Month: August 2024

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Two lenders based in New Jersey have struck an M&A deal. OceanFirst Bank N.A. is acquiring Garden State Home Loans Inc., which will become a new division for the regional depositary bank, HousingWire has learned.

Garden State’s president and CEO, Justin DeJoseph, emailed employees on July 25 to announce the transaction.

In the message reviewed by HousingWire, DeJoseph wrote that by becoming part of a larger organization, Garden State gains access to a “national lending platform, greater resources, enhanced career development opportunities, and the ability to offer more comprehensive services to our clients, well beyond residential mortgage lending.” 

Garden State’s website and social media page reflect the status of a “division of OceanFirst Bank N.A.” 

A spokesperson for OceanFirst Financial Corp, parent of OceanFirst Bank, and DeJoseph did not reply to requests for comments. 

Garden State had 34 sponsored loan officers and two active branches—in Medford (New Jersey) and Maitland (Florida)—as of Friday, per the Nationwide Multistate Licensing System (NMLS).

The company, founded in 2011 as a mortgage broker, transitioned to a mortgage lender in 2017. Its website says the lender has funded over $5.6 billion in 19,000 loans since its foundation. Meanwhile, OceanFirst Bank, founded in 1902, had about 200 loan officers as of Friday, the NMLS data shows. 

In the email to employees, DeJoseph wrote that selling the company will enable Garden State to provide more products without changing its processes.

DeJoseph also wrote that the deal did not change the company’s expansion plans. “We are actively hiring both operational and sales personnel to strengthen our team,” he said. “The goal is increasing our volume year over year and double our staff by mid-next year. This will allow us to hit our goals of doing $2 billion in volume in 2025.”

Source: housingwire.com

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Managing your personal finances can feel overwhelming, but with the right steps, you can take control and gain peace of mind. Whether you’re looking to pay off debt, save for a big purchase, or just want to feel more in control, these steps will guide you to financial stability.

In this post, you’ll discover 12 fail-proof steps to organize your personal finances. These practical tips will help you create a budget, track your expenses, and plan for the future, ensuring you can make smart financial decisions and stay on top of your money. Let’s get started on the path to better financial organization!

Why Organize your Finances?

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Organizing your finances makes life easier and less stressful. You can see where your money goes and save more. Thus, knowing your bills are paid in full.

1. Inventory all of Your Accounts

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List every bank, credit, and investment account you have. Knowing what you have helps manage your money better.

Learn More: Grab a copy of our POPULAR budget binder!

2. Figure Out Your Net Worth

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Calculate your net worth by subtracting debts from assets. This gives a clear picture of your financial health. Even if your net worth is negative, there is only one way up.

To learn more: How to Calculate Your Liquid Net Worth and Know What You’re Worth

3. Create a Budget Binder

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Use a budget binder to track spending and savings. It helps keep your financial life organized and on track.

To learn more: How to Make a Budget Binder to Motivate Your Financial Goals

4. Separate Email for Finances

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Create a separate email for all financial matters. It keeps everything organized and easy to find when needed.

5. Use a Bill Payment Organizer

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Track all your bills with a bill payment organizer. This ensures you never miss a payment and stay on budget.

To learn more: 5 Effective Bill Calendar Strategies That Boost Your Finances

6. Set Money Goals

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Define your financial goals, like saving for a car or paying off debt. Clear goals help you stay focused. This is something that should not be overlooked.

To learn more: Powerful Truth Behind Money Goals that you Need to Know

7. Know Your Income and Expenses

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Track your income and expenses to see where your money goes. This helps in making informed financial decisions.

To learn more: What is Annual Income? Meaning, Gross, Net, and How to Calculate

8. Find Out Your Credit Score Number

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Check your credit score regularly. Knowing your score helps you improve it and get better interest rates.

9. Update Your Estate Documents

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Keep your estate documents up to date. This protects your assets and ensures your wishes are followed. This is something that must be reviewed every couple of years.

