Considering a refi to save on your mortgage, but have questions? Read on as we chat with our local mortgage expert to get answers.
With interest rates at record lows, millions of homeowners are now finding themselves considering a refinance. And if mortgage rates continue to decline, even more homeowners will have a chance to save on their current mortgage by refinancing into a lower rate.
There are many questions and misconceptions when it comes to refinancing, so we tapped the expertise of Cincinnati-based Ron Erdmann at Guaranteed Rate for some mortgage refi myth busting.
Myth 1: Closing Costs are Expensive
Depending on the amount of your loan, the value of your property, and your lender, you may not have to pay any closing costs out of pocket. “There are alternatives not everyone is aware of,” Erdmann says. “One option is to roll your closing costs into your new mortgage loan, which you can then pay off through your monthly payments. Some lenders can waive fees like lender’s title insurance and the appraisal fee, which will result in immediate savings. Other options come with substantial credits off of closing fees, which can also result in an immediate benefit. You’ll want to talk with a highly recommended mortgage lender about these options.”
Myth 2: I Shouldn’t Refinance Because I Might be Moving Soon
Possibly moving or selling sometime soon? Erdmann says that’s not a problem either. “Many people think it’ll take three years to break even with the cost of a refinance,” he explains, “but I find that many of the clients that I talk with will recoup the fees in well under a year. So even if someone decides to move a year from now, they will still have savings. If someone is looking to move in the foreseeable future, then it’s even more important to talk with a trusted mortgage professional because we can offer solutions and can help the client plan for the move. Clients don’t always think about key questions like, ‘How will refinancing now affect my ability to buy the next house?’”
Myth 3: If I Refinance, I’m Just Adding More Years onto my Mortgage
If you’re concerned that a refinance will push back your payment timeline, Erdmann says that’s not the case. “If you took out a 30 year loan three years ago, you don’t have to do a new 30 year loan. You can do a 27 year loan or a 20 year loan or a 15 year loan. If you are worried about increasing your payment, then you can always do a new 30 year loan but make extra payments. The net effect is that you will have a lower required payment, but you will still have substantial interest savings that you can use to prepay your loan even faster than you would otherwise.
Myth 4: You Can Only Refinance Your Mortgage Once
Erdmann says there’s no limit to how many times you can refinance your mortgage. “Average 30 year fixed rates in Dec 2018 were 4.9%. When average rates dropped 0.5%, then we refinanced clients with minimal fees that resulted in immediate savings,” he explains. “When rates dropped another 0.5%, then we refinanced a lot of our clients again. There is no downside to refinancing as long as you’re doing an accurate cost vs savings analysis.”
For example, if a client has a $400k loan, and if they save 0.75% per year in rate, then they are saving $3,000 the first year in mortgage interest. “If it only costs $2,000 to refinance, then the refinance was a ‘win’ as long as they had the loan for at least eight months,” Erdmann says.
Myth 5: I’ll Have to Sign Paperwork In-Person
With many people taking extra precautions due to COVID and limiting contact to only essential activities, they may feel uncomfortable coming to an office to sign closing documents to refinance their mortgage. Erdmann says new technology protocols allow for a fully electronic way to sign documents.
To learn more about Ron Erdmann, NMLS 728342, Branch Manager and SVP of Mortgage Lending at Guaranteed Rate, visit https://www.rate.com/loan-
For folks who have been experiencing issues with their credit, it can seem like a fool’s errand to try to get their hands on money they might need. People with bad credit simply seem to have a harder time getting a loan than those with great credit scores, and this is mostly because major lending institutions and banks will rarely provide loan to those who have a bad credit score.
This isn’t necessarily the fault of the lenders or the banks – this is simply how the system is set up. This doesn’t bode well for people who deal with bad credit problems, even if these issues are due to unexpected life circumstances and through no fault of their own. Still, bad credit is something that will continue to affect the person until they are able to get their credit score up.
