Dallas-based Certainty Home Lending, an affiliate of Guaranteed Rate, named Shadi Kamran as its new national business development executive. Kamran is based in Los Angeles and will support Certainty’s strategy and sales performance.
“Our comprehensive product suite offers solutions for virtually every mortgage and home financing need,” Kamran said in a statement. “The technologically advanced mortgage platform empowers loan officers to serve both customers and business partners with ease and excellence. Additionally, the people and culture at Certainty are unique, and I am excited to once again collaborate with industry colleagues and leaders who I’ve regarded so highly over years in the business.”
Before joining Certainty, Kamran served as an area manager in the Greater Los Angeles region for Change Home Mortgage. He also held various executive positions at Bank of America for 16 years.
“We are thrilled to welcome Shadi to the Certainty family,” CEO Franco Terango said in a statement. “His dedication to building enduring partnerships across diverse business segments, extensive mortgage finance experience, and team leadership expertise will be leveraged within Certainty’s network of originators and branches.”
Certainty Home Lending operates under the umbrella of Guaranteed Rate. Headquartered in Chicago, Guaranteed Rate Companies is the second-largest retail mortgage lender in the U.S., with more than 850 branches serving all 50 states and Washington, D.C.
When you ask people how they’re doing, you often get a knee-jerk “fine” or “good” without much introspection. But lately, when you ask people about the economy, they have clear feelings.
Over the past several years, the economy has been remarkable, in a literal sense; there has been a lot to talk about. Inflation rose to levels we hadn’t seen in about 40 years, and home prices climbed roughly 50%. The Federal Reserve stepped in to fight inflation. Interest rates reached territory they hadn’t touched in 20 years or more, but they did so without triggering a recession. Economic growth has remained high and the labor market strong. All of these factors have resulted in a cacophony of narratives about the economy, which is very likely playing a role in people’s perceptions.
A new survey from NerdWallet, conducted online by The Harris Poll among more than 2,000 U.S. adults, reveals a disconnect that illustrates these perceptions well. When asked how they feel about a variety of economic and financial topics now compared with 12 months ago, Americans were nearly twice as likely to feel worse than better about the state of the U.S. economy in general. Yet they were slightly more likely to feel better than worse about the state of their own personal finances.
Over the past 12 months, the survey period we asked about, the economy has actually remained strong, and the post-pandemic recovery has carried on better than expected. Consumers continue spending, which is typically taken as a sign of confidence. It may be tempting to disregard negative sentiment if we can’t confirm it’s rooted in current economic reality. But that sentiment may provide clues to yet-unseen problems and potentially drive behavior changes that could have significant economic impact.
Half of Americans are feeling worse about the economy
People’s perceptions are colored by their background, personality traits and exposure to information, among many other things. And these perceptions don’t always reflect demonstrable reality, particularly when you ask about how people feel. Asking about perceptions and focusing on an emotional component can give people explicit permission to detach their experience from what the actual evidence might show. And often, it’s likely our feelings that govern our behaviors, whether we’re talking about managing relationships or spending money.
About half (49%) of Americans say they feel worse about the state of the U.S. economy in general now compared to 12 months ago, according to the NerdWallet survey conducted in April. Just 26% feel better. Among the questions asked, this one garnered the strongest opinions — it had the lowest rate of people who neither felt better nor worse.
Twelve months before this survey, the economic indicators most people would encounter in daily living were pretty close to where they are now. Unemployment was a low 3.4%; now, it’s still low by historical standards, at 3.9%. Gas prices were relatively the same: $3.71 per gallon on average then and $3.73 now. One major improvement over that one-year period can be found in price growth, however. Inflation in April 2023 was near 5%. Now, it’s closer to 3.5%. In fact, wages are now growing faster than prices.
When asked to look more locally — how they feel about the state of their personal finances now versus 12 months ago — one-third (33%) of Americans feel better and 29% feel worse. Parents of minor children are more likely (39%) than non-parents (31%) to feel better.
What’s driving the disconnect?
The disconnect between how people feel about the economy at large and how they feel about their household finances seems counterintuitive. By most official measures, the economy is strong. If feelings or perspectives run contrary to that, one source of the negative sentiment could be personal experience. In other words, if I feel bad about the economy when the economy is doing well, maybe it’s because my personal financial situation is not so great. But a modest segment of Americans hold these two seemingly disparate feelings simultaneously: 18% of those who feel worse about the economy now than they did 12 months ago say they feel better about their personal finances over the same period.
There are many other possible explanations for the perception of a worsening economy, including:
1. We could be measuring the economy wrong (maybe it’s not doing as well as we think). The COVID-19 pandemic didn’t just shake the economy, it shook economic data too. This explanation might not be the most likely, however, as the people responsible for economic data are experts in their field. If someone’s going to get it right, it’s likely them. Data collection, benchmarking and seasonal adjustments have all been impacted and continue to be accounted for.
