After falling for three consecutive weeks, purchase mortgage rates jumped 14 basis points, reflecting the expectation that the Federal Reserve (The Fed) will maintain its tightening monetary policy to fight inflationary pressures.
According to the latest Freddie Mac PMMS, purchase mortgage rates this week averaged 5.23%, compared to 5.09% the week prior. A year ago at this time, 30-year fixed rate purchase rates were at 2.96%.
The government-sponsored enterprise index accounts solely for purchase mortgages reported by lenders during the past three days.
“After little movement the last few weeks, mortgage rates rose again on the back of increased economic activity and incoming inflation data,” said Sam Khater, Freddie Mac’s chief economist.
Another index also showed higher rates this week.
Black Knight’s Optimal Blue OBMMI pricing engine, which includes some refinancing data — but excludes cash-out refis to avoid skewing averages – measured the 30-year conforming mortgage rate at 5.5% Wednesday, up from 5.42% the previous week.
Creating a path to success in today’s purchase market
Meeting the needs of a new generation of homebuyers while managing the ebbs and flows of a volatile housing market is a major endeavor for any mortgage lender. So, what should lenders be doing to thrive in the face of a post-pandemic housing market rife with new hurdles?
Presented by: Calyx
The 30-year fixed-rate jumbo was at 5.05% Wednesday, also up from 4.97% the week prior, according to the Black Knight index.
Higher rates are reducing borrowers’ demand for mortgage loans. This week, mortgage application volume dropped 6.5% from the past week to the lowest level in 22 years: Refi applications declined 6% and purchase apps decreased 7%, according to the MBA.
The housing market is incredibly rate-sensitive, consequently, demand again is pulling back, according to Khater.
“The material decline in purchase activity, combined with the rising supply of homes for sale, will cause a deceleration in price growth to more normal levels, providing some relief for buyers still interested in purchasing a home,” he said.
Overall, mortgage rates are following the Fed’s inflation-fighting monetary policy. Minutes from the Fed’s meeting earlier this month showed policymakers emphasized the need to quickly raise interest rates to bring consumer prices closer to the Fed’s 2% goal.
The central bank raised the interest rate by a half percentage point on May 4 and unveiled a plan to reduce its $9 trillion asset portfolio. The Fed also has repeatedly signaled it will continue to raise rates in 2022 and into 2023.
According to Freddie Mac, the 15-year fixed-rate purchase mortgage averaged 4.38% with an average of 0.8 point, up from last week’s 4.32%. The 15-year fixed-rate mortgage averaged 2.23% a year ago.
The 5-year ARM averaged 4.12%, with buyers on average paying for 0.3 point, up from 4.04% the week prior. The product averaged 2.55% a year ago.
Economists expect the tightening monetary policy to reduce origination volume significantly in 2022 and 2023. The Mortgage Bankers Association expects loan origination volume to drop more than 35% to about $2.5 trillion this year, from last year’s $4 trillion. Meanwhile, the MBA expects 5.93 million home sales in 2022, compared to 6.12 million in 2021.
Fitch Ratings, however, in a May 31 report said the pace of falling mortgage originations has surpassed its expectations and it is likely to fall short of the industry forecasts by MBA and Fannie Mae.
There are tons of amazing TV shows that set the world on fire with their stories but, for some reason or another weren’t continued. It’s tragic enough when a long-running series gets curtained, but it’s even more heartbreaking when a stellar show begins to hit its stride, and then gets abruptly canceled. We turned to Reddit to find out which canceled shows people miss the most. Whether you’re mourning a beloved show, or want an introduction to some television gold, here are 10 series that came and left far too quickly!
1. Mindhunter
One user said, “Probably anything canceled by Netflix.”
Another user replied, “Mindhunter has entered the chat.”
A third added, “Mindhunter is the first series I actually got super bummed out about being canceled. The story, actors, and music. Shame.”
One Redditor commented, “Soundtrack was elite. Almost got lost in the shuffle of everything else is so well done.”
Another user shared, “Inside Job made it two seasons before getting axed on a cliffhanger. I still want to know what happens.”
One commenter replied, “This is how I found out Inside Job got canceled… sigh.”
2. Rome
One user exclaimed, “ROME!!!!”
One commenter added, “Yes. Rome! It was Game of Thrones before Game of Thrones.”
One user replied, “Rome walked so GoT could run….into a post.”
“Yeah, the later seasons weren’t as good, but I don’t know how much better they could be considering everything that happened behind the scenes… Though I guess the real weakness was injecting Caesar and that one guy’s the stupid horrible son. Ugh…yeah…now I’m remembering everything…geez… you’re right…I was only thinking about the first season and the prequel,” one user responded.
3. 2003 Teen Titans
One user posted, “This may seem a bit childish, but Teen Titans—the original one from 2003…”
Another replied, “It’s a bummer because every character got one season where they were the focus of the ongoing plot. Season 1 was Robin, season 2 was Terra, season 3 was Cyborg, season 4 was Raven, and season 5 was Beast Boy. It was set up perfectly to have a 6th season focused on Starfire, and we never got it.”
One commenter added, “Rewatched the whole series reasonably recently. It really was such a unique show for the time. I remember seeing reruns on Boomerang after the series had finished airing on CN. Unfortunately, they no longer air anything from the original series or movie. Season 5 absolutely ended in a way that demanded something more, and the movie did not scratch that itch.”
4. Reaper
“Reaper—Absolutely loved that [show], oh and Firefly, but everyone says that,” one Redditor posted.
Another user added, “I hate that they don’t cast Tyler Labine in more comedy stuff. Reaper was a fantastic showcase of his hilarity, and one of my all-time favorite movies is Tucker and Dale vs. Evil.”
One user commented, “I can’t believe Reaper was so far down the list.”
Another added, “From what I remember, it was canceled because they wanted The Vampire Diaries in that time slot. Guess they made a good move, considering the success of TVD. But I still hate them for canceling it.”
One user added, “The network canceled it, they tried to syndicate to SciFi, but the cast would have to take pay cuts, so they weren’t on board, and then the showrunners were going to produce a comic book to at least wrap the cliffhanger they left us on, but… nothing. They did at least do an interview where they revealed the secrets behind Sam and the devil’s deal, his parentage, etc., if you’re interested. (Warning: spoilers for a show canceled 14 years ago).”
5. Jericho
One user posted, “Jericho.”
Another added, “Every time I see this thread, I come just to upvote or add Jericho. Nuts to CBS.”
One user also commented, “Same. I keep scrolling until I see Jericho, and then I upvote.”
“Let’s be honest. This would be one of the best ‘remakes’ of our time. Jericho and not just season one and a half. But seasons 3, 4, 5, and 6. Let’s see how the country is rebuilt. I would watch every last second of this. I also really like that long before preppers and all this other [stuff]. They were doing things that were way ahead of their time. Granted, they were probably public knowledge to somebody, but they weren’t mainstream. And I thought that was really cool that they were touching on a lot of topics. I think this show was ahead of its time, and it was canceled during a writer’s strike, and that [was terrible],” one user responded.
Another user concluded, “I think HBO or Paramount would do a good job on a Jericho reboot. However, if it ever does happen, I hope they use the original cast.”
6. Venture Bros
One user posted, “Venture Bros.”
One of the users then shared, “Venture Bros was easily a solid decade ahead of its time.The Boys, Invincible, Harley Quinn, Doom Patrol, Peacemaker. All these shows deal with deconstructing the superhero mythos, and the Venture Brothers did this in 2004. At least we’re getting a movie.”
