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May 7, 2021

Ally Bank Review | The Simple Dollar

As traditional banks struggle with customer frustration over hidden fees and insultingly low interest rates, Ally Bank has positioned itself as the antidote to these problems.

Savings APY

0.50%

1Y CD Rate

0.55%

J.D. Power Rating

853/1,000

SimpleScore

4.2 / 5.0

SimpleScore Ally Bank 4.2

Savings APY 5

1Y CD APY 5

Customer Satisfaction 4

Mobile App 3

Products 4

By and large, it has succeeded, becoming one of the best all-around options for online banking today and The Simple Dollar’s pick for the best all-around savings account for 2018.

Ally, previously known as GMAC Bank, launched in 2009. It was rebranded after parent company GMAC — the financial arm of General Motors — received billions in bailout money from the U.S. government during the subprime mortgage crisis.

Despite its rocky beginnings, Ally Bank has grown and flourished. It now has more than a million customers, likely due to its appealing blend of competitive interest rates and low, clearly disclosed fees.

Ally Bank at a Glance

If you’re just looking for basic checking or savings products, Ally has a particularly strong lineup. Here are the products and services you’ll find:

Savings: Ally offers two main options: an online savings account and a money market account.
Checking: There’s just one checking option, but it’s a good one: no-fee interest checking.
CDs: Choose from three account options: the High-Yield CD, with seven terms ranging from three months to five years; the Raise Your Rate CD, with a two- or four-year term; or the 11-month No Penalty CD.
IRA savings and CDs: Ally offers an IRA online savings account, or you can choose an IRA High-Yield CD or an IRA Raise Your Rate CD.
IRA plans: Traditional, Roth, and SEP IRAs are available, too.

Ally also has a sizeable auto loans business, but you can’t apply for financing online — it’s only available at select dealers, including GM, Chrysler, and Maserati. It also has a business financing division, but only for sizeable transactions of more than $15 million. There are no mortgages, personal loans, business checking or savings accounts, credit cards, or non-IRA investment accounts.

Just like any reputable bank, your deposits with Ally are insured up to Federal Deposit Insurance Corporation limits. Firewalls, SSL data encryption, and multi-factor authentication are among the security measures that keep your data safe while banking online. Ally also offers free Webroot anti-virus software to its customers — a nice touch.

Ally Online Savings

Ally’s Online Savings account is one of the best options in the industry when you consider the high interest rate and lack of fees. In fact, it’s such a strong option that The Simple Dollar named it the best all-around savings account for 2018. Here are the main account features:

No minimum deposit: You don’t need any certain amount to open your account, unlike some other banks that will require an initial deposit of $250, $500, or even $1,000 or more.
No account maintenance fees: You also won’t pay a monthly fee to keep your account open, regardless of your balance.
A very high interest rate: Your deposits will earn 0.50% APY currently.
Mobile check deposit: It’s as simple as snapping a photo of a check with your smartphone using Ally eCheck Deposit.
24/7 account access and customer service: Get the convenience of online banking or connect with a customer service agent regardless of the time.
Simple transfers: Move your money easily by scheduling transfers up to a year in advance, and link up to 20 external accounts to your Ally account.

The major benefit with Ally’s Online Savings is the interest rate, which is compounded daily. At 0.50% APY, it’s one of the most competitive rates in online banking. While this kind of interest certainly isn’t going to make you rich, it’s a lot better than the 0.01% (effective as of 10/14/2019. Interest rates are variable and subject to change) APY you might receive with Chase Savings℠, Bank of America, or another major brick-and-mortar bank.

Another big benefit is the generous number of external accounts you’re allowed to link up: 20. It’s common for other banks to limit you to three linked accounts, so this could be a big advantage for anyone who wants to move money between several accounts. You can also open, nickname, and link multiple savings accounts all in one go if you want to maintain separate accounts for separate savings goals.

Ally is also impressively clear about its fees. As I mentioned above, you won’t pay for monthly account maintenance. You also won’t pay for unlimited deposits, transfers to non-Ally accounts, incoming wires, online statements, postage-paid deposit envelopes, or cashier’s checks. (There are still some fees to note, but they are reasonable — they include $9 for overdrafts, $10 for excessive transactions, and $20 for outgoing wires.)

As for cons, there aren’t many. But if you’re used to depositing cash, that won’t be an option for you with Ally.

Ally Money Market Account

Ally also offers an outstanding money market account with a lot of the same features as its online savings account. For instance, there is no minimum deposit, there are no monthly maintenance fees, and you still have the option of mobile check deposits.

The major difference is that you’ll be getting a slightly lower interest rate, currently 0.50%, in exchange for a couple of nice conveniences. With the money market account, you’ll get a debit card and checks. And you can use your debit card at any ATM nationwide without paying steep fees: Ally won’t charge you, and it will reimburse any fees that other banks charge for using their ATMs.

Ally Interest Checking

Ally’s Interest Checking account is also a great all-around option, and ranks among The Simple Dollar’s best free checking accounts. Here are the highlights:

No maintenance fees or minimums: Some banks charge monthly maintenance fees or require you to have a certain balance to avoid them. Not so with Ally.
No ATM fees: Ally doesn’t charge you for ATM withdrawals, and it will reimburse you at the end of the month for any fees that other banks charge.
Mobile check deposit: It’s as simple as snapping a photo of a check with your smartphone using Ally eCheck Deposit.
Easy to pay other individuals: With the Popmoney feature, you can easily send money to anyone else who has a bank account as long as you know their email address or cell phone number.
Earn interest on your balance: Ally’s Interest Checking earns 0.10%–0.25%.

One of the biggest benefits of Ally’s Interest Checking is the lack of ATM fees. Considering you can expect to pay an average of $4.35 every time you get money from an out-of-network ATM, not having to plan ahead to avoid fees is a nice convenience.

Of course, the absence of monthly maintenance fees and minimums is also appreciated — my own bank requires me to keep a pretty substantial balance to avoid shelling out $11 each month. Checks are free with Ally, too.

There are still other fees, including 1% for foreign transactions, $9 for overdrafts, $15 to stop payment, and $20 for outgoing wires. These fees are a good bit lower than industry averages, but note that if you travel abroad frequently or are concerned about overdraft fees, Capital One 360 doesn’t charge either one. (Note that you can protect yourself from overdraft fees by linking an Ally savings or money market account to your checking. Ally will pull money from the linked accounts in $100 increments to cover the overdraft, but you obviously have to have the funds in the linked account to avoid fees.)

There are also some better options out there if you’re looking for the best interest rate in a checking account. For instance, Bank5Connect offers 0.20% APY on any balance over $100, and FNBO Direct offers 0.25% with no minimum balance. However, since it doesn’t make much sense to think of a checking account as a long-term place to grow your money, I don’t consider this a major con.

Ally Certificates of Deposit

None of Ally’s CDs require a minimum deposit to open, which is a rare benefit. Interest is compounded daily. Ally also offers a 10-day Best Rate Guarantee on its CDs, which ensures you can snag the best rate Ally has within 10 days of opening or renewing your account. Here’s a rundown of your CD choices with Ally:

High-Yield CD: This type of CD gives you the most flexibility on term: Go as short as three months or as long as five years. Of course, the shorter the term, the lower your interest rate, but a 12-month CD currently earns 0.55% APY. This CD is available for Ally IRAs.
Raise Your Rate CD: You’ll only be able to choose a two- or four-year term with this option. However, you get the chance to bump up your rate (once for a two-year CD, twice for a four-year CD) if Ally’s rates go up after you’ve funded your CD. This is also available for Ally IRAs.
No Penalty CD: If the prospect of early-withdrawal fees is keeping you from opening a CD, Ally’s No Penalty CD lets you skip them entirely. The convenience means you’ll be getting a lower rate, and there is only one term available (11 months).

Getting Started with Ally

Ally has a streamlined, easy-to-understand website, and opening an account is easy. In fact, you can open multiple account types at once, even linking a newly opened checking and savings account for overdraft transfer service right away.

