Jan. 14, 2017

Why I Love Lubbock

Considering a Lone Star State residency but don’t want to live in over-populated cities like Dallas, Houston or San Antonio? 

Welcome to Lubbock, the Texan city with the 11th highest population, housing approximately 236,065 of the state’s finest. Responsible for unending cotton, one of rock and roll’s greatest and rowdy Red Raiders, this West Texas gem might be what your new-dwelling doctor ordered. There’s only one way to find out.

Learn to A) love the color red, B) what the term “Guns Up” means, C) who the starting quarterback, wide receivers, running backs, and defensive ends are for the Texas Tech Football Team. After all, the saying goes “there’s a Texas Tech student for every tumbleweed you see.” Don’t worry,  you’ll fit right in.

In 2009 CNNMoney.com ranked Lubbock the 12th best midsize metro area to start a small business. Thanks to its expanding medical sector, flourishing agriculture industry, and educational system, Lubbock’s  economy is diverse enough to shelter it from the worst of the recession. Feeling entrepreneurial?

Lubbock is located in West Texas, home to the largest contiguous cotton-growing region in the world. Your allergies have officially, and adequately, been warned.

While Lubbock is the 11th largest city in Texas, there’s no denying that good ol’ home town feel. Everyone still waves to everyone, everyone still looks out for everyone, and everyone seems to smile for no apparent reason at all. The people are friendly the way only home town people can be. It’s hard to put a price on that.

Lubbock is the economic, education, and health care hub of the multi-country region known as the South Plains, which leaves little to wonder why the city’s nickname is “Hub City”.

In 2005 only 3.9% of Lubbock’s population was unemployed. While the city’s unemployment rate has slowly climbed in the last 9 years, now 4.8% in December 2013, it is significantly less than the state of Texas’ unemployment rate, which currently sits at 6.4%. Jobs for everyone!

Buddy Holly, aka Charles Hardin Holley, was born in Lubbock, Texas on September, 7th 1936. Ranked by Rolling Stone magazine as the 13th greatest artist of all time in 2004, influencing greats like Bob Dylan, Elvis, and The Rolling Stones, you won’t have to wonder why you’ll feel instantly cooler living where the “single most influential creative force in early rock and roll” was born.

 

Posted in Social
Dec. 1, 2015

5 Speedy Ways to Come Up With a Down Payment

The best way to come up with a down payment for a home: save for one, of course! But sometimes you’re in a hurry. Maybe your dream house just popped up on the market, or you’ve simply had it with being a renter. Whatever the reason, you’re ready to buy a house, now. But while your credit is good and your career is stable, you still need to come up with that big chunk of change for a down payment.

Never fear: There are plenty of ways to amass a sizable down payment fast. Check out these tactics, along with their pros and cons.

 

1. Dip into your 401(k)

If you’ve been socking away money in your 401(k), it is possible to borrow from that for a home loan—and get that cash in hand fast.

“Most 401(k) plans allow you to borrow up to 50% of the vested balance, or up to $50,000, and it takes about a week,” says Todd Huettner, owner of Huettner Capital, a residential and commercial real estate lender in Denver.

But it will cost you: If you take funds out of your 401(k) early—that is, before you’re 59½ years old—you’re going to take a 10% penalty on that withdrawn money. And it counts as gross income, which can bump you into a higher tax bracket.

Check out this Wells Fargo calculator to see what your penalties would be. In addition to penalties, most companies require you to repay that vested money over five years—or sooner if you quit or get axed. So be sure your career is stable.

2. Crack your IRA

Digging into your IRA usually carries the same 10% penalty of breaking open your 401(k) piggy bank, with one major difference: The penalty doesn’t apply to first-time home buyers. And unlike a 401(k), you don’t have to repay what you take out of an IRA. However, the withdrawal is still taxable. Plus there’s the matter of not repaying yourself, which can hurt your long-term retirement. So if you take out a sizable chunk, restoring this nest egg to its former level will take you many years.

