One of the original 13 colonies, Virginia has a rich history from the Jamestown settlement and living history museums like Colonial Williamsburg, to the picturesque Blue Ridge Mountains and the beach towns along the coast. If you’re considering living somewhere in Virginia then chances are you also have a budget you’re hoping to stay under in your home or apartment search. When it comes to buying a home in Virginia the median home sale price is $445,200.
Don’t worry if that price doesn’t fit in your budget – we’ve got options to help you find a home or apartment that does. Redfin has rounded up a list of the 8 most affordable places to live in Virginia – and they all have a median home sale price under $445,200. From Hampton to Richmond, let’s jump in and see what cities are on the list.
#1: Roanoke
Median home price: $201,000 Average sale price per square foot: $136 Average rent for a 1-bedroom apartment: $906 Median household income: $45,664 Nearest major metro: Greensboro, NC (100 miles) Roanoke, VA homes for sale Roanoke, VA apartments for rent
With a median home sale price of $201,000, Roanoke comes in at number one on our list of most affordable places to live in Virginia. There are about 100,000 residents living in this mid-sized city. If you’re considering moving to Roanoke make sure to stop by the Mill Mountain Star at the top of Mill Mountain Park, explore downtown Roanoke, or visit museums like Taubman Museum of Art or Virginia Museum of Transportation.
#2: Hampton
Median home price: $260,000 Average sale price per square foot: $174 Average rent for a 1-bedroom apartment: $1,223 Median household income: $59,380 Nearest major metro: Norfolk (10 miles) Hampton, VA homes for sale Hampton, VA apartments for rent
Coming in as the second best affordable city to live in Virginia is Hampton, part of the Hampton Roads Metropolitan area. When living in this city of 137,100 people, you can take a tour of one of the many museums like the Virginia Air and Space Center, visit the historic Fort Monroe National Monument, or have a beach day at Buckroe Beach.
#3: Portsmouth
Median home price: $264,000 Average sale price per square foot: $172 Average rent for a 1-bedroom apartment: $1,025 Median household income: $53,213 Nearest major metro: Norfolk (3 miles) Portsmouth, VA homes for sale Portsmouth, VA apartments for rent
About 97,900 people reside in Portsmouth. The median home sale price is $264,000 which is about $100K less than the median home sale price in Virginia. If you find yourself moving to the third most affordable city in Virginia, spend an evening outside watching a concert at Atlantic Union Bank Pavilion and have a meal at a waterfront restaurant. Make sure to check out the charming Olde Towne Historic District or discover the exhibits at Portsmouth Naval Shipyard Museum.
#4: Lynchburg
Median home price: $276,900 Average sale price per square foot: $167 Average rent for a 1-bedroom apartment: $972 Median household income: $59,380 Nearest major metro: Roanoke (50 miles) Lynchburg, VA homes for sale Lynchburg, VA apartments for rent
Only slightly more expensive than Portsmouth is Lynchburg, the next city on our list. With roughly 79,000 residents in Lynchburg, make sure to visit Riverside Park along the James River and explore the Percival’s Island Natural Area if you’re looking to spend some time outside. You can also check out downtown Lynchburg and the nearby Diamond Hill Historic District and Federal Hill Historic District.
#5: Newport News
Median home price: $284,000 Average sale price per square foot: $170 Average rent for a 1-bedroom apartment: $1,239 Median household income: $59,380 Nearest major metro: Norfolk (20 miles) Newport News, VA homes for sale Newport News, VA apartments for rent
Another great area to add to your list is Newport News, located just north of Hampton. With 186,200 residents, moving to this affordable city gives you the perks of city-life. Living in Newport News, you can check out one of the riverfront parks like Victory Landing Park, Huntington Park, or Riverview Farm Park, explore Newport News Park, or visit one of the museums like the Virginia Living Museum or the Virginia War Museum.
#6: Harrisonburg
Median home price: $327,500 Average sale price per square foot: $179 Average rent for a 1-bedroom apartment: $758 Median household income: $49,117 Nearest major metro: Charlottesville (55 miles) Harrisonburg, VA homes for sale Harrisonburg, VA apartments for rent
Another well-known city is Harrisonburg, where you’ll find the home prices are about $100K less than the state’s average. With roughly 51,800 people calling Harrisonburg home, it’s a great area to consider renting or buying a home this year. Whether you explore the greenery and flowers at Edith J. Carrier Arboretum and Botanical Gardens, check out Hillandale Park, and visit downtown Harrisonburg where you’ll find Saturday Harrisonburg Farmers Market, there are many cool things to do and see in this city.
#7: Suffolk
Median home price: $366,000 Average sale price per square foot: $182 Average rent for a 1-bedroom apartment: $1,075 Median household income: $81,883 Nearest major metro: Norfolk (20 miles) Suffolk, VA homes for sale Suffolk, VA apartments for rent
Seventh on our list of affordable places to live in Virginia is Suffolk. With a population of nearly 94,300, living in Suffolk is a great option for those looking for a mid-sized city to live in. Don’t miss out on taking a boat out on the water or walking through Bennett’s Creek Park, enjoying the river views at Sleepy Hole Park, or checking out the art galleries, restaurants, and museums in the heart of Suffolk.
#8: Richmond
Median home price: $378,000 Average sale price per square foot: $233 Average rent for a 1-bedroom apartment: $1,497 Median household income: $51,421 Richmond, VA homes for sale Richmond, VA apartments for rent
Last but not least on our list of most affordable places to live in Virginia is Richmond. Nearly 226,600 residents call this affordable city home. Be sure to visit the historic sites, neighborhoods, and museums like the Maymont mansion, the American Civil War Museum, and Byrd Park Court Historic District. You can also check out Belle Isle, stop by the Virginia State Capitol building, and see a concert at The National once living in Richmond.
Methodology: All cities must have over 50,000 residents per the US Census and have a median home sale price under the average median home sale price in Virginia. Median home sale price and median sale price per square foot from the Redfin Data Center during August 2023. Average rental data from Rent.com August 2023. Population and median household income data sourced from the United States Census Bureau.
When you’re thinking about buying a fixer-upper, there are a few factors to take into consideration before taking the next steps in the buying and renovating process.
Make sure you know exactly what you are looking for when on the hunt for your fixer-upper. It will make the search process less stressful. It also helps to have a plan for remodeling in place, so you create the finished product you always wanted.
Here are a few tips to lead you in the right direction.
What to look for when buying a fixer-upper
Keep an eye out for the large yet hidden expenses.
There is such a thing as too much of a fixer-upper. Make sure that the changes aren’t too costly and that the home is actually worth your while. Large hidden expenses would include, but are not limited to, structural problems, the foundation of the home, and roof problems.
Learn to recognize the jobs you can’t complete yourself.
Projects such as redoing the floors or the roof are a lot to take on as a new homeowner. Look to take on simple, high-impact tasks such as refurnishing the bedrooms or a few paint jobs if you want a more manageable and wallet-friendly challenge and budget in advance to hire professionals.
Look for an easily modifiable floor plan in case you want to remodel over time.
Renovating an entire house all at once isn’t always realistic. If the space in a potential home seems cramped and gives you little to work with, you may want to reevaluate your plans. In the event that you buy this home and plan to convert the living space, having an open floor plan would be much easier to work with rather than a jam packed non-conformable one.
Look for hazardous or outdated features.
If you don’t feel that the home inspector did a great job surveying the home, you can hire other professionals to test for dangerous materials like lead or get a second opinion on things like old wiring. This will insure that any potentially hazardous or outdated features are spotted and taken care of immediately.
Things to keep in mind when remodeling
Time manage yourself and the project.
Setting a realistic goal for how long the remodeling project will take is key. Of course you want all of the major jobs finished ASAP so you can enjoy your newly renovated home. However, you need to set a practical timeline giving every job a fair amount of time to be completed.
It is also important to calculate in unforeseen problems that could tack on extra time. There’s nothing worse than having to bump back your child’s birthday party because your house is still a construction zone.
Seek professional help.
The average homeowner can only get so far when remodeling their home. If you are making some major changes, such as restructuring the house, consulting in a certified architect can’t hurt. That is, after you decide what you want to do yourself.
Set a budget, but don’t be cheap.
It is important to come up with a budget early on so that you can set out a clear list of priorities and avoid unintended expenses. However, be wary of going too cheap when renovating, or risk using shoddy materials or getting poor workmanship. The saying “you get what you pay for” speaks for itself. If you can’t afford something, wait until the timing is right and you can remodel your home to your liking.
Applying for a new passport can be a complicated and time-consuming endeavor, especially if you plan to take your own passport photo to send in with your application.
