

  • Bundle your policies: If you also have an auto insurance policy, consider bundling your renters insurance with the same insurer — you might earn a discount on both policies.
  • Install protection devices: If your apartment has smoke alarms, a carbon monoxide detector or a home invasion alert system, you might save money on your policy.
  • Consider how you pay: If you can pay your annual premium in full, you might save money. If you do need to pay in installments, many companies offer discounts if you sign up for an automatic withdrawal.
  • Increase your deductible: Your deductible is the amount you will pay out of pocket if you file a claim. Generally, the higher your deductible, the lower your premium. Just be sure to choose a level that you can afford to pay if you file a claim.

Every insurance company is different, so discussing your policy with a licensed agent could help you find additional ways to save.

Frequently asked questions

    • Everyone’s situation is different and purchasing any kind of insurance policy is a highly individualized decision. Renters insurance is not required by law in any state, but a landlord has the right to require tenants to purchase a policy. However, even if you are not required to carry coverage, renters insurance does typically offer quite a bit of coverage for a relatively low cost. If your budget is particularly tight, you may be able to take advantage of discounts to lower the cost of a renters insurance policy while still getting valuable coverages.

    • The process of purchasing renters insurance is generally simple and there’s typically no waiting period, which means you may be eligible to get coverage on the same day you apply. For most people, the first step to getting a renters insurance policy is to obtain quotes from multiple insurance companies. Most companies offer personalized quotes online or by phone, or you could visit a local agency to speak to an insurance agent about your needs. During the quote process, you typically need to provide personal information, like your name, address and date of birth. This information can help determine the options and levels of coverage that are right for you. Once you have chosen a renters insurance policy to purchase, a representative will discuss the next steps. You may need to sign an application, and you will probably need to make at least one month’s payment for your policy to be active.

    • Because there are several insurers that offer renters on the market, you may not know where to start your search. Determining what kind of coverages you need and what features you want — like a digital app, 24/7 customer service or a live agent — may help you to find carriers that fit your needs. You can then request quotes from several companies to compare prices, coverages, discounts and features.

    • If you rent out a property, you may want to consider a landlord dwelling policy. This type of policy covers the structure of the home, detached structures and any personal property that you provide for the home (such as furniture). Your renters should consider purchasing a renters insurance policy, though, because a landlord dwelling policy does not provide any coverage for renters’ possessions.

      If you operate a short-term vacation rental, you may want to speak with your insurance agent to make sure you have adequate insurance coverage. Your short-term vacation rental tenants likely will not need a renters insurance policy. If they already have a homeowners, condo owners or renters insurance policy, their personal property coverage should transfer to a short-term rental, just as it would transfer to a hotel room.

    • That depends on the situation. Your pets are generally not considered personal property, so damage or injury to your pets is not typically covered by a renters insurance policy. For that, you need pet insurance. However, your liability coverage may cover damage or injury that your pets cause to others. However, some dog breeds and exotic animals are often excluded, and any animal that you do not disclose to your insurance company could also be excluded from coverage. Discussing your pet with your insurance company is often the best way to confirm your carrier’s guidelines.

    • Yes, renters insurance is a common policy. There are about 109 million renters in the United States, and most financial experts agree that renters insurance is a prudent purchase. Because of the prevalence of renters in the country, many different insurance companies offer renters insurance.

Source: thesimpledollar.com

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By Peter Anderson 2 Comments – The content of this website often contains affiliate links and I may be compensated if you buy through those links (at no cost to you!). Learn more about how we make money. Last edited January 22, 2013.

A few months back the IRS released their 2012 IRA contribution limits and deduction phaseouts. If you have a traditional or Roth IRA, you should keep a close eye on the limits every year because every once in a while we’ll see an increase in allowed contribution amounts or in the income phaseouts.  When that happens, you’ll want to increase your contribution amounts, or adjust  your pre-tax giving so that you can fully take advantage of what the current rules are.

For the 2012 tax year the allowed contribution amounts haven’t changed at all.  The income phaseout limits have seen some small increases, however.

2012 Contribution Limits For Roth & Traditional IRA

2012 saw the contribution limit  both Roth and Traditional IRAs stay at $5,000 for people under the age of 50.  If you are older than 50 this year you are able to make catch up contributions to your account of $1,000 – which means your limit is actually $6,000.

One thing to remember is that the Roth and Traditional IRA contribution limit is shared, so while you can contribute to both account types in one year, your $5,000 limit is a combined limit.  So if you contribute $3,000 to your Roth IRA, you could only contribute $2,000 to your traditional IRA (bump that up by $1,000 if you’re over 50).