If you prefer, you can also open an account over the phone or by mailing in an application. Online chat is available if you have any quick questions during account opening.

Online, all you’ll need to enter is your name, date of birth, Social Security number, email address, mailing address, and phone number. You’ll be able to fund your new account right away if you link a non-Ally account and transfer money electronically (you will have to verify ownership of the account). You can also mail a check, use mobile deposit to submit a check, or set up a wire transfer.

For savings and checking accounts, direct deposits are available the same day. You’ll wait up to three business days for transfers you request from linked non-Ally accounts. For most check deposits, you’ll have access to $200 within one business day and $4,800 in two business days. Any amounts over $5,000 won’t be available until the fifth business day. Ally may apply five-day holds for customers who’ve had a history of overdrafts.

Who is Ally Best For?

Ally is going to be one of your strongest overall options for online banking, but there are a few scenarios where it should definitely be your first choice:

You want the best combination of high interest rates, low fees, and no minimums: Ally is very near the top of the heap on interest rates across the board. Of course, nothing is stopping you from chasing the very highest rate you can find, but the trade-off for that rate is often higher fees and high account minimums. If you’ve got a lot of money to stash, that might not be a concern, but for the average Joe, it’s a good compromise.
You prize transparency: Ally is by far the clearest about fees of any of the banks I’ve researched, whether online or brick and mortar. Each product has a “Straight Talk Product Guide” that lays out everything you need to know about fees as well as important details such as when your money will be available.
You want to bank online, but you don’t want to skimp on customer service: Ally has 24/7 customer service, and the time you’ll wait to speak to a representative is disclosed at the top of the website (it was never more than a few minutes each time I visited). If phone calls aren’t your thing, you can still email a representative, search a comprehensive set of FAQs, or start an online chat session.

Who Might Want to Skip Ally?

Of course, there are also a couple of situations where Ally might fall short:

You want a one-stop shop: If you prefer to keep most or all of your financial dealings with one bank, Ally might not be the best option for you. It lacks several relatively common products, including mortgages, small-business accounts, and brokerage accounts. If this kind of variety is important to you, you’ll probably need a brick-and-mortar bank; if you want to stay with an online bank, Capital One 360 would be worth a look.
You want to build a personal relationship with a bank: For all of its plusses, there is one thing Ally (and all online-only banks) can’t offer: the chance for you to be more than a number. While its customer service availability is as good as it gets for an online bank, some customers may find comfort in the facetime they can get at their community bank branch. These relationships may come in handy when you’re in a bind, and one common customer complaint about online banks is that problems can take a long time to get resolved.
You need your money fast: Funds availability may be the Achilles heel of all online banks. While Ally isn’t the slowest online bank when it comes to transferring your money and making deposits available, it still generates plenty of complaints from customers who say holds were extended beyond what was promised, sometimes without explanation.

Ready to Bank With Ally?

Ally’s well-rounded personal account offerings should satisfy most of your everyday needs. The savings and checking options are particularly strong, or you can nab some of the benefits of both with a money market account.

If you want to read up on your other options, take a look at The Simple Dollar’s other banking recommendations in our guides to the best free checking accounts, best savings accounts, and best money market accounts.

Compare top bank accounts

Source: thesimpledollar.com

May 6, 2021

What Is Real Estate Due Diligence?

There isn’t an Easy Button for doing your due diligence. It’s really a time-consuming process, and few people have any idea what to do.

Purchasing and owning real estate is always high risk — whether it’s a single family home that you’ll occupy or a 50-unit apartment building for income. You’ll hear experts say to make sure to “do your due diligence” when buying property, but what does that actually mean? What is due diligence?

The truth is, there isn’t an “easy button” for doing your due diligence. It’s really a time-consuming process, and few people have any idea what to do. So here is what it means and some of the steps you should consider and perform.

Do your homework

Due diligence means taking caution, performing calculations, reviewing documents, procuring insurance, walking the property, etc. — essentially doing your homework for the property BEFORE you actually make the purchase. If there are too many issues with the property — and that means too much potential risk and cost — then you can cancel your purchase agreement and look for a better property.

Here are just a few of the steps that apply to both personal residences and investment properties, although some may only apply to one.

Shop the marketplace

Make sure you know what the market has to offer. Too many people look at just a few properties, put in an offer and purchase. You should spend several months looking at properties before you buy.

Mortgage financing

Make sure the mortgage deal you get is fair and in line with competitors. Probably less than 20 percent of people get two bids for their financing, so they don’t know whether they’ve received a fair deal.

Pencil out your investment

If you’re buying an investment property, it’s vital to pencil out your deal. How do you know whether it’s a good deal if you haven’t done the math and compared it to other opportunities?

Property inspection

You probably had an inspection, but did you go to it? Did you review the inspector’s remarks on all the work that needs to be done? Then did you call a contractor or go to a home repair store to see how much it will cost to put the property in the shape you desire? Renovating properties is hugely expensive and high risk, so make sure you get estimates for the work before you decide to move forward with a purchase.

Insurance

Did you check to see whether an insurance policy can be written for the property? How much will it cost? Some areas, such as fire-prone or hurricane-prone areas, might not even be able to get a policy. And even if they do, it might be prohibitively expensive. Get some bids before you’re too far along in your purchasing process.

Homeowners association

Do you know how to review the HOA documents to avoid communities that are in disastrous shape, out of money or have significant construction issues? This is actually a pretty complicated task, but you don’t want to buy into a total mess of an HOA. If you do, you will feel some discomfort as the years go by and you have to deal with the issues and special assessments that you will be required to pay.

Title insurance & plat

Did you look at the title abstract and insurance policy? This will help you see if there are some issues that should concern you. Talk to the title insurance company agent and lawyer to help you review the documents. Also look at the plat of the property, have the easements plotted by title and walk the property for encumbrances.

Those are just a few of the many items that make up due diligence when buying real estate. Remember, you have to do these before you close escrow on the property. If you fail to do the proper tasks, problems might arise that were preventable, and might make your real estate experience less than palatable, or downright life changing! Or they might cause you to lose all the money you’ve put into the property.

Leonard Baron is America’s Real Estate Professor®. His unbiased, neutral and inexpensive “Real Estate Ownership, Investment and Due Diligence 101” textbook teaches potential real estate buyers how to make smart and safe purchase decisions. He is a San Diego State University Lecturer, blogs at Zillow.com, and loves kicking the tires of a good piece of dirt! More at ProfessorBaron.com.

Note: The views and opinions expressed in this article are those of the author and do not necessarily reflect the opinion or position of Zillow.

Source: zillow.com

May 4, 2021

5 Tips for Approaching the Open House

In this article:

For decades, sellers and their agents have been using open houses to help generate interest in their listings. Open houses give the general public the chance to view a home without scheduling a private showing. While open houses do get a lot of curious neighbors and casual browsers, they can be a good opportunity for serious buyers to decide if a home is worth pursuing further, or a way to get a better grasp on neighborhood home values.

In fact, 59% of home buyers attended an open house during their shopping process last year and 43% of buyers said attending the open house was very or extremely important to determining if the home was right for them.* On average, home buyers attended 2.6 open houses before buying.

Whether you’re a sincere buyer or simply curious about the inside of a home, you should know how open houses work and understand how you can be a good open house attendee.

Note: If open houses are restricted or unavailable due to public health concerns, work with your agent to arrange a private tour or video tour. All Zillow-owned homes include a self-tour option — just use our app to unlock the door and tour at your convenience.

What is an open house?

An open house is an event during which potential buyers can tour a home that’s on the market. It’s usually hosted by the seller’s listing agent, or by the seller themselves, in case of a for-sale-by-owner (FSBO) listing. Open houses usually take place on weekends, during a set range of hours — typically midday.

Open house benefits for buyers

No scheduling required: Unlike a private showing, you don’t need to set up a specific appointment to see a home. Simply show up during the open house hours and view the home at your own pace.

Scope out the competition: If you’re interested in a home, attending the open house can help you gauge interest from other buyers. This can be helpful when determining how quickly you need to submit an offer and how much you should offer.