But things can get even trickier if the passport you’re applying for is for an infant or small child. Taking a baby passport photo that the U.S. Department of State will approve can be challenging to get right.
Remember, all U.S. citizens flying internationally must have a passport, including children and infants.
Official U.S. passport photo rules
Once you’ve filled out all the necessary forms for a minor’s passport, you’ll have to include a photo with the application. Whether you’re taking your own passport photo or your child’s passport photo, the same rules apply:
The photo must be taken within the last six months.
It should be in color, not black and white.
The image should be clear and in focus and feature natural skin tones.
Don’t use any filters or special effects.
Selfies aren’t allowed.
Remove glasses and any hats or head coverings not intended for religious purposes.
Take the photo in front of a plain white or off-white background.
The subject should directly face the camera with a neutral expression.
Crop and frame the photo correctly. When cropped to 2-by-2 inches, the photo should include the subject’s whole head centered in the frame with some space around the top and sides, plus their shoulders.
Tips for infant passport photos
While baby passport photo requirements are the same as for adults and older children, they can be trickier to meet given young children’s squirminess, inability to sit or stand upright and exaggerated facial expressions.
Here are a few ways to help guarantee you get the shot right the first time around.
Remove glasses, hats, pacifiers and anything that obscures the baby’s face.
Don’t hold or have someone else hold the baby while taking the photo. No one else should be in the photo.
Don’t obsess about facial expressions. The child shouldn’t be crying or laughing, but as long as they’re facing the camera, the photo will likely be deemed acceptable.
Use a favorite toy to get the baby’s attention and encourage them to look at the camera. Plan to snap your child’s passport photo when they’re awake and in a good mood.
In a child or toddler passport photo, the child’s eyes should be open and looking at the camera. But for an infant or newborn passport photo, closed eyes are acceptable.
Place babies or very small children in a car seat draped with a white sheet or lay them on top of a white sheet placed on the ground and shoot from above.
If you’re standing over your infant to get a passport picture, be careful not to cast a shadow over any part of the frame.
Take the photo in natural light in a well-lit room to avoid harsh shadows and multiple, different-colored light sources.
Turn off the flash to avoid harsh light, red eyes and shadows.
Take a lot of photos for the best chance of capturing a good one.
Use a tripod and a fast shutter speed in a well-lit room to help ensure the photo won’t be blurry.
Take your time and have fun.
Keep in mind you won’t have to go through this process often. You may update your child’s passport photo every year if you would like to keep it current, but you don’t have to. Passports for children under 16 are good for five years.
Where to get an infant passport photo taken
As long as you have a decent camera, or even a capable phone camera, you can probably take the photo yourself at home. But if you’re unsure of how it will turn out or want the best chance of your photo getting approved with your application, you can have pictures taken elsewhere.
Some U.S. post office locations will take passport photos, as will some office supply stores and pharmacies with photo departments, like FedEx or Walgreens.
But if your child can’t sit or stand upright, locations may not be able to accommodate them, so call ahead. Alternatively, you could schedule an appointment at a local photography studio.
Bottom line
Infant passport photo requirements may be the same as for adults, but the process can be far more time-consuming and involved.
Just remember to keep in mind these tips, follow government requirements and take your time. You’ll have a new baby passport photo in no time.
How to maximize your rewards
You want a travel credit card that prioritizes what’s important to you. Here are our picks for the best travel credit cards of 2023, including those best for:
If you’re planning to buy a higher-priced home, you may be looking to finance your purchase with a jumbo loan. And you’re probably also wondering about the difference between a jumbo and a conventional loan.
A jumbo loan is necessary to purchase a home where the loan amount is above the conforming loan limit values set by the Federal Housing Finance Agency (FHFA). Conforming loan limits change every year. For 2023, the limit for a single-unit property is $726,200 for most counties across the U.S. In high-cost areas, this amount increases to $1,089,300.
If you’re buying a home below this amount, you can finance with a traditional, conventional, conforming mortgage, or perhaps through one of several first-time home buyer programs. But if you need a mortgage that goes above the conforming loan limit, you’re going to be looking at a jumbo loan, so it’s time to get familiar with how to qualify and how the costs compare to other loans.
First-time homebuyers can prequalify for a SoFi mortgage loan, with as little as 3% down.
Recommended: The Cost of Living by State
What’s the Difference Between Jumbo and Conventional Loans?
Here’s a surprise: There isn’t really a difference between a jumbo and a conventional loan. Jumbo loans are conventional. “Conventional” simply means that a loan isn’t backed by a specific government agency such as the Federal Housing Administration (FHA), United States Department of Agriculture (USDA), or U.S. Department of Veterans Affairs (VA).
Many people get tangled up in the terminology. While jumbo loans are conventional, they are not “conforming.” Though the terms conventional and conforming are often used interchangeably (and mistakenly), a conforming loan is one that falls within the FHFA limits, meaning the lender can sell it to Fannie Mae and Freddie Mac to increase its liquidity. (Again, in 2023, the amount is $726,200 for most areas in the U.S., but can go up to $1,089,300 for high cost of living areas. If you’re wondering about your specific region, have a look at the conforming loan levels by state.)
💡 Quick Tip: One answer to rising house prices is a jumbo loan. Apply for a jumbo loan online with SoFi, and you could finance up to $2.5 million with as little as 10% down. Get preapproved and you’ll be prepared to compete in a hot market.
A jumbo loan exceeds these limits and is, thus, non-conforming. So when you’re comparing jumbo loans against other loans, you’re really comparing non-conforming loans against conforming loans. Other differences that affect borrowers are summarized in the table below:
Conforming Loan
Jumbo Non-conforming Loan
Loan amount
Below $726,200 for most areas, $1,089,300 for high-cost areas
Above $726,200 for most areas, above $1,089,300 for high-cost areas
Loan type
Fixed or variable rate
Fixed or variable rate
Down payment
Can be as low as 3%
Usually 10% or more
Credit score
660+
700+
Income requirements
Lower income requirements
Higher income requirements. For example, a payment on a $726,200 mortgage at 6.7% interest would be $4,969. In order for your payment to not exceed 28% of your monthly income (the margin of safety, you would need to make $17,746 per month or $212,952 per year.
Cash reserves or assets
Not required
6 to 12 months may be needed
How the loan is backed
Backed by Fannie Mae and Freddie Mac
Not backed by Fannie Mae or Freddie Mac
How to Qualify for a Jumbo Loan
Requirements for jumbo loans are more stringent than those for other types of loans. Because these types of mortgages can’t be sold to Fannie Mae or Freddie Mac, the lender takes on more risk should the borrower default.
These requirements include:
• Debt-to-income (DTI) ratio. You need plenty of income to qualify for a jumbo loan. Qualified mortgages require a DTI of 43% or lower.
• High credit score. Lenders want to be sure you’ll repay the loan, especially since it’s a much larger amount. A credit score of 700 or above is recommended.
• Assets. Lenders look for cash that can be used to pay the mortgage. To be safe, you may want to put aside enough money to cover the mortgage for 6 to 12 months.
What to Know About Jumbo Loan Mortgage Rates
Prospective jumbo loan borrowers often wonder, “Are jumbo loan rates higher than other loans?” Jumbo conventional loans don’t automatically have higher interest rates and can be competitive with conforming conventional loan interest rates. They fluctuate with market conditions. Sometimes, they’re even lower than conventional loan interest rates.
You may be able to check your jumbo loan rate with your lender before submitting a full application.
Jumbo Loan Closing Costs
With a larger loan amount, you can also expect jumbo loan closing costs to be higher. While many closing costs are fixed, there are others that are larger due to percentage-based compensation closing costs.
Should I Choose a Jumbo Mortgage?
If you have the option to choose between a jumbo loan vs. a conforming loan, (such as when you have enough money to reduce the principal loan amount so that it qualifies as a conforming loan), you’ll want to ask yourself if it’s worth it to put down the extra money to qualify for a conforming conventional loan. There are some specific scenarios where a jumbo loan vs. a conforming loan makes sense.
💡 Quick Tip: To see a house in person, particularly in a tight or expensive market, you may need to show the real estate agent proof that you’re preapproved for a mortgage. SoFi’s online application makes the process simple.
When to Choose a Jumbo Mortgage
Borrowers who should consider jumbo mortgages:
• If you’re looking for a luxury home
• If you’re buying a vacation home
• If you live in a high-cost area
• If you have a great credit score
• If you have a strong DTI ratio
• If you have plenty of income
When to Choose a Conventional Mortgage
Borrowers who should consider conventional mortgages:
• If you have moderate income
• If you’re looking for a moderately priced home
• If the mortgage amount is below the conforming loan limits
• If you need a down payment lower than 10%
• If your cash reserves after your down payment will be limited
If you’re close to the conforming loan limits, you may also want to consider a piggyback mortgage. If you’re able to obtain a piggyback loan, you may be able to buy your home with a conventional, conforming mortgage instead of a jumbo loan.
