Finance

Top 3 Reasons to Consult a Lender Before Hunting for a Home

Finance

Couple talking to man in suit, going over documentsOnce you’ve taken a good look at your finances and felt for sure you can finally afford to buy a home, it’s easy to start hunting for one right away. Many first-time home buyers do the same. But it’s not a smart idea if you intend to apply for a mortgage to finance the purchase. The first thing you need to do is talk to a lender. Here are three reasons why:

You Get to Set Realistic Expectations

Few things are as disappointing as finding a home you really like and then realizing that you can’t afford it after talking to the lender. That’s why you need to speak with your bank first to find out how much loan you qualify for, how much down payment you need, the current mortgage rate in Salt Lake City, and so on. This way, you know which houses you should look at.

You Appeal More to Sellers

Most sellers aren’t too enthusiastic to negotiate if they discover you haven’t been pre-approved for a mortgage. This is especially true if you intend to buy in a hot real estate market. You need to prove that you’re serious about making the purchase. Showing that you can indeed sign the check catches their eyes, and the negotiation process goes much more smoothly.

You Learn about the Closing Fees

While you may have what you think is sufficient money for the down payment, you need to realize that there are closing fees too. You’ll need to pay points, title insurance, mortgage insurance, etc. Unless you talk to your lender first, it’s tough to get a sense of how much you’ll need to pay, and whether you have enough money in the bank to do so.

Buying your first home can be trickier than you imagine. By consulting a reliable lender, you can understand what’s involved and go through the process faster.

Interest-Only Title Loans: Attractive Benefits Borrowers Love

Finance

The beauty of applying for a title loan in Utah is enjoying flexible payment options, and one of them is the interest-only arrangement. This doesn’t free you of your responsibility to repay what you owe. Rather, you’ll get the privilege to take care just your monthly payment’s interest, and not worry about the principal over a certain period.

Utah Money Center notes that generally, interest-only title loans in Provo, Sandy, Taylorsville, and Salt Lake City have two attractive benefits that magnetize borrowers:

Keeping Your Costs to a Minimum

Since the interest is your only financial obligation about during the initial period, your title loan wouldn’t bite into your savings for a while. This could offer you a huge relief if you have many bills to pay. Instead of shouldering all of your expenses at once, an interest-only loan can help you prioritize bigger and more time-sensitive debts.

Having More Cash in Hand

If you have less cash now but expecting more later, the chance to settle just your loan’s interest portion is perhaps the break you need. Having more cash gives you more financial flexibility, keeping you from acquiring new debts.

Calculate Its Risks

Despite its great advantages, interest-only title loans are not without risks. Realize that your bill will inevitably go up once your loan’s regular amortization schedule kicks in. At the point, your balance will still be the same. Ready yourself for a larger monthly payment you’ll then have to settle the principal and interest concurrently. If you’re financially unprepared, you could lose your vehicle if you fail to repay the loan in accordance with the contract.

An interest-only title loan can be beneficial, but it requires a lot of consideration. If you think that it’s not for you, explore other payment options that can better suit your needs and unique situation.

FHA 203k Loan Program in a Nutshell

Finance

The US government created the FHA 203k loan program to streamline the financing process for individuals who want to purchase a fixer-upper or renovate their current home. The loan covers the additional funds needed to repair or upgrade the property on top of its actual market price.

Before the existence of the FHA 203(k) loan, interested buyers of fixer-uppers had to apply for multiple loans to cover the costs of both the property and its required restoration. Now, the Federal Housing Authority has rolled these multiple arrangements into one convenient program that eliminates unnecessary paperwork and makes funding accessible to these buyers and homeowners.

Eligibility

The FHA 203k loan is available only to homeowners and home occupants, as well as nonprofit organizations. Investors are not qualified to apply for this loan.

Although the loan was designed mainly for 1 to 4-unit properties, this financing program may also cover interior projects for townhomes and condominiums.