2. Exposure to negative stories in the news or social media could be coloring people’s outlook on the economy’s health. The last high inflation period was a relative lifetime ago, in the 1980s. Then, our primary sources of economic information came at regularly scheduled and limited intervals: in the morning newspaper or in front of the evening newscast, for example. Now, economic data is everywhere you look, translated by both experts and social media influencers alike. This consistent attention to the economy’s measurements could be having an outsized impact on our perception of its well-being.
3. The housing market could be playing an outsized role in overall economic perspectives. If there’s one section of the economy that is undoubtedly difficult, it’s the housing market. Under current conditions — high home prices, a paltry number of homes available for sale and high borrowing costs — even if someone has taken steps to position themselves to buy, they’ll be met with difficulties. Healthy household finances can only get you so far if you’re trying to buy a home in this unfriendly market, and confronting these roadblocks on the path to a long-term financial goal can be very discouraging.
4. We’re aware that even though we might be doing better personally, others aren’t so fortunate. Aggregate measures of the economy conceal a lot of nuance. Unemployment is low on a national scale, but people are still unemployed. Wage growth is outpacing inflation, but not everyone is receiving raises. Even if you personally aren’t experiencing any downside to this economy, knowing that others are may color your views. This isn’t necessarily a bad thing — empathy across the economy can drive meaningful community involvement and policies that improve the well-being of others.
What we shouldn’t do is assume that people just don’t understand the economy and write off the disconnect as immaterial. At some point, how we feel about the economy can impact how we act. It can affect decisions such as whether now’s a good time to buy a new car, invest in the stock market or start a new business. For business owners, it can impact hiring and investment decisions. And all of these spending and saving decisions can ultimately impact the health of the economy, feeding into official data. Consumer expenditures account for about two-thirds of total GDP, for example. So how we feel about things, no matter the driving force, can impact economic reality. And that makes this sentiment worth listening to.
Loans can help us achieve big goals, like buying a car or going to college. But did you know that the interest rate on your loan can affect how much money you pay back? A lower interest rate means you pay less money over time. So, how can you get a lower loan rate? Here are some simple tips to help you save money.
1. Check Your Credit Score and Credit Reports
We know this is obvious but it needs to be said. Make sure that you are more familiar with your credit than any potential lender could be. This means checking your credit score and your credit reports (all three) because your lender will be looking at more than just your score. You may feel like you have a decent credit score, and then be surprised by what rate your lender quotes you because there are too many negative items in your credit report.
If you’ve never downloaded copies of your credit reports before, you can do so for free at the only official website, AnnualCreditReport.com
If you want a more broken out view of your credit and explanations for what everything means, you can also get a free Credit Report Card from us.
2. Really Spend Time Shopping Around
Don’t settle for the first loan offer you get. Don’t settle for the second. The difference of half a percent can mean thousands of dollars, so really take your time and do your research. Check the rates offered by your own bank, credit unions, digital lenders, mortgage brokers – anyone – to see who has the lowest rates.
Just remember to compare not only the interest rates but also any fees or charges that might be included.
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3. Consider a Co-Signer
If you’re having trouble getting approved for a loan or getting a low interest rate on your own, consider asking someone with good credit to co-sign the loan with you. Having a co-signer with a strong credit history can help you qualify for a lower interest rate.
4. Save Up For a Big Down Payment
Putting more money down upfront can help you secure a lower interest rate on your loan. It shows lenders that you’re serious about paying back the money you borrow. Plus, a larger down payment means you’ll have a smaller loan amount, which can also lead to lower monthly payments and less interest paid over time.
5. Choose a Shorter Loan Term
The length of your loan term can affect your interest rate. Generally, shorter loan terms come with lower interest rates because the lender takes on less risk. While a shorter loan term means higher monthly payments, it also means you’ll pay less in interest over the life of the loan. So if you can afford it, choosing a shorter loan term can help you save money in the long run.
6. Improve Your Debt-to-Income Ratio
Lenders also consider your debt-to-income ratio when deciding your loan rate. This is the amount of money you owe each month compared to the amount of money you make. If you have a high debt-to-income ratio, lenders might see you as a higher risk borrower and charge you a higher interest rate. Paying down debt or increasing your income can help improve your debt-to-income ratio and qualify you for a lower rate.
7. Ask About Discounts
Some lenders offer discounts on loan rates for things like setting up automatic payments or having a checking account with them. It doesn’t hurt to ask if there are any discounts or special offers available when you apply for a loan. Even a small discount can add up to big savings over time.