How it works: A piggyback loan allows you to take a second loan to “piggyback” off the first mortgage with the purpose of lending you enough money to avoid a jumbo mortgage or the PMI that comes with a down payment less than 20%. It’s essentially a second mortgage, and you’ll be making a second payment to cover it.
The Takeaway
When it comes to whether or not to choose a jumbo loan, the decision may be made for you based on the price of the home you want to buy. Mortgages above the conforming loan limit need jumbo loan financing. If you want a conforming, conventional loan, you’ll need to get a mortgage below $726,200 for most areas in the U.S. and $1,089,300 for high cost of living areas.
When you’re ready to take the next step, consider what SoFi Home Loans have to offer. Jumbo loans are offered with competitive interest rates, no private mortgage insurance, and down payments as low as 10%.
SoFi Mortgage Loans: We make the home loan process smart and simple.
FAQ
Are jumbo rates higher than a conventional mortgage?
Jumbo rates fluctuate with market conditions. They may be on par with rates of loans that fall within the limits for conforming loans set by the Federal Housing Finance Agency (so-called conforming loans). Sometimes, they’re even lower.
What is the downside of a jumbo mortgage?
Possible downsides of a jumbo mortgage include requirements for a higher down payment, higher credit score, more cash reserves, and a higher monthly payment because of the higher home price.
Do jumbo loans have PMI?
Private mortgage insurance is not always required on jumbo loans. Whether or not PMI is needed will depend on your lender and the size of your down payment.
Photo credit: iStock/courtneyk
SoFi Mortgages Terms, conditions, and state restrictions apply. Not all products are available in all states. See SoFi.com/eligibility for more information.
SoFi Loan Products SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.
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.
Let’s say your tenant is applying for a driver’s license and they need to prove they have state residency. Or, they’re about to get hired for a job and they need to let their employer know how long they’ve been in the area. Or, maybe your tenants are parents needing to prove that they do indeed live in a particular school district. For any of those scenarios, your tenant may approach you to write a proof of residency letter. Here’s what you need to know.
What is a proof of residency letter?
Sometimes known as an affidavit of residence, the proof of residency letter is a sworn statement attesting to the fact that a person really lives at a particular address. It’s a pretty straightforward piece of writing. No need to embellish or riff on your tenant’s good or bad qualities. You could certainly have one drafted by an attorney, but you can easily draft one yourself and save the attorney fees.
Who can request a proof of residency letter?
Usually, your resident makes the request when they need to prove residency, for a variety of reasons, as mentioned above. However, there are occasions when a third party asks for proof of residence in regard to your tenant.
Since it’s a landlord’s responsibility to protect a tenant’s personal and credit information, you will need your tenant’s written permission to disclose information to a third party. You can create a tenant release form with your name and address and your tenant’s name and address. Follow that with language such as this:
I [resident at address] hereby authorize the release of my residence information from [landlord’s name] to [recipient’s name]. [Landlord] can verify the following:
Monthly rent
Persons named on lease
Persons who live on the property
Etc.
Then leave a space for your tenant to sign and date the letter.
What to include in a proof of residency letter
First, find out why your tenant needs a proof of residency letter. You may need to have backup documents, such as a copy of the lease itself, or be required to state the date your tenant signed a lease or how much they pay in rent. You’ll also need to know if the letter is going to require more information about you than just your legal name and address.
Once you have the parameters, you can prepare the letter. Remember, keep it simple and stick to the facts.
Start with your legal name, current address and the date.
After a salutation such as “To whom it may concern,” you’re ready for the body of the proof of residency letter.
Declare your full legal name and title and say that you acknowledge that the resident resides at a particular address and has done so since a specified date and that s/he pays rent each month. Name any other person(s) living with the tenant.
Then, you need to insert a line that affirms that you’re telling the truth in this document.
You’ll have to sign this document in front of a notary and possibly another witness. You can use the template below as a guide to create your own document or download our template.
Proof of residency letter template
[Landlord’s Name]
[Landlord’s Street Address]
[Landlord’s City, State, ZIP Code]
[Date]
To Whom It May Concern,
I, [Your full legal name], am the landlord of [Name of your resident]. I’m writing to acknowledge and confirm that [he/she] resides at [Street address, City, State] and has done so since [Day/Month/Year] as my tenant.
[Tenant’s name] lives in the home with [Names of other residents who live with the tenant]. [Tenant’s name] pays me [Rent amount] each month on [Date].
I swear and affirm under penalty of perjury that the facts set forth in this statement are true and accurate.
If you have any questions or concerns, contact me at [Your phone number].
Sincerely,
[Your signature]
Quickly honor your tenant’s request
Find out when your tenant needs the proof of residency letter. Make it easy to honor this kind of request by having a sample copy on file so you can have it ready when asked. It’s especially important if you have a lot of properties to manage. Your tenants will surely appreciate your timely help.
Stacey Freed is an award-winning writer and former senior editor for Remodeling, a trade publication focused on the business of the remodeling and construction industry. As an independent writer, she continues to write about the building, design, architecture and housing industries. Her work has appeared in Better Homes and Gardens and USA Today special interest publications, Realtor magazine, This Old House, Professional Builder and online at AARP, Forbes.com, House Logic and Sweeten.com among other places.
Welcome to the ultimate guide to buying a mobile home – an increasingly popular housing option that offers affordability, flexibility, and a unique lifestyle. Maybe you’re a first-time buyer searching for an affordable entry into homeownership, or perhaps you’re looking to downsize and embrace a more minimalist way of living. Understanding the ins and outs of buying a mobile home is crucial.
This Redfin article will walk you through the key considerations, benefits, and potential challenges associated with mobile homeownership. So whether you’re looking for mobile homes in Tallahassee, FL, mobile homes in Austin, TX, or just want to know more about this home type, read on to get started.
What is a mobile home?
A mobile home, also known as a manufactured home, is a type of prefabricated housing constructed in a factory and then transported to its intended location. Built to specific standards, these homes are typically placed on a foundation, either temporary or permanent, but once set, they’re not designed for frequent relocation. Their factory-built nature often makes them more affordable than traditionally constructed homes, and they can vary in size, with options ranging from single to multiple sections.
Types of mobile homes
Mobile homes come in various sizes and configurations to cater to different preferences and needs. Single-wide mobile homes are typically the most compact, with a narrower structure. They often have a single long hallway and are ideal for individuals or couples looking for an affordable, space-efficient option.
Double-wide mobile homes are twice the width of single-wide homes, offering more space and a more open floor plan. Triple-wide mobile homes are even larger and offer more room than single and double wide. With three separate sections, they provide generous living areas and multiple bedrooms and often include features like walk-in closets and spacious kitchens.
How much do mobile homes cost
The cost of a mobile home can vary widely based on factors such as size, location, features, and the overall quality of construction. You might find used or smaller mobile homes for around $20,000 to $40,000 on the lower end of the spectrum. These could be basic models with few amenities. Mid-range options with more square footage, modern features, and better finishes could range from $50,000 to $100,000. Larger, high-end mobile homes with premium features and customization might exceed $100,000. However, these are just general estimates, and prices can differ significantly based on regional housing markets and the specific offerings of manufacturers. Additionally, it’s essential to consider other costs such as land purchase or rental, foundation installation, utilities, and potential maintenance expenses.
How to finance a mobile home
Financing a mobile home is somewhat different from a traditional home loan. Interested buyers should explore personal loans, mobile home loans, or chattel loans, which are specifically designed for properties that don’t have a permanent foundation. Some banks, credit unions, and specialized lenders offer these loans.
Additionally, the U.S. Federal Housing Administration (FHA) provides insured loans for manufactured homes and lots. It’s essential to check the eligibility criteria, interest rates, and down payment requirements of each option. Securing financing may also depend on factors such as the age of the mobile home, whether it’s placed on owned or leased land, and if it’s categorized as real property or personal property in that region.
Additional expenses when you buy a mobile home
When buying a mobile home, several additional expenses exceed the initial purchase price. These can vary based on factors such as the type of mobile home, location, and your individual choices. A few of these factors include:
Additional repairs and renovations. These costs should be factored in if you want to customize your mobile home with upgrades such as better appliances, flooring, or fixtures.