Here’s a table showing the 2012 Traditional and Roth IRA contribution limits, along with the limits in years past.

Year Age 49 and Below Age 50 and Above
2002-2004 $3,000 $3,500
2005 $4,000 $4,500
2006-2007 $4,000 $5,000
2008-2012 $5,000 $6,000
2013-2018 $5,500 $6,500
2019-2022 $6,000 $7,000
2023 $6,500 $7,500

AGI Based Income Phaseouts For  IRAs  In 2012

Both Roth and traditional IRAs have income phaseouts.  What that means is once you reach a certain level of income the amount of deductible contributions you can deduct gets reduced.

For Roth IRAs single taxpayers with an annual Modified Adjusted Gross Income (MAGI) over $110,000 begin to see their allowable deduction drop until at $125,000 it goes away completely. The limits for Married Filing Jointly investors are $173,000-$183,000.

For Traditional IRAs single taxpayers with an annual Modified Adjusted Gross Income (MAGI) over $58,000 begin to see their allowed deduction drop until at $68,000 it goes away completely. The limits for Married Filing Jointly investors are $92,000-$112,000.

Roth IRA Income Limits For Contributions (2021) Contributions are reduced if income is above this amount Contributions are not available if income exceeds this amount
Single/Married Filing Separate IF you didn’t live together during the year. $125,000 $140,000
Married Filing Jointly or qualifying widow or widower. $198,000 $208,000
Married filing separately IF you lived with your spouse at any point during the year. $0 $10,000

Tax Day Of The Following Year Is Contribution Cutoff

One thing a lot of people don’t realize is that if they haven’t already contributed the full amount to your Traditional IRA or Roth IRA for the 2011 tax year, they can still open a Roth IRA or a traditional IRA and contribute to the accounts up until tax day.  This year tax day falls on April 17th, 2012 because of a government holiday.

If you do make a contribution in 2012 before tax day, make sure you specify which tax year the contribution is being made for.

Keep An Eye On Phaseout Limits

One reason why you’ll want to keep an eye on the income based phaseout limits is that your ability to contribute to your accounts is reduced if you reach a certain income level.    If you know you’re close to reaching an income limit, try reducing your taxable income by contributing to an account like a 401k, reducing your taxable income and allowing yourself to contribute more to your IRA as well.

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Source: biblemoneymatters.com

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The Offer

Direct link to offer

  • Chase IHG Rewards Premier Business Credit Card is offering 165,000 points after $3,000 in purchases within the first three months


Card Details

  • $99 annual fee
  • This new cardmember bonus offer is not available to either (i) current cardmembers of this business credit card, or (ii) previous cardmembers of this business credit card who received a new cardmember bonus for this business credit card within the last 24 months.
  • Card earns at the following rates:
    • 10x on IHG purchases
    • 5x on gas stations, dining, social media and search engine advertising and office supply store purchases
    • 3x on all other purchases
  • Automatic IHG Platinum status, earn Diamond Elite with $40,000 in spend
  • $50 United TravelBank cash each calendar year. Must register card in your United account
  • TSA PreCheck/Global Entry Credit
  • Spending bonus of 10,000 points + $100 statement credit after spending $20,000 within a calendar year. Additional free night after $60,000 in spend
  • Redeem three nights, get one night free

Our Verdict

This is the highest offer we’ve seen on this card, previous high was the base bonus of 140,000 points. The nice thing about this card is that it doesn’t count towards your 5/24 status as it’s a Chase business card. We will add this to our list of the best credit card bonuses.

Source: doctorofcredit.com

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Should You Become an Authorized User? – MintLife Blog

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establish credit history, consider becoming an authorized user and building your credit in other ways, like getting a secured credit card.

What Is an Authorized User? 

An authorized user is someone who can make purchases on your credit card but isn’t legally obligated to pay the balance. It’s easy to sign someone up as an authorized user online or over the phone with a few pieces of information like their address, name, and birth date. You can order a separate card or have them use your credit card. You can have several authorized users on a single credit card, usually up to five. If the person is under 18, they can still usually be an authorized user on a parent or guardian’s account.

You get some privileges as an authorized user, but not the same ones as the cardholder. You can make purchases, find the available balance, and make payments. You can also report a missing card and dispute a fraudulent charge. Authorized users aren’t able to make changes to the account, though. For instance, they can’t close the account, add another user, or change the address.

