On Our Own

November 9, 2016
on-the-beach-112016-smaller

Belinda and me enjoying a late summer beach trip.

I am beginning to understand that vacations can be grouped into at least three different categories – especially for those of us with large families!  There were the vacations you took BEFORE kids during those early years of your marriage, the vacations you took WITH the kids and finally, those you have taken (or will take) AFTER your kids are gone – or are too busy to take with you!

For the two of us, we are now entering into the third phase of our vacations.  We started having kids over 30 years ago and I can count on one hand the trips we have taken without any kids during these years.  We’ve taken some great trips with our kids to beaches, mountains, national parks, historic cities and sites and amusement parks.  Most of those trips where designed to keep kids happy, entertained, fed, well-rested and healthy.  They have been fast paced, jam-packed and expensive – even when we tried to cut costs.

Our kids tell amusing stories to each other and their friends about “sneaking” into hotel and resort rooms 2 or 3 at a time because a few places where we stayed were not designed for a family of 5 kids under the age of 10 – just so we could all stay in the same room or condo.  Other stories include when their little sister actually slept in a make-shift “bed” in the bathtub during one trip because there were not enough beds for all five girls!  (Please don’t report us to the authorities!)

This year’s “Short Family Vacation” was actually planned during a time when we thought several of our girls would be able to join us at a beach-side location where several of them had expressed an interest in visiting again.  However, when it got closer to the designated week for our vacation only one of our grown daughters and her roommate were able to join us – and for only a couple of days.  Although slightly disappointing to us, we realize that our new reality is that our girls have moved out (except for our youngest who is a busy college senior) and are now very engaged with their lives and their time-off from work and family responsibilities may not coincide with our “Short Family Vacations”.

Similarly, I’ve heard others relate housing needs to these three vacation categories – BEFORE kids (starter homes), WITH kids (that house with all of those bedrooms and bathrooms and a big back yard) and AFTER the kids have moved out (the house with the master bedroom on the main floor and a much smaller yard!).  Many people who are changing their housing needs require the home loan services I provide.

As you or those you know find themselves starting-out, scaling-up or scaling-down I am able to be the experienced and trusted “Dream Maker, Problem Solver” to provide the tailor-made home loan solutions – so that no one in your family will find themselves sleeping in a bathtub!  Can I count on you to give my name to the next friend, neighbor, co-worker or family member who would benefit from my home loan expertise and hands-on customer care?

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Just the Facts, Ma’am, Just the Facts!

May 19, 2011

 

Sgt. Joe Friday (Jack Webb) from 50's & 60's hit TV show Dragnet

Buying a home has always been a big decision. But for some people today it’s a difficult decision because of all the conflicting information coming from the media. To make matters worse, that information is often outdated…or even inaccurate.

If you know anyone who is thinking of purchasing a home this year, please share the following information with them:

FACT 1. Mortgage options are still plentiful for borrowers with good credit scores and documented income. All assets & income will need to be fully documented in most all cases for the past 2 years.

FACT 2. There are still programs available, like FHA, that allow as little as 3.5% down payment, and many others that allow less than 20% down.  VA Loans still allow an eligible Veteran to buy a house up to $417,000 with $0 down payment!

FACT 3. Jumbo mortgages are still available on loan amounts even in excess of $2 million dollars.

FACT 4. Vacation/second home financing can be obtained with as little as 25% down, even with jumbo mortgages.

FACT 5. There are FHA Renovation (203k) Mortgages available which can be used to update or repair an existing home. Small projects (under $35,000) can usually be done in such a way where the homeowner or buyer can use up to one-half of this money upfront to purchase materials and then pay the contractor once the project is completed. 

FACT 6. Senior citizens can use their current equity in their home and actually relocate and buy a house and have NO MONTHLY PAYMENT on their new home for the REST OF THEIR LIVES.  The FHA Reverse (Home Equity Conversion) Mortgage can be used by those 62 years of age or older to refinance their currnet home or buy their idea retirement home.

FACT 7. As of today, rates on most mortgages are still at historically low levels when compared to the last 30 years.  Every indication is that rates will likely begin to increase before the end of 2011 – so delay if low interest rates are desired.

FACT 8. Most homes are selling at a big discount relative to 5 years ago.