Transportation. The cost could be significant if you’ve purchased a mobile home and need to move it. A single-wide mobile home can cost anywhere from $3,000-$9,000, depending on the miles moved, whereas a larger home can cost $15,000 or more.
Site preparation. This includes preparing the land for the mobile home, including leveling, grading, and clearing.
Land lease fees. If you place your mobile home in a park or community, there might be a monthly or annual fee.
Taxes and insurance. Depending on local regulations, you must pay for property tax and insurance.
Pros of buying a mobile home
1. Affordability
One of the primary advantages of purchasing a mobile home is its affordability compared to traditional houses. Mobile homes tend to have lower upfront costs, making homeownership more accessible for people with limited budgets. Additionally, mobile homes often have lower property taxes and utility bills, contributing to long-term cost savings. This affordability can be particularly attractive for first-time homebuyers or those looking to downsize.
2. Faster ownership
Given their prefabricated nature, mobile homes can be produced, delivered, and set up much faster than a home built on-site.
3. Reduced maintenance
Typically, mobile homes have a smaller footprint than traditional homes, which can mean less maintenance and upkeep.
4. Flexibility
Some mobile homeowners appreciate the potential to relocate their home. While not a simple task, moving a mobile home is possible.
5. Community and amenities
Many mobile homes are located within dedicated communities or parks explicitly designed for mobile home residents. These communities often offer recreational facilities, swimming pools, community centers, and social events.
Cons of buying a mobile home
1. Depreciation
Unlike traditional houses, which tend to appreciate over time, mobile homes often depreciate. As the home gets older, its resale value may decline, making it more challenging to build equity. Depreciation can impact your long-term financial outlook and the potential return on your investment.
2. Financing challenges
Securing a loan for a mobile home can be more difficult than for a traditional home. Interest rates for mobile home loans might be higher, and the loan terms might not be as favorable.
3. Land ownership issues
If you don’t own the land where the mobile home is placed, you might have to pay monthly lot rent. There’s also the risk that the land’s owner could sell the property, forcing you to relocate your home.
4. Resale challenges
When it comes time to sell a mobile home, there can be challenges in finding buyers. The narrower pool of potential buyers and concerns about depreciation and perceived quality differences between mobile and traditional homes can lead to longer listing times and potentially lower resale prices.
5. Limited design opportunities
When you buy a mobile home, you might have fewer chances to design it your way because the layouts and structure are already set.
Buying a mobile home: the bottom line
Buyers should carefully weigh the advantages and considerations of purchasing a mobile home based on their preferences and circumstances. With the potential for affordability, flexibility, and a sense of community, mobile homes provide an opportunity for homeownership that aligns with diverse needs. However, approaching the decision with thorough research, budgeting, and a clear understanding of drawbacks, including depreciation and resale challenges, is essential.
Inside: Looking for information on what a typical Christmas bonus in the US is? This guide will help you calculate how much you can expect and what to do with it.
Are you waiting eagerly for that year-end surprise called the Christmas bonus? Like Clark in National Lampoon’s Christmas Vacation?
Or maybe you’re an employer wondering about giving out festive bonuses?
This guide is a jingle bell away with everything you need to know about Christmas bonuses in the United States.
You’ll discover how these additional pays work, what the typical bonus amounts are, tax implications, the benefits of giving a bonus, and wisely spending your bonus. In other words, it decodes everything from the employer’s perspective, right to how it impacts an employee’s pocket and spending decisions.
So, buckle up – you’re about to become a little richer in knowledge. Stay tuned!
What is a typical Christmas bonus?
A Christmas bonus, often referred to as a “13-month-salary,” is a special gift you might receive from your employer at the end of the year.
It depends largely on your company’s resources and financial standing, meaning not everyone will get one.
However, if you’re lucky, you might expect a bonus ranging from 2% to 5% of that, discretionary to your employer.
Thus, the average Christmas bonus would be you could be looking at an additional payout of around $1144-2860, assuming an average income of $57,200.
Does everybody get a Christmas bonus?
Not all employees in the US typically receive a Christmas bonus.
The giving of bonuses varies between companies and roles within those companies.
Personally, I have only had one company that gave out Christmas bonuses. Most companies tend to give their annual year-end bonuses, which may be based on factors like performance or tenure, during the first quarter of the new year.
While a Christmas bonus would be nice as it often serves as an appreciation gesture for hard work throughout the year.
Understanding the concept of Christmas Bonus
A Christmas Bonus is essentially a little financial gift from your employer during the holiday season. Think of it as an extra dollop of icing on your annual salary cake.
It’s typically a percentage of your salary and serves to show appreciation for your hard work throughout the year.
For instance:
Let’s say you earn $80000 a year and your boss awards a Christmas bonus of 5% would then receive an extra $4000 just in time for the festivities.
Your company elects to give all employees a flat $1000 Christmas bonus regardless of seniority.
Note that a Christmas bonus isn’t legally required and varies greatly between businesses.
History of Christmas Bonuses
Woolworth’s birthed this tradition back in 1899, offering a cash bonus of $5 for each year of service with a limit of $25.
In Woolworth’s early years, they established a pattern of rewarding their employees with a generous Christmas bonus.
This practice was seen as an annual tradition and was appreciated by their staff, instilling a sense of loyalty within the workforce.
Over time, Christmas bonuses have evolved not just in amount but in form as well. Besides cash, you could also receive gifts or even lavish holiday parties.
Despite the more modern trend of diminishing Christmas bonuses, this part of Woolworth’s history highlights the positive potential of such incentives.
Factors influencing the amount of Christmas Bonus
Considering factors on the Christmas bonus is crucial because it ensures fair distribution, tailored to individual employees’ performance, length of service, or their specific needs.
We all know that bonuses adequately demonstrate appreciation and recognize the hard work of their employees, increasing their job satisfaction and driving productivity.
So, let’s look into whether or not a Christmas bonus is viable for you or your company.
1. Company policy on Christmas Bonus
A company’s policy about Christmas bonuses is typically laid out in the employee handbook and company policies.
Policies may stipulate that Christmas bonuses are issued under certain circumstances, like when the employee has met specified targets or when the company has performed exceptionally well during the year.
Also, the board of directors may elect to give out one-time Christmas bonuses.
However, if these bonuses are not incorporated into the employee’s employment contract, they are typically subject to the employer’s discretion. Employers must take extra caution to ensure that these bonuses are presented as discretionary and not part of a contractual agreement.
Remember, these factors may vary from one company to another. Always refer to your employer’s specific policies and handbooks for accurate information.
2. Amount of Salary
Your annual gross income might influence the amount of your Christmas bonus, as some employers factor in their employees’ base pay when determining bonus amounts.
However, not all organizations adopt this practice, with some opting for a fixed, equal distribution amongst all staff members regardless of their earnings.
Therefore, depending on your contractual agreement and your employer’s policies, your salary could influence your bonus, but this isn’t a universal rule.
3. Type of Bonus
The types of bonuses vary greatly as companies have the discretion to decide the nature of the bonus, with the decision often driven by the organization’s performance, the individual’s job role, and the overall economic conditions.
They can be incentive-based, linked to performance targets, holiday-exclusive like Christmas bonuses, or tagged to specific business milestones, leading to significant variability.
Here are different types of bonuses you should know about:
Discretionary bonuses: These are given at your employer’s will. They might consider factors like company performance or your personal performance reviews. However, there’s no guarantee you’ll receive one.
Non-discretionary bonuses: These are part of your employment contract. As long as you meet certain criteria, you’ll receive this bonus on top of your salary during the Christmas season.
Non-holiday bonuses: Given outside of the holiday season, these can be extra pay or an item like a company car.
Remember, your bonus type dictates how much you could get for Christmas. Be sure to check your contract!
4. Company Culture
Company culture significantly affects bonuses as it underpins how employees perceive their value and recognition within the organization.
If the culture fosters transparency, fairness, and goal-oriented behaviors, bonuses can effectively serve as an incentive and boost morale. Statistics show that employee loyalty increases when they feel appreciated, which can often be demonstrated through financial bonuses.
Moreover, a culture encouraging open communication assures employees of fair dealing when it comes to awarding bonuses.
Hence, bonuses, when tied to clear goals, become more than just monetary rewards, ensuring employees understand their role in the company’s success.
5. Recipients of the Bonus
In the US, Christmas bonuses are usually gifted to all employees, irrespective of their role or position.
Some of the roles that may receive a Christmas bonus include:
Full-time employees: Usually part of the main workforce, these individuals are often at the receiving end of holiday bonuses.
Part-time employees: Even though they may work fewer hours, many companies consider them for bonuses.