8. Use Mortgage Points
Mortgage points are a way to lower your interest rate by paying extra money upfront to your lender when you close on your mortgage. Each point typically costs 1% of the total amount of your loan.
So, let’s say you’re getting a $200,000 mortgage, and the lender offers you the option to buy one mortgage point for $2,000. If you buy one point, you’d pay an extra $2,000 upfront, but your lender might lower your interest rate by, let’s say, 0.25%.
If you plan to stay in your house for a long time, buying mortgage points might be a good idea because you could end up saving more money on your monthly mortgage payments. But remember, it’s not always the right choice for everyone. Think about how long you plan to stay in the house and whether you’ll actually save enough money in the long run to make up for the extra cost upfront.
By following these tips, you can increase your chances of getting a lower loan rate and save money on interest. Remember, every little bit counts when it comes to your finances, so take the time to explore your options and find the best loan rate for you. With a little effort, you can be on your way to achieving your goals while keeping more money in your pocket!
Investing can feel like riding a rollercoaster, especially when you’re trying to keep up with market fluctuations. One popular technique that long-term investors use to smooth out this ride is dollar-cost averaging (DCA).
This investment strategy offers a methodical approach to investing that can eliminate the guesswork and stress of trying to time the market. Let’s dive into the world of DCA and see how it might serve your personal finance goals.
Basics of Dollar-Cost Averaging
Dollar-cost averaging is a simple but effective investment strategy. The basic idea is to invest a fixed dollar amount at regular intervals into a particular investment, such as a stock or mutual fund, regardless of its share price. Over time, this approach can result in a lower average price per share compared to making a lump sum investment at a higher price.
Here’s how to dollar-cost average: Suppose you decide to invest $500 into an index fund every month. The share price of the fund fluctuates from month to month, sometimes high, sometimes low. By investing regularly, you buy more shares when the price is low and fewer shares when the price is high. Over time, this can lead to a lower average purchase price.
A Deeper Dive Into How Dollar-Cost Averaging Works
One way to get a better grasp of how dollar-cost averaging works is to look at a hypothetical scenario. Suppose you decide to invest $200 in a mutual fund every month. In January, the share price is $20, so you buy 10 shares.
In February, the share price drops to $10, so your $200 buys you 20 shares. In March, the price goes up to $25, so you can only afford 8 shares. Despite the market’s fluctuations, your regular investment allowed you to purchase more shares when the price was low and fewer shares when the price was high, resulting in a lower average purchase price.
Benefits of Dollar-Cost Averaging
The key advantage of the dollar-cost averaging approach is that it mitigates market volatility. Instead of trying to time the market and potentially making ill-timed investment decisions, DCA allows you to follow a fixed schedule and make regular investments.
This strategy can be especially beneficial in declining markets. When stock prices fall, your fixed dollar amount can purchase more shares. If the stock market recovers, you would have bought those shares at lower prices, potentially leading to gains. This way, DCA can turn market declines into opportunities.
Another benefit of dollar-cost averaging is that it can promote disciplined investing. By investing a fixed amount at regular intervals, you are more likely to stick with your investing strategy, even when the market is turbulent.
The Psychology Behind Dollar-Cost Averaging
Dollar-cost averaging isn’t just about mathematical probabilities and financial strategy—it’s also deeply intertwined with investor psychology. Investing can be an emotional roller coaster, especially during periods of significant market volatility. When stock prices swing wildly, investors often let their emotions guide their decisions, which can lead to costly mistakes.
For instance, a sudden market downturn might provoke feelings of fear and uncertainty. In response to these emotions, some investors may resort to panic selling, hastily offloading their investments to stave off further losses. This can be detrimental to their long-term financial goals because they might miss out on potential gains when the market eventually rebounds.
On the flip side, during a bullish market when prices are high, feelings of greed and fear of missing out (FOMO) might take over. These emotions can lead to impulsive buying, where investors pour money into the market hoping to ride the wave. But if the market corrects or crashes, these investors stand to lose a significant portion of their investment.
This is where the dollar-cost averaging approach comes into play. The discipline of investing a fixed amount at regular intervals removes the need to time the market and reduces the influence of emotions on investment decisions. It provides a systematic investment plan that is followed regardless of whether the market is up or down. This disciplined approach can prevent impulsive decisions, providing a level of emotional comfort and stability.
Limitations and Risks of Dollar-Cost Averaging
While dollar-cost averaging offers many benefits, it’s not without its potential drawbacks. One potential downside is that if the market consistently rises, a dollar-cost averaging strategy could yield lower returns compared to lump sum investing. In bullish markets, a lump sum invested early would have more time to grow.