“Venture Bros started as a pitch-perfect parody of old Hanna-Barbera cartoons and went on to skewer every element of pop culture they could get their hands on while maintaining well-written, context-driven comedy. It was never cheap. It was well-acted and scripted. It grew and evolved and allowed its characters to step outside the narrow channels they were born in, developing them from single characteristic, classic archetypes into something more complex. I [really] love the Venture Bros. Dead excited for the film, but I’d equally take another few seasons,” one user replied.
Another user concluded, “Honestly, the fact that most (all?) VB characters have some sort of arc is part of what makes the show great. Most shows (especially adult cartoons) have these flat, static characters. Venture bros are nothing like that.”
7. I Am Not Okay With This
One user shared, “I Am Not Okay With This.”
Another responded, “It had so much potential, not to mention they left so much unanswered at the end of the season purposely so they could make a second one.”
One Redditor commented, “Netflix does not [care at all] about finishing a story. It is not worth investing any time in any of their content, even the stuff that looks good.”
One user replied, “This cancellation made me give up on Netflix. I just can’t get excited by anything on their platform at this point because I know whatever I get interested in, no matter how good it is, will get dropped without a conclusion. I WON’T LET THEM HURT ME AGAIN!”
8. Pushing Daisies
One Redditor posted, “Pushing Daisies.”
One user replied, “Definitely this one. I loved the series and wanted to see where it was going.”
Another user seconded, “This and Dead Like Me. Both sensational shows.”
Another commenter responded, “I’ve just come to accept that anything Bryan Fuller makes, I’m going to love and then be heartbroken when it’s canceled too soon.”
One user commented, “Or when he’s ousted from it. American Gods took an extreme nosedive when he left.”
One user also shared, “I don’t really fault Fuller for Discovery. After all, CBS dropped him early in development, and they only used some of his outlines. As a result, the final product is different from what he was originally going for. As an example, he wanted to do an anthology series that explored many different eras of Star Trek.”
One user concluded, “Yeah, I thought he was there for the whole production of season one, but reading the Wiki page, it looks like there was a lot of turmoil early on.”
9. Dirk Gently’s Holistic Detective Agency
One of the Reddit users shared, “Dirk Gently’s Holistic Detective Agency. Edit: so many people didn’t like the 2nd season, which is entirely fair. It’s hard to live up to the expectations of such a solid first season. The reason I personally would like a 3rd season is that the cliffhanger is so damn tasty. Also, I want more Rowdy 3 (6?), Alan Tudyk, and Tyler Labine.
“I recognize that it deviates completely from the source material, and I understand why a lot of people are upset by that. There are a lot of examples where I hated the adaptation (looking at you, World War Z), but I personally believe this is a perfect example of how you take inspiration and run with it.
“A dark, gritty version where Dirk was the fat slob the books described him as might also be fantastic, and I’d probably watch… it. However, I think this adaptation perfectly captures the whimsical nonsense of Douglas Adam’s writing, and I’m ok with it. It’s just a shame that the show was attached to such a scumbag. Otherwise, we might have seen that 3rd season that gave us all the answers they teased.”
One user commented, “That show is still my absolute favorite. With absolute [great lines] like, ‘The Rowdy Three!’, ‘But there are 4 of them!’, ‘I’m WILDLY aware.’
“They captured Douglas Adams’ whimsical nonsense so perfectly in that show. I feel like the second series went completely off the rails, but I still loved it.”
“This was so gloriously, bizarrely brilliant. It was completely different from the (excellent) books, but it took on some of the core ideas and added a bunch of its own, then ran simultaneously with them in multiple directions. It was a joy to watch and made me feel an almost childlike wonder. It surprised and delighted me; a modern-day fairy-tale for grown-ups. Gutted it was canceled,” one user replied.
Another user added, “It was a book adaptation done right. Borrowed concepts from the book, but instead of trying to squeeze the book’s story onto the screen (which would have been a… trainwreck), they went their own way and made something unique.”
10. Better Off Ted
One Redditor posted, “Better Off Ted. The show was a brilliant satire of corporate business that was far too funny. The amazing cast was incredibly quotable and ended far too soon. Punisher should have had a season 2 with more gang/mafia shenanigans. Altered Carbon should have been able to wrap up its story. Rubicon. It didn’t have to be a continuation, but I would love to see more like it. Edit: I have corrected it. Punisher had a season 2—my mistake.
Another added, “The episode where they installed motion detectors for everything that didn’t see black people, so they had to assign every black person a white person to open doors, but then because of diversity rules, they had to hire more black people was phenomenal.
Ted: ‘That’s more than weird, Veronica. That’s basically, well… racist.’
Veronica: ‘The company’s position is that it’s actually the opposite of racist because it’s not targeting black people. It’s just ignoring them. So they insist the worst people can call it is indifferent.’
Ted: ‘Well, they know it has to be fixed, right? Please… at least say they know that.’
Veronica: ‘Of course they do, and they’re working on it. In the meantime, they’d like everyone to celebrate the fact that it sees Hispanics, Asians, Pacific Islanders, and Jews.’”
One user concluded, “Definitely. Whenever people ask me about good, fun TV, they usually know the standards like Office and 30 Rock, so I point them to Better off Ted and outline this specific episode. And each time, they are eager to check it out. It’s such an unusual, new trope that hits all the right points.”
Source: Reddit.
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When it comes to smart money decisions, understanding a ledger balance is key. A ledger balance is an important tool for small business owners and investors that helps track their financial health in real-time. It’s the foundation of any successful budgeting or investing strategy, but how exactly do you calculate your own? In this article, we’ll discuss what a ledger balance is, why it matters and how to calculate yours accurately – so you can make better-informed money decisions!
What’s Ahead:
What is a Ledger Balance?
A ledger balance is a record of all the financial transactions that have taken place in an account. It is used to track and monitor the money coming into and out of an account, such as income, expenses, investments, loans, etc. You can use the ledger balance to determine how much money is available for spending or investing at any given time.
Definition of a Ledger Balance
A ledger balance summarizes all financial activity within an account over a certain period. It shows the total amount owed (debits) versus the total amount received (credits).
Components of a Ledger Balance
The components of a ledger balance include debits and credits from various sources, such as deposits, withdrawals, transfers between accounts, or payments for goods/services. Debits are amounts subtracted from your account, while credits are amounts added.
For example, if you make two payments on your credit card bill totaling $200 each month, your debit would be $400 ($200 x 2). If you also deposit $500 into your checking account during this same period, your credit would be $500 ($500 x 1). Your net ledger balance after these transactions would be +$100 ($500 – 400 = +$100). This means that you now have an extra $100 in your checking account compared to before these transactions took place.
A ledger balance is integral to understanding your financial situation and making smart money decisions. In the next section, we’ll discuss using a ledger balance to help you make informed decisions about your finances.
Benefits of Maintaining a Ledger Balance
Maintaining a ledger balance is essential to the financial organization and record keeping. It can help you keep track of your finances, save time when preparing taxes, and ensure accuracy in all your financial transactions.
Improved Financial Organization
A ledger balance helps you stay organized by tracking all the money in and out of your accounts. You can easily view where each dollar goes and how much you have left to spend or save for future goals. This will give you a better understanding of your overall financial picture so that you can make informed decisions about spending, saving, investing, etc.
Accurate Record Keeping
By maintaining a ledger balance, you can accurately document every transaction made from each account – income or expenses – making it easier to audit if needed. This also allows for more efficient tax preparation since everything is already documented in one place instead of searching multiple documents for the same information.