Authorized Users and Credit

Becoming an authorized user could improve your credit score, but not always, and typically not in a drastic way. Check to see if the creditor sends authorized users’ activity to the major credit bureaus. Most do, but not all. If you’re trying to build your credit, you want to make sure being an authorized user will count toward your history.

When you’re a user on someone’s account who has a solid history of on-time payments and low credit utilization, it can help your credit. On the flip side, if you’re connected to someone with a lower credit score or a spotty payment history, your credit might suffer. For instance, if the cardholder misses a payment, your score could be affected, because it will also be reported on your history. That’s why it’s important to select someone you trust. Choose someone who you know will pay on time and not let their balance lapse. You can even have an upfront conversation about credit history and payments before being added as an authorized user to their credit card.

Just because you won’t be legally responsible for your charges, you may have a different arrangement with family. For example, Asher is an authorized user on his mom’s credit card. She pays for his groceries and utilities, but he is responsible for discretionary spending like going to the movies. Still, if the authorized user like Asher refuses to pay their portion, the cardholder remains responsible for covering it. If the cardholder doesn’t pay or can’t pay the balance, it could harm you more than help you.

Ways to Build Credit

Besides becoming an authorized user, there are other ways to build your credit. Try a combination of different approaches to build your history and show that you’re a responsible borrower.

  • Try a rent reporting service: Put your monthly payments toward your credit history by signing up for a rent reporting service. Proof of your payments is sent to the major credit bureaus. You’ll have to pay a small fee for the service, but it’s a low-risk way to create a credit history for payments you already make.
  • Apply for a secured credit card: Most credit cards are unsecured but require an established credit history. Secured credit cards allow you to put down collateral, such as a $500 cash deposit, in case you don’t pay your bills. These cards are for those without much credit history because the deposit guarantees payment to the lender if you don’t make payments. In most cases, secured credit cards carry higher fees and interest rates than normal unsecured cards.
  • Have someone cosign on a loan: Whether you’re purchasing a vehicle or need more funds for college, having someone cosign on a loan can help build your credit. Banks and lenders will often give out small loans to those without much credit history, as long as they have a solid cosigner backing them.
  • Choose a student credit card: If you’re in college, build credit with a student card. You may be approved even with no credit history. You might have a lower credit limit, such as $500 or $1,000, but the card allows you to spend on credit and build trust with creditors.

Practicing smart financial habits, like building your credit or having a personal budget, reaps rewards both now and in the future. Being an authorized user is one practical way to go about improving your overall financial health when done correctly. With a higher credit score and stronger finances, you can achieve bigger goals, like buying a home or saving for early retirement.

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Source: mint.intuit.com

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After the previous mortgage boom and subsequent crash, many questions were asked regarding what exactly went wrong.

There was plenty of finger pointing, from overreliance on credit scores, to endless investor speculation, to Wall St. packaging substandard mortgages and the government’s accommodative policies.

But one source of blame that kept resurfacing was the prevalence of high-risk loan products, such as the option arm.

Others blamed “subprime” for the housing crash, though that infamous eight-letter word was often used as a one-size-fits-all definition for any mortgage that went bad.

Regardless, it was clear that shoddy mortgages held some material amount of blame for the previous crisis.

After all, many of the loans were destined to fail, seeing that the teaser rates offered were the only way one could afford the property to begin with.

Today’s Mortgages Are Pristine

If you want to compare the previous housing run-up to that of today’s, you should consider the mortgages behind the properties being purchased.

Back during the mid-2000s, the quality of mortgages was awful. Scores of homeowners were purchasing properties with credit scores well below 620, which is the subprime cutoff.

Additionally, these borrowers were purchasing homes with zero down financing, or worse, with zero documentation. Not to mention many of the properties were non-owner occupied four-unit properties, often with second mortgages stuck at 12%.

One of the most common loan documentation types was stated income, which allowed borrowers (or their loan reps) to put any amount of monthly income they’d like in the box on the application.

This was all good and well in the eyes of pretty much everyone because it banked on home prices soaring ever higher, despite already chalking massive gains.

The idea, in short, was that it didn’t matter if the borrower was sound if the property was expected to surge in value.

At worse, the borrower could refinance again or sell (for a profit) if they couldn’t keep up with their mortgage payments. We all know how badly that ended…

Just a few short years later, the quality of mortgages has done a complete 180. The average credit score for newly originated loans is north of 700. Additionally, average LTVs have dropped, meaning borrowers have home equity in case something goes wrong.

If anything, LTVs are going to keep dropping as bidding wars force new homeowners to put more down in order to get their offers accepted.