Another risk is that despite the potential to achieve a lower average price per share, DCA doesn’t guarantee profits or protect against losses. If the market continually declines, you may lose money, especially if you need to withdraw your investment before the market has a chance to recover.
Finally, for dollar-cost averaging to work effectively, it requires regular and continuous investments. This may pose a challenge if you have a tight budget or unpredictable cash flow.
Dollar-Cost Averaging vs. Lump Sum Investing
Lump sum investing is another common strategy where an investor puts a large sum of money into the market at once. This approach can yield higher returns during a bull market because your entire investment is exposed to the market’s growth from the beginning.
However, timing the lump sum investment correctly can be challenging, even for professional investors. Misjudging the market can lead to buying high, which could result in lower returns or even losses. It’s also worth noting that investing a large sum all at once can be a significant risk if the market takes a downturn shortly after.
Choosing between dollar-cost averaging and lump sum investing largely depends on factors like your risk tolerance, investment horizon, and the amount of money you have to invest.
Implementing Dollar-Cost Averaging in Your Investment Strategy
If you’re interested in implementing a dollar-cost averaging strategy, you’ll need to consider several factors:
Choosing an investment: First, choose a suitable investment option. This could be individual stocks, mutual funds, or exchange-traded funds (ETFs). It’s wise to diversify across different asset classes to reduce risk.
Budget: Decide how much money you can invest regularly. This could be a fixed dollar amount you set aside from your paycheck every month. The key is to ensure it’s an amount you can commit to over time.
Frequency: Determine how often you want to invest. This could be monthly, quarterly, or any interval that fits your financial situation. The main point is to stick to a regular schedule.
Duration: Consider how long you plan to keep investing. This would typically be linked to your financial goals. Are you saving for retirement, a down payment on a home, or your child’s college education? Your end goal can help you determine how long you dollar-cost average.
Dollar-Cost Averaging in Different Market Conditions
Dollar-cost averaging can prove beneficial in various market conditions:
Bullish markets: In a steadily rising market, a DCA strategy may underperform a lump sum investing approach. However, the benefit is that you’re not risking a large sum of money at once and aren’t trying to time the market.
Bearish markets: In declining markets, DCA comes into its own by allowing you to buy more shares at lower prices. This can reduce the average cost of your investment over time.
Volatile markets: Market volatility can make it difficult to time your investments. With DCA, you’re investing at regular intervals, which means you’re less likely to be swayed by short-term market swings.
Dollar-Cost Averaging With Robo-Advisors and Investment Apps
Nowadays, you don’t need to manually make investments at regular intervals. Many financial institutions offer automatic trading plans, and several robo-advisors and investment apps also provide automated DCA services.
These tools can automatically deduct a set amount from your bank or brokerage account and invest it according to your preferences, making DCA even more straightforward.
Conclusion
Dollar-cost averaging helps you manage fluctuations in the market, mitigate the risks of market timing, and potentially lower your average purchase price. It offers a systematic and disciplined approach to investing. However, like any investment strategy, it’s not without risks. Always consider your financial goals, risk tolerance, and investment horizon before deciding to implement DCA.
Remember, past performance is not indicative of future results, and it’s important to evaluate your investment options carefully. While this article provides a thorough understanding of how dollar-cost averaging works, it does not provide investment advice. You should consider seeking advice from professional advisory or brokerage services that can provide personalized advice based on your circumstances.
Frequently Asked Questions
Can I use dollar-cost averaging in my retirement account?
Yes, DCA fits perfectly in retirement accounts like 401(k)s or IRAs. You’re typically contributing a set amount regularly, which is DCA in practice. Over time, this can help smooth out the impact of market volatility on your retirement savings.
Do I need a large sum of money to start dollar-cost averaging?
No, the advantage of DCA is that it allows you to start investing with any amount you’re comfortable with. You simply invest a fixed amount at regular intervals, which could be as little as a few dollars every month.
How does dollar-cost averaging help me build wealth over time?
DCA can contribute to wealth building by potentially lowering the average cost of your investments over time. By buying more shares when prices are low and fewer when they’re high, you might lower your average cost per share, setting the stage for potential gains in the long run.
Can dollar-cost averaging protect me from all investment losses?
While DCA can help mitigate the effects of volatile markets, it does not guarantee protection from all investment losses. The value of your investments can still go down, particularly if the entire market is in a prolonged downturn. It’s important to have a diversified portfolio and a strategy that aligns with your risk tolerance.
Is dollar-cost averaging only suitable for stocks?
Not at all. While often associated with buying stocks, you can apply dollar-cost averaging to other types of investments as well, like mutual funds, index funds, exchange-traded funds (ETFs), or even Bitcoin. The key is that the asset’s price changes over time.
How often should I make investments if I’m using a dollar-cost averaging strategy?