Easier Tax Preparation
When filing taxes with accurate records on hand, such as those found in a ledger balance, it eliminates any guesswork or potential errors that could occur while manually entering data into forms or spreadsheets used during tax season. This information readily available saves time when filing taxes because there is no need to go back and look up specific details regarding certain transactions throughout the year; they are already recorded within the ledger balance!
By maintaining a detailed ledger balance throughout the year, individuals and small business owners can benefit from improved financial organization, accurate record-keeping practices, and easier tax preparation processes come April 15th. These benefits will help ensure that all finances are properly tracked and documented for future reference and provide an efficient way to file taxes without any guesswork or potential errors.
Maintaining a ledger balance is essential to keeping your finances organized and up-to-date. In the next section, we’ll discuss setting up a ledger balance and tracking your transactions.
The Gist: Maintaining a ledger balance is essential to the financial organization and record keeping. It can help you stay organized, accurately document transactions, and simplify tax preparation: • Improved Financial Organization • Accurate Record Keeping • Easier Tax Preparation. A detailed ledger balance throughout the year provides individuals and small business owners with efficient ways to track finances, ensure accuracy in all their financial transactions, and save time when filing taxes.
How to Calculate Your Ledger Balance
It helps you stay organized and keep accurate records, making tax preparation easier. Knowing how to calculate your ledger balance is essential for small business owners and investors. Here’s what you need to know about calculating your ledger balance:
Step 1: Gather All Relevant Financial Documents
The first step in calculating your ledger balance is gathering all the relevant financial documents related to the account or accounts you want to track. This includes bank statements, credit card bills, investment portfolios, loan agreements, etc. Make sure all these documents are up-to-date so that you have an accurate picture of where you stand financially.
Step 2: Add Up All Debits and Credits
Once you have gathered all the necessary documents, it’s time to add up all debits and credits associated with each account or transaction. A debit is any money taken out of an account, while a credit is any money put into an account (including interest earned). When adding debits and credits for each transaction or account, be sure to include fees and taxes paid on investments, if applicable.
Step 3: Subtract Debits from Credits To Get The Final Amount
After adding debits and credits for each transaction or account, it’s time to subtract them from one another to get the final amount owed or due on each item/account/transaction listed in Step 1 above. For example, if there were $500 worth of debits associated with a particular bank statement, subtracting this number from $1000 worth of credits would give us a total remaining balance due on that particular statement of $500 ($1000 -$500 = $500). Once we do this for every document we gathered in Step 1, our overall ledger balance should be accurately calculated!
Knowing how to calculate your ledger balance can help ensure everything adds up correctly when it comes time to file taxes or make other financial decisions, such as investing in stocks and bonds. Keeping track of income versus expenses will also help small business owners budget accordingly, so they don’t overspend beyond their means.
Once you have gathered all your financial documents, added up the debits and credits, and subtracted them to get the final amount, you will be able to calculate your ledger balance. Next, we’ll look at how to use this information to make intelligent money decisions.
The Gist: Calculating your ledger balance is integral to managing finances. It helps you stay organized and make accurate records for tax preparation, budgeting, and investing decisions. Here are the following steps: 1. Gather all relevant financial documents 2. Add up all debits and credits 3. Subtract debits from credits to get the final amount owed or due
Tips for Maintaining an Accurate Ledger Balance
Maintaining an accurate ledger balance is essential for any individual or business to ensure their financial records are up-to-date and accurate. Here are some tips that can help you stay on top of your finances:
Keep Track of All Transactions Regularly
It’s essential to keep track of all incoming and outgoing transactions to understand where your money is going clearly. This includes recording deposits, withdrawals, transfers, bills paid, etc. Doing this regularly will help you stay organized and prevent errors from slipping through the cracks. Additionally, reviewing these transactions periodically ensures everything adds up correctly.
Double Check Your Math Before Finalizing Entries
When entering numbers into your ledger balance sheet or other financial documents, it’s always best practice to double-check your math before finalizing entries. Even if you think something looks correct at first glance – take the extra time to verify accuracy by running calculations twice just in case you made any mistakes. This will save you time and energy when reconciling accounts or preparing tax returns!
Utilize Automated Accounting Software When Possible
Technology has come a long way in recent years, making tracking finances more manageable! Utilizing automated accounting software such as QuickBooks or Xero can be extremely helpful when managing multiple accounts simultaneously, as they provide real-time updates with each transaction entered into them. Not only does this save time, but it also helps reduce the human error associated with manual entry processes – making it much more efficient overall!
Overall, maintaining an accurate ledger balance is key for anyone looking to manage their finances properly and efficiently over time – whether they’re a small business owner or simply trying to budget better personally. By following these simple tips outlined above (keeping track of all transactions regularly, double checking math, utilizing automated accounting software), individuals should be able to set themselves up for success in no time.
Maintaining an accurate ledger balance is essential for making sound financial decisions. With these tips, you can stay on top of your finances and make smart money moves.
The Gist: Maintaining an accurate ledger balance is essential for any individual or business to keep their financial records up-to-date and accurate. To do this, it’s vital to • Keep track of all transactions regularly • Double check math before finalizing entries • Utilize automated accounting software when possible By following these tips, individuals can set themselves up for success in managing their finances efficiently over time.
The Importance of a Ledger Balance for Small Business Owners and Investors
A ledger balance is integral to managing your finances, especially for small business owners and investors. A ledger balance is the total amount of money combined in all accounts. It’s calculated by subtracting all debits from credits to get the final amount. A clear understanding of your ledger balance can help you make better financial decisions and stay on top of your finances.
Why It Matters for Small Business Owners
For small business owners, having an accurate record of their ledger balance is essential to running their businesses efficiently and effectively. Knowing exactly how much money they have in each account helps them plan for budgeting, taxes, payroll, and other expenses. Additionally, keeping track of their ledgers allows them to quickly identify any discrepancies or errors so they can be addressed immediately before they become more significant problems.
Why It Matters for Investors
Investors also need to keep close tabs on their ledger balances because it gives them insight into how well their investments perform over time. By regularly monitoring changes in their ledgers, investors can determine if certain investments are worth continuing or if adjustments need to be made based on current market conditions or other factors that may affect returns on investment (ROI). This information can then be used as a guide when making future investing decisions.
Overall, a good understanding of one’s ledger balance is critical for small business owners and investors alike, as it provides valuable insights into where funds are coming from and going at any given moment in time. This ultimately leads to more informed decision-making about personal finance management strategies.
A clear understanding of your ledger balance is essential for small business owners and investors alike, as it allows them to make informed decisions about their financial future. Next, we’ll discuss why it matters for small business owners.
The Gist: A clear understanding of your ledger balance is essential for small business owners and investors. It allows them to keep track of all their accounts, quickly identify discrepancies or errors, monitor investments’ changes over time, and make more informed decisions regarding budgeting, taxes, payrolls, and other expenses. Key takeaways include: • Subtracting debits from credits to get the total amount • Monitoring ledgers regularly for any discrepancies or errors • Keeping track of investments’ performance over time • Using ledger information as a guide when making future investing decisions.
FAQs about What Is a Ledger Balance
Can we withdraw money from the ledger balance?
No, you cannot withdraw money from your ledger balance. Ledger balances are a record of the transactions that have occurred in an account and do not represent actual funds available for withdrawal. You must transfer funds to another account or use a payment method such as a debit card or check to access funds.
How long does the ledger balance take to be available?