Since the Federal Housing Administration (FHA) safeguards the FHA 203k loan, lenders such as Primary Residential Mortgage, Inc. are more lenient in approving applications. It means that this loan is easier to acquire compared to other types of loan. For instance, you do not need a perfect credit rating to qualify. But you should at least have a 31/43 debt to income ratio to better convince lenders that you are capable of incurring financial duties.

Limited 203k Loan

Aside from the purchase of fixer-upper properties, 203k loans fund the renovation projects of current homeowners. This is made possible via the limited 203k loan plan. Approved home improvement projects include, but are not limited to, the following:

  • Roofs, downspouts, gutters
  • Electrical and plumbing
  • Flooring
  • New doors and windows
  • Improvements for PWDs
  • HVAC systems
  • Minor bath and kitchen remodeling
  • Exterior/interior painting
  • Weather-stripping and insulation
  • Improvements in energy efficiency

The FHA 203k loan exists to fund both homebuyers and owners who see potential in what others deem not salvageable. In an increasingly saturated real estate market, this is a welcome and beneficial option.

Adjustable-Rate Mortgages: Benefits of Choosing 3/1 over 7/1 Loan

Finance

An adjustable-rate mortgage, or ARM, comes with a start rate period with stable interest lower than fixed-rate home loans. When the start rate expires, the interest could increase at least once a year or more—depending on the adjustment frequency stated in the contract.

Two of the most popular ARMs are 3/1 and 7/1 loans. The first digit refers to the number of years of the start rate period, while the second represents the adjustment frequency.

At first, it seems illogical to choose the 3/1 ARM over the 7/1 one, considering that the latter offers 48 more months of lower, fixed interest. Beyond this apparent disparity, though, any mortgage broker like Primary Residential Mortgage, Inc. in Portland, Houston, or Chicago would tell you that the two are more different from what you may think. In some cases, the 3/1 ARM is the sensible choice.

Here are the advantages of the 3/1 ARM over its 7/1 cousin:

Lower Interest

The fact that the 3/1 ARM only has three years of unchanging, below-average interest reduces its risk profile in the eyes of lenders. As a result, mortgages companies apply less interest on 3/1 ARMs than their 7/1 counterparts. The interest rate difference can go more than .30%. In turn, choosing a 3/1 ARM over other “hybrid” home loans with lengthier start rate periods provides you more interest savings.

Greater Loan Amount Maximum

Apart from the privilege to get an even more favorable interest rate, applying for a 3/1 ARM helps increase your purchase power. Compared to the 7/1 ARM, you can qualify for a larger loan amount with the 3/1 kind.

Wider Property Selection

The more money you can borrow, the more properties for sale you can choose from. The loan amount maximum difference between 3/1 and 7/1 ARMs can be over $20,000. If you pay a large down payment, say 20% of the property’s price, you can unlock even more property options—skip paying private mortgage insurance to keep your monthly payments low.

The edge of the 3/1 ARM over its hybrid mortgage relatives is undeniable. However, it might only make sense for your situation if you’d refinance your loan or sell your property before its start rate expires. Otherwise, your monthly housing payments could become too costly to manage for 12 months. Think with foresight and understand the cause-and-effect relationships of mortgage elements to choose the right financial product for you.

Tips for Replicating Your Success with Your Second Restaurant

Business | Finance

So business is doing good. Opening your restaurant’s second branch should be a walk in the park, right? Wrong. Things that might’ve worked well in the first location might not work as well with your next one. To make sure you’ve got the bases covered, here are the things you should consider.

Finances

You need the funds to start this expansion. You need to consider your options. Are you going to shell out your funds? Raise capital with some investors? Or perhaps you could look into lenders that offer loans for restaurants. You need to weigh the pros and cons of each option.

Restaurant Model Analysis

You need to evaluate your current business model if it’s scalable. Also, check if there are new concepts you can explore. By doing this analysis, you should be able to identify the potential strengths, weaknesses, opportunities, and threats (SWOT) of your new venture. Include this in your business plan.

Market Research

Careful planning goes a long way, even if you’ve had some success in the past. You still need to put in the work of determining who your target customers are, evaluating your competition, and checking out viable locations.