10. Review Your Insurance

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Regularly review insurance policies to ensure you have adequate coverage at the best price. This is for auto, homeowners, or umbrella policies.

11. Use a Password Manager

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Store all your financial passwords securely in a password manager. This keeps your accounts safe and accessible. Bitwarden is a preferred choice by many security analysts.

12. Tell Someone

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Share your financial plans with a trusted person. Having someone to talk to helps stay accountable and focused.

What is your next step to organize your personal finances?

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Now that you know the steps, start today. A little organization can make a big difference in your financial life. Plus you can relieve stress.

To learn more: How to Organize Personal Finances in 8 Simple Steps

Know someone else that needs this, too? Then, please share!!

Did the post resonate with you?

More importantly, did I answer the questions you have about this topic? Let me know in the comments if I can help in some other way!

Your comments are not just welcomed; they’re an integral part of our community. Let’s continue the conversation and explore how these ideas align with your journey towards Money Bliss.

Source: moneybliss.org

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Have you ever watched somebody pull out a set of jumper cables and thought, “I really should learn how to jump-start a car someday”?

It isn’t a difficult process. But to avoid damaging your car or hurting yourself, you should perform each step carefully, in the correct order, and with the right equipment.

By learning how to properly jump-start a car battery by yourself, you can save time, money, and hassle. In this guide, we’ll cover how to jump-start a car, how long it can take, and what you’ll need to get the job done.

How To Jump-start a Vehicle

Whether your battery is temporarily drained of power or truly dead, there are a few ways to get your car back on the road. The most important step is learning how before you’re stuck on the side of the road.

The most common method is to use a set of jumper cables and another car’s battery to give yours the charge it needs to get started. Or if you keep a portable jump-starter in your car, you may be able to give your battery a needed boost without anyone else’s help. And if you drive a car with a manual transmission, it might be possible to “pop the clutch” or “push-start” the car.

By the way, it helps if you have a good battery without a lot of corrosion on the posts. (A 12-volt battery typically lasts around six years. Batteries can deteriorate faster if you don’t drive much.) You may want to make checking the battery part of your routine to help save money on car maintenance.

Recommended: How Much Does Insurance Go Up After an Accident?

How to Jump-start a Vehicle with Jumper Cables

Before you try to jump-start any vehicle for the first time, it’s a good idea to read the owner’s manual, just in case there is anything you should know about that specific model. But the steps are basically the same no matter what you’re driving.

Get Out Your Jumper Cables

Jumper cables come in sets of two: The positive cable has red clamp at each end, and the negative cable has black clamps. You’ll need both cables to jump-start a car.

Jumper cables aren’t standard equipment with most vehicles, so you’ll have to purchase a set to keep in your trunk. You can purchase a new set for about $20-$40. You may want to keep a pair of gloves and safety glasses with the cables.

Get Another Car to Cozy Up Next to Yours

If you’re at home and have a second car, you might even be able to do this by yourself. Otherwise you’ll have to call a friend or flag down a Good Samaritan. The two cars should be parked close enough that you can connect the cables without pulling them too tight, but leave enough room so you can move comfortably between the cars. Both cars should have their engine turned off and the emergency brake on.

Open the Hood on Each Car

Open the hood and locate the battery in each car. Then look for the negative and positive terminals on each battery. The positive terminal should have a plus sign (+) and/or a red cover. The negative terminal should have a minus sign (-) and/or a black cover.

Connect the Jumper Cables

Start with the dead-battery car. Attach one red clamp from the positive cable to the dead battery’s positive terminal. The clamp should “bite” through any corrosion and onto the metal terminal. If you have the black clamp of the other cable near the dead-battery car, be sure it isn’t touching any metal surfaces before you move over to attach both clamps to the booster (working) car.