The availability of a ledger balance depends on the financial institution you are using. Generally, most banks and credit unions will update your account information within 24 hours. However, if you have recently made a deposit or withdrawal from an ATM, it may take up to 3 business days for the transaction to be reflected in your ledger balance. Additionally, suppose you have recently transferred funds between accounts at different institutions. In that case, it could take up to 5 business days for the transfer to be completed and reflected in your ledger balance.
How do I make my ledger balance available?
The best way to make your ledger balance available is to use online accounting software such as QuickBooks or Xero. These programs allow you to easily track and monitor your financial transactions, giving you a real-time view of your current finances. Additionally, they provide helpful features like budgeting tools and automated reminders to help you stay on top of your money management goals. With these services, you’ll be able to quickly access and review your ledger balance whenever needed.
Can I transfer the ledger balance to the bank account?
Yes, you can transfer your ledger balance to a bank account. This is typically done through an online banking platform or app. It’s important to double-check the transaction details before confirming it, as mistakes may be costly and time-consuming to fix. Additionally, there may be fees associated with transferring money from one account to another, so understand those costs beforehand.
Conclusion
It allows you to track your financial activity and make informed decisions about where to invest or how much money to allocate for certain expenses. By understanding the basics of calculating and maintaining a ledger balance, you can ensure that your finances are in order and that you’re making smart money decisions. So take some time today to review your ledger balance and get on the path toward financial success!
Cenlar FSB, the second-largest mortgage servicer and largest subservicer in the U.S., announced on Tuesday the promotion of two leaders in its wholesale bank division.
Keith Austin has been promoted to director of asset management and valuation services. With over 25 years of experience in portfolio management, he brings to the role an extensive expertise in default mortgage servicing.
Austin, who joined Cenlar in 2005, will be responsible for managing and mitigating default costs for the wholesale bank’s loans and mortgage servicing rights (MSR) portfolio. He will also continue to oversee the valuation team, which handles valuation requests from operations and ensures compliance with regulatory requirements.
Austin previously held the positions of senior asset manager and manager of the valuation team at Cenlar.
Tristan Watson has been promoted to the role of director of subservicing pricing and will oversee all revenue pricing generated by the subservicing business. This includes setting pricing for prospective clients, managing pricing for existing clients as they renew their contracts, and identifying other opportunities to support Cenlar’s clients and their homeowners.
Watson, who has been with Cenlar since 2016, previously held the role of senior pricing analyst and is a graduate of the Cenlar Leadership Development Program.
“I am proud to promote these two outstanding leaders who deliver the very best service to our clients and their homeowners,” said Michael Conway, senior vice president of the wholesale bank division at Cenlar. “On behalf of the entire Cenlar team, I would like to congratulate them on their promotions and look forward to their continued success and contributions to the company.”
Headquartered in Ewing, NJ, Cenlar FSB is a subservicer that caters to clients in all 50 states and U.S. territories. Its client base includes banks, credit unions, and mortgage bankers.
This content was generated using AI, and was edited and fact-checked by HousingWire’s editors.
Last Updated: April 6, 2020 BY Michelle Schroeder-Gardner – 45 Comments
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Lately, I’ve been hearing more and more about families relying on credit cards for their emergency savings fund.
This is something that scares me as while credit cards may work for some, I believe that emergency savings funds are a better solution for the average person. Whatever emergency fund amount you decide on, it’s better than nothing in my mind.
As I stated in the article Everything You Need To Know About Emergency Funds, 26% of Americans have no emergency fund whatsoever.
Also, only 40% of families have enough in savings to cover three months of expenses, with an even lower percentage having the often recommended six months worth of savings.
There are many things you should think about when it comes to whether or not you should use a credit card as your emergency fund.
What’s your financial situation?
Different people need a different emergency fund amount.
Some of the things you will want to think about when determining your emergency fund amount is the stability of your job, your income when compared to your expenses, whether you own a house and/or car or not, your health, and more.
Basically, the “riskier” your situation, the larger the emergency fund you will most likely want. If your situation is quite risky, then using a credit card for your emergency fund may be a bad idea because there is a large chance you may rack up credit card debt that you are unable to pay off whenever an emergency arises.
How much risk are you willing to take on?
By relying entirely on credit cards, you are going to be taking on a lot of risk.
You never know if something may come up, how big the expense may be, and whether or not you will have enough credit to fund the expense.
Plus, the interest rate on your credit card may hover somewhere near 25%, which can make for an expensive bill if you are unable to pay your credit card bill before interest accrues.
When does using a credit card for your emergency fund amount make sense?
Now, I understand that different techniques work for different people. There are situations where using a credit card for your emergency savings fund may not be a completely bad idea. If you know that you can pay off a large expense within one month (such as if you have a large income but a low level of expenses), if you have a lot of credit card debt at high-interest rates that you are trying to pay off (your money may be put to better use by paying off your debt first), and so on.
However, the problem with this thinking is what happens if you lose your job? Many have emergency funds that exist so that they can support themselves if they were to lose their job. What would happen if you relied on credit cards but lost your main source of income?
It would lead to a lot of credit card debt. Unmanageable credit card debt…
Having a “real” emergency fund can be much more worthwhile.
There are many other reasons to have a fully-funded emergency fund:
An emergency fund can help you if you lose your job. No matter how stable you think your job is, there is always a chance that something could happen where you may need money fast.
An emergency fund is wise if you don’t have great health insurance. This is another reason why we have a well-funded emergency fund. We do not have the greatest health insurance, with our deductible being over $12,000 annually. Having an emergency fund can help protect us if something were to happen to either of us.
An emergency fund is a good idea if you have a car. You just never know if it may need a repair.
An emergency fund is a need if you own a home. One of the lucky things that homeowners often get to deal with is an unexpected home repair.
An emergency fund can protect you in many other areas as well. This can include if you have a medical cost for your pet, if you have to take time off work for something, you need to go somewhere far to visit someone who is sick, and so on.
An emergency fund is always good to have because it can give you peace of mind if anything costly were to happen in your life. Instead of building onto your stress because of whatever has happened, at least you know you can afford to pay your bills and worry about more important things.
As you can see, there are plenty of positives of having an emergency savings fund. However, I know that different things work for different people and that some prefer to use credit cards in the case of an emergency.
What do I think?
I think everyone should have some sort of emergency savings fund. Even if you can only manage $500 to $1,000 right now, that is better than nothing. $500 to $1,000 can still most likely help you by for at least a little bit. Plus, you can still put money towards high-interest rate debt after you build up your specific emergency fund amount.
My problem with using credit cards as your sole source for an emergency fund is that it may lead to more debt in some situations.
Do you rely on credit cards for your emergency savings fund? What do you think of relying on credit cards for your full emergency fund amount?
As many as one in three Americans have criminal records. And since most employers run background checks on potential candidates, these records can be a considerable impediment for those previously convicted of a felony.
In fact, according to the Sentencing Project, more than 60% of formerly incarcerated individuals are unemployed one year after being released
.
Therefore, starting and running a business may be a suitable way of earning income. Although formerly incarcerated individuals can still face challenges as entrepreneurs, a variety of small-business grants and additional resources can help.
How Much Do You Need?
with Fundera by NerdWallet
Grants for people previously convicted of a felony
Unlike small-business loans, grants provide free funding that doesn’t need to be repaid. Grants can be a particularly good option for formerly incarcerated entrepreneurs who don’t want to take on debt or have trouble qualifying for debt financing.
It’s important to keep in mind that finding and applying for small-business grants is time-consuming and entries are competitive. If you dedicate the necessary time and effort, however, you may be able to access free capital for your business.
Nonprofit and corporate grants
Formerly incarcerated individuals can get business grants from corporations and nonprofit organizations. Some nonprofits even offer second-chance entrepreneurial programs — in other words, training and funding opportunities designed specifically for previously incarcerated people.
