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Create an Early Holiday Shopping Budget

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FCM_holidayshopping_headerIt’s the perfect time to plan your gift list and save money this holiday season. Taking just a few minutes now can save you a lot of stress, money and time.

While you might have your sites set on getting through the next major holiday, Thanksgiving, savvy shoppers are already planning for the holidays. Yes, we know thinking about holiday shopping now seems too early, but by taking just a little time now (even just an hour) can save you a lot of stress, money and time.

Are we starting to pique your interest? Read on for some tips on how to get organized and start saving:

  1. Review last year’s shopping list. Pull up last year’s shopping list and take a look at who you shopped for the previous year and how much you spent. This review can refresh your memory and kick-start your new shopping list.
  2. Create a budget. Compare last year’s budget with your current financial situation to see how much you can afford to spend this coming holiday season. Also, see what expenses are coming up and make sure you have a cushion for emergencies.
    • When creating a budget for the holidays, give yourself a spending limit for gifts and don’t forget to account for entertaining and party hosting, decorations, and travel costs.
    • Consider setting up a separate savings account, just for holiday shopping. That way you can avoid overspending.
    • For even more control over your budget, you can narrow down a budget per person on your shopping list.
  3. Download a holiday planning app. To prepare for this expensive time of year, you should start saving and planning now. There are a bunch of apps out there that will help you track your gifts, set budgets, and find the best deals.
    • Santa’s Bag (iTunes) – Input every person you’re buying for, what they want most, gifts you’ve gotten them, and your budget. Then, check off as you go and enjoy a more organized holiday.
    • The Christmas List (iTunes) – Keep track of stores where you’re doing holiday shopping, so you don’t waste money on shipping or trips out. It also lets you set a max spending budget and allocate how much to spend on who—so you stick to your financial goals. The lists you create are shareable so that you can loop someone else into the shopping plan too.
    • GiftPlanner (iTunes) – Track gifts for any event with GiftPlanner. Send gift cards straight from the app, bookmark online shopping items through a widget, and stay on top of your finances by balancing your budget.
    • Christmas Gift List (Android)  This app lets you budget, buy and manage your holiday shopping list. If you use it year to year, you can look up past gift history to make sure you don’t double up on the same gift. It’s also just a convenient tool to monitor your spending and gift list.
    • Christmas Gifts and Budget (Android): With this application, you can track gift ideas and your budget as you do your Christmas shopping.
    • Slickdeals (Both) Do you love a good deal? Get deal alerts to your phone on items you’re searching for, and displays handpicked deals from the Slickdeals team and deals from sites like Groupon and LivingSocial to make sure you don’t have to break your budget this holiday season.
  4. Prioritize your shopping. Now that you have a good start on your shopping list, you might notice there are a few gifts that are more specific than others. Your wife might be hoping for a new cashmere sweater, but your daughter has that particular new smartphone in mind – plus, she’d love it in that hard-to-find color. For gifts that will fly off the shelves early, make a priority to get these first. Of course, waiting for the week of Thanksgiving and Cyber Monday will give you the best chance of finding a deal, but you may want to keep an eye out for savings starting now. Note which gifts on your list need early attention and which ones are more generic or flexible that can wait until later.
  5. Subscribe to stores and coupon websites. Now is the perfect time to get on the email lists of the stores where you know you’ll do most of your shopping. You’ll be first to know when they have flash sales or free shipping days. You can also follow the accounts of your favorite shops on social media for exclusive sales and promotions. Subscribe to coupon and cash back websites and sign up for alerts now, and you’ll have all the best deals hitting your inbox directly – the perfect solution when you need an idea for the sibling who has everything.

See, that wasn’t too hard. Now that you spent a little time getting organized for the holidays, you can go back to enjoying fall.




Your Mortgage, What to Expect: Underwriting

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We are now at the halfway point of the mortgage process. Underwriting.

What is mortgage underwriting?

During the mortgage underwriting stage, your application moves from the desk of the loan processor to the mortgage underwriter. The mortgage underwriter will ensure your financial profile matches your lender’s guidelines and loan criteria and he or she will ultimately make the final decision: to approve or deny your loan request.

How Underwriters Assess Risk, the “Three C’s” of underwriting:

  1. Capacity: Do you have the means and resources to pay off your debts? Underwriters assess your available resources by reviewing your employment history, your income, your debts and your asset statements. (Note: If you are self-employed, you may be asked to provide much more documentation of your income and work status.)
    They will also review your savings, checking, 401(k), and IRA accounts to ensure you can still pay your mortgage if you lose your job or become ill. Underwriters will pay particular attention to your debt-to-income ratio; they want to make sure you have enough money to fulfill your current financial obligations, as well as take on a new mortgage.
  2. Credit: Do you have solid repayment and credit history? Your credit is one of the most critical factors in the loan approval process. The underwriter will review your credit score to see how you have handled past bills (like auto loans, student loans, and home equity lines of credit) and predict your ability to make the proposed mortgage payments on time and in full.
  3. Collateral: What is the value and type of property? The mortgage underwriter must make sure the loan amount meets the loan-to-value requirements of the product. Otherwise, in the case of a default, a lender may not be able to recover the unpaid balance of the loan. An underwriter will typically order a home appraisal which will assess the home’s current worth.