Does this mean that if you have bad credit, you simply are out of options until you are able to bring your credit score back up? Not necessarily, because you might be surprised to find that you still have options for getting your hands on the money you need, even with a bad credit score.
Payday Loans: A Solid Option For People With Bad Credit
There are millions of folks out there dealing with bad credit scores, but it doesn’t mean that they don’t have a few options they can count on to get the money they need. This is where payday loans come in. Payday loans are a little different than the typical loans you could receive from a bank or major lending institution.
You see, payday loans are a way to quickly get your hands on a smaller amount of cash, for whatever reason you might need it for. It could be for unexpected medical bills, car repairs, or something else entirely. Payday lenders usually loan smaller amounts at a time (typically under $1000) to be sure that the borrower will be able to pay their loan back on time. When someone applies for a 500 loan with bad credit, making sure it is able to be paid back is essential to ensuring everything is properly squared away with their loan.
When you borrow through a payday lender, you will usually be expected to have your loan paid back in full by the next time you get paid, hence the term payday loans. Get it paid off on time, and you won’t have any extra fees to worry about, and your credit might even be positively impacted if your payday lender is one to reports to one of the big three credit bureaus (which include Experian, TransUnion, and Equifax).
In short, a payday loan is one of the best ways for bad credit borrowers to get their hands on the money they need. If the borrower only needs a smaller amount of money, then it should be simple for them to repay it quickly by the due date.
Where Do You Find Payday Lenders?
Payday lenders do exist “in real life,” that is, you can visit some of them in local offices and see what they can do for you. However, some of the best payday lenders don’t have a dedicated office, but instead, exist solely online.
These are some of the best options for folks with bad credit who would like to get their hands on a payday loan. Simply open up your favorite internet browser, search for payday loans on your preferred search engine, and see what is available to you. Payday lenders use your income instead of your credit score to determine whether or not to approve you for a loan, so make sure you have your employment information at the ready when applying for your loan.
After you have filled out all of the necessary information, you will just have to wait on your loan decision. On most payday lenders’ websites, it only takes a few minutes to get your loan decision, either through email or through a page on the site alerting you to the decision. If your loan is approved, it will show up in your bank account in anywhere from a few minutes to a few hours, on average.
Once your payday loan is in your account, you are free to use it however you’d like. Use it to pay off your bills, get a handle on some medical expenses, or whatever else you might need to use it for. As long as you can pay it off on time, you will be good to go, and your credit won’t be negatively affected.
Is This the Best Option For You?
People with bad credit need somewhere to turn when they experience the need for quick cash. Everyone experiences hardships in life, and it doesn’t mean they don’t deserve a chance to turn things around. Look into payday loans for yourself if you think it could be the answer to getting your funds in order.
Doing taxes get you stressed (again) this year? Our financial expert offers four simple things you can do now to make tax prep much easier next year.
Tax season is officially over! Buy you accountant a drink for taking care of you during such a hectic, stressful time in their lives and if you added to that stress personally, buy him or her two drinks!
While no one enjoys giving money over to the government freely, it is a necessary endeavor that we must embark on as an American citizen. Although, I recommend never leaving money on the table by not claiming all your allowed deductions, the highlight of your year should not be your large tax refund, either. There needs to be some sort of balance to in your business finances.
I had the luxury of prepping and filing income tax returns for many small business owners. I witnessed multiple business owners get frustrated, take away valuable time from their business (i.e. losing money), forgo deductions (they could not locate all their receipts or statements), in addition to crying and cussing.
Many business owners are not realizing a profit or even paying themselves a salary. I have had entrepreneurs even say that they feel like they are working to pay taxes. Let’s be honest, business finances are a hard things to management. If you don’t get a handle on the finances, the business will suffer and you will be closing up shop quickly.
Unless you work in financial services, you are not in the business of finances; therefore, you should be focusing your attention on the income producing activities of your business. So if you find that management of your business finances is taking valuable time away from your business or that you are working just to pay taxes, it may be time to sit with a professional to discuss some strategies to shift your business finances to the next level.