Temporary workers: Though their roles are for a limited time, they are generally excluded as part of the company’s bonus scheme.
Contracted employees: If their contract includes a clause for a holiday bonus, they are quite likely to receive a Christmas bonus. If it does not, they will not receive one.
Remember, the goal is inclusivity, a policy aimed at making every employee feel rewarded and appreciated during the festive season.
6. Holiday Season
Christmas bonuses are commonly offered by employers during the holiday season in the United States. This bonus is seen as a way to show appreciation and respect to employees, which can help to mitigate feelings of burnout.
Companies may elect to give bonuses at other times of the year to motivate their employees and boost their job performance. These bonuses can incentivize individuals to achieve specific company goals, with the promise of additional monetary compensation driving their hard work.
Aside from motivation, off-season bonuses also serve as a token of appreciation, illustrating a company’s recognition and value of their employees’ efforts.
It’s worth noting that a bonus doesn’t necessarily have to be monetary. Examples can also include extra vacation days or other perks.
7. Amount Given to Employees
A Christmas bonus is an extra payment given to employees during the holiday season as a gesture of gratitude for their commitment and hard work.
Factors influencing the Christmas bonus amount include:
Length of service: Employees who’ve been with the company longer might receive a higher bonus. For instance, an employee with a decade of service might receive $1,000 at a rate of $100 per annum.
Based on Salary: Many companies may opt to give a flat percentage related to the salary of their employees.
Flat Amount: Others may give the same amount to all employees across the company.
8. Company’s Financial Resources & Performance
A stronger performing company is more likely to give more bonuses as it typically correlates with higher profits, enabling them to be more generous with employee rewards.
On a company level, if overall performance benchmarks are hit, Christmas bonuses may increase across the board.
In fact, the incentive of bonuses can create a highly driven workforce that pushes towards achieving and even exceeding business goals. Furthermore, companies that distribute bonuses, particularly holiday bonuses, can significantly boost employee morale, fostering both loyalty and a positive company culture.
How to Calculate Your Potential Christmas Bonus
Calculating your Christmas bonus can often seem nebulous, leaving many uncertain about the amount they should expect.
The elusive nature of the Christmas bonus can largely be attributed to the fact that unlike salary, it isn’t typically fixed and may vary based on several factors such as an employee’s performance, the length of their service, or the financial health of the organization.
Despite this, there are a few pointers that can shed light on how to calculate this anticipated festive season reward.
Step 1: Check if you are Eligible for a Christmas bonus
Figuring out your potential Christmas bonus firstly entails a careful examination of the terms of your employment contract, alongside other supporting documentation such as your employee handbook or job offer letters.
These documents accurately establish the contractual relationship between you and your employer and often contain crucial clues about bonus calculations.
For instance, if your contract states that you are entitled to an equivalent of one week’s salary as a Christmas bonus, then you can confidently expect that amount.
Keep in mind the discretion of the employer in case of confusion. Some bonuses might not be contractual but discretionary. Consult your HR department for clarification if needed.
Step 2: Calculate your percentage of the total bonus amount
To calculate your bonus based on your salary, you need to know the exact percentage your employer uses, which usually ranges from 2-5% of your annual earnings.
Multiply your annual salary by the bonus percentage to determine your possible holiday bonus.
For instance, if you earn a yearly salary of $100,000 and your employer gives a 2% bonus, you’ll receive a $2,000 bonus.
Step 3: Is my Christmas Bonus Taxable?
So, if you’re anticipating a hefty holiday bonus, remember, it might be subject to taxes.
Bonuses are often considered supplemental income.
As such, the Internal Revenue Service (IRS) requires a 22% federal income tax on this income, which can reduce your bonus significantly.
State laws also have a part to play. Your holiday bonus is taxed according to your state tax rate, which is another cut from your bonus.
For example, your bonus amount is $5000 after federal taxes of $1100 and state 4% taxes of $200 are deducted, your take-home bonus is $3700.
How to Spend Your Holiday Bonus
The anticipation of receiving that extra lump sum has many employees daydreaming about that eye-catching new car, an extravagantly relaxing vacation, or perhaps the latest tech gadget.
Although it’s tempting to indulge in the pleasure of immediate gratification, there are more finance-savvy alternatives to consider for the effective utilization of your annual bonus.
1. Invest your Christmas Bonus
Getting that skip in your heartbeat when you receive your Christmas bonus is a feeling like no other.
However, the real magic happens when you decide to invest this bonus, making it grow over time instead of spending it all at once.
Here are the top four ways to invest your Christmas bonus:
Wealth Creation: When you invest your bonus, you’re setting yourself up for future wealth. Learn how to invest 10k.
Earn Additional Income: Use your bonus as a kick-start to a side hustle. Many Americans already secure supplemental income this way. In fact, many people are interested in how to make money online for beginners.
Professional Growth: Investing your bonus into professional development is another smart move. Enrolling in online courses that build your technical skills or lead to certifications can enhance your earning potential. Learn to invest 100 to make 1000 a day.
Financial Security: Finally, investing your bonus helps to secure your financial future. Whether it’s putting money into retirement funds or investing in a high-yield savings account, every bit helps set you up for stability and freedom. This sets you up to become financially independent.
Your Christmas bonus could be the first step towards a future of financial growth and security.
2. Consider your financial needs for the coming year
Before you rush to spend your holiday bonus, consider your financial needs for the coming year.
Start by:
Assessing your monthly expenses. How much do you need for essentials like housing, utilities, and food? Compare with the ideal household budget percentages.
Evaluating your emergency fund. Remember, experts recommend at least $1000 in an emergency fund. Plus having three to six months’ worth of expenses stored away in a rainy day fund.
Big expenses coming your way: Do you have any costly expenses like home repairs or car replacement in your future?
You may want to set aside money for those future needs, so you will be financially stable when they happen.
3. Pay Off Bills
Don’t run to the stores before analyzing your debt.
If you have high-interest loans or credit card debt, prioritize paying these down. Our expert tip at Money Bliss is to tackle the highest interest debt first.
Use your bonus to pay off debts: Since a bonus is usually an unexpected sum of money not factored into your annual budget or salary, you can make significant headway in paying off your debts, particularly those with high-interest rates.
Save on interest charges by reducing debt: The bonus can help reduce your debt balance, leading to less interest accruing over time. This move could save you hundreds, even thousands, over the long term.
Consider debt management apps: Apps like UndebtIt help you find a debt free date. Platforms like Tally† can simplify your debt payoff journey with automated payments using a lower-interest line of credit.
Reconsider splurging your holiday bonus: Rather than spending it all on that coveted item or trip, you might want to consider other financially beneficial options.
4. Buy Christmas Gifts
Utilizing your holiday bonus wisely to purchase Christmas gifts can be a smart and rewarding way to use your end-of-year windfall.
Instead of splurging on high-cost items, consider thinking through your holiday gift list and budgeting accordingly.
Bear in mind that enjoying the holiday season doesn’t have to break the bank; as Christmas on a budget is possible.
Don’t forget to spoil yourself with a gift every now and then. You’ve worked hard for this bonus and deserve a treat too.
5. Splurge on Fun Things
It’s absolutely okay to treat yourself with a holiday bonus – after all, you’ve earned it! Using it wisely can add a dash of fun and pure enjoyment to your life.
Now, what do I want for Christmas?
Here are a few fun ways to splurge your holiday bonus:
Dream vacation: The bonus could be your ticket to the vacation you’ve been fantasizing about. Plan carefully to make the most out of it.
Invest in hobby: Whether it’s photography, painting, or gardening, investing in a hobby can prove to be quite rewarding.
Spoil yourself: Get that TV you’ve been eyeing or make a down payment for that new car you fancy.
Remember, pleasure is a great aspect of well-being. So, it’s great to treat yourself once in a while. Just balance it with other financial responsibilities.
6. Invest in Long-Term Goals
Ditch the instant gratification of spending your holiday bonus all at once. Instead, consider investing it towards long-term goals for an even greater payoff.
Here are some easy steps to set you on the right path:
Identify your long-term financial goals. Be it a dream home, kids’ education, or retirement, a clear goal will help you stay motivated.
Assess your current financial situation to gauge how much of the bonus you can invest.
Choose the right investment vehicle. Stocks, bonds, or real estate can be profitable, depending on your risk appetite and time horizon.
Remember, spending wisely today makes for a secure tomorrow.
7. Give Back to the Community
Giving back to your community during the holiday season is a fantastic way to share your fortunes. Not only does it bring joy to those in need, it fosters appreciation, empathy, and understanding.
Here are some thoughtful ways to use your holiday bonus:
Donate to a Local Charity: Identify a local charity that resonates with your values. Every donation counts and your contribution could make a substantial impact.