Move over to the booster car. Attach the other red clamp from the positive cable to the positive terminal on the booster car’s battery. Then attach a black clamp from the negative cable to the booster battery’s negative terminal.

Go back to the dead-battery car. Attach the other black clamp from the negative cable to an unpainted metal surface on the engine. (You can look for an unpainted bolt or bracket that is several inches away from the battery.)

Check the cables to be sure they aren’t dangling or exposed to any moving parts in either vehicle.

Turn Off All Accessories

Before starting the booster car, check that all electronics are turned off in the dead-battery car. This includes hazard lights, the air conditioner or heater, radio, cell phone charger, etc.

Start the Booster Car

Put the booster car in park, start the engine, and let it idle for a few minutes. Don’t race the engine, but gently rev it to a bit above idle for 30 seconds or so to help the charge get to the dead battery. An older battery may take more time to charge.

Start the Dead-Battery Car

Try starting the car with the dead battery, and if it works, let it idle for several minutes. (Ask the driver of the other car to please wait while you do this.)

If the disabled car doesn’t start, disconnect the black clamp from the dead battery, check to make sure all your other connections are good, then replace the black clamp to the dead battery. Start the booster car again and let it idle for five minutes. Then try again to start the non-working car. If you repeat this process a couple of times and the car still won’t start, you may have to call for a tow truck.

Disconnect the Jumper Cables

Once the dead-battery car is running, you can disconnect the four clamps, working in reverse order. Be careful to remove the black clamp from the dead-battery car first, and keep it away from any metal and the other cable clamps while you work your way through the rest of the clamps. Then remove the black clamp from the working car, the red clamp from the good battery, and the red clamp from the dead battery.

Replace the plastic post protectors if either car has them. Keep fingers, clothing, and equipment away from any moving parts.

Keep the Dead-Battery Car’s Engine Running

Let the engine in the car you jump-started run for about 20 minutes so the alternator can recharge the battery. Drive somewhere safe (home or to a friend’s house, for example) before you shut off the car and try to start it up again.

If the car won’t start up again, you may have to get another jump-start or buy a new battery. You may even want to take the car straight to a mechanic to have the battery tested and, if necessary, replaced.

How to Jump-start a Car with a Portable Jump-starter Device

If you like the idea of being completely self-sufficient, you may want to purchase a portable jump-starter to keep in your car. The portable unit can take the place of a second vehicle when you need to charge your battery. Here’s how it works:

Confirm That the Unit’s Battery Is Charged

Before you stash the battery pack in your car, check that it has enough juice. Units typically plug into a common household outlet, and take an hour or longer to charge. Read the directions before you use the charger for the first time.

Attach the Cables

The unit will have two cables coming out of it: one with a red clamp and one with a black clamp. The unit and your car should be turned off. Then, with your car in park, attach the cable with the red clamp to the positive post on your car battery, and the cable with the black clamp to a bare metal area on the car. (Check your device’s directions for specifics.) Ensure that the unit won’t fall over or into the engine when you start the car.

Turn on the Power

When you’re ready, hit the power switch on the jump-starter device.

Start Your Car

Try to start your engine. If the problem is a dead battery, the engine should turn over.

Disconnect the Clamps

Just as you would when using jumper cables, let the car run above idle for a few minutes to help the battery charge. Then, with the car still running, turn off the power to the device and carefully disconnect the black and red clamps. Drive the car to a safe place or take it to a mechanic to have the battery tested.

To charge a motorcycle, the steps are pretty much the same if you’re using the portable jump-starter. It may be better for your bike than using a car battery, and easier than using another motorcycle. You also can try push-starting your motorcycle.

Recommended: How to Get Car Insurance

How to Push Start a Manual Transmission

This method is sometimes called “bump starting,” “clutch starting,” or “popping the clutch.” The idea is to get the car moving fast enough (by going downhill, getting some helpers to push it, or pushing it bumper-to-bumper with another car) that you can put it in gear, quickly let out the clutch, and get the engine to turn over. (If you enjoy learning new terms, consider adding some car insurance terms to your repertoire.)