The frequency of investments in a DCA strategy can vary based on your personal finance situation and goals. Common intervals include monthly and bi-weekly, often aligned with pay periods. The key is to be consistent and stick to your predetermined schedule.
The CFPB’s budget cannot exceed 12% of the Federal Reserve’s annual operating expenses. The watchdog agency has so far not requested all of the budget authorized to it in any given year, the Post reported. However, the appeals court said the CFPB’s funding mechanism violated a constitutional mandate for congressional appropriation of money, the Post … [Read more…]
MCLEAN, VA – JULY 10: A Freddie Mac sign sits in front of its headquarters July 10, 2008 in … [+] McClean, Virginia. Shares in Fannie Mae and Freddie Mac have dropped to their lowest levels in 17 years. (Photo by Chip Somodevilla/Getty Images)
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Last week, I submitted a very brief comment letter on the Biden administration’s proposal to allow Freddie Mac to start purchasing second mortgages. It makes the very narrow point that the proposal doesn’t address safety and soundness, a legal requirement enacted by the Housing and Economic Recovery Act of 2008.
That flaw should disqualify the proposal on technical grounds, but the proposal is terrible housing finance policy even if it meets all the legal requirements.
Like most federal housing finance policies enacted during the last few decades, this one will do nothing to increase home ownership or to make housing more affordable. If anything, it will increase Americans’ debt levels and put upward pressure on prices (not just housing prices).
If policymakers want to make housing more affordable, they must do something very different: Start shrinking the federal government’s role in housing finance. That approach, of course, would be the polar opposite of the direction taken during the last few decades.
In 1990, Fannie’s and Freddie’s combined share of outstanding residential mortgage debt was just 25.7 percent. But that share soon started climbing, and by 2010 it was up to 47 percent, where it remains. (For a reminder: Both GSEs are still under government conservatorship because they imploded in 2008.)
Separately, in 2023, the Federal Housing Administration insured 16 percent of the single family mortgage market (see table 3). Combined with Fannie and Freddie, that’s a federal share of 63 percent.
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In the secondary mortgage market, privately issued mortgage-backed securities are practically an imperceptible share of the total, and that’s not a new occurrence. From 2009 to 2023, the combined federal share (Fannie, Freddie, and Ginnie Mae) of the MBS market averaged 93 percent per year.
One interesting problem with this arrangement is that it violates the spirit of how and why Congress set up Fannie and Freddie. These GSEs were not supposed to dominate the market, and Congress said so. Fannie’s and Freddie’s charters require “the volume of the Corporation’s lending activities” to be small enough to “reasonably prevent excessive use of the Corporation’s facilities.”
Nobody in the administration (or Congress) seems to care, but the FHFA has never promulgated a rule so that it might enforce this excessive use provision. The current lack of enforcement is bad enough, but the new proposal explicitly authorizes Freddie to purchase even more mortgages.
Even in the absence of the excessive use provisions, it would be hard to defend this new proposal on the grounds that it might help increase homeownership. In fact, it’s so difficult that the FHFA isn’t even trying. Instead, the proposal explicitly states “the primary goal of this proposed new product is to provide borrowers a lower cost alternative to a cash-out refinance in higher interest rate environments.”
So now the express purpose of the GSEs is to help homeowners take on even more debt, above and beyond what they need to purchase a home.
The FHFA will insist that the new proposal is in the public interest, but the proposal should be disqualified on that basis for several reasons.
First, private markets do provide home equity lines of credit. In 2023, they provided almost $370 billion. There is no natural market barrier to overcome, and if the MBS market is any indication, the new program will stifle competition.
And if the product does spur additional low equity debt for underserved markets, that means federal policies are saddling the most vulnerable borrowers with higher debt, putting any equity they have managed to build up at even further risk. And, of course, the more successful this program becomes, the more risk it poses to the overall financial system.
Obviously, none of this is very surprising coming from the Biden administration, especially given its recent proposal to make housing more affordable with yet more subsidies. Chances are, though, that an administration from either political party would have introduced the same new proposal for Freddie and pitched it as a way to increase competition and make homes more affordable.
The truth is housing will always be somewhat supply constrained, depending on the location, and many of the reforms that can ease those constraints and improve affordability have to occur at the state and local level. If federal policymakers want to make housing more affordable, they must pare back federal subsidies of all kinds.
One very easy place to start is by enforcing the excessive use provisions in the GSEs’ charters. Another is to restrict the GSEs to buying only primary mortgages for owner-occupied homes. These should be the lowest hanging fruit for policy reform.
Homesense is now open in the Alliance area of Fort Worth, offering a variety of furniture, an art and mirror gallery, lighting options, a rug emporium, and more at discounted prices.
