Thereâs nothing inherently wrong with living with your parents, other than EVERYTHING! So letâs talk about how to GET OUT! To be clear, Iâm going to discuss moving out and buying a place of your own, not moving out and renting, seeing that the latter is fairly self-explanatory. The desire to move out might be [&hellip
The post How to Move Out of Your Parents House first appeared on The Truth About Mortgage.
To help you head into the new year as a well-informed home buyer, seller, or owner, here are the top lessons we learned about real estate this year.
The post The Best Real Estate Advice of 2020: How the Pandemic Transformed Housing This Year appeared first on Real Estate News & Insights | realtor.com®.
If you have a business, the next step to taking it further is to build and grow a connection with your customers. Simply providing a service or product is no longer enough. In a world that is always moving and full of change, people crave meaningful interactions. And that need extends to the products and services they use. Customers want to be surrounded by things they can identify with. If a business with great products or services is also able to provide some kind of added value for someone, that person is more likely to become a loyal patron.
As a business owner, providing that added value can feel like a huge task. This is where the value of blog writing services can really shine. Not only can these services create more connections between you and your customers, but they can also make your life easier through a smoother workflow. Here are some questions you can ask yourself to get started.
Ultimately, you probably hope to increase your sales. However, modern consumers expect personal connections. Set a goal for providing helpful facts that engage new readers. Establish a goal regarding how many new readers left comments on your blog. Consumers are more likely to complete sales when they feel that you hope to improve their lives.
Yes. According to studies conducted by the Pew Research Center, people regularly turn to blogs and internet articles instead of using their televisions for news and information.
A blog allows businesses to connect with customers in many ways. Blogs provide answers to consumers' questions. They make your brand seem approachable and friendly. Blogs encourage readers to interact with your company and maintain meaningful connections. In addition to providing a blog, reach out through social media to invite readers to visit your website.
If you aren't sure about the needs, motivations, and concerns of your existing customers, it will be easy to miss out on meaningful connections. As you respond to comments on your blog posts or on your social media sites, you'll learn more about the needs that drive sales. While copywriters will spend time researching your current customers, it's also helpful for you to develop relationships with them.
Who benefits most from the goods or services you offer? These people are your target audience. Take a look at the demographics of your existing customers to identify the new audience you want to attract. Remember to focus on how your offerings can improve the lives of your existing customers to understand how to attract people from your target audience.
Building and maintaining a blog with a consistent schedule takes a lot of work. Some people make the mistake of underestimating the time commitment that goes into planning, design, and content creation. When your workday is already pushing beyond the 9-to-5 schedule, you don't really have time to produce consistent, fresh content.
There are a lot of potentially great blogs out there that consist of just one or two posts … last updated eight months ago. If you want to have a blog that builds and sustains an audience, a consistent schedule is critical. Without a schedule, it can sometimes be impossible to ensure posts are written and content keeps flowing. If you have loyal followers and you disappear for several months, you may very well be forgotten! Using blog writing services makes this a non-issue. When someone else writes your content, you can tend to your life and work without having to worry about losing customers.
The task of finding someone to accurately portray your company should not be taken lightly. After all, writing in a business or brand's voice is a critical part of the copywriting process.
It is equally important to understand the value of professional copywriters. There are many factors involved in the process of creating great copy that leads to increased sales, and copywriters must understand and use these strategies. With research into your subject and your target consumers, talented copywriters can represent your voice.
If your country kitchen is running out of room, consider a dresser. Even though you’re used to bureaus being only for bedrooms, it can be a valuable addition to a kitchen for storing napkins, utensils, and more. Repaint the dresser in colors to match your kitchen and you’ll have guests asking where you got your newest piece of kitchen furniture.
If your furniture is weathered or out of style, that’s not necessarily a reason to replace it. There are plenty of ways to spruce up old dressers, chairs, and tables. Everybody loves quilts, so why not drape one over that old chair that needs re-upholstering? You can also try using colorful fabrics on the fronts of nightstand and dresser drawers. Just get some scrap cloth from your last project or from a fabric store, and attach it to the dresser drawers with a staple gun. To have even more fun with it, we like to paint part of the piece and color-coordinate it with the cloth we’re using.
If your cabinets are getting old and worn, you can revive them just by replacing the knobs and handles. A good variety should be available inexpensively at your local hardware store. They’ll make your kitchen or bathroom look brand new!