Central Management

Now that you’ll be having more than one branch to manage, you need to look into central management solutions so that you can efficiently oversee both branches. This will also serve a foundation should you wish to add more branches in the future.

With a central management system, it’ll be easier to track inventory and sales as well as keep the menu consistent and services.

Pursuing a new venture is exhilarating. You’ve navigated through the challenges of opening a restaurant, and you start a second branch armed with wisdom. However, don’t let that success fool you into complacency.

Previous success doesn’t translate to success in your new location. But, with careful planning and execution, you can improve your chances of duplicating that winning formula.

Lose Your Mortgage Before You Retire

Finance

You may look forward to your retirement, but most retirees face less than perfect lives what with their mortgages still hounding them. In 2016, 60-year-olds and older Americans borrowed as much as $2.84 trillion for their homes, and many of them continue to pay their loans well into retirement.

Some authorities may argue that housing debt in retirement can be a good thing, but it will remain as the single biggest expense you have. You can have a debt-free retirement, however, by following one of three ways.

Pay Down the Loan

Now, you probably already know one way how to retire without a mortgage: you simply have to pay off your loan before you retire.

No matter what age you are, no matter what mortgage rates you have in your Ogden mortgage, you can pay off your home loan quicker if you add in extra payments every month, semi-annually, or annually. Alternately, you can also pay any cash bonuses you receive towards your loan.

Downsize the House

The second way to retire without a mortgage involves downsizing. Downsizing can work perfectly for couples whose children are already grown-ups. You can sell your current home for a much smaller one you can happily live in, and the profits can go towards your home loan.

You can also downsize even if you still have children at home.

Refinance the Mortgage Terms

Thirdly and finally, you can refinance. Refinancing makes sense if your credit score went up or current interest rates became more favorable. When you refinance, however, choose a 15-year mortgage that you can pay off by the time you retire.

You also end up with more savings in the long run, and you can even combine this with the first suggested method: refinance then pay down the loan.

You can easily retire debt-free with any of the three methods above, and they will work best if you start on them early enough. Come retirement, you can relax and give no thought to your housing loan expense.

Why Now is the Best Time to Start Doing Your Estate Planning

Finance

You have a family that you love unconditionally and do everything you can for. At this very moment, you still have their best interest at heart, seeing as how you’re researching about estate planning. You want to make sure that you can still provide for them even when you can’t be with them any longer.

This then raises the question of when you should start to do estate planning. The simple answer is, right now, while you still can. The earlier you start planning for the future of all your possessions, from your house to your bank accounts to even the smallest things you own, the greater the peace of mind you’ll have. Here’s what you should know to begin your preparations.

Why now?

For the simple reason that you don’t know nor can you predict when exactly you’ll leave your loved ones behind. You don’t have complete control over something as inevitable as this, which means that your demise can happen at any given time. Just think about it: no one can predict when an accident may happen, and accidents can happen to anyone, including you.

So many possible things can happen in a matter of a few hours, so the longer you put off your planning, the higher the risk of you leaving your family in financial trouble. As such, MDF Estate Planning, Inc. suggests that there’s no other better time than now, regardless of how old you are or what your net worth is.

A misconception about who only needs estate planning

A lot of people think that estate planning is just for people who are of considerable wealth. This isn’t necessarily the case. In fact, the less wealth one has, the more reason to plan for it, and the sooner, the better. This way, you can ensure that it goes directly to your family and loved ones who you intended it for.

Title Loan Application: What You Need to Know

Finance

Many people rush to apply for title loans when faced with an urgent need for money such that they fail to appreciate the finer details that spell out the terms of engagement, putting their collateral at risk.

The last thing you need in life is bill collectors ringing you at odd hours reminding you that you are behind on your payments. Unfortunately, this scenario plays out on a regular basis. It often happens when you are not in command of your finances, explains Utah Money Centera reputable title loans service provider in Provo.