Make sure your friends and family know the facts! Owning the home of their dreams may not be as hard as they think. Send your friends and family this link and let them know I would be happy to meet with them and help them determine what options are available in their personal situation.

Getting pre-approved for a mortgage BEFORE speaking to a Realtor could help make them a much stronger buyer in the eyes of a seller.

If there’s anyway I can lend a hand, I’ll be happy to do so. Thanks for your help and continued support, and if you have any questions about your own situation call or email me anytime!


GOING UNDER: America’s Debt Dilemma

November 1, 2010

STEPS TO END IMPULSIVE BUYING

1.  Identify your problem.

2.  Build a support network. Have friends, or relatives help talk you out of unnecessary purchases and share your successes in resisting temptation.

3.  Assess current debts and income and build a workable budget for paying off debts. (Do not continue to increase debts.)

4.  Approach your creditors to negotiate payment plans you can fit into the budget you’ve built.

5.  Use your support network to help you change your buying behavior.

6.  Set up realistic financial goals and a timetable for meeting them.

7.  Keep track of your progress; share your successes. Do what you can to stop backsliding, but don’t dwell on it.

8.  Pay off all outstanding credit card debts.

9.  Set up new guidelines for responsible credit use.

10.  Begin saving money for your financial goals.

11.  Reward yourself for accomplishments (not by spending money).

12.  Check your financial status regularly and adjust any backsliding. Set new financial goals as you accomplish the old ones. And, most important — now that you know the way, help someone else who might be tangled in debt.

Source: Debtors Anonymous


 Answers to the Credit Dilemma

What students can do:

1.  Educate yourselves by reading and checking the Internet on what card companies are up to. (See accompanying Web-site information).

2.  Don’t give up just because you’re in debt. Most students can salvage their situation by addressing it early. Don’t be afraid or embarrassed. Ask for help early. Problems with long-term blemishes on credit reports occur when students feel they can’t win and give up.

3.  Get only one card, for emergency use only. Not many horror stories of debt occur when students have one major card. The danger comes when other companies continue to mail pre-approved offers — and students take the bait. Do not get cards from furniture or department stores. Nightmares about credit seem always to include those secondary cards.

What parents can do:

1.  Teach children early. MasterCard is not shy about putting a card bearing its likeness into a Barbie doll’s hand, so parents should work equally as hard to combat those approaches.

2.  Be ”nosy” about your child’s finances even if he or she is 20 or older. That may be when they need snooping most.

3.  Be a role model. Children will follow Mommy and Daddy’s lead. Will yours see you do the right things?

What companies can do:

1.  Give people accurate information about interest rates. Eliminate the fine print on the back of monthly statements. Bring that information out front, in clear language and charts. Looming legislation may help.

2.  Put the owner’s picture on every card, as Citibank does now. If the industry truly wants to lower card thefts, this would be a major step forward. The idea is simple: If the shopper doesn’t match the picture on the card, clerks should not sell them anything.

3.  Stop targeting teen-agers.

 

What universities can do:

1.  Make personal finance mandatory to graduate. Students should be required to get at least a ”C” for credit. National statistics, surveys and personal testimonies show that students need lessons in personal finance.

2.  Ban solicitors from campus, or at least limit their visits. Make them put away the candy, toys and T-shirts — free gifts designed to attract student interest.

3.  Credit is a privilege. Require people under 21 to take a test on money matters before qualifying for a card. In most states, no teen can get a driver’s license without passing a test. It should be that way with credit cards.

TIPS FOR AVOIDING DEBT

How you handle your credit and finances is as individual a choice as picking a toothbrush. But here are some general tips to help you stay out of debt, or avoid getting there.

•If you have many cards, cut up all but one. Experts say one is enough. Two is OK for theft of the other card or an emergency.

•Ignore the Joneses; keep up with yourself. Much of credit card hype involves status. Chasing fads can tempt even the most disciplined consumer to spend.

•Pay your entire balance every month. If you can’t, pay as much as possible. Some months, double or triple a payment, but make reaching zero balance a priority.

•Don’t be intimidated by card firms. NCCU sociology professor Ike Robinson likens them to bullies.  ”It’s about power,” he said. ”These are very, very powerful companies with vast resources preying on vulnerable, unstable young people. And most of these youngsters are coming from homes that are not usually affluent.”