Rise Up, Get Started Grant Program
Determination, Incorporated, a nonprofit organization based in Kansas City, Missouri, that helps formerly incarcerated individuals start and grow their own businesses.
Through the organization’s Rise Up, Get Started initiative, business owners can participate in a year-long program where they receive coaching, mentoring and community support. Entrepreneurs will also have assistance writing a business plan and creating a budget.
At the conclusion of the program, participants will have $300 saved for their business — and Determination, Incorporation will award a $750 grant on top of these savings.
The nonprofit organization also runs an in-prison Back to Business workshop, which helps incarcerated individuals develop a business plan so that they can get started quickly upon release.
Georgetown Pivot Program
The Georgetown Pivot Program is a full-time, one-year program designed to help formerly incarcerated individuals develop the skills to succeed in a business and professional environment.
Over the course of the program, participants will attend classes, receive an internship placement and get the opportunity to develop their own business idea. Each participant will present their business idea at the Pivot Pitch Competition for a chance to win startup funding. In 2022, participants were awarded a total of $15,000 in grant money.
To qualify, participants must be 25 years or older with a high school or a GED diploma who were last incarcerated within the past five years. Preference is given to Washington, D.C., residents.
The Transform Business Grant
The Transform Business Grant is open to business owners in systemically oppressed groups, including formerly incarcerated people. In addition to $1,000 microgrant, recipients will also be awarded a customized, year-long business strategy and development program. The next grant cycle runs from July 20-August 20, 2023.
LEAP Virtual Entrepreneurial Academy
LEAP is a nonprofit organization based in Florida that works with previously incarcerated women and helps them as they transition back into society. The LEAP Virtual Entrepreneurial Academy is a program that runs twice per year and teaches business skills to its participants.
Over a three-month period, students attend classes twice per week, and at the conclusion of the program, they pitch a business plan to a panel of entrepreneurs for an opportunity to win cash prizes. Graduates are also eligible to apply for a $1,000 microloan.
To qualify, you must be a formerly incarcerated woman who has access to a computer. LEAP covers all program costs through funding from its sponsors.
Amber Grant
Although not designated exclusively for previously incarcerated individuals, the Amber Grant is another great funding option for women entrepreneurs. The nonprofit organization WomensNet offers several grant opportunities to businesses that are at least 50% women-owned, including the $10,000 monthly Amber Grant and the $25,000 annual Amber Grant.
WomensNet also issues a startup-dedicated grant, a nonprofit-dedicated grant and business category grants. Each month, the organization offers a $10,000 grant to a company in a specific industry — in July, for example, the funding is awarded to an animal services business.
You can apply for all of these grants by submitting one simple application through the Amber Grant website.
NASE Growth Grant
The National Association for the Self-Employed (NASE), provides growth grants of up to $4,000 to small businesses on a quarterly basis. To be eligible for one of these grants, however, you must be a NASE member.
The organization offers several different membership options (which include additional benefits, such as expert advice and product discounts) and does not exclude formerly incarcerated individuals from joining.
Once you become a member, you can apply for a grant through the NASE website. Monthly members, however, will have to wait 90 days before they can apply. For the application, you’ll need to provide a business plan and explain why you need the funds and how you’ll use the money.
Incfile Fresh Start Business Grant
Grant winners will receive Incfile’s Gold plan for free, which includes incorporation services in your state, free registered agent services for a year and a free tax consultation. You’ll also receive a $2,500 grant.
To apply, you must complete an online application, create a two-minute video explaining how entrepreneurship will impact your life and submit a sample business plan. Incfile accepts applications three times per year.
Government grants
Individuals previously convicted of a felony can also get business grants from the federal government, as well as state and local governments. Here are some options to consider:
Grants.gov
Grants.gov is a database of federal small-business grants available to all types of entrepreneurs, including formerly incarcerated individuals. This database offers access to over 1,000 grants administered by 26 government agencies, such as the Department of Energy, Department of State and Department of Transportation.
To apply, you’ll need to register your business using the System Award Management platform and get a unique entity identification number. Once you have your number, you can create an account on Grants.gov to submit your grant applications.
Economic Development Offices
Most states and many cities have economic development offices, which are dedicated to promoting and supporting local businesses. Through your regional office, you’ll likely be able to find information regarding government funding solutions, training programs and tax incentives.
Maine’s Office of Business Development, for example, provides a variety of grant opportunities, including options that finance recreation businesses, local tourism, agriculture and food businesses, among others.
Additional resources for people previously convicted of a felony
Entrepreneurial training programs and other tools can be extremely beneficial for individuals previously convicted of a felony looking to start or grow their businesses — even if they don’t necessarily provide free funding. Finding organizations that focus on helping the formerly incarcerated transition back into society through entrepreneurship can be particularly useful.
Here are some available resources:
Help For Felons
The website HelpForFelons.org provides a wide variety of resources for those who were convicted of felonies, as well as other previously incarcerated individuals. Through the site, you can find job postings, legal information and housing options. You can also access lists of personal and business grants, loans and other forms of financial assistance.
Inmates to Entrepreneurs
Inmates to Entrepreneurs is a nonprofit organization whose mission is to help people with criminal backgrounds launch their own businesses. The organization offers free online and in-person courses to give would-be entrepreneurs the business education they need to get started.
Defy Ventures
Defy Ventures administers several second-chance programs with the goal of helping formerly incarcerated individuals succeed in their new lives and decrease the rate of recidivism. Through Defy Ventures, potential entrepreneurs can participate in an entrepreneur boot camp or a business accelerator. Through these programs, they gain the skills they need to launch and grow a business.
Project ReMADE
Project Remade is an entrepreneurship training program run by Stanford Law School. This program teaches formerly incarcerated individuals basic business skills and introduces them to professionals in the business community.
Between classes, students meet with mentor teams who help them develop a potential business plan. Mentor teams consist of one Stanford Law Student, one Stanford Graduate School of Business student and one Silicon Valley professional.
At the conclusion of the program, entrepreneurs present their business plans before a panel of executives and microdevelopment organizations.
Entre Capital
For entrepreneurs who are still looking for financing, Entre Capital is a community development financial institution (CDFI), specifically devoted to providing capital to second-chance businesses. The organization only funds previously incarcerated individuals, offering them loans to start or expand their operations.
Entre Capital also offers assistance with business planning, budgeting and financial reporting, as well as mentorship resources.
Refoundry
Refoundry is an incubator program based in Brooklyn, New York. Through this program, formerly incarcerated individuals are taught to repurpose reclaimed materials into home furnishings. As they develop these skills, Refoundry mentors also teach participants how to build a resume, succeed in an interview and start their own business.
Small Business Development Centers
Small Business Development Centers (SBDCs) are SBA-sponsored centers that provide free or low-cost training and assistance to new and existing businesses. These centers are typically hosted by local colleges or universities, as well as state economic development agencies. SBDCs often maintain lists of funding opportunities in your area and can help you find and apply for the best options for your needs.
Frequently asked questions
Are there grants for those convicted of felonies to start their own businesses?
Yes. Formerly incarcerated individuals may be able to get startup business grants from the federal government and their state or local government. Some organizations, like the National Association for the Self-Employed, also offer grants for startup businesses.
How do you get a business grant as a formerly incarcerated individual?
As a formerly incarcerated individual, you can search and apply for grants related to your business. These grants may be available from the government, nonprofit organizations or large corporations. Before applying, you should ensure you meet all of the eligibility criteria, such as industry, time in business and specific need for funds.