Sponsor a Family’s Holiday: Many organizations connect sponsors with families in need. Your bonus could help provide them with essential groceries, clothes, toys, and a memorable holiday experience.
Contribute to a Fundraiser: Participate in your community or workplace fundraisers. Your financial support could contribute towards a noble cause, be it medical aid, education, or relief work.
Volunteer Your Time and Skills: Although not a direct use of your bonus, volunteering can be another way to give back. Maybe your bonus might allow you some additional free time to offer.
Remember, volunteering often reflects individual happiness and improves overall well-being.
Do You Expect the Average Christmas Bonus?
Remember, Christmas bonuses can be diversified: from additional checks or sums of money to extra vacation days or tangible gifts.
Everyone always wants a Christmas bonus! So now, you can determine if yours is above or below the average Christmas Bonus!
Based on research, less than a quarter of employers offer a performance-based holiday bonus, so if you’re fortunate enough to receive one, consider investing it to reap greater returns in the future.
The best decision depends on your unique financial situation, so use the above tips to make a smart choice with your bonus money.
Know someone else that needs this, too? Then, please share!!
You have probably heard (multiple times) that saving money for your future is important, but do you know how much you are actually socking away? There’s a formula to calculate your own specific personal savings rate (aka the percentage of your after-tax dollars that you’re putting away).
It’s not too complex and can be a helpful tool to see how your money management is tracking. Find out how to calculate your savings rate here.
What Information is Included in the Savings Rate Formula?
The basic formula to calculate savings rate is:
Your savings / your after-tax income = your savings rate
Once you’ve calculated your savings rate, you can use it to:
• Review how you’re doing from month to month or year to year.
• See how your current spending habits are affecting your future goals and financial independence.
• Motivate yourself to do better with your savings.
• Compare your efforts to others.
You can gather up the numbers you need to determine your savings rate (which is sometimes referred to as a savings ratio) in just a few steps:
Step 1: Add Up Your Income for the Month
Your income streams might include, after taxes: your monthly salary, the money you earned from any side gigs or from selling homemade items online, or rental income if you’re renting out a room of your home to get extra funds. Don’t forget to include money you earned that’s automatically deducted from your pay and added to a retirement account, such as a 401(k) or a traditional or Roth IRA. And add in your employer’s matching retirement plan contributions, as well.
Recommended: 39 Ways to Earn Passive Income Streams
Step 2: Add Up the Money You Put into Savings Each Month
This is about what you’re saving for the long-term, not next week. So it would include the money that’s automatically coming out of your check for retirement savings, plus your employer’s matching contributions, along with any funds you’re putting into separate savings or brokerage accounts.
💡 Quick Tip: Want to save more, spend smarter? Let your bank manage the basics. It’s surprisingly easy, and secure, when you open an online bank account.
Step 3: Do the Math
Divide the total amount of your long-term savings (Step 2) by the total amount of your after-tax income (Step 1). Turn the number you get into a percentage (.10 is 10%, for example), and that’s your savings rate.
You may hear or see a few variations on what’s included in the calculation. Some people don’t include their employer’s 401(k) contributions in their calculations, for instance, and some might add in extra payments they’re putting toward the principal on a student loan or other debt. The point is to be consistent with what you do or don’t include from month to month.
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How About an Example?
Let’s use Jane, whose hypothetical after-tax Income every month is $4,500. She brings in another $500, after taxes, by renting the extra bedroom in her apartment to her cousin, for a total of $5,000 a month.
Jane’s employer doesn’t offer a 401(k) plan, but on her own, Jane puts $500 a month into a Roth IRA. And she always puts another $100 a month in an online savings account she has earmarked for long-term goals. Jane’s savings amount totals $600 a month.
Using the savings rate formula, that’s $600 / $5,000 = .12, which makes Jane’s personal monthly savings rate 12%.
Of course, everyone’s numbers may not be quite so straightforward. Couples, for instance, may have to consider two or more paychecks and, possibly, two or more retirement accounts. Some individuals work more than one job or earn income from multiple sources. Some might count their emergency fund as savings, and others don’t. But the idea is the same: An individual’s or a household’s savings rate measures how much disposable income (defined by the U.S. Bureau of Economic Analysis (BEA) as after-tax income) is being set aside for long-term savings and retirement.
Why Is Knowing Your Personal Savings Rate Important?
The BEA tracks the nation’s personal savings rate from month to month to monitor Americans’ financial health and better predict consumer behavior. And you can do much the same thing with your own savings rate.
By tracking your rate on a regular basis, you can assess how you’re doing in real-time. If you’re consistently falling short of the savings goals you’ve set for yourself, you can look at what behaviors might need changing or if you need to rework your budget. You also can use the information as an incentive to do better. And you might even find it’s a fun way to compete with others close to you, with the nation’s average personal savings rate, or just against yourself.
If you saved 8% in 2023, for example, could you bump that amount to 9% or 10% in 2024? What if you got an unexpected raise or bonus: Would you have the discipline to put that amount into your savings to keep your rate the same or improve it?
Knowing your savings rate can help you make those kinds of financial decisions.
💡 Quick Tip: Most savings accounts only earn a fraction of a percentage in interest. Not at SoFi. Our high-yield savings account can help you make meaningful progress towards your financial goals.
What’s a Good Savings Rate?
The average personal savings rate in the U.S. was about 4.03% in mid 2023, according to the Fed. But financial experts generally advise savers to stash away at least 10% of their income every month ($500 of a $5,000 monthly salary, for example). The popular 50/30/20 budget rule created by Sen. Elizabeth Warren suggests saving 20% of after-tax income.
If that seems extreme, it’s probably more useful to simply target a number you’re sure you can stick to monthly or annually. Just having a positive savings rate — anything above zero — can be a good starting point for building good fiscal habits and a nest egg. You can always make adjustments as you accomplish other financial goals, such as paying off student loans or credit card debt.
Isn’t Having a Good Budget Enough?
A personal budget can be a useful guide when it comes to reaching financial goals. And tracking your spending with a spreadsheet or an app can help you see where your dollars (and dimes) are actually going, as opposed to where you think they’re going—those two places might be very different.
Many people who make a budget include the amount they plan to put toward savings in their budget as a monthly expense. But that’s different from knowing your savings rate.
A savings rate provides a separate, wide-angle view of how much of what you make is going into savings. And that can help you further evaluate how you’re doing.
How Can Someone Improve Their Savings Rate?
The answer is simple: Spend less and save more.
Here are some steps that could help improve an individual’s or household’s savings rate.
Opening or Contributing More to a Retirement Account
One of the easiest ways to save more money can be to open a 401(k) or IRA, or to boost the amount that’s automatically deposited to an account you already have. After all, if you never see the money, you likely won’t be as tempted to spend it. And if you’re a long way from retirement, the money you invest should have lots of time to grow with compound interest. If your employer offers a 401(k) with a matching contribution, a goal might be to save as much as possible to maximize those funds.
Recommended: How an Employer 401(k) Match Works
Opening an Online Savings Account
If you’ve been saving s-l-o-w-l-y with a traditional type of savings account, it might be time to consider other options. Many online financial institutions, for example, offer higher interest rates for deposit accounts because they have lower overhead costs than brick-and-mortar banks, and they pass those savings on to their customers. Online accounts also may offer lower fees than traditional banks—or, in some cases, no fees.
Cut Back on Discretionary Spending
The thought of squeezing out additional dollars for savings each month might be daunting if you’re already on a tight budget. But even a little spending cut can go a long way toward nudging up your savings rate.
Let’s go back to our hypothetical saver, Jane, for an example. If Jane could manage to save just $50 more every month (or about $12 a week), she could increase her savings rate by a full percentage point — from 12% to 13%. That might mean getting takeout one less time every week. Or one less night out with the girls every month. Or maybe cutting back on streaming services she seldom uses.
Lowering Fixed Expenses
Lowering the bills that have to be paid every month can increase the amount of money that’s available for savings. That could include:
• Shopping for cheaper car insurance or a less expensive cell phone carrier
• Keeping your paid-off car for an extra year or two instead of jumping right back into another auto loan
• Refinancing to a lower interest rate on a mortgage or student loans
• Cutting the cord on cable
• Doing your own landscaping.
Ditching the Credit Card Debt
Yes, credit cards are convenient, and using your cards wisely can have a positive effect on your credit score. But the interest on credit cards is typically higher than for other types of borrowing, and it compounds, which means you could be paying interest on the interest charged on previous purchases.