In order to be better for next year, I want to provide some tips to help you keep the stress down during tax season. Here are my tips:
1. Get a solid bookkeeping system.
Monthly reconciliation of bank accounts and transactions is key to creating transparency in your business. As a business owners, the bottom line is important. If you don’t know how much is coming in and going out of the business, it is going to be hard to realize a profit, pay yourself a salary, and expand to the next level in your business.
2. Review income and expenses at least monthly.
You can’t know where you are going, unless you know how to get there.
3. Establish a method or system of retention and tracking.
It is not enough to throw receipts in a bag or your wallet and then try to organize them in January when it time to bring them out to determine your tax deductions. This is a task that needs to be completed throughout the year and you should be diligent about it. Expenses are the bread and butter of business and you don’t want to leave any money on the table because you can’t find your business meals or your advertising costs. Keeping track of receipts and invoices are important for record retention purposes, as well. The IRS loves paper, it serves as evidence that you are doing what you are claiming to do as an entrepreneur.
4. Keep it simple with the receipt of money.
You should not be accepting money from 10 different sources at once (i.e Cash App, PayPal, Stripe, Square, Cash, Bitcoins, Checks, etc.). This leads to confusion and disorganization of funds. Service-based entrepreneurs struggle with this one most often. Accept a few and keep it simple so you keep it all together for tax purposes and life, in general.
If you think it is time to hand the baton to a skilled financial professional, schedule a consultation with me at emeraldsparks.com. I help business owners prevent financial mistakes that would risk the future of their business, while helping them keep/realize profits and pay themselves a salary.
Realistically, you can’t handle everything as a business owner and that may be the reason why your business finances are struggling. You are trying to be the social media coordinator, the head of shipping, chief graphic designer, accountant, etc, something will fail, something will lack, so do yourself a favor and take at least one thing off your plate.
Stay frugal my friends!
Our finance columnist explains which smarter investment decisions a woman can make for a lifetime of financial security.
Women are just the bomb, aren’t we? I mean let’s be honest, we multi-task effortlessly, run our households, make sure everyone we know is taken care of, we are CEOs of our own businesses, we raise children, we just get it done, right? Although we rock out at all these things and more, we are not always nice to ourselves, financially?
We kind of, sort of, put our finances on the backburner and do everything else and then we see our finances spiral out of control. Or, better yet, we don’t pay attention to the financial part of our household, which is not smart. We definitely need an understanding and to be an extra pair of eyes to ensure everything is on course and running well.
As a women it is important to know that we have to invest in our financial future differently. Here are some known facts about women:
Because working with women is my sweet spot, I could not ignore this any longer. We have to do better financially. Just like we care about our families, our children, our health and wellness, we have to take care of our finances and mind them just as closely as we do everything else in our lives. It is one of the most important areas in our lives because literally everything we do as an adult is touched by our finances.
So ladies, I want to make sure us as women have what we need to start being more responsible today!
Finances are important, and not understanding the concepts of money is no longer an excuse to not have your financial house in order. It is imperative as a woman who takes charge of household, her children, and her social life to take control of her finances. We are strong and competent beings, and we should not let our finances be the boss of us, but instead, us telling our finances what to do! Be a boss, a financial boss.
Read on as our finance columnist shares the story of an inspiring mom who changed her life around financially for her kids to live a better life.
Moms are one of the most magically beings on this earth. Let’s be honest, who else knew where your sweater was as a child or how to make you feel better with just a hug? This mom I want to highlight has went through a lot to ensure her two kids and herself were, as I like to say, financially great!
Nahamani Yisrael, grew up with a unique financial background, her grandparents were upper middle class and lived in a predominantly Jewish neighborhood in Cincinnati, but with her mother she experienced some difficult financial times. Yisrael went to private school, but lived on government assistance. At 18, like most teens, she was eager to leave home and obtained her own apartment. Making the decision to delay college, Yisrael went from job to job trying to make a living herself. In her early 20s, Yisrael had her children. Although she struggled to provide a stable environment for them, her children ended up saving her, because at one point, Yisrael and her children dependent on a local food pantry for food, received government assistance, and even slept in a shelter. She saw the cycle repeating itself from her childhood. She didn’t like it, it sadden her and she decided to do something about it.