When you get a push, warn your helpers that the car may jerk a bit when you pop the clutch. If someone offers to use their car to push you, be sure you can do so without denting or scratching either car.

Recommended: How to Get Car Insurance

Get into Gear

Depress the clutch pedal, and put the car into second gear.

Turn the Key Part Way

Turn the key one step to turn on the car, but not far enough to start the engine.

Get the Car Moving

If you’re at the top of the hill, you may be able to do this on your own, just by taking your foot off the brake and letting it roll. But you’ll likely need other people or another car to push your car. Keep the clutch pedal down.

Pop the Clutch

When the car is moving about 5 mph, quickly let your foot off the clutch pedal. The car may jerk a bit and the engine should turn over and start. If it doesn’t, you can try depressing and popping the clutch again while the car is still rolling.

Words of Caution Before Jump-starting Your Car

Once you learn how to do it, jump-starting your car can be fairly simple. But because there may be sparks, and batteries can explode, it’s always important to go through each step cautiously.

•   Do keep your face as far from the battery as you can while you’re attaching the cables.

•   Don’t let the clamps dangle near any metal while you’re attaching them. Don’t cross the cables when you’re attaching them to the batteries. Do keep the cables clear of the engine when you’re ready to start the cars.

•   Do avoid connecting all four clamps to battery posts. It’s safer to attach the black clamp to bare metal on the disabled car.

How Long Will It Take To Jump-start Your Car?

Once you know the basics of jump-starting a battery, you can expect it to take 15 to 20 minutes. Of course, waiting until you find another motorist to help you could add to the overall time.

If you’re a first-timer, it may take longer than 20 minutes. But you can cut down that time just by knowing where your jumper cables are, and where your car battery and battery terminals are located. (Speaking of first-timers, new drivers may benefit from these car insurance tips for first-time drivers.)

Calling for Help

If you don’t feel comfortable jump-starting a car yourself or don’t feel safe where you are, you can always call a pro for help when your battery dies. The jump-start or tow might even be free if you have a roadside assistance plan through your car insurance policy. Most plans include jump-starts as a basic service, but you should verify in advance what your coverage offers.

Recommended: How to Lower Car Insurance & Save Money

The Takeaway

Jump-starting a car isn’t that complicated, and it doesn’t take long — if you have the right equipment and know the proper steps. Still, it’s important to use caution as you go through the process to avoid hurting yourself or damaging your vehicle. The hardest part might be finding someone who will let you use their car for the jump (or give you a push, if you’re trying that method). And you’ll have to be in a spot where you can park two cars close enough together that you can use your jumper cables.

If you don’t want to — or can’t — jump-start your car, you may decide it’s easier and safer to call roadside assistance. You can purchase roadside assistance through an auto club, and many car insurance companies offer inexpensive plan options as part of their coverage. If you haven’t had a personal insurance planning session lately, this might be a good time to review your options.

And if you’re looking for the best car insurance for your needs, it can help to compare your current auto insurance policy to what other top insurers are offering.

When you’re ready to shop for auto insurance, SoFi can help. Our online auto insurance comparison tool lets you see quotes from a network of top insurance providers within minutes, saving you time and hassle.

SoFi brings you real rates, with no bait and switch.

FAQ

How long does it take to jump-start a car?

The process — attaching the cables, starting the cars and running both for a few minutes, then detaching the cables — should take just a few minutes. It’s a good idea, though, to keep the booster car around for a few minutes after that, just to be sure the boosted car keeps running and can get back on the road.

How long should you let a car run after you jump-start it?

You should let a car idle for several minutes after you jump-start it, to be sure you have a sufficient charge. After that, it’s important to let it keep running or drive it for at least 20 minutes so the battery can fully charge.

Can you jump-start a car alone?