Dress up an inexpensive set of plastic drawers by covering them in wrapping paper. Choose some paper you love (you can even pick several coordinating designs), and cut the pieces to fit the size of the drawers. Then spread a crafting glue/sealer, such as Mod Podge, on the plastic and smooth the wrapping paper onto it, being careful to eliminate bubbles. Allow to dry, and apply a coat of sealant on top. Not only does the paper look beautiful, but it also hides the contents of the drawers, making everything appear neat and tidy.
You’ve probably noticed this at the restaurants you frequent, but it’s becoming more and more acceptable nowadays—even hip—to eat your meals on vintage, mismatched chairs. Instead of spending a fortune on a dining-room set, go for the mismatched look and hunt for your chairs at thrift shops and used furniture stores.
If you’re looking for an easy, inexpensive way to add a pop of color to a room, look no further than the bookshelf. You can paint the interior back “wall” of the bookshelf a color that either contrasts or coordinates with your decor. It will add a modern touch for not a lot of money!
Get more great tips on our podcast by subscribing on iTunes or Stitcher! You can also sign up for our newsletter and follow us on Facebook for our daily tips!
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The new stimulus bill passed by Congress includes $25 billion in rental relief for struggling tenants, $2.6 billion of which is coming to California. Can I apply?
Show Summary Welcome back to the show! Excited to be here today with Glenn Williams. Glenn rehabs a lot of houses, I’ve rehab hundred of houses, and you start to learn…
For this podcast about commercial lending I sat down with Angie Hoffman at U.S. Bank. During the podcast we discussed investing in real estate, commercial lending, and how commerceial mortgages can help investors. If you want to learn more about commercial loans this is a great pdocast for you.
I hope you enjoy the podcast and find it informative. Please consider sharing with those who also may benefit. Listen via YouTube: You can connect with Angie on LinkedIn. You can reach out to Angie for more information on their lending products by emailing her at [email protected].
You can connect with me on Facebook, Pinterest, Twitter, LinkedIn, YouTube and Instagram.
About the author: The above article “Podcast #12: Hard Money Lending” was provided by Luxury Real Estate Specialist Paul Sian. Paul can be reached at [email protected] or by phone at 513-560-8002. If you’re thinking of selling or buying your investment or commercial business property I would love to share my marketing knowledge and expertise to help you. Contact me today!
I work in the following Greater Cincinnati, OH and Northern KY areas: Alexandria, Amberly, Amelia, Anderson Township, Cincinnati, Batavia, Blue Ash, Covington, Edgewood, Florence, Fort Mitchell, Fort Thomas, Hebron, Hyde Park, Indian Hill, Kenwood, Madeira, Mariemont, Milford, Montgomery, Mt. Washington, Newport, Newtown, Norwood, Taylor Mill, Terrace Park, Union Township, and Villa Hills.
TRANSCRIPT
Commercial Lending Podcast
Paul Sian: Hello everybody. This is Paul Sian, Realtor with United Real Estate Home Connections, licensed in the State of Ohio and Kentucky. With me today is Angie Hoffman with US Bank. Angie how are you today?
Angie Hoffman: I’m doing great Paul. How are you?
Paul Sian: Great. Thank you for being on my podcast. We’re gonna start off. Today’s topic is ‘Commercial Lending’. Angie is a commercial lender with US Bank, as I mentioned. Angie, why don’t you tell us a little bit by your background. What you do with the US bank, and how did you get started in that field?
Angie Hoffman: Sure. So, I am a Cincinnati resident, have been my entire life. Was previously with a company called the ‘Conner group’, which is located out of Dayton, Ohio. They’re a private investment real estate firm. I was with him for about five plus years, just learned a ton of information, really loved the financing portion of their group. So, that turned me to the banking portion, which I ended up going with US Bank just because of the knowledge and the breadth of what they can do as well. Just the culture within US Bank has been phenomenal. I’ve actually been with us Bank now for five years; in the last three years I’ve been within the commercial real estate side as well as the business banking side.
Paul Sian: Okay. Your primary focus is commercial loans.
Angie Hoffman: Correct. Yes, both investment real estate as well as owner-occupied and small to medium businesses.
Paul Sian: Okay. The investment side, I represent a lot of buyers of multifamily. I know with the form below we do, the conventional space generally, and then when you’re in the five units and above. You go into the commercial space, which is your space. I have also heard it being covered with mixed-use buildings, industrial properties, is there something else that commercial loans would cover?