Are there SBA grants for those convicted of felonies?
The SBA doesn’t usually offer grants directly to any small-business owners. Instead, it grants nonprofits and community organizations that promote and support entrepreneurship. Alternatively, you might consider an SBA loan. Individuals with a felony record are not excluded from applying but will need to provide a completed fingerprint card.
While not offered in the traditional sense through an employer, self-employed individuals have several types of insurance policies available to them. People who are self-employed often benefit the most from having insurance policies.
One type of insurance that is available and should be considered is disability insurance. If a self-employed individual has to work because of injury, or sickness, disability insurance helps to provide some income and security for the business owner.
Disability insurance is an extremely important insurance purchase, especially for anyone that is self-employed, but the vast majority of people ignore it, avoid this mistake at all costs. If you were suddenly unable to work because of a disability, what would happen to your business? Would you still be able to pay your own bills? What about the bills for your business?
You’ve worked hard to start your own business. Don’t let a disability destroy all of your hard work and all the hours you’ve put into your business.
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#1
Quotes from the top disability carriers to ensure you find the best rates
Helps thousands of consumers apply for disability insurance each year
Rated Excellent on TrustPilot
Benefit terms range from 3 months to age 67
Choose your waiting period
Multiple riders add flexibility to your policy
#2
Benefit periods from as little as 2 years or all the way to retirement age
Family care benefit provides coverage for up to a year if policyholder has to take off work to care for a child, spouse, or parent
10% discount to business owners and an additional 10% to preferred occupational classes.
Offers the option of Full Coverage for Mental/Nervous disabilities or a 10% discount for a 2 year limitation.
Rated A (Excellent) by A.M. Best for financial strength
Table of Contents
Types of Disability Insurance Policies
There are two types of disability insurance policies.
Short Term Disability Insurance Policy
The first is for short-term disability which is a term of two to five years. This type of disability insurance is suitable for those who know that they will need to be out of work, perhaps for a scheduled surgery, for cancer treatment, or for the birth of a child.
Long Term Disability Insurance Policy
The second type of disability insurance policy is long term disability. This kind of policy is more of a “what if” policy. If something should happen that would cause a self-employed person to be out of work, the disability coverage would be in place.
It also covers a long-term disability period, someone who might be out of work for years. This policy can be purchased for a specified number of years or until retirement age.
If the worst happened tomorrow would you be satisfied with your financial planning?. If something were to put you out of work for several months or years, would you and your family be able to survive without the income?
Yes, life insurance is an extremely important purchase, but statistics say that you’re much more likely to end up with a disability than to die prematurely. The importance of life insurance is widely known, but few people understand just how important disability insurance is.
Coverage Amounts
It is important to note that there are almost no disability insurance policies available that cover 100% of the individuals salary.
The top life insurance companies cover the maximum of 50% to 60% of the salary. 50% or 60% doesn’t sound like a lot, and more than likely you may have to dip into savings, but you should take note that these benefits are tax-free.
So while disability insurance is beneficial to have, self-employed individuals need to have savings, additional insurance, and investments to help with the remaining lost wages.
Criteria for Selecting
There are many criteria for selecting an insurance policy and being selected as a candidate for disability insurance. Some things to consider:
Waiting Period – All policies have a waiting period before benefits will be paid. Should one need disability insurance quickly, the premium will be higher. The shorter the waiting period, the higher the premium. The longer the waiting period is the lower the premium for that area will be.
Premiums – Premiums are going to be based on the factors already discussed. These being if it is a short term or long term policy. Long term policies cost more as there is more of a chance for a long term pay out. Secondly, the waiting period. As mentioned this will help determine how much the premium will be.
Occupational Class – When one works in a high-risk occupational class it is slightly harder to obtain disability insurance. Even if you have a high-risk occupation coverage is possible, but you will pay more in monthly premiums. However, security outweighs the higher price any day. Proof of working records and salary/income need to be verified for a three year period. Only after a person is determined to not be able to perform the job duties required, will they be considered disabled.
Guaranteed policy – Individuals want to select a policy that is guaranteed, meaning it is automatically renewed as long as the premiums are paid. Benefits have to remain the same and must be paid if one becomes disabled. Beware of non-guaranteed policies as the rates and benefits can be changed at any time.There are countless stories of workers with a non-guaranteed policy that lost coverage and then ended up with devastating injuries.
What you need to know – Before you purchase a disability insurance policy, there are a couple things that you should know. As we mentioned earlier, the biggest thing that you should know is how much of your salary you’ll receive, because you want to get enough money to live off of. Another factor that you should be aware of is any exemptions that your policy may hold. Some long-term policies will pay out after the waiting period as long as you are disabled and can’t preform your job. Regardless of what the disability is, if you can’t do your normal job, you’ll be able to get the policy benefits. Some insurance plans aren’t that simple.Some policies will only pay out if you can’t work at all. If you can still work at any job, then you aren’t going to be paid. It’s important to make the distinction between the two types of plans, it could have a drastic impact on your future. There are countless stories of workers with a non-guaranteed policy that lost coverage and then ended up with devastating injuries.
Comparison
It is important to shop around, perhaps with an agent or financial adviser, for the best policy available. Finding the perfect rates by comparing several different companies that offer disability insurance. There are dozens of companies that offer unique rating systems, premium structures and guidelines which leads to widely different quotes. Consider the factors listed above to get the lowest premiums for the most coverage.
Please ask us about disability insurance, business insurance, or traditional life insurance, and our agents are standing by ready to provide you with the correct answers. It’s important that you and your family have the insurance protection they need.
Getting a disability insurance policy can be confusing. There are so many different factors to consider. It can be a burdensome process, especially if you’re self-employed, but it’s a purchase that you need to make. Don’t worry, you don’t have to go on that process alone, our agents will love to point you in the right direction to ensure that you get the disability coverage that you need.
If you’re thinking about selling your home, you’ve got a lot of options.
It’s not 2012 anymore, when you simply enlisted the services of a real estate agent and went on about your day.
Or bravely went down the for-sale-by-owner (FSBO) path, a much less common scenario.
Today, there are many more ways to unload a property thanks to the disruptors.
What Is an iBuyer?
It stands for instant buyer, a company that buys your home and then sells it shortly after
iBuyers offer all-cash in as little as 24 hours
Can choose your own close date and sell property as-is
Downside is offer will likely be below traditional market offers and fees and repair costs still apply
By now, you’ve probably heard the phrase “iBuyer.”
The term iBuyer is short for “instant buyer.” These companies buy homes almost immediately, with all-cash offers generated in as little as 24 hours, and then sell them not long after.
While the valuation methods might differ from company to company, the name of the game is speed.
With some companies, you simply enter your address into an online form and provide details about your home and the computers do the rest.
They instantly run comparable sales and factor in any improvements your home has to generate a so-called competitive market offer.
Assuming you like their offer, they’ll come by your home and verify the home is in the condition described, and adjust their offer to account for any necessary repairs.
Others might come to your home after you request an offer online, and once they see the property in person, you’ll receive an offer shortly thereafter.
Either way, you’ll get an offer fast, and it’ll be all-cash, meaning there won’t be any pesky mortgage lenders to deal with, or home buyers with cold feet who walk away last minute.
These iBuyers are generally happy to buy homes in any reasonable condition, without you having to worry about finding an agent, listing it, cleaning it, repairing it, staging it, giving tours, and waiting weeks or months for it to sell.
Some of the largest iBuyers include Offerpad, Opendoor, RedfinNow, and Zillow Offers. And even some real estate brokerages are getting into it, including Keller Offers from Keller Williams.