The Fort Worth store is the first store in Texas for the brand, with additional locations coming to Austin, Houston and San Antonio.
Welcome to the charming city of Bend, Oregon, where the stunning Cascade Mountains provide a breathtaking backdrop for outdoor enthusiasts and nature lovers. With its vibrant arts scene, thriving craft beer culture, and an abundance of outdoor recreational activities, Bend offers a unique blend of urban amenities and natural beauty. Whether you’re drawn to an apartment in Bend’s bustling downtown area or a rental home in the serene neighborhoods nestled along the Deschutes River, Bend has something to offer for everyone.
In this Apartment Guide article, we’ll cut to the chase, breaking down the pros and cons of moving to Bend, Oregon. Let’s get started and see what awaits in this outdoor paradise.
Pros of living in Bend, OR
1. Outdoor paradise
Bend is a haven for outdoor enthusiasts, with its proximity to the Cascade Mountains and the Deschutes River. Drake Park, which stretches 13 acres along the banks of the Deschutes through downtown Bend, is a highlight. Residents can enjoy a wide range of outdoor activities, including hiking, mountain biking, skiing, and rock climbing. The city’s numerous parks and trails offer breathtaking views and opportunities for adventure, making it an ideal location for nature lovers.
2. Craft beer scene
With numerous breweries offering a diverse selection of locally brewed beers, Bend has a thriving craft beer scene. Residents can explore the Bend Ale Trail, which features over 20 breweries, each with its own unique atmosphere and flavors. The city’s beer culture fosters a sense of community and provides a vibrant social scene for beer enthusiasts.
3. Vibrant arts and culture
Bend boasts a vibrant arts and culture scene, with numerous galleries, art festivals, and live music venues. The city’s First Friday Art Walk allows residents to explore local art and connect with the creative community. Additionally, the Tower Theatre hosts a variety of performances, from live music to theater productions, providing residents with diverse cultural experiences.
4. Thriving food scene
Bend offers a diverse and thriving food scene, with a wide range of restaurants, food carts, and farmers’ markets. Residents can savor farm-to-table dining experiences, sample international cuisines, and enjoy local specialties at restaurants like Dear Irene and Ariana. The city’s culinary landscape reflects its commitment to sustainability and quality, making it a paradise for food enthusiasts.
5. Strong sense of community
Bend fosters a strong sense of community, with residents actively participating in local events, volunteer opportunities, and community initiatives. The city’s friendly and welcoming atmosphere creates a supportive environment for individuals and families, promoting a sense of belonging and connection.
6. Abundance of outdoor recreation
Bend offers an abundance of outdoor recreation opportunities, with access to world-class skiing, snowboarding, and snowshoeing in the winter, and hiking, fishing, and paddleboarding in the summer. The city’s natural beauty and diverse landscapes provide endless possibilities for adventure and exploration, making it an ideal location for outdoor enthusiasts.
Cons of living in Bend, OR
1. Limited job opportunities
One of the challenges of living in Bend is the limited job opportunities, particularly in certain industries. The city’s economy is primarily driven by tourism and outdoor recreation, which may not offer as many career options for professionals in other fields. Residents may need to explore remote work or consider commuting to nearby cities for employment.
2. Seasonal tourism impact
Bend experiences a significant influx of tourists during peak seasons, which can impact the local infrastructure, traffic, and availability of resources. Residents may find it challenging to navigate crowded areas and may experience fluctuations in the availability of services and amenities during peak tourist periods.
3. Harsh winter weather
Bend’s winter weather can be harsh, with heavy snowfall and cold temperatures. The city gets an average of 30+ inches of snow annually. While this may be appealing to winter sports enthusiasts, it can also pose challenges for daily commuting, outdoor activities, and overall comfort during the colder months. Residents need to be prepared for the winter climate and its potential impact on daily life.
4. Distance from major cities
Bend is located at a distance from major cities, which may result in longer travel times for residents needing access to specific amenities, services, or entertainment options. Travel from Bend to major cities such as Salem and Portland takes more than 2 hours. While the city offers a unique and serene environment, the distance from larger urban centers may pose challenges for those seeking a more metropolitan lifestyle.
5. Limited public transportation
Bend’s public transportation system is relatively limited, which may pose challenges for residents who rely on public transit for their daily commute or travel needs. The city’s infrastructure primarily caters to private vehicles, and residents may find it challenging to navigate the city without access to a personal vehicle.
6. Water scarcity concerns
Bend faces water scarcity concerns, particularly during dry seasons, which may impact water usage and conservation efforts. Residents need to be mindful of water consumption and adhere to local regulations to ensure sustainable water management in the region.