Angie Hoffman: Correct. I mean it can really be quite an array of properties, office is one that we see pretty often, and can tend to be either hot in certain areas, whether it’s office Class B or Office Class A. Retail strip centers, we’ll look at Triple Net properties, and absolute not properties. We are very popular, if you’re looking at diversifying a multi-family portfolio and adding in some triple net properties. We also do, obviously owner-occupied properties too. When you have that small business or medium business owner who wants to own their own real estate. We do that as well, and that’s again part of what my position entails, and then we will also look at portfolios will do single-family homes.
I’m actually working with somebody now who has a portfolio of several single-family homes, that were looking to kind of restructure and refinance for him. We can even utilize current equity and properties to purchase additional properties to help you grow your portfolio. We do try to have a full understanding of your portfolio or a full understanding of what your strategy is. How partner with you, as you continue to grow that portfolio short- and long-term goals.
Paul Sian: For our listeners, who don’t know. What Triple Net means, do you mind explaining that.
Angie Hoffman: Sure. So, Triple Net is gonna tend to be your properties that have the tenant itself is paying the taxes, the insurance, you may have some pretty minimal depending upon the property, responsibilities that are usually restricted to the exterior of the building. It may be like a roof or a parking lot. Type of maintenance but generally speaking the great thing about the triple net is that for some clients, it’s a property that you can basically own, and you have to do pretty much nothing with. So, you’re gaining that income without having to do a very minimal type of responsibility or maintenance.
The downfall of that is that typically they’re gonna be somebody, who is gonna be a longer-term lease, which is great. However, you still have the issue that it’s a bigger square footage generally. So, five, ten, twenty thousand plus square feet. If you lose a tenant obviously, that can be very impactful. It just depends upon your, again your focus of your portfolio, and if you want to add in that. But it can be great opportunity, but tends to again be a little bit less of a return. Because of the minimal responsibilities.
Paul Sian: Going back to single family. That is similar, I am using the same term your bank use but to ‘wrap mortgage’. Is that what you use for single families?
Angie Hoffman: We do have the ability, from the perspective of what you say wrap mortgage. We’re typically calling that like an umbrella, if you’re grouping all, let’s call it, if there’s ten single family homes. You’re grouping this all into one, it lies together. We have the ability to do that depending again on the structure that the client is looking for.
We also have the ability to separate out those facilities, and do a simultaneous closing for each one of them to have them separated out from each other. Obviously, there’s some contingencies but that the properties itself have to be able to cash flow by themselves, things along those lines that we would underwrite to. But we do have ability to look at it from both perspectives.
Paul Sian: Okay. The biggest advantage of that if someone has reached the maximum ten convention mortgage loanlimit. They can step into your space there and you could cover them, and they can either restart that or. With something like that, let’s say somebody does get ten properties, and are they able to finance in additional properties into that same loan or is that has to re-finance each time?
Angie Hoffman: No. We would be able to add in. I mean, if you’re asking like if they want to refinance these properties, and they’re also looking to maybe either use some of the equity in them or they’re also buying at the same time. We can do all of that together, so that’s not an issue at all.
Paul Sian: Let’s say to somebody new coming to investment. What is the typical down payment on commercial loans? That are looking to buy in the mixed-use space or multifamily space?
Angie Hoffman: So, generally speaking. We’ll go up to 80% loan-to-value. The biggest factor within that is gonna be how much the capability of the property to hold that debt. We’re gonna have, we have a pretty. I don’t want to say complex but we do have multiple factors that go within our cash flow, and net operating, income calculation, that we’re gonna want to see. It balanced to a certain point for it to be able to hold the debt at an 80% loan to value. Again, we tend to partner with our clients. I have several clients who will send me properties on a daily basis, that they’re interested in. We will let them know what the debt capacity would be on that property.
Paul Sian: Okay. Income from the rents per sale, let’s say, something’s got a ten-unit building. Then you’re looking at the rents that are coming in. You’re also considering the buyers income level, income to debt ratio, all that as well.
Angie Hoffman: Yes. When I talk about the capacity, the debt for the property is being the one of the first things we look at is. In order to get to that 80% LTV, if you’re looking at the actual depth, they’re wanting the property to take on. Compared to other rent they’re taking in and the expenses, as well as some vacancy factors, things like that. That’s what we’re looking at to have a certain ratio, then on top of that. When we get to the next step would be look at the client globally, and their personal debt to income, and that factor too.