Selling a Home Isn’t Fun
The reason iBuyers exist is because selling a home is basically the worst.
In fact, Zillow’s 2019 Consumer Housing Trends Report found that 95% of home sellers were stressed by some aspect of the process.
As you can see from their chart of despair, home sellers have a lot of worries and concerns, with not knowing when the home would sell topping the list.
It was followed closely by uncertainty about it selling for the right price, having to prep and/or make improvements, concerns the offer would fall through, and timing the sale with a new home purchase.
These are all very legitimate issues to stress about, and younger homeowners are even more likely to be stressed by it all.
Enter Zillow Offers! But seriously, it is hard to part with a half-million-dollar property for the sheer fact that it’s half-a-million dollars.
That just comes with the territory – as a homeowner, you’ve got responsibilities that renters do not.
You need to maintain your home, make repairs, keep it updated, pay lots of bills every month, property taxes, homeowners insurance, and so on.
And when it comes time to sell, you’ve got to do a lot of things to ensure it sells for the right price. Or you can use an iBuyer…
The Pros of iBuyers
You can sell your home very quickly
You don’t need to find a real estate agent
You don’t need to clean it, repair it, stage it, or hold open houses
You can choose your own closing date to coincide with a new home purchase
As noted, iBuying is all about speed and convenience. We can actually use Zillow’s list from above to highlight the many advantages to using an iBuyer.
First, you can choose your closing date with an iBuyer, so that completely eliminates the fear of a property selling in a desired time frame.
Next, they tell you the price upfront, so if you’re happy with said price, there’s no stress.
Third, iBuyers will make repairs themselves, so you don’t have to make them. Of course, there’s a cost, but savvy home buyers will also make requests for repairs, so it’s somewhat awash.
See Curbio for an alternative to paying for repairs out-of-pocket prior to listing.
Fourth, you don’t have to worry about the offer falling through because it’s a large company paying with cash that has done its diligence and isn’t going to have second thoughts.
Fifth, and perhaps one of the biggies to iBuying, is timing the sale of your home with the purchase of a new replacement home.
They totally alleviate this concern because your offer is guaranteed and you get to choose your closing date.
This also covers the lack of control with the selling process and timeline, and not knowing if the buyer is “serious.”
You also completely forego the touring (open houses), staging, and cleaning necessary with a traditional home sale.
In terms of negotiating, most iBuyers will probably say the price is the price, but you can still argue if you’ve made improvements and disagree with their assessment.
But you’ll likely find that they aren’t willing to budge much if at all.
The Cons of iBuyers
The price will likely be well below what a traditional buyer would offer
There are still fees that must be paid to the iBuyer in lieu of real estate agent commissions
Repairs will also cost you even if you don’t need to complete them yourself
Buying and selling homes shouldn’t necessarily be rushed
We’ve highlighted some of the pros of iBuying, namely the quick and easy process, and the all-cash offer. Sounds like a no-brainer, right?
Unfortunately, there’s a cost to the convenience. Sure, you can have the valet park your car instead of walking a block to the restaurant, but it’ll cost you $5.
That might be worth it though – with an iBuyer, the price could be significantly more devastating to your wallet.
You might miss out on $25,000 or more because of the inconvenience of selling yourself. Ouch!
At the end of the day, your competitive offer from an iBuyer is likely going to be significantly less than what the home might appraise for and/or what a traditional real estate agent would sell it for.
Additionally, iBuyers charge fees in place of real estate agent commissions, which while seemingly offsetting one another, probably don’t because of the lower offer price.
The old cliché is that a real estate agent’s commission is covered via a higher sale’s price. So even if they get paid 5-6% of the sale’s price, the home sells for that much more.
That’s the theory at least.
When all is said and done, you’ll likely receive less in your pocket if you use an iBuyer to sell your home, once factoring in their fee, the in all likelihood lower offer, and the cost of any repairs.
The question you need to ask is if it’s worth the price. There are a lot of things we probably don’t want to do, which we could have someone else do for us.
But there’s a cost involved. And when we’re talking about a very large transaction, the price is likely going to be steep.
Of course, you can always take the iBuyer up on their free offer to see if it’s close to what you’d get going the traditional route.
In some cases, it may be worth the convenience, especially if you’re trying to buy a replacement home.
But do your homework. You might need those extra proceeds for that subsequent home purchase.
An alternative might be to use a flat-fee listing company like Reali, which uses traditional real estate agents but doesn’t charge the percentage fee.
If you’re thinking about selling your home, you’ve got a lot of options.
It’s not 2012 anymore, when you simply enlisted the services of a real estate agent and went on about your day.
Or bravely went down the for-sale-by-owner (FSBO) path, a much less common scenario.
Today, there are many more ways to unload a property thanks to the disruptors.
What Is an iBuyer?
It stands for instant buyer, a company that buys your home and then sells it shortly after
iBuyers offer all-cash in as little as 24 hours
Can choose your own close date and sell property as-is
Downside is offer will likely be below traditional market offers and fees and repair costs still apply
By now, you’ve probably heard the phrase “iBuyer.”
The term iBuyer is short for “instant buyer.” These companies buy homes almost immediately, with all-cash offers generated in as little as 24 hours, and then sell them not long after.
While the valuation methods might differ from company to company, the name of the game is speed.
With some companies, you simply enter your address into an online form and provide details about your home and the computers do the rest.
They instantly run comparable sales and factor in any improvements your home has to generate a so-called competitive market offer.
Assuming you like their offer, they’ll come by your home and verify the home is in the condition described, and adjust their offer to account for any necessary repairs.
Others might come to your home after you request an offer online, and once they see the property in person, you’ll receive an offer shortly thereafter.
Either way, you’ll get an offer fast, and it’ll be all-cash, meaning there won’t be any pesky mortgage lenders to deal with, or home buyers with cold feet who walk away last minute.
These iBuyers are generally happy to buy homes in any reasonable condition, without you having to worry about finding an agent, listing it, cleaning it, repairing it, staging it, giving tours, and waiting weeks or months for it to sell.
Some of the largest iBuyers include Offerpad, Opendoor, RedfinNow, and Zillow Offers. And even some real estate brokerages are getting into it, including Keller Offers from Keller Williams.
Selling a Home Isn’t Fun
The reason iBuyers exist is because selling a home is basically the worst.
In fact, Zillow’s 2019 Consumer Housing Trends Report found that 95% of home sellers were stressed by some aspect of the process.
As you can see from their chart of despair, home sellers have a lot of worries and concerns, with not knowing when the home would sell topping the list.
It was followed closely by uncertainty about it selling for the right price, having to prep and/or make improvements, concerns the offer would fall through, and timing the sale with a new home purchase.
These are all very legitimate issues to stress about, and younger homeowners are even more likely to be stressed by it all.
Enter Zillow Offers! But seriously, it is hard to part with a half-million-dollar property for the sheer fact that it’s half-a-million dollars.
That just comes with the territory – as a homeowner, you’ve got responsibilities that renters do not.
You need to maintain your home, make repairs, keep it updated, pay lots of bills every month, property taxes, homeowners insurance, and so on.
And when it comes time to sell, you’ve got to do a lot of things to ensure it sells for the right price. Or you can use an iBuyer…
The Pros of iBuyers
You can sell your home very quickly
You don’t need to find a real estate agent
You don’t need to clean it, repair it, stage it, or hold open houses
You can choose your own closing date to coincide with a new home purchase
As noted, iBuying is all about speed and convenience. We can actually use Zillow’s list from above to highlight the many advantages to using an iBuyer.