It’s possible to jump-start a car alone if you’re home and have a second car handy to use as a booster car, or if you have a portable jump-starting device with you.

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Insurance not available in all states.
Experian is a registered service mark of Experian Personal Insurance Agency, Inc.
Social Finance, LLC (“SoFi”) is compensated by Experian for each customer who purchases a policy through Experian from the site.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

SOPRO-Q324-008

Source: sofi.com

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The Offer

Check your email for the following offer on the Citi Sears card with Shop Your Way Rewards:

  • Spend $450 or more each month through 10/31/2024 on total eligible utilities purchases on your Shop Your Way Mastercard and earn 5% back in statement credits each month during this offer.
    Hurry, offer ends 10/31/2024!
  • Only purchases made after activation qualify. Activate by 10/31/24.
  • Max earn is $50 each month; $150 over the course of the offer.

Our Verdict

Nice savings for Utilities which are typically an non-bonused category. This can potentially stack with other spend offers you have on the SYW card.

Hat tip to reader Gary A

Source: doctorofcredit.com

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“For example, I locked one loan today that would have cost the borrower 1.213 points on Monday versus 0.375 today. This loan amount happens to be $610,000, and the cost of the rate went from costing $7,400 to costing $3,200 today,” Hoff said. “The average mortgage loan amount in the U.S. is $405,000, and saving an extra 80 basis points could equate to $150 to $250 a month, depending on the overall scenario. This is huge for borrowers.”

According to Hoff, borrowers who take advantage of these rates are those who have purchased or taken a cash-out refinance over the past 12 to 18 months. In addition, some borrowers are looking to buy now or have been prequalified this past year.

“They can take advantage of a lower payment or even qualifying for a higher purchase price if the DTI was a key factor in the preapproval,” she said.

Hoff has already advised her clients on “rate alerts” to “get the ball rolling now so that they can be prepared for when the rate reaches the level of benefit.”

Looking forward, she believes rates will be volatile and “jump all over the place, just like the stock market.”

“Usually, when rates take a big drop, we see a correction the following week,” Hoff said. “I hope this is not the case, but I advised my clients that this is the reason why I locked three loans today.”

Cutting fees for VA borrowers

Patton Gade, the national director of military lending at UMortgage, said he believes the market has already priced in a September rate hike. He’s not limboing as low as possible on rates but is stacking fees on top or structuring refis to eat up equity.

“Some will dazzle with a 5.2% rate, but they’re charging a full point on the origination fee and two discount points,” Gade said. “I believe the best way to care for the veteran is a loan with little to no fees. The lowest rate for the lowest possible cost is the way I want to go.”

As for the future, he’s not banking on the notion that rates are going to continue dropping into the low 6s and beyond.

“You can’t bet your life or client’s financial future on what we think might happen in the next six, 12, 18 months. Things happen that are unexpected,” Gade said.

Daniel Sa, a division president at NFM Lending, said he’s been proactive in communicating with past clients about how they can benefit from refinances. He’s telling clients they can refi with no lender fees and get an appraisal reimbursement.

“Given the recent positive shifts in the mortgage rate environment, we believe the coming months, especially between September and December, will be the optimal time for our clients to refinance,” Sa said.

“For new customers, we are currently quoting competitive rates that reflect both the current market conditions at 6.375% to 6.750% and our anticipation of further rate reductions,” he said. “This strategic positioning is designed to ensure our clients not only benefit from potential rate decreases but are also well-informed and prepared to act quickly to optimize their mortgage terms.

“Our aim is to keep our clients ahead of the curve, maximizing their financial benefits and enhancing their overall satisfaction with our services.”

Source: housingwire.com

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A home equity loan can allow you to access large sums of money without selling your home. Using your home as collateral, you can get a loan to finance anything you want — the choice is up to you.

There is a bit you should know before jumping all in. Any time a loan requires collateral, it’s always best to read the fine print. Keep reading to learn more about the details and see if a home equity loan is right for you.