3. Hit up your boss

Let’s get real: You don’t want to stroll into your boss’ office and demand help buying your house. But you can ask if your company has an employer-assisted housing program. Think about it: Companies hate employee turnover, so what better way to keep you around than pitching in to help you buy a home? It’s a win-win: Home loans are often low- or zero-interest and are usually structured to be forgivable over a period of time, often five years, which further encourages employees to stay put. The downside? Not all employers offer it. Hospitals and universities most often do, so be sure to ask to avoid overlooking this ready source of financial assistance.

4. Explore state and city programs

Local assistance programs abound to help you scratch up cash for a down payment. Offered by either your state, your city, or nonprofits, these programs often partner with banks, who hope to gain clientele they might pass over otherwise: Bank of America, for instance, recently launched a searchable database of local programs. Wells Fargo’s partnership with NeighborhoodLIFT offers down payment assistance up to $15,000.

The catch? You’ll need to qualify. For NeighborhoodLIFT, for instance, your household income has to be no more than 120% of the median in your area.

5. Get a gift from family or friends

Understandably, many home buyers turn to their family for help buying a home, and for good reason: There are no limits on how much a family member can “gift” another family member, although only a specific portion can be excluded from taxes ($14,000 per parent).

But it’s not just as easy as that. Gifters, even family, will need to provide paperwork in the form of a gift letter. And if the gifter is a friend, it gets even more complicated. For example, you’ll have to wait about 90 to 120 days before you can use any of those funds.

 

 

 

Posted in finance
Nov. 1, 2015

First Time Home Buyer

Buying a Home Process 

 

1 - Strengthen your credit. 

 

The higher your FICO score, which ranges from 300 to 850, the better interest rate you'll qualify for. This is extremely important. The difference between a 4.5% interest mortgage and a 5% interest mortgage can mean tens of thousands of dollars over the life of the loan.

 

Get Free Copy Of Your Credit Report

 

 

2- Get pre-approved to get the actual amount you can pay. 

 

Apply With a lender within a two week period so that the inquiries do not damage your credit report. Do this before searching for home so you don't accidentally fall in love with a house that you cannot afford.

·       Seller love buyers who get pre-approved. Pre-approved buyers are almost always given the green light by lenders, meaning there's less risk for the deal to get scuttled in the end.

 

 

3- Find a good real estate agent 

to represent you in the search and negotiation process. 

 

·       A realtor's job is to connect people who want to buy and sell a particular home. For this reason, a realtor has an interest in selling homes. A very good realtor will use her experience to sell the right home to the right buyer — you.

·       A Realtor who is a neighborhood specialist will often have particular expertise in the neighborhood you are targeting and can give you pros and cons that a more generalist cannot.

·       When you do find your realtor, go into exhaustive detail when describing what you want in a home — number of bathrooms and bedrooms, attached garage, land and anything else that may be important, such good lighting or yard space for the kids.

 

 

5 - Sign up for an MLS alert service to search on properties in your area. 

 

 

A Multiple Listing Service will give you a feeling for what is on the market in your price range. Your agent can do this for you.

·       If you sign up through a real estate agent, it is poor form to call the listing agent directly to see a house. Don't ask an agent to do things for you unless you're planning to have them represent you — they don't get paid until a client buys a house and it's not fair to ask them to work for free, knowing that you're not going to use them to buy your home!

 

 

6 - Start looking for houses within your range. 

 

 

Allow your realtor to start working for you, but know what's within your budget and what's not. The general rule of thumb here is that you can afford a house that's 2.5 times your yearly household salary. For example, if your annual combined salary is $85k, you should be able to afford at least a $210k mortgage and very possibly more.

·       Make use of online mortgage calculators to start crunching numbers, and remember the mortgage shopping you did earlier on. Keep these numbers in mind as you prepare to find your new dream home.

 

Start to think about what you're really looking for in a home. 

You probably already have a vague idea, but the angel's in the details. There are a couple things in particular that you and your family should give good thought to:

·       What will you and your family need in several years? Maybe you're just a couple right now, but are there are plans for kids in the future? A home that snugly fit two people could be torturous for three or four.