She enrolled herself into college, receiving many grants and scholarships because of her academic efforts, but her struggled continued. Going to school, raising children, and maintaining a job is not easy, and there were times Yisrael could not even afford car insurance, her spending habits and lack of resources caught up with her and in the middle of collegiate career, she had to file bankruptcy for all the debt she had acquired from money mismanagement over the years. But she didn’t stop…
“I need this reset”, said Yisrael, “I was going to do it right this time.” From the skills she learned in college in bookkeeping and web designed, she landed on her feet. She peeled back the layers like an onion and got serious about her finances.
No more lavish shopping trips, no more luxury trips, and first things first, obtain car insurance! Yisrael has changed many of her habits, she now pays bills even before they are due and has been conscious of the money she spends on her children and herself. She teaches her children to take care of what they have, instead of quickly going out to buy new things.
Yisrael states, “Life is a lot more peaceful now, I am lot happier, my kids are a lot happier.” She shared she used to obsess and become severely ill thinking about her financial woes. She now thinks, ‘is that pair of shoes, more important than my peace of mind or my children’s future’. She has readjusted her mindset.
She enjoys the rhythm she is in now. “I am living, I am blessed, and I own four businesses, with two more in my brain”, said Yisrael. She has truly turned her financial situation completely around and definitely moving in the right direction. Kudos to Nahamani Yisrael! Check out her various business at nahamani.org
Women like Nahamani are why I do what I do. It is my mission to introduce financial literacy to individuals who have not been exposed to basic concepts of personal finances. I strive to inspire people to live financially healthier lives. We all know financial success is not determined by income, because how many multi-millionaires have filed bankruptcy. I made it my business to solve people’s misconceptions about their money and if I can give people the told they need to successfully navigate their finances, then I have lived a life with living.
Our finance columnist has five fab saving ideas to jumpstart your summertime vacation fund!
If you have not thought about where your family will go this summer for vacation, I know you have not thought about how you were going to pay for it either. There are so many fun and creative ways to save for vacation. Many of these techniques can be incorporated into your daily lifestyle and do not cause much thought or effort on your part. I am very aware saving can be a chore, but my goal is to take the chore out of saving and make it fun. Good habits are formed out of consistently and saving is nothing but good habit, if you treat it like a bill, you will always have a saving. Let’s get into these tips!
To ensure I give strategies for everyone, I will include both manual and automatic techniques, as well as some cash based strategies. Here are my top creative saving strategies:
#1 The 5 Dollar Bill Challenge
If you use cash more than a debit or credit card, please search the house for a large jar or even an empty cereal box. As you spend cash, hold onto you 5 dollar bills and placed them into you storage container of choice.
Qapital is a mobile app that allows you to set a goal, such as a ‘trip to Colorado’. You set the cost of the goal and then Qapital automatically takes money from your checking account and holds it within an account. Once you reach your goal, you can withdraw the funds to your checking account and use them towards your goal. Don’t worry, the mobile app will never overdraw your bank account.
#3 The Word of the Week Challenge
This is a hit with families. Pick a common word, it has to be so common that you forget to avoid the word in every day conversations. Whoever in the family uses the word has to put a dollar in the storage container of choice. Watch your words because it will cost you.
#4 The Bad Habit Challenge
We all have a bad habit that we want to get rid of, right? Well, pick that habit and every time you correct it, put a dollar into a jar. For instance, if you find yourself biting your nails and then you stop, you owe yourself a dollar.
Clarity combines budgeting and automatic saving! It is a mobile app that links to your debit card and tracks your transactions. It also analyzes your transactions and anything that appears to be a subscription, it will cancel them for you. Additionally, you can categorize by merchant and determined how much you have spent over the course of a month. It may help to see what you are spending money on so that can make cut backs, if necessary.