Key Takeaways

  • A home equity loan allows homeowners to borrow against the equity in their home, using it as collateral.
  • Borrowers typically can access up to 80% of the home’s value, minus the existing mortgage balance.
  • Home equity loans have fixed interest rates and terms, while home equity lines of credit (HELOCs) offer flexible borrowing with variable rates.

What is a home equity loan?

Let’s start by explaining what home equity is. Home equity is the amount of your home’s value that you own beyond your mortgage.

In other words, it’s what you could sell your house for right now minus what you still owe on your mortgage. For example, if your current mortgage is $150,000, but the house appraises for $280,000, then you would have $130,000 in home equity.

How does a home equity loan work?

A home equity loan is a loan where you, the homeowner, use the equity in your home as collateral to borrow money.

But here’s the catch.

Just because you have $130,000 in home equity doesn’t mean that’s what is available to you from the bank. Lenders typically only approve home equity loans for up to 80% of the home’s value. So in this example, the lendable value of the home is $224,000. When you subtract your $150,000 mortgage balance, that leaves you with $74,000 available to you via a home equity loan.

Of course, there are other variables the lender considers as well.

Check Out Our Top Picks for 2024:

Best Home Equity Lenders

Requirements to Get a Home Equity Loan

Home equity loans used to be a sure thing. You could just walk into a bank and take out a home equity loan if you had equity in your home.

Then the 2008 housing crisis happened, and everything changed.

Now lenders are pickier and comb through every detail of each application. They have also started limiting the loan amount to only 80% of your home’s value, whereas 90% to 100% used to be commonplace.

Before approval, you’ll also obviously need to demonstrate and prove that you can repay the loan. If you argue that you have immediate plans to sell after renovation, prepare to be disappointed. Plans alone won’t suffice. A secure and constant revenue stream is definitely needed.

Most lenders require a debt-to-income ratio of 43% or less. So, the monthly payment for your home equity loan, along with your other monthly debt payments, can’t exceed 43% of your monthly pre-tax pay. Depending on your finances, this could limit just how much equity you’re able to tap into.

Home Equity Loans vs. Home Improvement Loans

Is a home equity loan the same thing as a home improvement loan?

No, they are very different. For example, you could use a home equity loan to finance needed repairs or home improvements. However, you could not use the funds from a home improvement loan as you would a personal loan.

A home improvement loan also doesn’t consider the equity you have in your home, nor does it require any collateral. Instead, you use it for anything that revolves around the “improvement” of your home — be it to install a swimming pool, remodel a kitchen, or repair a roof.

Lenders usually require you to provide a detailed plan of what you would use the money for. Additionally, the repayment periods are a lot shorter than home equity loans.

Home Equity Loans vs. Second Mortgages

Is a home equity loan the same as taking out a second mortgage?

Generally speaking, yes. People tend to confuse home equity loans with home equity lines of credit. A home equity line of credit (HELOC) is an adjustable-rate loan and can be a second mortgage, but it doesn’t have to be.

You can get a HELOC after you’ve paid off your mortgage, in which case the HELOC would be your first mortgage. However, rather than receiving a single payment as you would with a home equity loan, a HELOC lets you draw from an account as you need funds.

Home Equity Loan Benefits

There are quite a few pros and cons associated with home equity loans for borrowers and lenders.

From the buyer’s side:

For starters, home equity loans tend to be easier to get than other types of loans if you have bad credit. So if you’re getting turned down by multiple lenders, it’s a great alternative to traditional personal loans.

Secondly, most home equity loans have lower interest rates than unsecured loans, which will help you pay less over time. And you can use the funds to pay off credit card debt with higher interest.

Your credit score will directly affect the interest rate you get. The higher your credit score, the lower your interest rate will be.