Also, the underwriter will likely review the type of property you are looking to buy, because different kinds of properties carry different risks. For example, many lenders consider an investment property a riskier investment; this is because, historically, a borrower is more likely to walk away from an investment property than their primary residence in a difficult financial situation.

Ready to get started? Give us a call or fill out an online application: APPLY ONLINE HERE.




3 Tips to Improve your Credit Score and Score a Lower Interest Rate

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score interest rateA good credit score translates into lower interest rates. In a mortgage lender’s eyes, the higher your score is, the less risk you are, and the more likely it is you will pay off your debt. For this reason, borrowers with lower scores can end up paying higher interest rates on their loans.

If this is you, don’t panic!

There are some things you can do to adjust your credit score to receive a favorable review from the underwriter. Here are a few suggestions:

#1: Pay your bills on time:

The simplest, and sometimes hardest, thing you can do is pay all your bills on time. Generally, you can improve your scores by making all your payments on time, keeping debt levels low (below 30%, and ideally 10% of available credit), removing errors and limiting credit inquiries.

If you are still treating your personal financing like you are a struggling college student, it is time to start #adulting. If you do, your credit score will start climbing.


#2: Keep existing credit card accounts open

Part of your credit score is based on credit history. If you have old credit cards that you don’t use very much, you still have the benefit of the credit history they represent.

Rather than trying to pay off all your credit cards, you can move part of the debt from one card to another to even out the distribution of debt. Try to keep balances as close to zero as possible, and definitely below 30% of the available credit limit when trying to purchase a home. Also, if your credit provider will increase your line of credit, the ratio of debt to available credit is automatically reduced.

#3: Fix errors on your credit report

If you are not already doing so, pull a FREE credit report annually. If items are showing up on your credit report that you know you have already paid, request to have the credit bureau remove them. They are obligated to rectify this within 30 days.

If there are items on your credit report that are less than two years old, send in your payment if possible and mark the back of the check with the following notation: “Accepting this check is evidence that the transaction is complete, and this charge will be deleted from my credit record.” If necessary, the canceled check will be proof that this should be promptly removed from your credit report if it interferes with the closing of your loan.

If you are still not sure of what step to take to secure yourself a low-interest rate, contact our team of mortgage professionals to schedule a time to review your financial situation. The appointment is FREE and no-commitment. 



March Tech Tip: Pack Smarter With PackPoint

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How many times have you packed for a trip and arrived at your destination only to discover you forgot an essential item… or two. Buying things you already own is a waste of time and money.

PackPoint is a smartphone app that eliminates the two most prominent problems travelers experience when preparing for a trip: deciding what is essential to bring when space is at a premium and remembering to put it in your suitcase.

Whether you’re traveling for business, pleasure or both, PackPoint suggests what to pack based on the length of travel and planned activities, adjusting suggestions based on the weather forecast at your destination. You even get a web link to share your list with fellow travelers, so they’ll know what to pack too!

PackPoint is free for both iOS and Android, with a premium version ($2.99) that allows you to customize packing templates and activities, as well as sync your list with TripIt and Evernote for even more productivity.



4 Ways to Pay Off Your Mortgage Early

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4 ways to pay off your mortgageAre you ready to start chipping away at your mortgage at an accelerated pace?

For those homeowners who are fully funding their retirement accounts, are free of high-interest debt and have enough cash socked away for other life goals, here are four simple tactics may help you to pay off your mortgage early on your home.

1. Refinance into a shorter-term mortgage: If you have a 30-year mortgage consider refinancing it into a 10-, 15-, or 20-year loan. With a shorter-term mortgage, you will pay significantly less interest, but only if you can afford the higher monthly payment. Use this calculator to compare different mortgage terms, and let us help you decide which term is better for you. If you want a quick calculation, check out our Mortgage Comparison Calculator

2. Make an extra mortgage payment every year: Even small additional principal payments add up over time. On a $150,000 loan for 30 years at 3.75%, with no additional payments, more than $100,000 will be paid in interest over the course of the loan. By adding just $100 per month in principal payments, you will reduce the total interest paid by nearly $25,000 and the loan will be paid off more than six years sooner.

3. Set up bi-weekly mortgage payments instead of making 12 monthly payments, this equals out to 26 half-payments — or 13 full payments — per year. Give us a call before you start with a bi-weekly payment schedule. We will make sure your extra payments are applied to the principal of the loan and not being applied towards the interest. Use our Mortgage Payment Calculator to the calculate your savings.

4. Round up your monthly payments: This is similar to making bi-weekly payments. If your monthly payment if $815, try rounding your payment up to $900. The extra $85 goes toward the principal. Early in a mortgage, most of your regular payment goes toward interest.

As always, if you have questions about paying off your mortgage early, please give us a call. We would be happy to review your current financial situation and help you determine the best course of action for your unique situation.