I believe combining some mix of automatic and manual saving challenge will be beneficial to any budget and goal, whether it is vacation or a new pair of shoes. Saving can be as fun as you make it. If you have a negative attitude towards it, it will drain all your energy. However, if you have a positive attitude, it will become easier to do. I love saving, it makes me feel good for the future of my family, it makes me not worry about those ‘life happens’ moments, it makes me feel free. What are some fun and creative ways you save money?
Our finance columnist offers up six fun and frugal ideas to keep the family active and adventurous this summer.
It is almost that time of year, where the kiddos will be home more often because school is out. The weather will be beautiful, and you will need creative ideas to make sure the kids do not waste their summer in front of the television playing video games and talking on the phone. It can be challenging to keep children engaged, while maintaining your sanity at the same time. Because let’s be real, do kids play outside anymore? ☺ I am sure there are kids that play outside but the media just wants us to believe all kids are wasting their lives away in front of the television, tablets, and cell phones, right?. While I love technology and understand the need to be tech savvy in this world, we have to feed our creative and engage with others in person.
Moms and Dads, I have picked my top fun and frugal activities to do with the children in Cincinnati this summer to break up the day from all that television and tablet watching.
Fun activities for Cincinnati and surrounding areas:
1. Pure Beauty Bar Cincinnati is hosting a Pure Beauty Camp. The camp is designed to help young girls, ages 13 to 18, embrace their own pure beauty. Fun activities such as a sleepover, vision board, health & fitness, hair/skin care, etiquette, anti-bullying, and financial fun (with yours truly).
2. Smale Riverfront Park is located in the banks of the Ohio River in downtown Cincinnati is filled with many attractions such as Carol Ann’s Carousel, oversized swings, rock climbing canyon, twin racing slides, water jets, and so much more!
3. The Public Library of Cincinnati and Hamilton County has an awesome summer reading program entitled Summer Adventure. As a participant, your child would receive an awesome Adventure Kit which includes a Summer Adventure passport, a free book, and a voucher for a free view level ticket to a Cincinnati Reds game. Each week has a theme and weekly prizes are given based on the themes.
4. The Kenwood, Mariemont, and Esquire Theatres are letting the kiddos enjoy free movies on Monday and Wednesday mornings. Additionally, several communities such as Anderson Township and Deerfield Township offer ‘Movies in the Park” on select days during the summer.
5. S&S Western Bowl, Heid Bowling Lanes, and Colerain Bowl offer a Kids Bowl Free program.
6. Parkey’s Playbarn, located at Parky’s Farm in Winton Woods, has an indoor, farm themed accessible playground and admission is $2.50 per child.
In the summer, the outdoors are a great way to get your kids moving and away from the television. It can be hard nowadays to keep the kiddos entertained but your local cities, parks, libraries, and neighborhoods are here to help you out. Do a little research if your neighborhood was not mentioned above, Google is a great resource to find inexpensive activities for the entire family to enjoy.
Summer activities for the kiddos should not break the bank. The key to remember is expensive does not equal more fun. I have heard of tons of parents who state their kids have more fun with the cardboard box, then with the millions of toys they have in their room. Summer is almost here, so do some research and have some fun with the children this year.
Stay frugal my friends!
It’s difficult but necessary. Our financial expert shares tips on communicating about finances with your significant other.
Whether you are married, engaged, or thinking about the possibility of getting serious with someone, a talk about money should be had sooner rather than later.
Money is a tricky, uncomfortable thing that can break a couple at any stage in life. It does not matter if there is a lot of money or a little bit of money, if it is not managed properly it can be detrimental to a relationship.
In my business, I counsel a lot of couples around increasing their income, paying off their debt, and day-to-day money management. More than not, it is clear not all couples have had an open, honest conversation about their finances. As a result, I want to share some tips to help people at any stage in their relationship navigate a financial talk without feeling embarrassed or awkward.
First make sure it just you and your significant other in a peaceful, relaxed setting.