Understand current home values: Seeing what homes are selling for in your area and what you can buy at a particular price point can be helpful if you’re just starting your search.

Redefine your nonnegotiable home features: Checking out homes in person can help you redefine your list of must-haves: Do you really need that extra bedroom? What does a backyard of this size really look like?

How do open houses work?

Not every seller or listing agent will hold one, but here’s the typical process for sellers setting up an open house:

The seller and their agent determine a day and time for the open house.
The agent lists the open house on the local MLS.
The agent advertises the open house on social media, online and with print ads or flyers.
The agent prepares for the open house — purchasing refreshments, printing flyers, setting up signs and adding little touches to make the home feel welcoming to buyers. (Yes, as a shopper, you can eat the cookies.)
The agent hosts the event, greeting buyers and answering questions about the property and community.
Buyers remove their shoes, tour the home, take pictures and video (if allowed) and jot down important notes.
Any buyer who liked the house will contact their own agent. They’ll then set up a private showing to see the home again or they’ll submit an offer right away — the latter is common in fast-moving real estate markets.

Who hosts an open house?

The person hosting an open house could be any one of the following:

Listing agent: As the person hired to sell the home, the listing agent should be an expert on the property.
Listing agent’s team member or associate: A busy listing agent may also send another agent in their place — either someone on their team or another agent in their office. They should be experts in the local market, but may not be as familiar with the individual home.
Homeowner: If a home is for sale by owner (FSBO), the homeowner will be hosting their own open house. They’re undoubtedly the expert on the home, but their local market expertise may be limited.

How to prepare for an open house

There are times when you might just stumble upon an open house while you’re on a walk or running errands. But if you’re intentionally looking for open houses as part of your home-buying strategy, try these tips.

Seek out relevant open houses

If you plan to visit multiple open houses in one day, make sure you’re focusing on listings that fit your criteria for budget and location. It’s not worth wasting time looking at homes outside your budget or those that are too far from your work or school.

Tip: With Zillow’s home search tool, buyers can filter by homes with upcoming open houses (this filter can be applied in addition to other search filters like price, bedrooms, bathrooms, square footage and location). When you use the open houses filter in conjunction with filters for your other criteria, you can easily find the right open houses for your search.

You can also tour most Zillow-owned homes any time between 6 a.m. to 8 p.m., any day of the week — just select the tour option on the listing. Although the listing agent will not be present, you can avoid a busy open house and rest assured the property is in move-in ready condition.

Do research on the market beforehand

With help from your agent or on your own, find out how each home you’re planning to visit stacks up against others nearby. Is the price in line with similar listings in the area? Are there any defects? Has it gone under contract recently and then returned to the market? Are there a lot of other interested buyers? Has it been sitting on the market for a long time? (“Days on market” is an indicator of a stale listing, but the standard number of days on market can vary based on where you live.)

Stay open-minded

If you’re searching on a tight budget in a hot neighborhood, there’s a good chance that the home that fits the bill will need some TLC. Fortunately, attending an open house can give you a better idea of the home’s condition and potential, while also giving you the opportunity to ask renovation-related questions — e.g., the location of load bearing walls and the details of local regulations.

How to attend an open house

Now that you’ve done your research and are prepared to add some open houses to your home search, here’s what you should do once the day arrives.

Ask questions

An open house is your best opportunity to ask the listing agent (or their associate) your questions — don’t be shy. Ask questions that you wouldn’t be able to answer just by reading a home’s listing description, such as:

What are the HOA restrictions?
Has the seller done a property tax appeal?
Have there been any recent renovations or repairs?

Tip: If you’re not currently working with an agent and you ultimately decide you aren’t interested in a particular home you tour, the open house could help you see if the listing agent might be the right person to represent you — many agents represent both buyers and sellers.

Be honest

If anyone other than the listing agent or the homeowner is hosting the open house, they’re likely an agent hoping to find potential buyer clients. If you’re already working with an agent (or if you have no real interest in buying), be honest.

Check for damage and disrepair

Professional or edited photos can make a home look a lot better online than it is in person. At an open house, take the opportunity to closely evaluate a home’s condition and take note of any potential defects that would factor into your offer price.

Assess the windows: Look for flaking paint, misaligned sashes and condensation due to air leaks. These could be signs of windows that need replacement.

Check for water damage: Look for warped baseboards, ceiling stains and musty smells.

Make note of cracks: Noticeable cracks in the ceiling or drywall could indicate foundation issues.

Test functions: Open cabinets, doors and drawers. Run the faucets. Check the water pressure. An open house is a good opportunity to make sure every part of the home is in good working order.

Gauge potential renovation needs: Home improvements can really add up. As you walk through a home, keep an eye out for urgent renovation needs like floors, fixtures or large repainting projects.

Open house tips for buyers

Whenever you attend an open house, put yourself in the seller’s shoes — you’re letting a bunch of strangers walk through your home while you’re not there. While every seller wants their open house to net a buyer, they also want to keep their home safe and their furnishings free of damage.

Do

Take off your shoes or wear booties if requested.
Greet the host and provide your name.
Sign in if necessary or requested (this is a safety issue for the seller and their agent).
Take notes on your phone about your likes, dislikes and follow-up questions.
Ask if you can capture a video (if the listing doesn’t already include a video).
Respect other buyers and guests.
Wait for others to exit a room before you enter.
Provide feedback if requested.
Thank the person hosting the event.

Don’t

Refuse to comply with an agent or homeowner’s house rules.
Criticize the home or the owner’s style.
Listen in on other visitors’ conversations.
Touch the owner’s belongings.
Let kids run around without supervision.
Bring food or beverages in (except water).
Reveal information that would compromise your negotiating power, like your budget or level of interest in the home.
Bring pets.

*Zillow Group Consumer Housing Trends Report 2019 survey data

Source: zillow.com

May 4, 2021

Do You Own the Land Under Your Home?

Do your due diligence to ensure you know about liens, easements or land grants made on property you’re thinking about purchasing.

When you buy a home, you probably assume that you own everything in and around it within the property lines. But in some parts of the country, homeowners are discovering the property they’re buying does not fully include the land beneath it.

For example, in Tampa Bay, FL a family realized at closing that their home builder had already signed away the rights to the land underneath their home to its own energy company. The “mineral rights” grant gave the energy company the freedom to drill, mine or explore for precious minerals beneath the home.

How is this even possible, and how can it be avoided? Who really owns the land beneath your home? Here’s what you need to know.

You probably own the land

Generally speaking, it’s likely that you own the property underneath and around your house. Most property ownership law is based on the Latin doctrine, “For whoever owns the soil, it is theirs up to heaven and down to hell.”

There can be exceptions, though. On occasion, a buyer will uncover an easement for a driveway or walkway that goes through their property. This is why it’s important to carefully review contracts and disclosures.

Contract and disclosures

A seller, be it a home builder or a homeowner, can’t claim any sort of rights to the property without first disclosing those rights in the real estate contract or in some sort of disclosure statement.

Each state is different with regard to how things are disclosed. Many disclosure statements require the seller to tell the buyer whether or not someone else has laid claim to the property or if the buyer is limited to claims in the future. If the seller is unaware, or the home you’re purchasing is in a state that doesn’t require the seller to disclose, then you should carefully review the property’s title report before signing off.

Preliminary title report

There can be a situation in which a seller doesn’t know that someone else has laid claim to the property. For example, this could happen in the case of a resale in a newer subdivision where the current owner bought from a homebuilder directly.

Throughout the years, there have been instances when an easement, encroachment or even a small mechanic’s lien sits on a title unbeknownst to the current seller. When this happens, all parties must work together to determine the best course of action. Access to the land below your home would have to be granted via a deed and, as such, it would show up on the preliminary title report.

The title report provides ownership information and acknowledges loans, deeds or trusts, easements, encroachments, unpaid property taxes or anything else that has been recorded against the property. If a homebuilder deeded mineral rights to themselves, for instance, they would have had to record that deed. If so, it stays on the title report until they and the current owner agree to take it off.