•Be like David: Grab your slingshot and fire away at Goliath. Complain if you get hit with improper penalties, late fees or over-the-limit fees. Scrutinize your statement for phony or wrong charges. At least once, photocopy the fine print so you can enlarge it and see what it is saying.

•Network with friends and family to find ways to deal with card companies. Just as you discuss getting the best deal on a car, talk about how you can combine brain power to get the best credit deals possible.

•If you are a parent, teach your child about responsible money management, regardless of age.


Get familiar with your credit report

One of the most important tools you have to rebuild financially is your credit report.

It is the one item that will tell you what creditors are saying about how you handle money, loans, car payments — and credit cards. It also will show how often you apply for credit.

In an age when employers increasingly are asking to see credit reports, you need to arm yourself with information. Become familiar with every item on your report and get them from all three major agencies: Experian (TRW), Equifax and TransUnion.

The first step is to contact the agencies. Call to find out what information you need to send them. TRW will send a free report if you request it. Call 1-800-392-1122. Equifax charges $8. Call 1-800-685-1111. TransUnion charges $8. Call 1-800-916-8800.

Be sure to order a report from all three agencies — to compare and to have the most complete information about your credit history. One agency sometimes will have information that conflicts with figures from another agency.

Here are some common questions you may have when the reports arrive.

Q. How can I get a mistake off my record?

A. According to Equifax, you will have to document the details of the problem in writing.

Some reporting agencies will include a form to use for disputes over information you believe is wrong. The reporting agency then will check with the companies that say they gave you credit. Information that cannot be verified will be removed from your file.

Take up disputes with the company that is the source of the information in question.

Q. What if I still disagree with an item after it has been verified?

A. Send a brief statement for your credit file that will be disclosed each time your file is checked.

Q. What in my credit file could keep me from being approved for credit?

A. The answer varies. It could be directly related to items in your file. Your credit could appear to be perfect, but you could be denied because of not living at your current address long enough. Also, having too many inquiries could make stores think you constantly are applying for credit. If you have questions about why you were not approved for credit, contact the store that turned you down and ask why.

Q. How long will bad credit information stay on my report?

A. Most comes off after seven years. If you filed bankruptcy, it might stay on there for 10 years.

Q. Who can look at my credit report?

A. The law says credit bureaus can disclose any information about you to any person with a ”permissible purpose” for seeing the information.

That could include landlords, car dealerships or employers — anyone who wants to see your financial habits. Your report will show who has been requesting information about you and when they requested it.

Sources: Equifax Credit Information Services; ”Get a Financial Life,” by Beth Kobliner

 CREDIT HELP ON THE WEB

Listed below are Web sites and telephone numbers that should help anyone seeking more information on credit companies’ relationship with college students:

1.www.JumpStart.org — JumpStart is dedicated to increasing financial literacy among teen-agers and children. It is excellent for parents and children. (202) 466-8613.

2.www.ftc.gov — The Federal Trade Commission has a site loaded with information in easy-to-understand English. The publications page should be helpful. (404) 347-4836.

3.www.abiworld.org — The American Bankruptcy Institute site is a must for anyone thinking about filing bankruptcy. This a nonprofit organization that won’t push for or against filing. But it will provide a plethora of information for you to make an informed choice. (703) 739-0800.

4.www.debtorsanonymous.org — This is the site of one the first national help organizations for over spenders and debtors. (212) 642-8220.

5.www.fraud.com — This is the national fraud information center. It has vast resources on how to protect your cards and account numbers. (800) 876-7060.

6.www.powersource.com/cccs/ — This is a national site for the Consumer Credit Counseling Service. The service also has a local office that provides counselors who can help people analyze their debt and how to get it under control. The CCCS also can be contacted by calling 800.251.2227,* Books: ”Get a Financial Life,” by Beth Kobliner; ”Expressing America,” by George Ritzer.

Download this Debt Seminar: Click Here


4 Reasons to Buy a Home in 2010: Affordability returns to housing, and buyers have loads of negotiating power.

September 13, 2010

 

Brian Short, CMC, CRMS, GMA – Licensed Mortgage Professional

Many people are afraid to buy a home in times like these, with the economy tanking and home prices continuing to fall. But if you’re brave enough to stray from the herd, you might be in for the home-buying opportunity of a lifetime.

