Adjustable Or Fixed-Rate Mortgage – Which Is Right For Me?

Adjustable rate mortgage (ARM) or fixed mortgage?

If you’re mortgage shopping, you may be overwhelmed by the number of options. Dozens of lenders, each with their own rates, terms, conditions and costs, can make the decision feel that way. But it doesn’t have to be that difficult! The choice of which mortgage to go with starts with a simple question: fixed-rate or adjustable? There are many different terms, points and rates associated with each, but narrowing your search to a category can really simplify the process.

As an overview, fixed-rate mortgages are the more traditional choice. You and a lender agree to a length of time (or term) and an interest rate. That interest rate stays the same throughout the term of the mortgage.

Adjustable Rate Mortgages (ARMs) are a slightly newer offering. These loans have a segment of time during which the interest rate is fixed. After that, the rate is determined by an economic indicator. If you’ve seen the notation “ARM 5/1,” that means an it is an adjustable rate mortgage with a set rate for the first five years of the loan, and then a new rate every year after that. There’s more to it than that, but this basic explanation will get us started. [Read more…]

Figuring Out the Right Down Payment for Your New Home

Figuring the right down payment for a houseWhen you think about your down payment, balance is key. If you think you might sell the house within just a few years of ownership, having a large down payment exposes you to greater risk if real estate prices fall. However, a larger down payment can also mean lower monthly payments.

The value of $1,000 is pretty hard to quantify, especially iin a real estate market that might have $30,000 homes and $300,000 homes. Instead of thinking about the amount of money, think about a percentage of the value of the house. When making these decisions, here are three questions to ask yourself. [Read more…]

What To Do When The Rent Is Due – But You’re Coming Up Short

how to manage when you're shot on rentNearly everyone can relate to the feeling of having rent due in a few days but being short on cash to pay.  An unexpected bill or a short paycheck puts you behind, and you spend the rest of the month playing catch up. Finally, a big, important bill comes up and you’re out of backup plans. That grim feeling of panic creeps up your spine. Your heart races.

This is a financial crisis!

The first step is to silence that panic. Take two or three deep breaths. Although it is a problem, it’s one you need to solve, not one to give up on. A practical plan is needed to come up with the money.

Rather than going through a list of things you can do, it might be easier to talk about places to look. Let’s go through a few locations you can go to try to find those few extra dollars. This task is going to be equal parts creativity and hard work, so roll up your sleeves and get your thinking cap on! [Read more…]

Your Home: Buy or Rent [Infographic]

Renting versus buying a homeThinking about buying a new home?

It’s a big decision.  Sure, interest rates are low — and that’s appealing.  But is now the right time for you to personally make the leap from renter to homeowner?

Will your mortgage cost more than your monthly rent?  Can you afford a down payment?  There’s a lot to consider.

Check out our latest infographic for facts and figures on the current state of home ownership in the United States — it just might make your decision a little simpler. [Read more…]

Six Reasons Why Renting Makes Smart Financial Sense

why renting makes financial senseWith interest rates reaching near-historic lows, it’s no surprise that mortgage lenders have been pushing consumers to buy now to avoid the coming rate bump.

But, if you’re not ready to buy a home yet, there’s really no sense to make the leap yet.  Buying a home is one of the largest and most important purchases decisions you’ll ever have to make as a consumer.  There’s no reason to leap into a home purchase just because the market may be right or interest rates are low.

Home ownership is a big financial decision that requires careful planning and consideration – not to mention smart saving.

Plus there are built-in advantages that can make renting very attractive – especially if you’re just starting out or need to get a handle on your financial status. [Read more…]

College Housing: Where Will You Live?

college housing financialsWith the start of college classes just around the corner, this is college orientation season for millions of freshmen-to-be all across the country.  If you’re among those future university attendees, you’ve probably got a ton of questions — not to mention a to-do checklist about a mile long.

We’re here to help.  Over the next few weeks, we’ll be rolling out a series of articles to help you get caught up and ready for the start of the fall semester in a few short weeks.  In our first article last week, we did a deep-dive on how to make sense of financial aid applications and navigate the related paperwork.  This week, we’re turning our attention from the financial side of school to something that’s just as important: where you are going to live next year.

Tops on the priority list for high school graduates is often, “Move out of mom and dad’s house.” And while sometimes mom and dad can’t agree more, that’s not always the best long-term financial move. [Read more…]

Three Budget-Friendly Ways to Make Your Dorm Room More Like Home

Budget Friendly Dorm Room TipsThe first few weeks back from break can be tough. In the fall, there’s the giddy rush of a new school year to distract from how nice mom and dad’s house is compared to your dorm room. In the winter, though, there’s just cold and classes.

Don’t despair! There are a few low-cost hacks that can turn the institutional discomfort of your dorm room into the comfort of your parents’ home. Make a list, pop down to the home improvement store, and check out these three quick fixes. [Read more…]

4 Things to Consider Before Buying Your First Home

First Time Home Buyer TipsA decade ago, economic experts were bemoaning the emergence of a “boomerang generation.” Young people had left for college with bright eyes and exciting dreams of rewarding and fulfilling careers. Then, in 2000, the economy collapsed. These ambitious, well-educated folk found themselves with tons of debt and little opportunity. Many of them swallowed their pride and moved back home with Mom and Dad.

This situation wasn’t great for anyone. Mom and Dad had to put retirement plans on hold. Gen Y members had to postpone their professional and social development to take internships and part-time jobs. It’s also hard to feel fully “grown up” when your evenings end and mornings begin in your old childhood bedroom, perhaps still full of stuffed animals or posters of bands you liked in high school. [Read more…]

Buying Insurance: What, When, and Why?

iStock_000002692383SmallToday I’m very happy to be writing about insurance…said almost no one ever.

Look, I get it: even for someone who works at a credit union and has an appreciation for some of the dullest personal financial topics you could imagine, insurance is just, well, really boring.

But it also just so happens to be absolutely essential. [Read more…]

Financial Life after College: Renting or Buying?

Renting versus buying a homeOne of the best things about being a working man or woman is the freedom that comes from having your own money.

A steady paycheck opens all kinds of doors.  For example: the one at your parent’s house as you move all your stuff from your old room into a new place.

But higher purchasing-power usually means more tough decisions.  And relocating is no exception. [Read more…]