First, you can choose your closing date with an iBuyer, so that completely eliminates the fear of a property selling in a desired time frame.
Next, they tell you the price upfront, so if you’re happy with said price, there’s no stress.
Third, iBuyers will make repairs themselves, so you don’t have to make them. Of course, there’s a cost, but savvy home buyers will also make requests for repairs, so it’s somewhat awash.
See Curbio for an alternative to paying for repairs out-of-pocket prior to listing.
Fourth, you don’t have to worry about the offer falling through because it’s a large company paying with cash that has done its diligence and isn’t going to have second thoughts.
Fifth, and perhaps one of the biggies to iBuying, is timing the sale of your home with the purchase of a new replacement home.
They totally alleviate this concern because your offer is guaranteed and you get to choose your closing date.
This also covers the lack of control with the selling process and timeline, and not knowing if the buyer is “serious.”
You also completely forego the touring (open houses), staging, and cleaning necessary with a traditional home sale.
In terms of negotiating, most iBuyers will probably say the price is the price, but you can still argue if you’ve made improvements and disagree with their assessment.
But you’ll likely find that they aren’t willing to budge much if at all.
The Cons of iBuyers
The price will likely be well below what a traditional buyer would offer
There are still fees that must be paid to the iBuyer in lieu of real estate agent commissions
Repairs will also cost you even if you don’t need to complete them yourself
Buying and selling homes shouldn’t necessarily be rushed
We’ve highlighted some of the pros of iBuying, namely the quick and easy process, and the all-cash offer. Sounds like a no-brainer, right?
Unfortunately, there’s a cost to the convenience. Sure, you can have the valet park your car instead of walking a block to the restaurant, but it’ll cost you $5.
That might be worth it though – with an iBuyer, the price could be significantly more devastating to your wallet.
You might miss out on $25,000 or more because of the inconvenience of selling yourself. Ouch!
At the end of the day, your competitive offer from an iBuyer is likely going to be significantly less than what the home might appraise for and/or what a traditional real estate agent would sell it for.
Additionally, iBuyers charge fees in place of real estate agent commissions, which while seemingly offsetting one another, probably don’t because of the lower offer price.
The old cliché is that a real estate agent’s commission is covered via a higher sale’s price. So even if they get paid 5-6% of the sale’s price, the home sells for that much more.
That’s the theory at least.
When all is said and done, you’ll likely receive less in your pocket if you use an iBuyer to sell your home, once factoring in their fee, the in all likelihood lower offer, and the cost of any repairs.
The question you need to ask is if it’s worth the price. There are a lot of things we probably don’t want to do, which we could have someone else do for us.
But there’s a cost involved. And when we’re talking about a very large transaction, the price is likely going to be steep.
Of course, you can always take the iBuyer up on their free offer to see if it’s close to what you’d get going the traditional route.
In some cases, it may be worth the convenience, especially if you’re trying to buy a replacement home.
But do your homework. You might need those extra proceeds for that subsequent home purchase.
An alternative might be to use a flat-fee listing company like Reali, which uses traditional real estate agents but doesn’t charge the percentage fee.
A new tech company called LemonBrew has launched its so-called “custom matching platform” to link up home buyers (and sellers) with local, expert real estate agents.
The team behind the operation consists of “experienced entrepreneurs and operators” who work in the real estate and mortgage industry.
Their goal is to create a frictionless home buying process and improve efficiencies in what is often a daunting and stressful endeavor.
Initially rolled out via pilot in local markets across North Carolina and Florida last fall, LemonBrew plans to launch nationwide throughout 2020. It appears they are currently live in 15 states.
The platform has a “couple thousand” Partner Agents in its database, but expects that number to climb above 50,000 by the end of the year.
How LemonBrew’s Matchmaker Service Works
Answer basic questions to get matched up with local real estate agents
Questions include property type, budget, number of bedrooms and bathrooms
If you already have a home picked out or are still looking, when you want to buy, etc.
Then get top 3 matches in your area to choose from
It can be difficult to choose a real estate agent. Do you go with someone a friend or family used, someone you saw in an ad, or do you respond to a flyer or freebie you received in the mail?
All of those methods are pretty old school, yet still effective for agents for the time being. But are they the best approach for home buyers and home sellers? Possibly not.
LemonBrew feels it’s super important to go with a high-quality agent, and that’s exactly what they set out to do.
After you answer a series of questions, you’ll be matched up with a local expert based on factors beyond just location.
Your match also considers things like personal budget, down payment, property type, and various sales history metrics such as how fast an agent can help you find your dream home.
The company’s proprietary algorithm then presents prospective home buyers with the profiles of the top 3 matches and lets them choose who to work with.
Ostensibly, this will lead to greater success if/when you purchase or sell a property, as opposed to just going with someone random or referred to you.
Your LemonBrew BrewScore
Prospective home buyers are assigned a BrewScore
Which is based on thousands of analyzed data points
The more complete your profile, the higher your score
Those with higher BrewScores qualify for larger rebates at closing
The company comes up with a custom score known as a your “BrewScore,” which is based on thousands of data points analyzed by their proprietary algorithm.
The more information you provide and securely verify, the higher your BrewScore.
This includes verifying your credit, income, assets, and employment to ensure you’re a qualified buyer, similar to getting a mortgage pre-approval.
And the higher the BrewScore, the more money you can receive at closing to offset closing costs.
BrewScores range from 0 to 100, with a score north of 70 considered “good,” and high enough to qualify for a rebate back at closing.
It’s not totally clear what you can do to ensure your BrewScore is as high as possible other than providing all information that is asked of you.
But the general idea is someone with a higher BrewScore is more motivated (and likely) to buy/sell soon, and thus can qualify for a higher rebate because it’s closer to a sure thing for the real estate agent.
LemonBrew Provides a Rebate to Home Buyers and Sellers
To sweeten the deal, LemonBrew provides rebates to both home buyers and sellers who use a LemonBrew Partner Agent.
These real estate commission rebates back to the buyer are allowed in 42 of 50 states, along with DC.
If you’re selling, you can save up to 2% off the listing fee, which instead of 3% might be just 1%. On a $500,000 home sale, we’re talking $5,000 versus $15,000. Those are big savings.
And this is for a full-service agent, which might differ from other discount real estate brokerages.
If buying a home, you get a rebate that can be used to offset your closing costs.
It’s unclear what percentage or amount this is as LemonBrew does not disclose it. But as noted, it’s based on your BrewScore.
Rebates aside, LemonBrew is 100% free to both home buyers and home sellers.
If and when you buy/sell with a LemonBrew Partner Agent, that individual pays LemonBrew a referral fee, which is 25% of the gross commission.
While agents may receive less than they would if prospecting clients on their own, greater volume may lead to higher overall income.
LemonBrew Lending
A mortgage brokerage formerly operating as SD Capital Funding
Headquartered in New Jersey with loan origination contact center in Charlotte, NC
Currently operational in 19 states nationwide and DC
Expect to roll out to all 50 states by the end of 2019
The company also operates an affiliated mortgage brokerage called “LemonBrew Lending,” which used to go by the name SD Capital Funding (and still does in New Jersey).
They were apparently ranked #1 with Quicken Loans Mortgage Services (QLMS), receiving the wholesale lender’s Top Partner Award for 2019.
LemonBrew Lending complements the real estate side of their business, allowing homeowners and home buyers to enjoy one seamless transaction from start to finish.
They currently operate in 19 states nationwide, along with the District of Columbia. The company expects to expand to all 50 states by the end of 2019.