How to avoid last-minute disclosures

In Tampa Bay, unsuspecting homeowners signed over to the builder’s holding company the “eternal rights to practically anything of value (found) buried underground, including gold, groundwater and gemstones,” according to the Tampa Bay Times. If that weren’t enough, homeowners who didn’t realize they had signed over the mineral rights, or who did so at the last minute under duress, could have trouble selling their home later to wary buyers.

With any home purchase, you should give yourself enough time so that you can do your due diligence, either as a contingency to the contract or in the period leading up to the contract before you sign it.

When buyers think about due diligence, they immediately think “property inspection.” And in the case of new construction, it’s uncommon to do an inspection. But there is so much more to due diligence than a simple property inspection.

Never wait until the closing to discover such a big disclosure, as the unfortunate buyers in Tampa Bay experienced. It’s common practice for a good listing agent or seller, in states where disclosure is required, to raise something like mineral rights as a red flag to all buyers from the get-go.

Deeding access to the land below your home isn’t simply some “fine print” buried in the closing papers that could be easily overlooked. Such a disclosure would require paragraphs, if not pages, of documentation.

Best course of action: Review all documentation, disclosures and title paperwork prior to signing a real estate contract or during a due diligence period. If you’re uncertain, ask your agent for help reviewing the documents or hire a real estate attorney to pore through the paperwork on your behalf.

Related:

Note: The views and opinions expressed in this article are those of the author and do not necessarily reflect the opinion or position of Zillow.

Source: zillow.com

May 3, 2021

The Average Cost of Home Insurance

We’ll get straight to the point: The cost of home insurance varies widely, but the average American homeowner pays $1,249 a year in premiums, according to the Insurance Information Institute’s 2018 figures, the most recent available.

(This is based on the HO-3 homeowner package policy for owner-occupied dwellings, 1 to 4 family units. It provides all risks coverage (except those specifically excluded in the policy) on buildings and broad named-peril coverage on personal property, and is the most common package written.)

Home insurance premiums can vary widely in part because of:

Your location
Your history of claims
Your credit score
The age and condition of your home

However, there are ways that homeowners can save money on their insurance costs, which we’ll get into. We’ll also walk through which areas in the U.S. are the cheapest and most expensive, typical coverages and more.

[ Read: Home Insurance Quotes, Explained ]

How much does home insurance cost by state?

As you can see below, the average home insurance premium varies widely by state. As you might expect, weather events figure big in the average annual premium by state, although there are other factors, of course, such as your credit score and the age of the home. The figures in this table come from 2018 data provided by the Insurance Information Institute.

State	Rank	Average annual premium	State	Rank	Average annual premium	State	Rank	Average annual premium
Ala.	13	$1,409	Ky.	26	$1,152	N.D.	18	$1,293
Alaska	36	$984	La.	1	$1,987	Ohio	44	$874
Ariz.	46	$843	Maine	42	$905	Okla.	4	$1,944
Ark.	12	$1,419	Md.	32	$1,071	Ore.	51	$706
Calif.	31	$1,073	Mass.	10	$1,543	Pa.	40	$943
Colo.	7	$1,616	Mich.	38	$981	R.I.	5	$1,630
Conn.	11	$1,494	Minn.	14	$1,400	S.C.	19	$1,284
Del.	45	$873	Miss.	8	$1,578	S.D.	20	$1,280
D.C.	21	$1,264	Mo.	15	$1,383	Tenn.	23	$1,232
Fla.	2	$1,960	Mont.	22	$1,237	Texas	3	$1,955
Ga.	17	$1,313	Neb.	9	$1,569	Utah	50	$730
Hawaii	27	$1,140	Nev.	48	$776	Vt.	41	$935
Idaho	49	$772	N.H.	36	$984	Va.	34	$1,026
Ill.	28	$1,103	N.J.	24	$1,209	Wash.	43	$881
Ind.	33	$1,030	N.M.	30	$1,075	W.Va.	39	$970
Iowa	35	$987	N.Y.	16	$1,321	Wis.	47	$814
Kansas	6	$1,617	N.C.	28	$1,103	Wy.	25	$1,187

Based on the HO-3 homeowner package policy for owner-occupied dwellings, 1 to 4 family units. Provides all risks coverage (except those specifically excluded in the policy) on buildings and broad named-peril coverage on personal property, and is the most common package written.

Most expensive states in home insurance premiums

Below are the most expensive average home insurance premiums by state, according to the Insurance Information Institute’s figures from 2018. Premiums can vary widely within the state, and of course, there are more factors in your premium than the location of your home.

Louisiana: $1,987
Florida: $1,960
Texas: $1,955
Oklahoma: $1,944
Rhode Island: $1,630

Cheapest states in home insurance premiums

Below are the cheapest average home insurance premiums by state, according to the Insurance Information Institute’s figures from 2018. Premiums can vary widely within each state, and of course, there are more factors in your premium than the location of your home.

Wisconsin: $814
Nevada: $776
Idaho: $772
Utah: $730
Oregon: $706

What determines the cost of homeowners insurance?

The cost of an individual homeowners insurance policy is determined by a wide range of factors. Some of those factors are within your control, and some of them are not.

For instance, home insurance can be more expensive in areas with a high risk of flooding or fires than in places where natural disasters are uncommon. Newer homes often cost less to insure than older dwellings — especially those in need of repairs. Insurance companies also look at your personal credit history before covering your home, so people with good credit histories could receive a lower premium than those with poor credit histories.

Every insurance company calculates rates differently. Some carriers place a higher value on credit score and claims history, while others look more closely at the condition and age of the home. Below is a more comprehensive list of the considerations that might determine your homeowners insurance premium.

[ Read: The Best Homeowners Insurance Companies ]

State, city and neighborhood: Some states are more prone to wildfires, earthquakes, and hurricanes than others.
Location of home: This information is pulled for crime and claim statistics in your home’s area.
Construction of the home: Is the home made out of wood, brick, or vinyl siding?
Heating system: Is the home heated with an HVAC or wood stove?
Security system: Homes with security systems might be less likely to be broken into.
Previous claims on the home: If the home has a history of water and electrical issues, then the homeowner may be more likely to file a future claim.
Homeowner’s previous claims: If the homeowner has a history with other insurance companies, he or she may be more likely file a claim again in the not-so-distant future.
Credit score: People with low credit scores may be more likely to file a claim.
Nearest fire station: The distance between your home and the nearest fire station can be a factor.
Marital status: Married couples are statistically less likely to file claims with insurance companies.
Replacement cost: The cost to replace an older home and bring it up to code can be more expensive than replacing a new home.
Pets: Certain animals might be considered a greater risk for liability claims.
Outside structures: Things like pools, sheds or greenhouses can also affect your policy rate.

Aside from these factors, the cost of an individual policy can also be determined by which features you chose to include in your coverage. A few of the options that can affect the cost are:

Deductible amount
Extra coverage add-ons
Bundled insurance policies
Discounts

[ More: Complete Guide to Home Insurance ]

Types of coverage

There are many different types of homeowners insurance coverage. Some coverages, like dwelling and liability coverage, can come standard with most policies. But insurance companies also often sell add-on policies that offer protection in certain areas. Here are some of the most common home insurance coverages you might find:

Dwelling coverage is insurance that covers qualified damages to the home itself. If the siding of your home tore off in a major storm, dwelling insurance might cover the cost of repairs. Insurance companies might sell add-ons for roof damage, water back/sump pump overflow, flood insurance and earthquake insurance.
Personal property coverage pertains to the cost of replacing possessions in your home, such as furniture. If someone broke into your home and stole personal items, personal property coverage might reimburse you. If you need to protect valuables, your agent might recommend you purchase a scheduled personal property endorsement for higher coverage limits.
Personal liability coverage protects against lawsuits for property damage or injury. If a delivery driver slipped and fell on your icy driveway, liability coverage might pay for their medical expenses and court costs if they sued you. Some insurance companies offer add-on policies that extend your liability coverage limits.
Loss of use coverage might cover additional living expenses you have after your home has been damaged. This might include hotel stays, groceries and gas while your home is being repaired. If your house is under construction after a covered claim, loss of use coverage might pay for your temporary hotel and food expenses up to your policy’s limit.