7. Cost of living
The cost of living in Bend is high compared to other cities in Oregon. The city has been growing in popularity over recent years, as renters flock to Bend for its access to stunning natural beauty and year-round recreational opportunities. The average rent for a 2 bedroom apartment in Bend is $2,175, higher than nearby Sisters ($1,295) and even Portland ($1,887).
When you apply for a home loan, an underwriter will review your file in order to make a lending decision.
They can approve your loan, deny your loan, or possibly suspend your loan pending additional information.
The two most common outcomes are approval and denial, but even an approved loan is typically “conditional.”
This means it’s actually a conditional approval that requires certain requirements to be met before you’re issued a final approval.
Only at that point can you sign loan documents and eventually fund your loan.
Not All Mortgage Approvals Are Created Equal
There are various levels of loan approval in the mortgage world.
If you’ve been considering a home purchase, you’ve likely come across the terms mortgage pre-qual or mortgage pre-approval.
As the names suggests, it’s a preliminary step in the home loan approval process, a sort of “seeing where you stand.”
A pre-qual is the less robust of the two and often just involves light calculations (sans any real paperwork) to determine your purchasing power.
Depending on the bank or lender in question, a pre-approval may involve a credit pull and the furnishing of certain documentation such as pay stubs, tax returns, and bank statements.
With this information in hand, a lender can give you a fairly good idea of how much house you can afford and whether you qualify for a home loan.
It’s still pretty preliminary though, which explains why it’s called a pre-approval. And it’s also not a formal loan application, nor is it reviewed by an actual underwriter.
Once you find a home and make an offer, you’d formally apply for a loan and if approved, it would be a conditional loan approval.
This approval is subject to meeting any outstanding conditions, as determined by the loan underwriter.
After those are met, you’ll be issued what’s called a “final approval” and will be able to sign loan documents and fund/record.
Prior-to-Doc Conditions
If and when you receive a conditional loan approval, you’ll also be given a list of conditions that must be met to get a final approval.
These are known as “prior-to-doc conditions,” or PTDs for short. Before you can receive loan documents to sign, these need to be signed off.
The loan underwriter (or loan processor) will provide this list of conditions when they review your loan file.
Typical PTD conditions include things like:
– rental and employment verification – bank statements (showing proof of funds or deposits) – tax returns or transcripts – credit card statements – CPA letter if self-employed – mortgage statements (for other properties) – copy of driver’s license for identification – copy of check for down payment/earnest money – home appraisal – title search – gift letters – proof of homeowners insurance – flood certification – lock confirmation (if floating your rate) – letters of explanation (LOEs)
As you can see, there can still be quite a bit of work once you’re conditionally approved for a mortgage.
This explains why it typically takes a month or longer to get a mortgage, even if you’re approved in a matter of days (or minutes).
However, many of these items are straightforward and can often be satisfied quite easily. Others simply take time, like the home appraisal and title search.
There are also times when the underwriter needs more information, so a letter of explanation (LOE) may be required to clear up any questions or confusion.
Tip: Work diligently with the loan officer or mortgage broker to submit a complete and clean loan file upfront to avoid extra paperwork requests later!
Final Approval and Clear to Close (CTC)
Once your list of PTDs are satisfied, you’ll receive what is known as a “clear-to-close” (CTC) notice and a final approval from the underwriter. This is great news and means you’re almost to the finish line!
A clear-to-close is the underwriter’s way of saying all conditions were met and the loan documents can finally be generated. At this time, you’ll also receive your Closing Disclosure (CD).
It lists all the details of your loan, including your interest rate, monthly payment, closing costs, and your right of rescission (if applicable).
This document must be sent to you for review at least three business days before loan signing.
At this time, you’ll also make an appointment to sign with a notary public (or to eSign if available in your state). And you’ll receive wire instructions from escrow.
But wait, there’s more!
Prior-to-Funding Conditions
Once you’ve signed your loan documents, there might be another set of conditions known as prior-to-funding conditions, or PTFs.
Typically, these involve some housekeeping by the lender and the title/escrow company and might just be a matter of confirming and sending a wire.
Common PTF conditions include things like:
– employment verification – final credit check (to see if any new debt/inquiries) – verification of funds to close – any additional letters of explanation – title/escrow tasks like sending a wire or requesting proof of funds
After the PTF conditions are cleared, your loan will be able to fund and record with the county clerk.
This can still take a day or two depending on timing, wires, etc. Yes, it’s time-consuming, but a mortgage is a big deal so be patient!
Can I Still Be Denied After Receiving a Conditional Approval?
The short answer is yes. The home loan process generally takes 30 to 45 days.
During that time, if anything material changes or is discovered by the underwriter, it’s possible that your conditional approval can turn into a loan denial.
For example, you might be denied if the underwriter finds out you quit or lost your job, or if you missed a different mortgage payment. Or if you applied for other loans or racked up new debt.