 Ask for price reductions, improvements, closing costs — whatever — and the seller, desperate to get a contract, is likely to work with you but when the market starts improving, your negotiating power will start to diminish.

 If you’re qualified to buy a home now, and the purchase makes sense for your situation, and you’re prepared to live in that home for at least five years, there are four reasons you may be headed for a great deal:

 1. Affordability is better than ever.

According to the National Association of Realtors’ housing affordability index, homes are more affordable now than at any other point since the group started the index in 1970. The NAR’s affordability index is a measure of the relationship between home prices, mortgage interest rates and family income.

 

 

 What’s your home worth?

 Not all markets have experienced huge drops, however, so it’s wise to take a look at how far prices have fallen in your area. The Federal Housing Finance Agency’s Web site has a house price calculator that can help. Visit the calculator. http://www.fhfa.gov/

I have plugged in the information regarding my house in the Nashville market to see how values are beginning to turn in my favor as a homeowner.  This means that values are starting to go back up and will never be as cheap as they are now.

MSA: Nashville-Davidson-Murfreesboro-Franklin, TN

Purchase Date: Second Quarter 2000

Valuation Date: Second Quarter 2010

Purchase Price: $225,000

Extimated Value: $314,781

   
   
   
   
   
 

When using the House Price Calculator, please note that it does not project the actual value of any particular house. Rather, it projects what a given house purchased at a point in time would be worth today if it appreciated at the average appreciation rate of all homes in the area. The actual value of any house will depend on the local real estate market, house condition and age, home improvements made and needed, and many other factors. Consult a qualified real estate appraiser in your area to obtain a professional estimate of the current value of your home. Title XI of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 requires that any appraisal used in connection with a federally related transaction must be performed by a competent individual whose professional conduct is subject to supervision and regulation. Appraisers must be licensed or certified according to state law.The House Price Calculator uses the FHFA Purchase-Only House Price Index for all states, including the District of Columbia, and for the largest 25 Metropolitan Statistical Areas and Divisions.


 

 The median existing single-family home price was $184,200 in June, up 1.3 percent from a year ago. Single-family median existing-home prices were higher in 10 out of 19 metropolitan statistical areas reported in June in comparison with June 2009. The median existing condo price was $180,100 in June, which is 1.4 percent below a year ago. The national median existing-home price for all housing types was $183,700 in June, which is 1.0 percent higher than a year ago.

 2. You have a large inventory to choose from.

In many places it is taking months to sell a home, creating loads of inventory — from new homes to existing homes to foreclosures.   A large selection gives buyers more choices and drives down prices. And home sellers have gotten the picture.

 Total housing inventory at the end of June rose 2.5 percent to 3.99 million existing homes available for sale, which represents an 8.9-month supply at the current sales pace, up from an 8.3-month supply in May. This is the largest amount of existing homes for sale, in terms of months of supply, since August 2009. Raw unsold inventory remains 12.7 percent below the record of 4.58 million in July 2008.

 

It’s fair to say that home sellers have become increasingly desperate.  People who have had for-sale signs in the yard for six months are starting to become in tune with the reality of the situation.   Buyers can take advantage.

 But if you put off a purchase until inventory shrinks substantially, you might not get as good a price.  And be forewarned: It’s nearly impossible to time the exact bottom of the housing market, and even if you do, there’s no guarantee you’ll make a killing.

 Buy for quality of life . . . don’t buy on speculation.  I wouldn’t buy a home expecting the housing market to rebound quickly in the next 10 years, and expect moderate gains in values when the turnaround does happen.

Historically, real estate appreciates about 5% a year over the long term. But as the country crawls out of a recession, many markets probably won’t see huge home-price gains any time soon.

3. Builders are offering big discounts.

Home builders are getting even more aggressive with their pricing.  You may consider looking at completed new homes first because builders are offering such steep discounts. Plus, you’d have a warranty not only on the home itself, but also on the home’s appliances, he said.

Builders want to save their credit, save their brand, save their reputation and clear out inventory.  They can go buy cheap land today with that cash.