If you’re carrying a balance from month to month and paying interest, you’re giving money to the credit card company that could be going into your savings account. Using a debt payoff strategy or consolidating your credit card debt with a personal loan could help you dump those credit card bills and get your savings back on track.
Putting Pay Raises Toward Savings, Not Spending
No one is suggesting that you should live ultra frugally like when you were scraping by in college or starting your career, but it might not hurt to hold on to some of those money-saving habits you had then. Otherwise, if your pay goes up and your savings stay static, your savings ratio is doomed to drop.
One last example using our hypothetical friend, Jane: If Jane got a $100-a-month raise (after taxes), but she continued putting $600 a month into savings, her savings rate would fall from 12% to just below 10%.
The Takeaway
Saving money might not be considered exciting by everyone, but the thought of being financially secure is pretty appealing. Think of your savings rate as a mirror you can hold up every month to see how you’re doing.
Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.
Better banking is here with up to 4.50% APY on SoFi Checking and Savings.
The SoFi Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.
SoFi members with direct deposit activity can earn 4.50% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a deposit to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate.
SoFi members with Qualifying Deposits can earn 4.50% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant.
SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.50% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.
SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.
Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.
Interest rates are variable and subject to change at any time. These rates are current as of 8/9/2023. There is no minimum balance requirement. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet..
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.
You have probably heard (multiple times) that saving money for your future is important, but do you know how much you are actually socking away? There’s a formula to calculate your own specific personal savings rate (aka the percentage of your after-tax dollars that you’re putting away).
It’s not too complex and can be a helpful tool to see how your money management is tracking. Find out how to calculate your savings rate here.
What Information is Included in the Savings Rate Formula?
The basic formula to calculate savings rate is:
Your savings / your after-tax income = your savings rate
Once you’ve calculated your savings rate, you can use it to:
• Review how you’re doing from month to month or year to year.
• See how your current spending habits are affecting your future goals and financial independence.
• Motivate yourself to do better with your savings.
• Compare your efforts to others.
You can gather up the numbers you need to determine your savings rate (which is sometimes referred to as a savings ratio) in just a few steps:
Step 1: Add Up Your Income for the Month
Your income streams might include, after taxes: your monthly salary, the money you earned from any side gigs or from selling homemade items online, or rental income if you’re renting out a room of your home to get extra funds. Don’t forget to include money you earned that’s automatically deducted from your pay and added to a retirement account, such as a 401(k) or a traditional or Roth IRA. And add in your employer’s matching retirement plan contributions, as well.
Recommended: 39 Ways to Earn Passive Income Streams
Step 2: Add Up the Money You Put into Savings Each Month
This is about what you’re saving for the long-term, not next week. So it would include the money that’s automatically coming out of your check for retirement savings, plus your employer’s matching contributions, along with any funds you’re putting into separate savings or brokerage accounts.
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Step 3: Do the Math
Divide the total amount of your long-term savings (Step 2) by the total amount of your after-tax income (Step 1). Turn the number you get into a percentage (.10 is 10%, for example), and that’s your savings rate.
You may hear or see a few variations on what’s included in the calculation. Some people don’t include their employer’s 401(k) contributions in their calculations, for instance, and some might add in extra payments they’re putting toward the principal on a student loan or other debt. The point is to be consistent with what you do or don’t include from month to month.
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How About an Example?
Let’s use Jane, whose hypothetical after-tax Income every month is $4,500. She brings in another $500, after taxes, by renting the extra bedroom in her apartment to her cousin, for a total of $5,000 a month.
Jane’s employer doesn’t offer a 401(k) plan, but on her own, Jane puts $500 a month into a Roth IRA. And she always puts another $100 a month in an online savings account she has earmarked for long-term goals. Jane’s savings amount totals $600 a month.
Using the savings rate formula, that’s $600 / $5,000 = .12, which makes Jane’s personal monthly savings rate 12%.
Of course, everyone’s numbers may not be quite so straightforward. Couples, for instance, may have to consider two or more paychecks and, possibly, two or more retirement accounts. Some individuals work more than one job or earn income from multiple sources. Some might count their emergency fund as savings, and others don’t. But the idea is the same: An individual’s or a household’s savings rate measures how much disposable income (defined by the U.S. Bureau of Economic Analysis (BEA) as after-tax income) is being set aside for long-term savings and retirement.
Why Is Knowing Your Personal Savings Rate Important?
The BEA tracks the nation’s personal savings rate from month to month to monitor Americans’ financial health and better predict consumer behavior. And you can do much the same thing with your own savings rate.
By tracking your rate on a regular basis, you can assess how you’re doing in real-time. If you’re consistently falling short of the savings goals you’ve set for yourself, you can look at what behaviors might need changing or if you need to rework your budget. You also can use the information as an incentive to do better. And you might even find it’s a fun way to compete with others close to you, with the nation’s average personal savings rate, or just against yourself.
If you saved 8% in 2023, for example, could you bump that amount to 9% or 10% in 2024? What if you got an unexpected raise or bonus: Would you have the discipline to put that amount into your savings to keep your rate the same or improve it?
Knowing your savings rate can help you make those kinds of financial decisions.
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What’s a Good Savings Rate?
The average personal savings rate in the U.S. was about 4.03% in mid 2023, according to the Fed. But financial experts generally advise savers to stash away at least 10% of their income every month ($500 of a $5,000 monthly salary, for example). The popular 50/30/20 budget rule created by Sen. Elizabeth Warren suggests saving 20% of after-tax income.
If that seems extreme, it’s probably more useful to simply target a number you’re sure you can stick to monthly or annually. Just having a positive savings rate — anything above zero — can be a good starting point for building good fiscal habits and a nest egg. You can always make adjustments as you accomplish other financial goals, such as paying off student loans or credit card debt.
Isn’t Having a Good Budget Enough?
A personal budget can be a useful guide when it comes to reaching financial goals. And tracking your spending with a spreadsheet or an app can help you see where your dollars (and dimes) are actually going, as opposed to where you think they’re going—those two places might be very different.
Many people who make a budget include the amount they plan to put toward savings in their budget as a monthly expense. But that’s different from knowing your savings rate.
A savings rate provides a separate, wide-angle view of how much of what you make is going into savings. And that can help you further evaluate how you’re doing.
How Can Someone Improve Their Savings Rate?
The answer is simple: Spend less and save more.
Here are some steps that could help improve an individual’s or household’s savings rate.
Opening or Contributing More to a Retirement Account
One of the easiest ways to save more money can be to open a 401(k) or IRA, or to boost the amount that’s automatically deposited to an account you already have. After all, if you never see the money, you likely won’t be as tempted to spend it. And if you’re a long way from retirement, the money you invest should have lots of time to grow with compound interest. If your employer offers a 401(k) with a matching contribution, a goal might be to save as much as possible to maximize those funds.
Recommended: How an Employer 401(k) Match Works
Opening an Online Savings Account
If you’ve been saving s-l-o-w-l-y with a traditional type of savings account, it might be time to consider other options. Many online financial institutions, for example, offer higher interest rates for deposit accounts because they have lower overhead costs than brick-and-mortar banks, and they pass those savings on to their customers. Online accounts also may offer lower fees than traditional banks—or, in some cases, no fees.
Cut Back on Discretionary Spending
The thought of squeezing out additional dollars for savings each month might be daunting if you’re already on a tight budget. But even a little spending cut can go a long way toward nudging up your savings rate.
Let’s go back to our hypothetical saver, Jane, for an example. If Jane could manage to save just $50 more every month (or about $12 a week), she could increase her savings rate by a full percentage point — from 12% to 13%. That might mean getting takeout one less time every week. Or one less night out with the girls every month. Or maybe cutting back on streaming services she seldom uses.
Lowering Fixed Expenses
Lowering the bills that have to be paid every month can increase the amount of money that’s available for savings. That could include:
• Shopping for cheaper car insurance or a less expensive cell phone carrier
• Keeping your paid-off car for an extra year or two instead of jumping right back into another auto loan
• Refinancing to a lower interest rate on a mortgage or student loans
• Cutting the cord on cable
• Doing your own landscaping.
Ditching the Credit Card Debt
Yes, credit cards are convenient, and using your cards wisely can have a positive effect on your credit score. But the interest on credit cards is typically higher than for other types of borrowing, and it compounds, which means you could be paying interest on the interest charged on previous purchases.
If you’re carrying a balance from month to month and paying interest, you’re giving money to the credit card company that could be going into your savings account. Using a debt payoff strategy or consolidating your credit card debt with a personal loan could help you dump those credit card bills and get your savings back on track.