Paul Sian: Looking at that commercial mortgages, can buyer use the mortgage to upgrade property, to build in some equity in the property. Does the building of the equity get taken into account, and do you have a loan that allows them to do that?
Angie Hoffman: That question is kind of twofold. If you have a property, let’s say, it’s multiple unit, and you’re continuing to kind of do some improvements and renovations. If the property has the equity, we can look at small lines of credit to help with that renovation cost. Then once everything’s complete to be able to wrap that together. If you’re looking at a property that’s completely distressed, and doesn’t have any type of income. Then that’s gonna be something that generally we’re gonna have a harder time with. Because it’s a speculative type of scenario, and we want to typically see the actual income.
Paul Sian: How about converting something, I am interested in buying warehouse, either in retail space or multifamily. Do you offer products for that, or is that a similar situation when you’re looking at the risk as being a little high?
Angie Hoffman: Yes. So, that is gonna be a similar situation. Once the actual project would be completed again from a speculative standpoint, it just it becomes a little bit more difficult from a risk perspective. However, we’ve been in scenarios where we’ve worked with clients and partnered clients, people we know who work in that space more than we do. We can look to, guide them to what we would look at if we wanted to refinance that once it was completed, and there were leases in place.
Paul Sian: Okay. So, that is one of the benefits working with a big bank like US bank, is you can reach across departments there, and tap other resources within your organization.
Angie Hoffman: Even if it’s within the organization, we have other resources whether it’s our private wealth or wealth group, have some capabilities that are different than what we have as well as from a CUI or network basis. It may be somebody just within my network that I know works within that space to introduce that way and hopefully can get that client taken care of.
Paul Sian: Are you able to comment on the underwriting process of commercial loans compared to residential. Is there a big difference in that process?
Angie Hoffman: So, yes and no. I know we touch on it already a little bit. One of the biggest differences is obviously we’re gonna look at the actual collateral in a very different way, especially on the investment real estate side. When you’re looking at investment real estate, the factors that the net operating income as well as the cash flow of the property become factors. Whereas, when you’re buying a home, obviously it’s a lot more about the loan to value of the property. However on the other side of that, if we are looking at a property that’s gonna be owner occupied by a small to medium business. It becomes a lot more about the loan-to-value as well. So, it can depend upon the situation.
Paul Sian: Okay. How important is the person’s experience when they come to loan, get a loan for you. If it’s a new first-time investor looking at multi families versus somebody who’s already got five to ten units and then either self-managing or running it for a couple years.
Angie Hoffman: I mean, generally speaking, if you have somebody brand new, one of the biggest things is if you’re not familiar in the scope. You don’t have experience, you gonna be partnering potentially with a property management company or somebody else who is maybe a partnership within the LLC or the property that you’re buying that has the experience. Just being able to show you may not have previous experience in this but you are partnering with a property management company that has historical success in these properties. You’re partnering with somebody, for instance, who has historical success in the properties.
Paul Sian: So, yeah boils down to your team then. What you’re bringing to the team. What kind of document requirements are there to start a commercial loan process with US bank?
Angie Hoffman: Generally speaking, in every situation is different, every request is different, client is different. But it’s typically going to be two to three years of taxes, personal and business, personal financial statements pretty standard as well. If it’s a purchase, we’re gonna want to see a purchase agreement or understand the purchase agreement as well. As you’re gonna want to have financials whether it’s profit loss or the rent rolls preferably a Schedule E or 8852 from the client. Showing what the historical trends of that property of have been. That’s where we really try and partner with our clients of understanding their portfolios, understanding what purchase they’re trying to make. So, that, does it fit, and is there anything we see because we see them on a very regular basis that. Maybe we need to discuss or let the client know that we are suggesting maybe prying a little bit more information.
Paul Sian: How important is ones credit score when they come to apply for loan with you?
Angie Hoffman: It is a factor, I mean. In any type of just like the traditional mortgage, it is gonna be a factor. But there are so many different factors that, it’s only one of many.
Paul Sian: One of the important things when it comes to purchasing real estate is I always tell the buyers that have a pre-approval letter ready. Is there something similar in the commercial loans place? A pre-approval letter, pre-qualification letter. Just something that says, somebody sat down with you, they started the initial process. They’ve got access to certain amount that they can borrow to purchase this property. Do you have something like that?