The same might be true if you’re unable to verify income, assets, etc., or if the home inspection reveals property issues that can’t be resolved.
Perhaps the appraised value came in low and you no longer qualify, or rates skyrocketed and you failed to lock your loan.
There are countless ways to jeopardize a mortgage. While some things might be out of your control, many are not.
This is why you’re typically told to do nothing and wait for the loan to fund before spending or making any big life changes.
Ultimately, lenders want to know that you’re able to pay back the loan, so anything that counters that belief can put your approval into question.
To make the process as painless as possible, do as you’re told and provide documents promptly when asked.
Debt can feel like a heavy burden, but understanding the different types of debt and how to manage them can help you stay financially healthy. From student loans to credit card debt, here’s a guide to common types of debt and tips for avoiding growing debt.
Student Loans
Student loans come in two main types: federal student loans, which are backed by the government, and private student loans, which are offered by banks, credit unions, and other lenders.
Federal Student Loans: These loans typically have lower interest rates and more flexible repayment options compared to private student loans. They also offer benefits like income-driven repayment plans and loan forgiveness programs for certain professions.
Private Student Loans: Private student loans usually have higher interest rates and fewer borrower protections compared to federal loans. They’re a good option for filling the gap between financial aid and the cost of attendance, but should be used wisely.
To prevent student loan debt from dominating your life, budget carefully, prioritize loan payments, and explore income-driven repayment plans or loan forgiveness programs. Communicate with lenders if you face financial hardship and seek guidance from financial advisors.
Credit Card Debt
Credit cards are a form of revolving credit, which means you can borrow money up to a certain credit limit and pay it back over time. If you don’t pay off the full balance each month, you’ll accrue interest on the remaining balance. Credit cards often have high interest rates compared to other types of loans, which can make it easy for debt to spiral out of control if not managed carefully.
To avoid credit card debt, pay off balances in full each month to avoid interest charges (it’s a myth that you need to carry a balance to build credit) and set a budget to limit spending. Avoid maxing out credit cards and making only minimum payments. Monitor spending regularly and prioritize paying off high-interest debts first.
Car Loans
The interest rate on a car loan can vary depending on factors like your credit score, the length of the loan term, and the type of vehicle you’re purchasing. Car loans are typically secured by the vehicle itself, which means the lender can repossess the car if you fail to make payments. Cars lose value over time, so it’s important to consider how much you’re willing to spend on a vehicle relative to its long-term value.
Common mistakes with car loans include not shopping around for the best interest rate, taking out loans with lengthy terms that result in higher overall costs, and failing to make extra payments to pay off the loan faster. Additionally, some people underestimate the total cost of ownership, including maintenance and insurance, leading to financial strain.
Personal Loans
Personal loans are typically unsecured, which means they’re not backed by collateral like a car or house. Personal loans often have fixed interest rates, which means your monthly payment stays the same over the life of the loan. Lenders usually require a credit check to qualify for a personal loan, and your interest rate will depend on factors like your credit score and income.
Common mistakes with personal loans include borrowing more than needed, neglecting to compare interest rates and fees from multiple lenders, and not understanding the terms and conditions of the loan. Additionally, some people use personal loans for non-essential expenses, increasing their debt burden unnecessarily. It’s also common to overlook the impact of the loan on overall financial health and fail to create a repayment plan.
Tips for Avoiding Growing Debt
1. Create a Budget
Track your income and expenses to see where your money is going each month. Set spending limits for different categories like groceries, entertainment, and transportation. Prioritize essential expenses like housing, food, and utilities, and cut back on non-essential expenses where you can.
2. Build an Emergency Fund
Save money in an emergency fund to cover unexpected expenses like car repairs, medical bills, or job loss. Aim to save enough to cover 3-6 months’ worth of living expenses, or more if you have dependents or are self-employed.
3. Pay Off High-Interest Debt First
Focus on paying off debt with the highest interest rates first, like credit card debt. Consider strategies like the debt avalanche or debt snowball method to prioritize your debts and pay them off more efficiently.
4. Negotiate Lower Interest Rates
Contact your lenders to see if you qualify for lower interest rates or better repayment terms. Consider transferring high-interest credit card balances to a card with a lower interest rate or taking out a personal loan to consolidate debt.
5. Seek Financial Assistance if Needed
If you’re struggling to manage your debt, don’t be afraid to seek help from a credit counselor or financial advisor. They can help you create a debt repayment plan, negotiate with creditors, and explore options like debt settlement or bankruptcy if necessary. By understanding the different types of debt and implementing these tips, you can avoid growing debt and achieve financial stability. Remember, managing debt is all about making informed decisions and taking control of your financial future.