My advice:  Walk in with a pre-approval for a mortgage, make an offer, and then walk away without making a deal if you have to. Chances are, a builder will call back and reconsider that offer rather than let a potential buyer get away.

4. Mortgage rates are historically low.

It’s not just the price of the home that will affect affordability; mortgage terms will also affect your monthly payments. These days, rates are very attractive for conforming loans, those that can be purchased by mortgage agencies Fannie Mae and Freddie Mac. (The current limit is $417,000.)

Earlier this year, rates on the popular 30-year fixed-rate mortgage hit a level not seen in decades, and rates have stayed relatively near that low for weeks.

More mortgage help could also be on the way. Recently, President Obama said that his new economic plan would help lower the cost of mortgages for home buyers, although he did not give specifics.

But low rates don’t mean lenders are handing out mortgages easily. You’ll need good credit, a substantial down payment and a willingness to document your income in order to qualify for those great rates.


Preparing for Home Ownership: A ‘Do-List’ for a Soon-To-Graduate College Student – Part 2

November 24, 2008

By Brian Short, CMC, CRMS, GMA 

What else can you do to help you prepare for home ownership in the next 12 or 24 months?  Work on these things:

1. Pay your bills on time.  Utilities, cell phone, car insurance, student loans or other debt your are paying off quickly – make you payments on time and in full.  Put them on an auto pay through your bank if you have your paycheck on an auto deposit.  It all goes in and out every month – on time and in full – even if you are out of town, covered up at work or just distracted for some reason.

balance-checkbook2. Keep your check book reconciled and up-to-date.  This may seem unnecessary in the age of “online banking” but even the “best of us” forget to enter a debit card payment once in a while and it comes back to bite us where it hurts.  Overdraft charges of $35-50 each will add up quickly and cause a blemish on your banking history when applying for a new mortgage in the months to come.  Mortgage underwriters like to see very clean banking history and prefer to loan to those who demonstrate the ability to manage their money – no matter how much or how little they make.

3. Save some money for a down-payment and for your closing costs.  Depending on the loan program you desire, you will need to save 3%, 5% or 20% of the sales price of the home you desire to buy.  Any loan for which you qualify for more than 80% of the sales price will require a monthly mortgage insurance premium which will cost you $50-$250 per month depending on the size of the loan in addition to your monthly property taxes and home owners insurance payments. 

FHA loans will let you buy a house with only a 3% down payment but you will have an up-front and monthly mortgage insurance premium figured into this loan.  If you bring a 20% down payment, you will avoid this mortgage insurance premium.  In addition, your closing costs and pre-paids will average about 3% of the sales price with most loan programs.  Therefore, if you desire to buy a $150,000 house in 2 years and you want to use an FHA loan you should need $4,500 for your down payment and about $4,500 for your closing costs or a total of $9,000 to close the sale.  That should give you a good goal to shoot for!

3. Keep your paperwork in order.  You need to keep the following financial records.  If you don’t have filecabinetthem, start keeping them – THIS WEEK!

   a. Pay stubs – Keep in order for 1 year until you successfully file your tax return for that year.

   b. Sales Receipts and Debit Card transaction receipts– Keep in an envelope or file folder for each month for the year until you have filed your tax return for that year.  You may decide to keep them for as long a five years for warranty purposes for items you have purchased.

   c. Bank Statements (Print off hard copies every month) – Keep in file folders in order for 5 years.  The IRS can audit you for any year for the past 5 years. 

   d. W-2’s and Tax Returns– Keep until you die.  (Let your kids or grand kids throw these away.)  Do not throw away you tax returns – always keep a copy of the exact return you filed with the IRS.  I keep an electronic (pdf) copy and a hard copy.

   e. Insurance documents – Keep your most recent copy of your health insurance, auto insurance and renter’s insurance in their own file folder in your file cabinet for easy reference.

 glove-box1  f. Auto service receipts– Keep all of you oil change, tire purchase and auto repair receipts in the glove box of your car along with your insurance card and annual registration if there is room.  It your glove box becomes too full, start a separate file for this information.  You will need this information for warranty purposes and for documenting the service on your car if you ever sell it someone who wants to know how well you have taken care of it. 