Angie Hoffman: We do. So, on the commercial side it’s gonna be called a letter of interest, and it basically lays out that we are working with a client. We have a price range or up to a price range that we’re looking for with the client, and depending upon the collateral. We are looking to work with him on the financing, again depending upon what the collateral is, and then we also have once we’ve actually maybe gone through a more official process of underwriting and submitted an actual financial package. We do have, depending again on what the financing contingency is for that client.
We do have a letter of commitment, which lays out that there is an approval but it goes through all of the conditions as well like your appraisal certain things like that, that we’re gonna have to clear.
Paul Sian: Okay. How long does that process take? If you are writing an offer today for a client, and then usually you have to write in how many days we’re gonna close in. 30 days, 40 to 45 days. I know conventional, it’s usually a little quicker, a little easier. So, we can do it in 30 days or so. I mean, what would you recommend for a commercial loan?
Angie Hoffman: I think 45 days is very practical. One of the biggest things that I always talk about with my clients is that 45 days really is incumbent of me having a full financial package, meaning those two years of tax returns. The financials, I spoke about from the client that you’re purchasing, and or if you’re refinancing. To me, having that full financial package is really the key and then, again from there it’s gonna be some of the factors of the appraisal as well as the title work that would go along with it. But generally speaking, 45 days to close is pretty.
Paul Sian: Reasonable.
Angie Hoffman: Yes.
Paul Sian: You mentioned the documents that was my blog article documents for the conventional mortgage process. You mentioned W2s, 1040, tax returns, that is pretty similar the document requirements for commercial loans that it is for residential space?
Angie Hoffman: Yes. It’s very similar. With the PFS is gonna be one of the biggest as well as the two years of tax returns. Potentially three years depending upon, again the request size. Like you said, I mean, if they’re a W2 income type of employee, then we may need additional pay stubs. like I said, for any client, it could be very different depending again on what their history is. If they’re a business owner, then we may mean some more details but generally speaking, again it would be two to three years of personal business has returns, personal financial statement, and potentially obviously purchase agreement or additional documentation from that side.
Paul Sian: Okay. When it comes to partnership, people coming together, those documents from everybody. Correct?
Angie Hoffman: Correct. So, depending on what the ownership structure is. Generally, if somebody’s over 20% ownership within the property, then we’re going to need that financial information from them as well.
Paul Sian: Okay. I know with the conventional space. Lending into an LLC is generally impossible. Most lenders will not allow conventional borrowers to use an LLC. How does that work on the commercial side?
Angie Hoffman: The vast majority of the lending that I do is going to be through an LLC in a holding company. The clients are still a personal guarantor but the lending itself in the title is all within the LLC.
Paul Sian: Is it a requirement in LLC or is it an option for the buyer?
Angie Hoffman: It’s an option. I mean, one that again depending from an attorney’s perspective, if you’re talking about liability. It may be a best-case scenario to have an LLC with that property. But we always reference stuff talk to your attorney about what makes sense for you.
Paul Sian: How much, do you have any minimum loan requirements and your maximum loan requirement?
Angie Hoffman: Up to ten million on the investment real estate side, and then once it’s beyond that, we do have a commercial group that we would work with a real estate group as well as our middle marker group that would potentially be involved. As far as minimum typically, again if it’s under 2,50,000. It’s still something that we would do. It just, we pull in a different partner to work with us on that too, because it kind of goes into a little bit different of a space.
Paul Sian: Is there, under 250,000$ or is there a lower minimum. I know some conventional lenders won’t touch anything fifty thousand and under.
Angie Hoffman: It’s pretty common. Yes, under fifty thousand is gonna be a little bit more difficult.
Paul Sian: 50,000 to 2,50,000, and above that.
Angie Hoffman: But keep in mind too. I mean, if you have properties itself. It may be again, you see this more with the single-family home portfolios. You may have multiple properties that are under fifty thousand. But we’re looking at the entirety of the portfolio, makes a little bit different of a scenario. I would caution that anything that somebody is looking at from the perspective of either total lending amount or even individual property. We’re happy to take a look at it, have an understanding of what you’re looking to do, and if for some reason it’s not something that is in our world necessarily. Again, from an internal and external standpoint. We typically have somebody who I can contact.