Generally speaking, your agent may recommend that your home insurance coverages be based on your lifestyle, where you live and the value of your assets.

Keep in mind that your agent may recommend you add coverage as time goes on. If you adopt a puppy six months after you purchase your home insurance policy, your agent may recommend you add pet coverage when the time comes. Or, if you take on a remote job, you can contact your insurance company and see if you should add home business coverage for a small fee.

Every home insurance coverage has a policy limit. A policy limit is the highest amount of money your insurance company will give you after a covered loss. For example, if your dwelling coverage limit is $400,000, that may limit how much is paid out if your home is damaged or destroyed by a covered peril to no more than $400,000, although factors like your deductible may come into play.

When you purchase a home insurance policy, you may be able to set your own policy limits. As a rule of thumb, you may be recommended to have enough dwelling coverage to rebuild your home in its current state, enough personal property coverage to cover the full value of your personal items and enough liability coverage to protect your personal assets.

[ Read: What is Dwelling Insurance? ]

Reimbursement coverage types

There are three different coverage options commonly provided by home insurance companies. Each option affects your premium differently.

Actual cash value (ACV) is based on the current market value, or how much your home and personal property is worth, with depreciation factored in. Most home insurance policies offer ACV reimbursement by default. It can be the lowest option.
Replacement cost value (RCV) works in the same way as ACV, but without depreciation factored in. That means you might get a higher payout after a covered claim. RCV home insurance policies can be more expensive than ACV policies, and you may need to purchase an endorsement to get it. Your agent may recommend this if you own valuables or have an expensive home.
Guaranteed replacement cost (GRC) is also referred to as extended replacement cost (ERC), and this option can cover the complete cost of rebuilding the home, even if that cost exceeds the policy limit. GRC can be the most expensive replacement cost type, and not all insurance companies offer it. Your agent may recommend this if you live in areas with extreme weather, wildfires, earthquakes or any place where home destruction is more likely.

Discounts and ways to save on home insurance

Homeowners insurance can be costly, so before selecting a plan, shop around to find the best deal based on your needs. It can be helpful to consult an insurance agent, read consumer reviews and check online insurance quotes to find companies with the lowest rates. Here are some other ways to save money on home insurance:

Ask about available discounts: Some companies offer discounted policy rates if your home is in a gated community, if you bundle with your car insurance or if you’re part of a homeowner’s association.
Bundle your insurance policies: Oftentimes, companies that sell home, auto and life coverage may deduct up to 15% off your premium if you buy two or more policies from them.
Make your home safer: Some providers may offer a discount if you install fixtures that make your home safer, such as smoke alarms or a security system, that reduce the likelihood that damage or theft will occur in the first place.

How do past claims impact home insurance cost?

It depends on the nature of the claim. Just how much a claim raises your premium varies in part on the provider and the nature of the claim.

There are also further complications when you make the same type of claim twice. Not only can this increase what you pay each month, but, depending on you and your home’s history, it’s possible the provider may even decide to drop you.

Though your premium may increase if you are found at fault, it’s also possible for your monthly bill to increase even if you’re not found to be liable. Your home may be considered riskier to insure than other homes.

Home insurance cost FAQs

No, states do not require homeowners to get insurance when they purchase a home. However, if you choose to get a mortgage loan, most lenders will require you to have some insurance.

To determine how much coverage you should purchase, talk to your agent about your home inventory, your overall worth, and of course, comfort level. Also discuss factoring in the location of your home, and evaluate risks based on weather, fires and other events that could potentially damage or destroy your home.

There are a few ways to potentially get home insurance discounts. Discount options include things like:

Bundling your home insurance policy with another policy (such as auto).
Going claims free for extended periods of time.
Making certain home improvements.
Living in a gated community.
Installing a security system.

In 2018, 34.4% of home insurance losses were wind and hail related, 32.7% were fire or lightning related and 23.8% were water damage or freezing claims. Only 1% of claims were related to theft, and less than 2% of losses were liability claims. These figures are according to the Insurance Information Institute.

In Florida the most common claims may be related to hurricanes, wind damage, water damage and flooding. In California, earthquake, flood and wildfire claims may be more common. When you purchase insurance, talk to an agent about the specific risks in your area and ask about separate insurance policies you might need, like flood or earthquake coverage.

Too long, didn’t read?

The cost of your insurance can vary widely because of such factors as location, your credit score and your home’s age. There are discounts your insurance carrier may offer, such as policy bundling and security systems.

We welcome your feedback on this article. Contact us at inquiries@thesimpledollar.com with comments or questions.

Source: thesimpledollar.com

May 2, 2021

Is Delivering for Postmates Worth It? – Review

Postmates is a popular local delivery app with a dense network of local merchants, many of which are small, independently owned businesses. These include restaurants, grocery stores, drugstores, liquor stores, and general-purpose retailers.

Operating in more than 100 metropolitan areas around the United States, Postmates is powered by a growing army of relatively well-compensated independent contractors — also called Postmates — capable of delivering most products an hour or less after they’re ordered.

If you’re looking to monetize your spare time by tapping into the gig economy as a delivery driver, Postmates is a great way to earn some extra cash. All you need is a car, bike, or scooter and a willingness to out-hustle your fellow couriers. According to the company, Postmates workers can earn $25 per hour or more in some markets at periods of peak demand.

Intrigued by the prospect of earning extra income with Postmates, one of the premier grocery and food delivery apps on the market? Read on to learn what to expect from the platform, what to watch out for, and how to maximize your earning potential.

How Postmates Works for Delivery Employees (Postmates)

If you’re willing to brave traffic, the elements, and the myriad pitfalls of the service industry, working as a Postmate driver is a great way to earn extra income outside of your day job, help pay the bills as you work toward a degree, or simply to fill the gaps between full-time positions.

As a Postmate, you’re classified as an independent contractor and aren’t entitled to a minimum wage or other protections afforded full-time employees. But Postmates brags that individual Postmate drivers can make $25 per hour or more. Although these results aren’t typical, they’re not bad for a job that doesn’t require a four-year college degree or even much on-the-job training.

Basic Eligibility Requirements

To make it through the initial round of the delivery agent application process, applicants need to meet some basic eligibility requirements:

Live in or near a Postmates market, although a Postmate can work in any of the company’s active markets once admitted to the app
Be at least 18 years old
Be a U.S. citizen or permanent resident
Own a functional bike, car, truck, scooter, or motorcycle, with valid vehicle insurance if required (Postmates also provides liability insurance up to $1 million per incident for each Postmate at no cost to the worker)
Have a valid driver’s license, even if you’re only delivering by bike

Postmate applicants often have previous delivery experience. That could mean they’ve worked directly for a restaurant, delivered for a logistics company like UPS or FedEx, or picked up hours with direct competitors like Instacart or Grubhub. But it isn’t a prerequisite.

Application and Hiring Process

Postmates’ initial application takes just a few minutes. You need to enter some basic biographical and contact information, including your full name, address, vehicle type, and the make and model of your mobile device.

You also need to provide your driver’s license number and Social Security number, and consent to a background check and driving history check (for Postmates with motor vehicles). Postmates doesn’t divulge what it looks for with these checks, but it’s safe to assume a recent felony conviction or pattern of vehicle accidents would be grounds for disqualification.

If you pass your background check, you’ll need to upload a profile photo and then wait for your Postmates delivery bag and prepaid debit card to arrive in the mail. You’ll pay for most pickups with this card. Once your card arrives, you’ll need to complete some final tasks and sign into the Postmates Fleet app for the first time.

Scheduling and Making Deliveries

If you’re approved to work as a Postmate, you can get to work right away. Whenever you want to make deliveries, simply indicate that you’re available in the app. When you open the app, you’ll see whether Blitz Pricing is in effect in your area (more on that below).