These simple habits, developed early in your adult life, will help you be a stellar mortgage applicant and allow you to qualify very soon for the best possible mortgage loan programs available.


Preparing for Home Ownership: A ‘Do-List’ for a Soon-To-Graduate College Student

November 20, 2008

By Brian Short, CMC, CRMS, GMA

cap20graduationIf you can count the number of days, weeks or months until you graduate and “enter the real world” of having your own place, buying your own food and doing your own laundry, then let me give you a few tips for how to set yourself up for financial success – especially when it comes to buying a owning your own home.

1. Don’t buy a house during your first year out of school or during your first year of marriage.  Hold it – I’m a mortgage professional!  Shouldn’t everyone BUY a house – as soon as possible???  Not always!  Working through the adjustments of a new job, a new city, new schedule or a new spouse will be time and emotionally consuming enough without the added pressure of shopping for, qualifying for, buying and moving into a new house.  Rent for your first year before you begin thinking of buying.  You may have second thoughts about your location or employment situation in one year which will help you decide when and where you might want to buy a house.

2.  When interviewing for a job give high priority to a job which can help you pay-off CB055356any school debt you may have in the shortest period of time.  Think about knocking down you student loans and saving for a reliable car during those first couple of years after graduating.  If you are not married, you will not want to bring your student loans with you into a new marriage.  So make this a priority to pay off all your debts by living very simply and write out a payment plan to pay massive amounts toward your debts.  Take on roommates, drive an older car, eat out less, buy less expensive clothes – do all you can to PAY OFF DEBT!

3. Live on a budget.  Write it out.  Put it on paper and stick to it.  My wife uses www.mvelopes.com for our personal budgeting needs. It is an on-line “envelope system” which will let the user start each month with allotted amounts for each category in your budget and then be required to move money from one “envelope” to another if you overspend in an area before the month comes to an end.  A user can “sync” your bank accounts to your “envelopes” and so you can move money out as checks clear or debit card transactions ar posted.

easel4. Keep balanced. Now is the time to develop life-long spending, lifestyle, health and relationship habits.  You don’t have homework, term papers, exams and assignments hanging over you now – so you no longer have any (or fewer!) excuses!  If you have been putting off going to the gym, starting a diet, learning to cook (or dance, or play a musical instrument, or paint), going back to church, looking up your old friends from high school, or whatever you have wanted (or needed) to do while you were in school, but never had the time or money to do – do it now! 

However, do what will bring about balance in your life.  If you have been without physical exercise for the past several years – do that.  If you have drifted away from your faith and your deeping spiritual life – work on that.  What will bring balance and what will give you new things to learn and make your life a joy to live?  If you are happy – truly happy – others around you will be happy, as well.

5. Live with margin in your life.  Each time you get paid, pay down debt and put some money away.  If you are earning $4,000 each month, try to live on 1/2 of that amount until you have your debts paid off and you have built some financial cushion in your life.  Dave Ramsey calls these “Baby Steps”.  (www.daveramsey) You should have an Emergency Fund ($1,000) and 3-6 months of your expenses in savings before you begin your long-term and retirement savings funds.

Also, build in some margin in your health, your relationships and your intellectual development.  Eat good foods (Not too much – your body is slowing down as you move into your 20’s and 30’s.) take vitamins and supplements to help you rebuild the past 20-25 years of abuse.  Surround yourself with people who are “givers” who help you accomplish your life goals. 

I concluded years ago that there were two kinds of people in the world: “Givers” and “Takers”.  “Givers” cheering-business-people-thumbknow how to contribute to the the “building-up” process in others lives.  “Takers” are constantly trying to get all they can from others – sympathy, pity, attention, money, worth, time, etc.  Stay away from those.  They will suck the life out of your life if they are given the chance.  Be with those who, like you, desire to be “givers” because they are confident, secure, valuable, focused, sensitive and respectful of others’ time and possessions.  Intentionally put yourself around others you want to become like.

These are great days of very few pressures and responsibilities – even though you may not feel like this at times.  Enjoy your 20’s and see the world!  You will have many years to be very committed to a house payment and job and family responsibilities.  However, your 20’s can be great years of learning about yourself and developing good life-long habits which will bring about decades of joy and fulfillment if you spend these years wisely.