Paul Sian: Discussing interest rates from general perspective, everybody’s situation is different and unique. But in terms of paying more, having a lower LTV, 60% LTV rather than 80%. People get themselves a better interest rate or is it generally, can we same and more just depending on credit and history.
Angie Hoffman: So, from an interest rate standpoint, the commercial side is a little bit different. Then maybe the mortgage or lines of credit side, then you then you generally see. Ours is based off of what banks cost the funds are, and then there is a spread that is on top of that. That’s where you get the percent from. Right now, cost of funds are pretty minimal. So, interest rates are extremely competitive. But from that perspective, it doesn’t necessarily factor in the actual loan it saw or the guarantor itself or the property itself.
Paul Sian: So, there’s some risk-based consideration towards interest rates. I guess a little higher risk project is that something you would price a little higher in the interest rate or generally that it’s not considered as much?
Angie Hoffman: No. That’s not considered as much, generally.
Paul Sian: Okay. Great. That’s all the questions I have for you today Angie. Did you have any final thoughts to share with the group?
Angie Hoffman: Sure. One thing I would say is if anybody has any questions about property specific, cash flow, if this property may fit into their portfolio or something that we would look to land up to 80%.I’m happy to partner with anybody on that side as well, and be resource for them. On top of that, I did want to mention that obviously US Bank is across the country. That gives us the ability even, if I’m your contact in Cincinnati to lend out-of-state borrowers.
I’ve worked with quite a few clients obviously from California that are buying in Cincinnati as well Chicago. So, those are people that I’ve worked with quite frequently as well.
Paul Sian: That is perfect. I’ve got a number of out of state clients to. That is one of the biggest challenges that I’ve faced with some local lenders is that they don’t lend to out of state. That’s a great ability to have.
Angie Hoffman: So, the key with in that too is just as I want to mention too. I mean, anytime that scenario comes up. We are happy to discuss it. One of the biggest factors with out-of-state lenders is that we do look for them to be within US bank footprint. So, we are very much on the west coast and Portland, all of those areas. If they’re somewhere you’re not familiar, if we’re within that area, please reach out. Let me know, and I’m happy to take a look.
Paul Sian: Great. Thank you again. I will leave your contact information on my blog post once it gets published live. Thanks again for being on the podcast.
Angie Hoffman: Thanks for having me.
Itâs that time of the year where many of us make — and later break — a new yearâs resolution to lose weight But what if you could get paid to lose weight? Would making money incentivize you to stick with it? Get Paid to Lose Weight in 2019  We all know weight-loss is big […]
The post 8 Brilliant Tips on How To Get Paid To Lose Weight appeared first on Incomist.
Clothes are a basic necessity that also express your style—but building a good wardrobe can be expensive. According to Statisticbrain.com, the average American spends about $120 a month on clothes. No matter if you’re way above or below that number, the challenge is to get the most out of every piece that you bring home.
In this article I’ll give men and women eight smart tips to spend less on clothes and build a better wardrobe at the same time. You’ll learn how to create a wardrobe strategy, know what’s a good deal, how to get deeper discounts, and how to care for what you buy the right way so it lasts longer.
Use these tips to build a great wardrobe for less and protect your purchases so you can enjoy them for years:
Tip #1: Set a “one in, one out” rule
A few years ago I noticed that I kept running out of clothes hangers and my big walk-in closet kept getting more and more crammed. I was adding new items but rarely purging old ones and it was finally catching up with me.
So I created a rule that every time I buy something new, something similar has to go. For instance, if I buy a new pair of shoes, I better be ready to sacrifice an old pair that I haven’t worn in a while. Or if I buy a new sweater, I need to throw one out that doesn’t look so great anymore.
If you want to be aggressive about paring down your wardrobe to essentials, get rid of 2 items for every new one that you bring home. This strategy will really make you reevaluate what you like and wear often versus what’s just taking up space in your closet.
If you truly have a gap in your wardrobe—like no black boots or running shoes—that’s one thing. But in general we tend to buy more and more of what we already have. And the more stuff that’s in your closet or drawers, the easier it is to forget about the good pieces you already have because they get buried.
Decide why you need another top or pair of jeans before you buy it. Is it because what you already have doesn’t fit, is out of style, or just looks shabby? Be clear about why a piece in your wardrobe isn’t working and make the decision to donate it to Goodwill or throw it away before or immediately after you replace it.