1. Discuss one another’s financial goals.
It is important to know where you and your significant other want to go financially, especially as it relates to lifestyle goals. This is a great conversation starter and will identify current income and debt levels. Couples should understand how their personal finances will now affect their significant other’s finances. It is best to get on the same footing with a solid financial vision and goals to achieve that vision. The two of you have to be financially great together and the only way to do so is by ironing at all the details when it comes to incomes, businesses, homes, and investments.
2. Determine your significant other’s strengths and opportunities.
Knowing if your significant other is a saver or a spender is HUGE. It will help the two of you determine who is responsible for ensuring bills are paid consistently and on time. Obviously savers and spenders budget differently as well, it will take some work to help the spender stay on track. Just as it might be a challenge to get the saver to spend money. Know how to encourage your partner to be their best selves.
3. To have joint accounts or not, that is the question?
This is absolutely the decision of each couple. There is not one right or wrong answer here. Some couples have their own separate checking accounts and then a joint account for family saving and household bill payments. While other couples have joint checking and saving accounts, all the money goes to one place and they both share a debit or credit card. Still there are other couples that do not have joint accounts at all, one partner is responsible for making all the household payments and each person saves in their own saving accounts. You have to find a balance that works for you and your significant other because finances are like relationships, one size does not fit all.
4. Protect your spouse against the loss of your income.
Your significant other will eventually come to depend on your income to manage the household. It is invaluable to protect against such a loss or disability. Finding the right insurance is imperative. Talk to a trusted professional because your job benefits may not be enough or may not be available upon termination or retirement.
Wish you could get yourself on a budget, but don’t know where to start? Our financial expert shares the three steps for getting started and sticking to it.
Budgeting, believe it or not, is the cornerstone to a healthy financial life. I’ve found that most individual either don’t have a budget, don’t know what a budget is, or don’t like the word budget.
But let’s talk about budgeting. When I say budget, I don’t mean restrictions from all the fun of being a vivant adult. I mean knowing when to say yes and when to say no. More thing everything I want you to enjoy the fruits of your labor BUT I want you to be financially GREAT as well.
Essentially, all a budget demonstrates is that you are only willing to spend a certain amount for a specific item or service. It’s all about tracking your income and expenses, while making sure your expenses don’t win.
I want to share three steps for starting your budget.
Tip #1 Determine your monthly fixed income and expenses.
This is self-explanatory. For instance, if you receive a salary, your direct deposit or pay stub should reflect the same amount. Usually, fixed expenses include rent, cable, car note, and car insurance, etc. After all fixed items have been determined, consider your variable costs such as groceries, gasoline, electric, and water because these change based on use. You could use more or less in any given month. This same concept applies to income.
Tip #2 Review your last month’s credit card and debit card statements to understand where you are spending your money.
Note, this helps when determining variable income and expenses, as well. Limits can be set here. Key statements such as “I am not spending more than $100 on gas a month.” “I am not spending more than “$150 at the grocery store.” Additionally, your bank statements tell you if you are spending a lot on fast food, nightclubs, clothing, etc.
Tip #3 Always budget with a goal or vision in mind.
Nothing is more pointless than saving money just to save money because as an adult you are told to do so. How many of us do what we are told to do all the time? Budget or save with a goal in mind. You may not have an emergency fund and want to save $1000 initially. That will be your driving force or your motivating factor. Better yet, you may want to buy a house next year and need a down payment of $3,000. Your budget will show you where you can cutback or if additional income needs to be obtained to meet your goal. Remember a cutback now is not a cutback forever. You can add back your discretionary (wants not needs) once your goal has been obtained.
Budgeting is all about planning. Ever heard the saying, “Proper, Prior, Planning, Prevents Piss Poor Performance – the 7 Ps? You cannot expect to just drop into a better financial situation, you have to put in the work to do so. Just like you plan a trip or night out, you have to plan your financial life for changes to occur. A budget is simply a guide to help you achieve your overall financial goals. So ask yourself, do you want to be in the same financial situation you are a year from now or 5 years from now?