The delivery process is straightforward. For each accepted delivery, you’re shown the order’s complete contents and told where to pick it up. In most cases, the merchant receives the order well before your arrival and has it ready for you as you walk in.

However, it’s a good idea to call ahead to make sure this is the case and to check that the order is complete and correct once you arrive. Always ask for an itemized receipt from the merchant. It can come in handy if the customer disputes the accuracy of an order.

Under normal circumstances, you pay for pay-on-pickup orders with your Postmates debit card. Adding funds to this card is easy. If you find you’re out of funds when you arrive at the merchant, you should be able to execute a reload in a minute or two, with minimal impact on delivery timing.

For orders paid in advance, you simply confirm the order with the merchant and leave without exchanging any funds. You then take the goods to the customer, accept payment, and move on to the next delivery.

Payment

For each completed delivery, you’ll receive a payment broken down as follows:

A variable amount for each completed pickup
A variable amount for each completed dropoff
A variable amount (paid by the minute) for time spent waiting for the merchant to fill the order (if applicable)
A variable per-mile rate covering the distance between the pickup and dropoff locations
100% of tips from the customer

Your entire account balance pays out via weekly direct deposits. Payments for activity during the prior Monday-to-Sunday period hit your linked account by midweek in most cases. If you need funds sooner, you can cash out to a linked bank account using Postmates’ Instant Deposit feature.

Note that while you’ll always receive 100% of customer tips, you won’t receive all the fees the customer pays. Postmates keeps a significant cut of customer-paid fees to cover its own expenses.

Postmates does its best to exclude cash-only merchants from its platform, but screening isn’t 100% accurate. If you find yourself at a cash-only business, you can notify Postmates support and pawn the transaction off on Postmates itself.

You never have to pay for deliveries out of your own pocket and shouldn’t do so under any circumstances, no matter how much the merchant pressures you.

Alternatives to Postmates

Postmates doesn’t have a lock on the local delivery market, of course. Opportunities to earn money by delivering everyday goods abound, thanks to:

Advantages of Postmates

Postmates’ top advantages for drivers include not requiring a car to work on the platform, potentially attractive pay, delivery fees proportional to distance, and demand pricing during busy periods.

1. No Car Necessary

If you’re an avid bike commuter, there’s a place for you at Postmates. The platform permits bike-only delivery agents in all its markets, allowing people who don’t own cars to earn some extra cash.

Other platforms, including TaskRabbit and Bite Squad, require you to have your own car or at least be comfortable with driving one.

2. Pay Can Be Attractive

Postmates brags that its delivery people can make $25 or more per hour, including tips.

Although this isn’t guaranteed, and you probably shouldn’t expect to earn so much on your very first shift, your earning power is higher here than in most other service-industry jobs — and on many competing grocery food delivery services. For instance, Instacart shoppers earn about $13 per hour plus tips, according to Glassdoor.

3. Delivery Fees Rise With Delivery Distance

To account for higher out-of-pocket fuel costs and greater time investments, Postmates compensates delivery people more for longer deliveries, increasing the likelihood they’ll accept out-of-the-way jobs.

Some competing platforms’ delivery fees are proportional to the size of the order, not the distance. That means drivers on long-distance deliveries must hope for higher tips, which aren’t always forthcoming.

4. Blitz Pricing Is an Additional Earning Incentive

Postmates’ Blitz Pricing feature offers a powerful incentive for idle Postmates, including those who haven’t signed up for shifts in advance, to get out to delivery hot spots during peak hours and make money.

By jacking up delivery fees by 50% or more, Postmates ensures its workers are compensated fairly during rush periods when they have to work harder. It also increases the likelihood of faster delivery for customers because there are more Postmates on the clock.

TaskRabbit and some similar platforms don’t have demand pricing for delivery jobs.

Disadvantage of Postmates

Postmates’ disadvantages include workers’ independent contractor status, potentially high overhead for those with gas-powered vehicles, and limited availability in smaller cities and metro areas.

1. Postmates Are Independent Contractors

All Postmates work as independent contractors. They’re responsible for tracking their own tax liabilities, paying their own expenses (such as fuel and car insurance), and eating the opportunity cost of an illness or injury (Postmates doesn’t offer workers’ compensation, sick days, or paid time off).

Postmates also don’t have much in the way of job security — they can be kicked off the Postmates app basically at will.

Pro tip: Because you’ll be running your own small business, it would be a good idea to use a cloud-based accounting platform like Freshbooks to track all your expenses. Then at tax time you can just hand everything over to your accountant or upload it into either H&R Block.

2. Overhead Can Eat Into Earnings

Postmates, particularly couriers using their own cars, deal with fairly high overhead costs that can eat into their ability to make extra money. They’re responsible for the cost of fuel, vehicle insurance, parking, and possibly other expenses.

By contrast, Bite Squad and some regional grocery delivery services cover overhead costs, allowing workers to keep more of their pay and tips.

Pro tip: You can also rent cars from Hyrecar and use them for the sole purpose of driving for Postmates or similar services.

3. Not Viable in Many Locations

Postmates operates chiefly in larger cities and metro areas. If you’re out in the boonies, Postmates isn’t a viable extra-income option. Larger logistics firms, such as Amazon, and regional grocery delivery services often have a presence in rural areas.

Still, they’re not guaranteed to pay as well or schedule workers as flexibly as Postmates.

Final Word

According to the Bureau of Labor Statistics, the median U.S. hourly wage paid by private employers was right around $30 per hour as of early 2021. Many jobs that pay more than $25 per hour require a four-year (or longer) degree, union membership, or many years of workplace experience.

Workers without these advantages, including millions of adults who string together multiple retail and food service jobs to support their families, often make far less — under $10 per hour, in many cases.

From this perspective, working as a Postmates courier is an attractive proposition, even if it’s not a full-time gig. All you need is a bike or car, a strong work ethic, and a willingness to move quickly when the job demands it. That’s less than many other sharing economy gigs require and might be enough on its own to make Postmates worth it in your book.

Source: moneycrashers.com

May 1, 2021

How to Budget for Insurance

The cost of insurance can be a big hit to your personal bottom line. That’s especially true when you consider all the types of coverage you may need to pay for, including auto, health, and life insurance plans. Here are some tips for how to budget for insurance without compromising your lifestyle.

Steps for Budgeting for Insurance

In addition to being legally required in many instances, insurance is often a good investment for your wallet and your peace of mind. The expense of insurance can actually save you money in the long run.

Budgeting for insurance may seem complicated, but it really comes down to two simple actions: First, decide what type of insurance you need. Then, start budgeting for it. Here are five steps for incorporating insurance into your personal finances.

1. Decide how much insurance you need

For each type of insurance you decide to get, you’ll need to decide how much coverage to buy. When it comes to insurance, cost shouldn’t be the only factor in your purchase decision. Instead, think critically about how much coverage you need. If you’re not sure how much insurance or what type to get, consider talking with an insurance agent for advice.

Do you need your homeowner’s insurance to include liability in case someone else is injured on your property? Is term life or whole life insurance better for your situation? Who needs to be covered by your auto insurance?

2. Get quotes from agents or online

Once you know what type of insurance you want and how much coverage you need, get some quotes. Shop around and get quotes from multiple companies. Remember to compare the coverage and not just the premium price—you might find that you’re getting a much better value when paying only a little more a month with one company over another.

3. Find out what the payment schedule is

Discuss the payment schedule before you agree to an insurance policy. It’s common for auto insurance companies to offer a significant discount if you can pay for six months of insurance at a time, for example. Here are some common pay schedule options for various types of coverage.

Home Insurance: Paid annually or biannually, often out of escrow if you have a current mortgage
Car insurance: Paid every six months or monthly
Life insurance: Paid monthly
Health insurance: Paid monthly or via pretax deductions from your paycheck if the coverage is through your employer

Understanding the payment schedule will help you budget for insurance more effectively.