Be clear about why a piece in your wardrobe isn’t working and make the decision to donate it to Goodwill or throw it away before or immediately after you replace it.
Tip #2: Create a clothing baseline
While I can’t tell you the exact number of garments you should have in your wardrobe, I recommend that you create a clothing baseline. This is the total number of items in your closet.
I settled on my hanging wardrobe baseline when I got rid of all my mismatched hangers and invested in Huggable Hangers. These amazing hangers are thin so they save space, and have a curved shaped with a non-slip, velvety surface. This prevents the shoulders of tops from getting stretched out and keeps clothes from falling off.
If you saw the 2015 movie Joy, starring Jennifer Lawrence, it tells the story of Joy Mangano who invented Huggable Hangers and many other products that sold millions on the Home Shopping Network and QVC.
These hangers make my closet look more uniform and organized, but they also keep me honest. If you only have 100 special hangers, then you can’t exceed that amount of hanging garments.
For items you typically fold, like jeans, sweaters, or t-shirts, decide how many is reasonable and stick to it. If 10 pairs of jeans is more than enough, make a deal with yourself to throw away any unused pair before expanding your wardrobe to 11 pairs.
The baseline and “one in, one out” strategy helps me stay away from mindlessly buying sale items. Even if something is at a rock-bottom price, I remember that I’ll have to give something up in order to bring it into my wardrobe.
Tip #3: Buy quality basics
I’m a big believer in buying better quality basics. Think about the foundational pieces you wear over and over, like black pants, black shoes, suits, long-sleeved white shirts, or a black sweater.
These wardrobe staples won’t last or look good for very long if they’re cheaply made. A pair of shoes that are trendy, but not well-made or don’t fit well, won’t give you any satisfaction or value and will probably gather dust in your closet.
It’s better to buy trendy items cheaply because they’ll be out of style very soon and just end up taking up space in your closet. So consider buying fewer trends and investing a little more in your basics so they last longer and prevent you from having to constantly replace cheaper versions. That saves money, time, and hassle in the long run.
Consider buying fewer trends and investing a little more in your basics so they last longer and prevent you from having to constantly replace cheaper versions.
Tip #4: Buy clothes that fit now
Never buy clothes that don’t fit you perfectly right now. I always feel like I should be a few pounds lighter than I am. But I know that I’ll feel and look better in clothes that are the right size when I need them.
If you’re in the middle of a big weight loss program or are starting a new exercise program to lose weight or build muscle, I don’t recommend buying key clothing pieces. Wait until your weight and body size stabilizes before investing a lot in your wardrobe and purging items that don’t fit anymore.
Tip #5: Never pay full price
One way to afford better quality clothes is to never pay full price. There are so many sales at top retailers and ways to get discounts online, paying full price should be the exception and not the rule.
If you find a wardrobe staple or something you need right away for a special occasion that’s a perfect fit, color, and style, then I might consider buying it. But it’s likely that you could find the same item or something similar on sale.
If you’re in a local store, don’t be shy about politely asking for a discount if an item isn’t perfect. Any damage that you or a cleaner could easily correct—like a loose or missing button or a stain that probably isn’t permanent—is fair game for at least a 10% reduction.
When I try on clothes in a store or see a handbag that I love, I typically wait and buy it online instead. Not only does that give me time to think about whether I really need the item, but it typically allows me to buy it for less.
When you start your online shopping at free sites like Ebates and Giving Assistant you get cash back. Ebates sends you a check or makes a deposit in your PayPal account for your rewards every quarter. Discounts vary depending on the retailer, so find all the major stores that sell the item you want, and then purchase it from the store that offers the best cash back offer.
Another way to avoid paying full price is to buy out of season. You probably know that if you buy a heavy coat at the beginning of winter, you’ll likely pay much more for it than at the beginning of spring. That’s because season-specific clothes—like bathing suits, summer shorts, and winter coats—hit the shelves about a month early and then are likely to go on sale about halfway through the season.
Retailers have to turn over merchandise frequently in order to make room for the next batch of incoming items. So keep the big picture of the retail industry in mind and resist the urge to pay full price for the coming season. Instead, buy quality pieces after they’re marked down, but that you can still wear.
I know that it can feel strange to buy a wool sweater when it’s hot outside or sandals when there’s still snow on the ground, but filling gaps in your wardrobe in off seasons and using online discounts are the best ways to build a quality wardrobe for less.