Plus, there are some tax advantages. Not everybody qualifies, but all the interest you pay is tax-deductible if you do. That means you’ll pay less in taxes come April. Lastly, if you have a fair amount of equity in your home, you can borrow money against the equity.

For lenders:

Home equity loans are safe loans to make for a bank because they’re secured by the homeowner’s house. If the homeowner fails to make mortgage payments, the lender can seize the home to recoup the funds they’ve lost (which is how some of those blue foreclosure dots end up on Zillow).

Borrowers are always more likely to make a monthly payment on a loan if it’s secured by something valuable. Most of the time, they’ll choose to miss a credit card payment over a loan payment if they have to make a choice.

Home Equity Loan Drawbacks

The main con is the most obvious one: you could lose your home if you’re unable to make loan payments. Many times we’re put between a rock and a hard place.

It may not be the best loan for you if you have a real chance of not being able to pay both your mortgage and equity loan in the future. Unsecured installment loans may be a better option. However, the interest rate will be higher.

Another thing you should know is that the home equity loan market is rife with scammers. Some lenders will take advantage of any opportunity to rid you of your home at the first chance they get. So, if the company that’s caught your eye seems too good to be true, it most likely is.

How does a home equity loan work?

First, let’s talk about how you receive your money. There are a couple of different ways. You can either receive money as a lump sum or as a line of credit.

Lump Sum

Get all your cash at once and begin paying back the loan with monthly payments. Home equity loans usually come with a fixed interest rate. Each monthly mortgage payment you make will go towards interest and the principal.

Line of Credit

Once you are approved for a line of credit, you can choose only to borrow what you need when you need it. It has a credit limit, much like a credit card.

Referred to as a HELOC (home equity line of credit), if you go this route, you can borrow multiple times and only have to make smaller payments as you do. You can do this for several years until you’re expected to start making larger payments to pay off the loan.

Home equity lines of credit are considered by many to be the best option because of their flexibility. You’re only expected to pay interest on the loan amount you’ve used in the beginning. However, with a variable interest rate, some monthly payments may be higher or lower than others.

Another downside to a HELOC is that if banks need to, they can cancel the HELOC before you’ve even gotten a chance to use it. If it happens to you, pay off whatever you need to pay off and go somewhere else. There are lenders everywhere.

It’s always wise to shop around before settling with a lender. Interest rates can often vary significantly, and some lenders are more reputable than others. Moreover, many lenders require you to pay closing costs when taking out a home equity loan, but many won’t.

Do your homework and calculate which one will save you the most money over time. For example, a company may charge you closing costs, but if their mortgage rates are a lot lower than everyone else’s, they may be the best choice.

How long do you have to repay a home equity loan?

Home equity loans typically have terms ranging from five to 20 years, but some can last up to 30 years. With a fixed interest rate home equity loan, you’ll have fixed monthly payments until the loan is paid off.

If you take out a home equity line of credit, you’ll only have to pay the interest each month on what you’ve drawn. The draw period can last only a few years or up to ten years (depending on the lender). Once the draw period is over, your payments become regular payments, so each month’s payments will go towards both the interest and principal.

It is possible to pay off either type of loan early, but, once again, depending on the lender, there may be fees involved.

Can you sell your home if you get a home equity loan?

Yes, you can. It’s considered a lien on your house, so it’s settled at closing. Your loan is added to whatever you still owe on your mortgage. The sum of both is subtracted from whatever you sold your house for, with the remaining profits going to you (and, of course, Realtor fees).

Problems arise if the housing market collapses after you’ve taken out a home equity loan and the value of your home tanks. If you sell your house in this situation, what you make on your house will unlikely pay for what you still owe.

Banks don’t like giving out loans to buyers for houses with liens because they represent a greater risk for them. So if you intend to sell your home soon, make sure you can pay off the loan either through the sales proceeds or other means like cash savings.

How does a home equity loan affect my credit?