Putting Pay Raises Toward Savings, Not Spending
No one is suggesting that you should live ultra frugally like when you were scraping by in college or starting your career, but it might not hurt to hold on to some of those money-saving habits you had then. Otherwise, if your pay goes up and your savings stay static, your savings ratio is doomed to drop.
One last example using our hypothetical friend, Jane: If Jane got a $100-a-month raise (after taxes), but she continued putting $600 a month into savings, her savings rate would fall from 12% to just below 10%.
The Takeaway
Saving money might not be considered exciting by everyone, but the thought of being financially secure is pretty appealing. Think of your savings rate as a mirror you can hold up every month to see how you’re doing.
Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.
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SoFi members with direct deposit activity can earn 4.50% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a deposit to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate.
SoFi members with Qualifying Deposits can earn 4.50% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant.
SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.50% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.
SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.
Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.
Interest rates are variable and subject to change at any time. These rates are current as of 8/9/2023. There is no minimum balance requirement. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet..
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.
According to iPropertyManagement, just over one-third of American households are rental units, such as apartments, townhomes and even single-family residences. That means that of the approximately 332 million people residing in the United States, over 110 million rent.
With that many would-be tenants searching for a new rental unit at any given time, criminals will be out there looking for vulnerable people they can con out of their hard-earned money. However, there are some tell-tale signs that someone is trying to scam you in your apartment search.
Here’s what you need to look for so you don’t fall victim to common rental scams.
1. Don’t fall for misleading advertisements
Landlords and property managers often reach a potential renter by posting advertisements about their available units in newspapers, magazines and on a listing website. That translates into an unthinkable number of rental listings highlighting what’s on the market at any given time, not to mention all vacation rental listings out there.
Or, at least, what’s supposedly available. Rental listing scams are rampant, so it’s imperative to know how to differentiate between a legitimate advertisement and one full of lies.
Don’t be fooled by beautiful pictures advertising an apartment that looks perfect before doing your due diligence on all property matches. When searching for the next place to call your own, keep these suggestions in mind to avoid common rental scams.
2. Review apartment rental listings carefully
When reading advertisements, pay attention to the way it’s written. Skip listings with misspelled words, improper abbreviations or incomplete information. Details are important, so be extra wary if an apartment ad has errors, blank spaces or confusing terms.
Those kinds of no-nos are a potential clue the person posting the ad is not advertising a real place for rent. Or, maybe they aren’t really a legitimate landlord.
3. Is a month’s rent too low?
Another common rental scam is creating an environment that’s too good. For example, is the monthly rent unexpectedly low for what’s being promised? If the average cost to live in your dream neighborhood is $2,000 a month for a one-bedroom, be wary of apartments being advertised in the same vicinity for far less.
Seeing is believing, so be sure to tour the rental property before signing a lease. That investment of time could go a long way to preventing rental fraud.
4. Cash is not king for a security deposit or first month’s rent
Run, don’t walk, from any supposed landlord requesting cash for any debt relating to renting a property, like an application fee or a security deposit. Giving cash means it will be difficult to prove the payment was actually made. Therefore, even if the would-be landlord offers to provide a written receipt, that paper means nothing if they request money and the transaction is a rental scam.
Other payment methods
Other tips when paying rent, the security deposit or the first month’s rent include:
Not wiring money. When you wire money, you run the risk of not having enough of a paper trail.
Using the actual payee’s name and phone number on payment apps like Venmo to ensure the money reaches a legitimate destination
Familiarizing yourself with staff personnel to gain reassurance you’re dealing with a legitimate landlord
The more information you have, the better you can protect yourself from the bad people out there trying to engage in rental scams.
5. Avoid landlords who will not meet in person
It’s said a picture is worth a thousand words, but sometimes, a photo is not always what it seems. Anyone can create and post breathtaking images, its amenities and the surrounding area in an online listing, hoping viewers will like what they see. Therefore, it’s imperative to meet the property manager, landlord or their authorized agent in person before signing on the dotted line.
And, of course, visit the apartment you’re interested in to ensure posted pictures of the abode match the place depicted in the photos. Walking through the rental properties that may become your home is the best way to decide if you like the place. You might feel a vibe you don’t like or realize the available storage space isn’t sufficient for your needs.
Don’t be satisfied with a virtual tour, because the apartment in the video may not be the one you actually rent. If you have to insist on a personal walk-through before renting, you might want to consider walking away instead. This is a sign it could be a rental scam.
Unusual circumstances
A different set of challenges arise when extenuating circumstances prevent a potential tenant from touring a property before renting. One example is if you live out of town and are unable to travel to a new city to visit the apartment prior to signing a lease and moving in. While it’s best to avoid that situation, there are steps to take to decrease the likelihood of falling for a fraudulent listing.
They include:
Asking a friend or relative to check the place out for you
Checking the property address online
Surfing Google Earth for additional details
Requesting the landlord provide references from prior tenants
6. Vet the landlord
Researching a supposed landlord before renting from them can go a long way to preventing fraud.
One way to do that is by checking the website of the county auditor or county recorder where the rental is. That should help you determine who owns the property you want to rent. Be extra careful if it’s difficult to decipher ownership because that could make it easier for someone to perpetrate a fraud.
Hit the internet
While perusing government websites about your would-be landlord, check the criminal courts, too. It could reveal a supposed landlord’s checkered past or their clean background.
Another good place to look online is the county’s municipal court, or wherever you file rental disputes. Does the property owner sue to evict many tenants? How often do they win those cases?
And yet another website to peruse is the Better Business Bureau in the city where the property is or where the landlord has their headquarters. Consumers should report both positive and negative interactions with the business community, so a quick check of their website could reveal whether the landlord or their rental company has ever perpetrated rental scams.
7. Read the lease. Really.
No matter how honest or direct a landlord or property manager might appear, don’t solely rely on a rental listing to decipher what an apartment and its community actually offer.
When you sign a lease, you’re entering into a contract obligating you to perform certain acts, like pay rent on time. The document also explains what the landlord is responsible for, like providing working heat.
If you don’t understand or agree with everything contained in a lease, voice your concerns to the landlord before signing it. It’s too late afterward.
Avoid inexplicable blank spaces on a lease
Don’t sign a lease that’s incomplete. Any missing but pertinent information, such as monthly cost, the rental term and details about who is financially responsible for utilities, are immediate red flags the contact isn’t legitimate.
Rental agreements should also be error-free
A lease agreement is a written contract between a landlord or property manager and a tenant. When a would-be tenant and landlord sign a rental agreement, they enter into a contract requiring certain acts of each of them.
For example, the tenant agrees to pay the rent according to the terms of the contract. The landlord promises to perform whatever the lease promises.
However, a lease pocked with typos, or missing or inaccurate information could be a sign the document is a fraud.
8. Avoid an immediate move-in request
A supposed landlord who insists a potential tenant move in immediately, before a personal walk-through of the place, does not sound legitimate. If nothing else, they sound desperate to rent their unit.
When you tour an apartment and meet the property manager or their representative, they’re meeting with you, too. Normally, an owner takes an interest in who lives in their units. Not taking the time to vet you, as well, should worry you.
Be concerned if they don’t demonstrate that level of concern for their property.
What to do if you’re a victim of rental scams
Unfortunately, despite best efforts not to fall victim to fraudsters, it still happens. If it does, you can fight back.
An initial response is to contact local law enforcement to report the crime. Provide as much information as you can when you contact local authorities to help them in their search for the fraudulent landlord.
Try canceling your method of payment of the security deposit or rent you paid in advance. If you paid cash, you’re out of luck. Using a traceable method, such as a check or credit card, gives you some some recourse to take them to small claims court.
If you wrote a check, contact your bank to determine if somehow, the check was not yet cashed. If it was, report the fraud to your bank. You can also try to stop the payment.
File all the complaints
Don’t forget to file a fraud report with the Federal Trade Commission. While the feds won’t resolve your individual complaint, they use submitted reports to investigate rental scams, unethical business practices and cases of fraud.
The Internet Crime Complaint Center, also known as the IC3, offers another tool for fighting rental fraud. Anyone who believes they’ve been a victim of an Internet crime may file a complaint through that website.
Enjoy a successful apartment search
Finding a great place to live that suits your lifestyle and is affordable is challenging enough, and the prospect of fraud makes it that much more difficult. Create a paper trail of payments for rent or deposits by paying by credit card or check, never by cash. Meet the landlord or their representative personally when you tour the premises and read the written rental agreement thoroughly before signing.
Then, sit back and enjoy your new surroundings.
The information contained in this article is for educational purposes only and does not, and is not intended to, constitute legal or financial advice. Readers are encouraged to seek professional legal or finance advice as they may deem it necessary.