4. Set aside enough money monthly

However you plan to pay for insurance, break the amount down into a monthly budgeted amount. For example, if your home insurance is $900 every six months, set aside $150 every month. It’s much easier to budget for $150 than it is to come up with $900 all at once.

5. “Pay” the bill monthly

If you do pay monthly, go ahead and budget so that you can pay your insurance bill at least a week before it’s due. That leaves you plenty of wiggle room if something ever comes up.

If you don’t pay monthly, act like you do. Move the monthly budgeted amount into a savings account and don’t touch it. Act like it’s not there so you’re not tempted to use it on something else and risk not having the money when the bill comes due.

How to Budget for Different Types of Insurance

Trying to include a large insurance expense in an already tight budget can be difficult. Here are some tips for making various types of insurance potentially more affordable so they are easier to budget for.

Car Insurance

The average American pays around $2,388 per year on auto insurance. But your actual expense can vary widely depending on your age, state of residence, type of car, credit score, and many other factors. Here are some tips for saving money on car insurance.

Increase your deductible. You may need to shell out a bit more in the event of an accident, but you can save a lot of money on your premiums.
Ask about discounts if you’re married, have multiple cars, are buying different types of insurance from the same company, or are a good driver. Some insurance companies also offer discounts for students with good grades.
Lower your liability amounts. This can reduce premiums, but you should ensure that it’s a good move for you financially overall.

Health Insurance

According to numbers from the Kaiser Family Foundation in 2018, the average amount people were contributing to their employer-sponsored health care plans each year was $1,186 for single coverage. You don’t have to pay that much for health insurance, though. Some ways you can save on this expense, especially if you’re purchasing as an individual through the marketplace, include:

Buy a plan with a higher deductible.
Enter all your income data into the marketplace application form to see if you qualify for subsidies or credits.
Apply for Medicaid if you’re eligible.

Life Insurance

The cost of life insurance depends heavily on your age, the type of insurance, and how much you’re purchasing. If you’re young, you might want to buy a whole-life policy that you can pay for now and still have when you’re older. If you’re older, you may want to opt for term life insurance, which is cheaper than other types.

Homeowner’s or Renter’s Insurance

One of the reasons insurance costs might be lower is because the company sees you as less of a risk. Homeowner’s and renter’s insurance may be cheaper for those that invest in security measures such as home security systems.

The Bottom Line on How to Budget for Insurance

You can get discounts and great deals on insurance if you’re willing to do your research. But, in most cases, insurance may still be a sizeable expense. Planning ahead and budgeting every month for these expenses is one of the best ways to ensure you can afford the coverage you need.

And since your insurance costs are sometimes impacted by your credit score, make sure you’re keeping up on all your other bills and reviewing your credit reports regularly.

DISCLAIMER. The information provided in this article does not, and is not intended to be, legal, financial or credit advice; instead, it is for general informational purposes only.

Source: credit.com

May 1, 2021

Is Paying Rent in Advance a Good Idea?

Thinking about handing over a stack of money to secure an apartment or get a rent discount? Be sure you know what you’re getting into.

In some instances a landlord might offer, or you might propose, paying rent in advance. This could be done to secure a particular property that is on the rental market, or to get a discount on rent.

Paying in advance could be a good idea depending on the circumstances, but be sure you know what you’re getting into — especially if you’re paying a significant amount like a full year’s rent upfront.

Paying ahead to secure a unit

If you are vying to rent a particular property and you believe the competition is fierce, you might think offering to pay a large amount of rent upfront could help seal the deal. Or the landlord might encourage you to do this to get the place. It could be a good idea if the rental is a great place for you at the right price. However, you do want to be careful of a few issues.

First, as with any rental property, watch out for fraud. Sometimes scammers try to rent a property they don’t own. It might be done fully online, or they might meet you at the property, gain access somehow, pretend they’re the landlord, and take your security deposit. They could also push you into providing upfront rent for the place to secure it. Unfortunately, if they are a fraudster, you’ll never see a dime of your money again.

To protect yourself, research the landlord and the property, and talk to a real estate agent about any concerns. Go meet the landlord at their office if possible, never wire money, and watch out if the deal seems too good to be true.

Even if the landlord is reputable, if they ask for extra rent upfront, try to verify that they’re not going into foreclosure. If they do lose the property, you’re pretty well protected under many states’ laws if you’ve paid rent.

Paying ahead to get discounted rent

If you are already living in the property and the option comes up to pay advance rent, it should come with a sweetener like reduced rent or some other benefit to you. You are taking a risk by paying upfront. What if the place burns down, or there is a flood, or you have to move out? Do you want to fight with a landlord over getting your money returned? It’s not worth it in most cases.

Sometimes it may make sense if there is a benefit sweetener to you. You’ll have to determine whether or not it is the right incentive for you to jump on it. A 10-percent discount might make paying a full year in advance a good option, but only if you are sure the landlord is stable and you’ll be able to get your full year of residency. A smaller discount might not be worth the risk.

Overall, these pay-in-advance options are infrequently available, but if one comes up and it’s a good arrangement with low risk, it might be to your benefit to open up that checkbook and make the deal.

Note: The views and opinions expressed in this article are those of the author and do not necessarily reflect the opinion or position of Zillow.

Source: zillow.com

May 1, 2021

List of Credit Cards that Issue an Instant Card Number Upon Approval (2021 Update)

A big expense comes up, and you want to charge it on a credit card…but you haven’t applied for the card yet. Which credit card issuers will instantly issue the card number upon approval so that it can be used immediately for online purchases or at a vendor who is willing to accept the card number without a physical card?

Before breaking this issue down by card issuer, it’s important to bear in mind that getting the card number instantly will only happen if you get an automatic approval; if the application goes into pending and gets approved later, it’s unlikely that an agent will give you the card number over the phone.

Also, remember that many card issuers will expedite a new credit card, and it’s often possible to have the physical card at your doorstep in less than 48-hours, see Which Credit Card Issuers Offer Expedited Shipping? for more information.

Alliant

Alliant does not currently offer instant credit card numbers, it’s something they are currently looking into.

American Express

Any Amex card can get an instant card number immediately upon approval. They even email you a link where you can continuously view your instant card number if you request one (1). You can also login and go to this link to get the instant card number after the fact (1).
Business cards more often don’t get the instant card number. (1, 2) Personal cards usually do.
Some co-branded Amex cards will get the card number only to be used at the co-brand location.

The account number given out right away is the same number you’ll get in the mail, but the 4-digit code (and possibly expiration) is different. The system will ask you if you want a temporary number and will e-mail it to you on request (it e-mails a secure link where the card number can be viewed). American Express won’t give you the temporary card number over the phone.

Amex is the best about giving out card numbers instantly. In fact, they’ve even been known, occasionally, to give out hefty bonuses (automatically) if the system fails to offer the instant card number. However, not everyone always sees the instant card number option, likely based on various security factors.

Another trick for using an Amex card before receiving the physical card is this: if the card shows up in your Amex app, you can try adding it to Apple Pay without even knowing the card number. (Seems they rolled out a feature specifically to allow the card to be added to Apple Pay immediately – I assume it’s found at the time of card approval an option to add to Apple Pay.) Additionally, you can use Amex Checkout online at merchants who accept that form of payment.

Apple – Goldman Sachs

The Apple credit card issued by Goldman Sachs gives you instant ability to use the card for purchases from within Apple Pay.

Bank of America

Alaska Airlines card often gives an instant card number.

The only BofA card that’s commonly reported to get an instant card number is the Alaska Airlines card. Many have gotten an instant card number for Alaska while some have not. (One reader was told that the card can only be used on Alaska Airlines purchases. I haven’t heard others mention that.)

All other cards typically do not get access to an instant card number. Occasionally it might be possible to add the card to your mobile wallet from within the Bank of America mobile app; this works specifically when applying for a targeted promotion from within the Bank of America app (1).

Barclaycard

Barclaycard does not offer instant card numbers.