Don’t think of it as free money

A title loan entails pledging your car as collateral when you need money quickly. On small catch is that you must’ve paid off your car and it must be in good condition for you to be eligible. On sweet aspect of this kind of arrangement is that your income and credit score might not be an issue. If your car can cover the amount of money you need, then you’re good to go.

Despite the lack of rigid structure, all other aspects of a loan hold. The terms of the agreement and repayment terms are legally binding. Therefore, you should treat it with the seriousness it deserves or else you stand a chance of losing your car.

Do read the agreement

One crucial mistake that people make when they are in desperate need of money is to skim over the paperwork. They fail to read and understand the crucial aspects of the loans including the interest rates, repayment dates, and most importantly, the penalties. As such, you are likely to be saddled with hefty penalties and fines if you get behind on payments.

Such penalties often cause the loan amount to spiral out of control, increasing the risk of losing your vehicle. If necessary, have a legal mind take you through the paperwork. That way, you can be sure of what is expected of you once you accept the loan.

While title loans offer access to quick cash when you are in need, you should approach the process with a bit of caution. Otherwise, you stand to lose your collateral if you overlook critical details.

The Fundamentals of Purchase Order Funding

Finance

In the world of resellers and distributors, a sudden spike in sales or customer demand is not uncommon. If you want to keep your business successful, you have to be prepared or well-funded when these situations arise.

Turning down a customer’s purchase order may not only cause you your sales but also customer loyalty and satisfaction as well. Capital solutions specialist MRKT Capital believes that purchase order financing is a quick and efficient way to fulfill those unexpected large purchase orders.

You can sum up the basic process in eight steps

  1. Your customer gives you a purchase order.
  2. You give this purchase order to your supplier and they reply with a written proposal stating how much it would cost.
  3. You apply for PO financing presenting the supplier’s proposal and get approved.
  4. The financing company pays your supplier, and your supplier fulfills the order.
  5. Your customer receives his order, and you send him his invoice.
  6. The customer sends payment directly to the financing company.
  7. The financing company deducts their fees and gives you the rest.

It’s a simple process

As long as you meet the qualifications required by the financing company, you can benefit from this system. These are:

  1. You are a reseller or distributor of material goods.
  2. Your supplier and customer are both creditworthy (No history of bankruptcy or serious litigation).
  3. You have a minimum of 15% or 20% profit margin (Depending on the financing company).
  4. You have a completed written purchase order from your customer.

Now, there may be other funding options available to your business. What’s important is that you analyze and understand each one, and choose what’s best for your business needs, and what’s most attainable for your finances.

Having long business relationships with suppliers and customers will not only get you the best rates, but will also build trust and loyalty with the entities that make your business whole.

Are You Financially Prepared for a Divorce?

Finance

Would you save money to prepare for a divorce? A survey showed that two-thirds of Americans are unprepared financially in the event that their marriage reaches a dead end.

TD Ameritrade’s Financial Challenges of Divorce and Widowhood survey gathered information from 2,000 adults between 37 years old and above. The respondents also said that they have not prepared for the possibility of becoming a widow or widower.

The Truth Hurts

It might seem counterintuitive to tie the knot and then save for a potential divorce, but statistics indicate the ugly truth. An estimated 4 out of 10 married couples in the US decide to break up, while widowed Americans account for around 25% of people 65 years old and above.

If you live in New York, the first thing you should do when making financial plans includes looking for divorce lawyers in Long Island or New York City. The state may have the lowest divorce rate in 2016, but it does not imply that it may continue in the future.

Financial Plans

Census data revealed that only nearly 13 out of 1,000 New York married couples divorced in 2016. Experts believe that this may be due to alimony laws in the state. David Lynch, TD Ameritrade managing director and head of branches, said that having a financial plan is essential for when all else fails.

This will help you when the time comes that experiencing the burden of alimony laws might be a better option than remaining married to your spouse. Lynch described a financial plan for divorce similar to how we spend for other emergencies, such as possible disabilities or illnesses, in the future.

When you start saving for a potential divorce, it should not necessarily mean that you expect a failed marriage. You should consider it as a safety net since it is common knowledge that ending your marriage will require you to spend a lot of money.