As with any loan, it can help or hurt your credit scores in various ways. You shouldn’t expect much improvement in your credit scores unless you take out a large loan and make on-time payments for years and years.

Pros

  • Make your monthly payments on time, and your Payment History category will get a boost.
  • If you get a HELOC, you’ll get a bump in the Debts Owed category because you’ll have more credit available to you.
  • No matter whether you choose a lump sum or line of credit, you should see a bump in Types of Credit.
  • Depending on how long it takes you to pay back the loan, if it’s for more than a few years, you’ll see a bump in Length of Credit History.

Cons

  • Your credit score will be lowered if you don’t make your payments on time.
  • If you take out a large amount, your Balances Owed category could cause your credit score to go down a few points.
  • Because it’s simply a new credit line, your credit score will also lower due to the New Credit category.

Bottom Line

A home equity loan can be a valuable financial tool if you need access to significant funds and have substantial equity in your home. It offers advantages like lower interest rates compared to unsecured loans and potential tax benefits.

Be aware of the risks, such as the possibility of losing your home if you’re unable to make payments. Ensure you meet the lender’s requirements, shop around for the best rates, and understand the terms before proceeding. By doing so, you can make an informed decision and potentially benefit from the financial flexibility a home equity loan provides.

Source: crediful.com

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Living frugally doesn’t mean giving up the things you love. It’s about making smart choices and finding ways to save money without sacrificing comfort.

In this post, you’ll find the top frugal living tips for around the house. These practical ideas will help you cut costs on everyday expenses, reduce waste, and make your home more efficient. Whether you’re looking to save on your utility bills, groceries, or household items, these tips will help you stretch your budget and make the most of what you have.

Adjust the temperature

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Turn down the heat or air conditioning at night to save on energy bills. It’s good for your wallet and your health.

Cut back cell phone plan

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Save money by reducing your cell phone plan’s data plan. Make sure it still meets your needs. This is especially true for preteen or teen cell phone plans.

Make clothes last longer

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Wash clothes less often and use gentle detergents to keep them looking new. This helps you spend less on clothes.

Shop for clothing on clearance

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Buy clothes on clearance to save money. I have found that shopping off-season can get you great deals. Plus only buy what you truly need.

Learn More: How to Shop for Clothes on a Budget

Eliminate cable or satellite TV

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Save money by streaming shows online instead of paying for cable or satellite TV. You may opt for monthly billing to binge watch shows.

Switch cell phones

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Consider switching to a cheaper cell phone provider. There are so many new providers to the market. Just check if they offer good service in your area.

Look into your energy usage

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Adjust your thermostat a few degrees to save money on energy. Invest in a comfy sweatshirt to stay warm.

Limit trips to the salon

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Save money by cutting your own hair or letting your natural color grow out. This was one of the ways we paid off debt faster!

Turn off unused lights

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Turn off lights when you leave a room to save on your electricity bill. This is a simple adage, but it still holds true.

Buy in bulk

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Save money by buying items like toilet paper and toothpaste in bulk. Be wise with what you buy that will you actually use the extra items.

Save money on laundry

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Wash clothes at night and hang them up to dry. This saves money and keeps clothes in good shape. For U.K. folks, this is a normal practice.

Check out the Must Haves for a Frugal Home

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Incorporating these frugal living tips into your home can significantly reduce your overall costs. By embracing a minimalist approach, being mindful of your spending, and making smart choices, you can create a comfortable and budget-friendly living space that aligns with your financial goals. Remember, small changes can lead to big savings over time, so start implementing these frugal home essentials today for a brighter and more financially secure future.

To learn more: 25 Frugal Home Must Haves To Save Money for Clean and Organized Home

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More importantly, did I answer the questions you have about this topic? Let me know in the comments if I can help in some other way!

Your comments are not just welcomed; they’re an integral part of our community. Let’s continue the conversation and explore how these ideas align with your journey towards Money Bliss.

Source: moneybliss.org