At the same time, more and more borrowers are opting for long-term fixed-rate mortgages, and with mortgage rates are at or near record lows, it makes for a pretty solid bet (even Buffett backs it).

The low rates are good for the housing market because it means homes are more affordable in payment terms, and it also means many previously stuck with higher rates can refinance.

Even those with underwater mortgages have benefited, thanks to HARP 2.0, which erased the LTV ceiling.

Yes, there will be consequences of this quantitative easing down the road, but for now, quality mortgages are being originated at rock-bottom rates.

And some banks are even compensating their loan officers based on loan quality, as opposed to loan volume.

Is This a Housing Boom or a Mortgage Boom?

You almost have to question whether this is a play on housing, or a play on getting a mortgage at a ridiculously low rate.

If mortgage rates were closer to historic norms, would prospective home buyers have the same voracious appetite?

My guess would be no, seeing that home prices have already returned to fairly high levels in many parts of country.

In fact, they aren’t too far off their previous bubble highs in some regions, meaning the low rates must be part of the equation.

Still, if and when rates do rise, it doesn’t mean home prices will plummet like they did before. It will probably result in a cooling off period, but that doesn’t equate to a bubble bursting.

[Mortgage rates vs. home prices]

The reason most people lost their homes or walked away during the previous crisis was due to a lack of home equity (and down payment), coupled with an unsustainable housing payment.

Today’s borrowers are a lot more qualified and invested, holding mortgages they can truly afford. This makes owning long term a lot more attractive, even if home prices have shot up recently.

These homeowners will be able to sit tight and enjoy their low, low fixed housing payments, even if home prices bounce around a bit. Why walk away from that?

Read more: How it became a bad time to buy a home.

Source: thetruthaboutmortgage.com

Apache is functioning normally

Often times student loans get in the way of a mortgage because of the tremendous monthly debt, but fintech lender SoFi wants to create the opposite effect.

They’ve launched their so-called “Student Loan Payoff ReFi,” which as the name implies, is a way to get rid of student loan debt while refinancing the mortgage.

The general idea is that mortgage rates (at the moment) are lower than the interest rates on student loans, meaning borrowers can save money by shuffling debt to their existing mortgage balance.

Apparently 8.5 million households have student debt obligations, so this mechanism could equal a lot of savings, and a lot of originations for SoFi.

The program is being offered in conjunction with Fannie Mae, and is apparently cheaper than a traditional cash out refinance.

How the SoFi Student Loan Payoff ReFi Works

Say a student (or I suppose a parent) owns a home with a mortgage balance of $200,000 at 67% LTV, and there is also outstanding student loan debt of $40,000.

This hypothetical homeowner can combine the two debts into one and enjoy a lower interest rate, despite a higher LTV.

This example would push the LTV to 80%, likely the maximum under the program, but the rate would still be a competitive 3.75% or so on a 30-year fixed.

The payment would be even cheaper because student loans often amortize over a shorter period, such as 20 years. But the lower combined rate would offset the longer amortization period.

SoFi will actually disburse the funds directly to the servicer of the student loan debt, instead of just giving the borrower cash at closing.

Because the funds are going straight to the student loan company, instead of the bank account of the homeowner, there is less perceived risk.

After all, in general homeowners are welcome to tap equity to use for whatever they’d like, including paying off other loans. But lenders assume more risk if the funds can be used for any purpose, such as buying a Hummer.

This might explain why the interest rates on this product are more competitive than typical rates tied to a cash out refinance.

Still Explore All Options

Borrowers might get a rate closer to what they’d expect to receive via a rate and term refinance, the latter of which involves no cash to the borrower.

It might also be easier to qualify if the to-be-paid-off student loan debt no longer bumps up the DTI ratio to unacceptable levels.

This program works for both those who manage their own student debt and those who have a co-signer on the student loan such as a parent.

Per Experian data, the average homeowner with an outstanding co-signed student loan has a balance of $36,000, while those with Parent PLUS loans have $33,000 in outstanding debt.

The Parent PLUS loan is a private offering and apparently 90% of private student loans required a co-signer. They also tend to come with interest rates that are higher than current mortgage rates.

The one downside to a program like this is that the funds can only be used for one purpose. And your home loan debt will grow, which could potentially put your primary residence at risk.

As noted, a traditional cash out refinance allows you to tap equity and use funds for any reason. In a nutshell, you get more flexibility.

However, the interest rate might be higher than this product from SoFi. Of course, you’d still want to shop around to see if you can get the best of both worlds.

You might be able to snag a low rate without sacrificing any flexibility.

Source: thetruthaboutmortgage.com