Tip #6: Buy easy-care clothes
The more clothing you can buy that doesn’t require expensive, professional cleaning, the better. In fact, many clothes that say “dry clean” can actually be washed at home, if you’re willing to do it carefully.
The more clothing you can buy that doesn’t require expensive, professional cleaning, the better.
I routinely wash wool sweaters, silk tops, and linen items in a cold delicate cycle with a gentle liquid detergent, like Woolite. Never put them in the dryer; let them dry naturally.
You can speed up the process by laying out an item out on a bath towel and then rolling it up, pressing moisture out as you go. Then unroll the towel and reshape the garment on a dry towel or hang up lighter pieces where they can air dry.
Some fabrics, like silk and linen will need to be ironed after they’re dry. Items that I really love are tops that have the look and feel of silk, but are polyester. They can be tossed in a cold, delicate cycle, hung up to dry, and don’t even need an iron to look perfect.
Now, certain types of clothes, like suits and party dresses, must be dry cleaned in order maintain a crisp look and to avoid shrinking. Leave woven wool fabrics or any clothing with delicate stitching, beading, or sequins, to the professionals.
Tip #7: Extend time between cleanings
No matter if you send out clothes to a cleaner or wash them yourself, remember that cleaning stresses fabric and can cause clothes to wear out faster. So forget the idea that you need to wash everything you wear every time you wear it. Extend the time between washes by spot cleaning pants, jeans, shirts, jackets, and dresses.
One trick I use for jackets and blazers is to turn them inside out, spray on a fabric refresher, and let them naturally air out. This works perfectly when the item is basically clean, but just has a little armpit odor.
Febreze is the best known fabric deodorizer and it’s not just for couches and carpets—it works great on clothes. Lysol and Dreft also make fabric refreshers and there are eco-friendly products like Biokleen and Eco Breeze.
Woolite has a product called Dry Cleaner’s Secret, which is an at home dry cleaner for delicate items, like silk, linen, and cashmere that works in the dryer. I’ve never tried it, but it claims to remove odors, stains, and body oils in about 20 minutes.
Another tip is to wear an undershirt or a basic, thin cotton t-shirt under shirts and sweaters. Men usually do this, but women should do it more often when possible.
A short sleeve shirt that covers your armpits is better than a tank or camisole so you really protect clothes from sweat stains and smells. You wash the t-shirt, but may be able to skip washing the garment you wore over it.
See also: Cool Tips to Save Money on Utility Bills
Tip #8: Take care of what you buy
There are many ways to make your clothes last longer and still look great. In addition to washing them less, you need to launder them the right way. Follow laundry basics, of course, like washing like colors together and not over-stuffing the machine.
When you get a stain, the trick to making it disappear is to treat it as quickly as possible with a stain stick, spray, or liquid stain remover. Clorox 2 is one of my favorite detergents because even when I’m sure that a stain has ruined something, if I follow the instructions, it always comes out.
Another tip is to keep clothes with elastic or spandex—like underwear, athletic shorts, yoga pants, and bras—away from dryer heat. Let them tumble on a low setting for a short period of time or lay them out to air dry. Using the dryer less protects your clothes and saves money on your utility bill!
Also make sure that any item with a zipper—like pants, skirts, and hoodies—are completely zipped up before they go in the washing machine and dryer. Zipper teeth can easily pull and destroy other garments in the same load.
If an item that you love does show damage or wear, have it repaired by a professional. Missing buttons, a small run in a sweater, or a worn heel are easy to fix and cost less than buying a new item. I’ve had quality boots re-heeled and re-soled many times and they come back looking like new.
Missing buttons, a small run in a sweater, or a worn heel are easy to fix and cost less than buying a new item.
How you store clothes is also really important for making them last longer. With dry cleaning, remove the plastic bags before putting them in your closet.
Cleaning chemicals can cause fabrics to yellow and weaken over time, so let your dry cleaning air out. For long-term storage for suits and dresses, choose garment bags made from natural fibers like cotton or canvas that can breathe easily.
Building a better wardrobe is about picking pieces that reflect your personal style, are appropriate for the type of work you do, and complement your lifestyle when you’re not working. You’ll get the most bang for your buck when you choose items that can be worn interchangeably with everything else.
Clothes don’t last forever—even when you care for them meticulously. As you need to replace old pieces, it’s a great opportunity to invest in affordable basics and update your look at the same time.
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