I’ve never seen a report for Barclaycard to offer an instant number and it probably does not exist. The only exception is the Barclaycard Uber card: when you get instantly approved with an in-app application, the card will immediately show up for use in the Uber app (it still won’t be usable elsewhere since you’ll only see the last 4 digits).

Also, Barclay airline cards offer an instant card number only for use within that airline.

BBVA

BBVA does not offer their card number instantly. However, I was told by a BBVA rep that it’s possible to get the card number by going into a physical branch and verifying your identity. In practice, it’s reported that the folks at the branch won’t necessarily be willing to give out the card number.

Capital One

After being approved you can see all of the card details in-app. However, some readers report only being able to see the last 4-digits which isn’t very too useful. Others are able to see the entire number and use the card immediately.

More recently, Capital One began displaying your card number permanently on the web and in the app (1), so it should now be available for everyone immediately. You can also connect your Capital One card to PayPal via the login and use it that way (1).

Chase

Chase generally does not offer instant card numbers.
You can add any Chase card to your mobile wallet like Apple Pay, Samsung Pay, or Google Pay and use it instantly. (our original post on this)

A few specific cards:

The Chase Starbucks card instantly makes the new card available virtually, but only to load your Starbucks app, not for use elsewhere.
The Chase Amazon card becomes available instantly for use on Amazon only (1). Again, you should be able to add it to your mobile wallet for use outside Amazon as well (1).
Other cobrands such as Southwest, Marriott, United, British, Disney might work for that specific partner.

Citi

Based on my conversation with a Citi rep, they’ll sometimes offer an instant card number for two cards:

American Airlines
AT&T

Regarding the latter, I assume the logic is due to the fact that the AT&T card is especially aimed at online shoppers, making the card number more important than the physical card. (See also this comment.)

The Costco card can also get an instant card number, see Costco (below).

Costco Credit Card

The Costco credit card does get an instant card issued, only when you apply in a Costco store. They’ll print out a temporary card number/bar code right at the desk and you’ll be able to use that at checkout. (1)

Discover

Discover does not offer instant card numbers.

I’ve never seen a report for Discover to offer an instant number and it probably does not exist.

Final

Final is a company that specializes in offering unique card numbers under one account. They also issue a card number instantly upon approval so you don’t need to wait for the physical card to come in the mail to start using it.

FNBO

A report that the MGM Resorts M life MasterCard gets printed out and issued instantly upon approval when you apply inside an MGM resort at the M life counter.

HSBC

HSBC will give you a credit card number after approval, unfortunately they don’t give you a CVV2 number or the expiry date so it’s largely useless.

Navy Federal Credit Union (NFCU)

Reader Jason reports getting a virtual credit card number via email around 24 hours after approval from NFCU. Not sure if they always send this or it’s YMMV.

SoFi

SoFi offers an instant credit card number upon approval. (1)

Synchrony

Ebates credit card
Paypal/eBay 3/2/1 credit card will give a small credit line of $250, which can be used for Paypal purchases only (IIRC)
Paypal 2% cash back credit card will give an instant line or credit (probably a smaller one)

These two cards are known to give an instant number, probably because both are meant especially for online purchases.

USAA

USAA gives you an instant card number to use (card number, expiration, and 3-digit code). This has a maximum credit limit of $1,000 (increased when physical card arrives).

US Bank

U.S. Bank does not typically offer instant card numbers; see this post for specific instances where they do.

Wells Fargo

Wells Fargo does not offer the card number instantly.

How it Works with Store Cards

Many stores offer their own branded credit card; either as a Visa/MC/Amex-issued card which can be used anywhere and more often they are for in-store use only. When applying for a store credit card in-store or online, you’ll often be able to use them immediately upon approval for that day’s purchases.

For future purchases as well it may be possible to use, even before getting the physical card:

Some stores may offer you a temporary card number to use. Dick Sporting does this (heard from PF Digest), and I’ve heard Target does this with their REDcard.
Some stores may allow you to use the card whenever you wish by verifying your personal info at the POS. Best Buy does this – if you don’t have your Best Buy store card handy, you input your info into the POS and make the purchase that way. Same with Kohl’s.
Cabela’s issues instantly a physical card when getting approved for their credit card in store (1).
Walmart Capital One card is available instantly for use (1)
Also, check out this list from ProudMoney for a list of many store cards and whether they offer the ability to use instantly.

Conclusion

If you want to get a credit card number instantly, prominent options would be: any Amex card, Alaska from BofA, American or AT&T from Citi.

As with everything else in life, YMMV, you may not always have success getting the number instantly. As noted above, you’re only likely to get the card number right away when getting an instant approval. Also, a Citi rep told me, that there may be other security factors, such as IP address, which determine whether the system will offer the instant card number.

It’s worth noting that with the emergence of mobile wallets, once you have the card number, you can add it to your mobile wallet and use it in stores as well. Please let us know if you’ve had other experiences in this realm and we’ll add it to the post.

Further Reading: (1, 2, 3, 4, 5, 6, 7, 8, 9)

Source: doctorofcredit.com

April 28, 2021

Real Estate Q&A: Condo Parking Space Ownership

Real estate investor and Zillow Blog contributor Leonard Baron answers questions from readers regarding buying, selling and investing.

Hi Leonard — I have a situation with my condominium association. I’ve owned the condo for more than 10 years. Today the condominium association manager showed me a map in the bylaws about parking spaces, which shows I own different spaces than the ones I’ve been using for 10 years. Is there a common law protecting me since I have used these spaces since I bought the property? The prior owner of my condominium unit also used these exact spaces for about 10 years. Any guidance is appreciated! Ruiming L., CT

Hi Ruiming — Sorry to hear about this issue. I’ve seen similar situations before. This might not be an easy one to resolve — and things might not go your way.

Let me first describe what every buyer of a unit in a common interest development should do before they purchase it to protect themselves when parking spaces come along with their property.

Deeded parking spaces

Many common interest developments’ homeowners associations (HOAs) have a “condominium map” that shows what parking spaces are deeded to each unit. You should also be able to look at the title documents recorded on the property to verify what spaces go with your property. Your title insurance agent should be able to help you sort out these issues, and review the condominium map and recorded documents so you are more comfortable with your purchase.

If those title documents confirm spaces are deeded to your unit, you should also try to get a title insurance policy that includes those spaces. Title insurance may not be available, and you will pay extra, but it’s probably worth the money.

HOA-controlled parking spaces

Sometimes the developer will just assign parking spaces to the units but the spaces are not deeded to any particular unit. There should be a contract of some sort that describes who gets what spaces. The governing documents — called Covenants, Conditions and Restrictions (CC&Rs) — may retain the rights for the HOA board to change what spaces each unit gets.

If this is the case, you need to ask the board in writing — before you purchase — how this process works and what rights you have to which spaces. You need to know what you are getting, and not just hope things will go well. You might want to get a lawyer involved to review your rights and give you an opinion in a case like this.

Worst case scenario

What if there is no condominium map, or no good written guidance on who gets what spaces? Or what if the original developer had terrible condominium governing documents, or there is a dispute over parking spaces with other owners? In any of these cases — all of which you need to know about before you buy the property — you need to decide if you want to purchase a property where you could lose your parking rights and/or get in a multi-year legal battle over spaces. (Hint: It’s not worth it!)

Now, back to your question. Unless you have something in writing that differs from the condominium map or the CC&Rs, you’re probably out of luck. You should try to work with the HOA first to amicably resolve the issue satisfactorily for all parties. You’ll probably need to hire a lawyer, and it is going to be expensive to get the best outcome for you.

One last thought: In some states, you might have a potential “adverse possession” claim to get ownership. However, in Connecticut, it’s 15 years to adversely possess real property, and the prior owner’s use probably doesn’t help your case.

This is a good lesson for anyone buying a condominium. These issues are rare, but they do occur. Buyers need to do the proper research and due diligence to protect themselves before they move forward with a purchase in a common interest development.

Related:

Note: The views and opinions expressed in this article are those of the author and do not necessarily reflect the opinion or position of Zillow.

Source: zillow.com

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