·       What trade offs are you willing to make? In other words, what are your priorities? Although we like to believe that buying a house can be straightforward, it's often a complex ordeal in which we're forced to compromise. Do you care more about a safe neighborhood and good schools over a big backyard? Do you need a big, workable kitchen more than a big luxurious bedroom? What are you willing to sacrifice when it's crunch time?

·       Do you expect your income to increase over the next couple years? If your income has increased by 3% for several years in a row and you hold a secure job in a safe industry, you can probably rest assured that buying an expensive but still reasonable mortgage is possible. Many homebuyers buy relatively expensive and then grow into their mortgage after a year or two.

 


7 - Define the area you'd like to live in. 

Scout out what's available in the vicinity. Look at prices, home design, proximity to shopping, schools and other amenities. Read the town paper, if there is one, and chat with the locals. Look beyond the home to the neighborhood and the condition of nearby homes to make sure you aren't buying the only gem in sight.

·       The area in which your home is located is sometimes a bigger consideration than the home itself, since it has a major impact on your home's resale value.

 

Visit a few  houses to gauge what's on the market and see firsthand what you want. 

Pay attention to overall layout, number of bedrooms and bathrooms, kitchen amenities, and storage. Visit properties you're seriously interested in at various times of the day to check traffic and congestion, available parking, noise levels and general activities. What may seem like a peaceful neighborhood at lunch can become a loud shortcut during rush hour, and you'd never know it if you drove by only once.

 

Making An Offer

 

1 - If possible, tailor your bid to the seller's circumstances. 

This is not easy, and often impossible, but it doesn't hurt to try when making one of the biggest purchases in your life. Here are some things to keep in mind as you think about your offer:

·       What is the seller's financial prospects? Are they in desperate need of money or are they sitting on a pile of cash? Cash-strapped sellers will be more likely to take an offer that undercuts their asking price.

·       How long has the home been on the market? Homes that have been on the market for longer periods of time can usually be bid down.

·       Have they already bought another house? If the sellers aren't currently living in the house they're trying to sell, it may be easier to bid less than you otherwise might.

 

2 - Look at comparables when you make your bid. 

What did other homes in the neighborhood start off as ("asking price"), and what did they sell at? 

 

 


3 - Calculate your expected housing expenses. 

Estimate the annual real estate taxes and insurance costs in your area and add that to the average price of the home you're trying to buy. Also add how much you can expect to pay in closing costs. (These take in various charges that generally run 3 percent of the money you're borrowing.

 


4 - If you absolutely fall in love with a home, be prepared to make an offer that's above the asking price. 

Economics of supply and demand will sometimes force your hand. If many people are competing for few homes, be prepared to lead with your highest possible offer. Some homebuyers don't believe that you should lead with your highest offer, but you could easily find yourself being outbid and never get the chance to bid on your house. If you want to give yourself the best shot on a home that you really, really like, lead with a high bid.

 

 


5 - Talk to your realtor when you're ready to formally present your offer.

This is usually how it goes:

You submit your offer to your realtor, who then forwards it to the seller's representative. The seller then decides to accept, reject, or make a counter-offer.

·       Include earnest money with your offer. Once you sign an offer, you are officially in escrow, which means you are committed to buy the house or lose your deposit, unless you do not get final mortgage approval or something came up during your inspection contingency time that you cannot accept. During escrow (typically 30 to 90 days), your lender arranges for purchase financing and finalizes your mortgage.

 


6 - Home inspection.

·       A home inspection costs between $200 and $500, depending on the area, but it can prevent a $100,000 mistake. This is especially true with older homes, as you want to avoid financial landmines such as lead-paint, asbestos insulation and mold.

·       If you use the inspection results to negotiate down the price of your purchase, do not refer to the inspection or bids for work in your contract. The lending institution may request to see a copy of your inspection, which will supersede their appraiser's evaluation.

 

7 - Close escrow. 

 

This is usually conducted in an escrow office and involves signing documents related to the property and your mortgage arrangements. The packet of papers includes the deed, proving you now own the house, and the title, which shows that no one else has any claim to it or lien against it. If any issues remain, money may be set aside in escrow until they are resolved, which acts as an incentive for the seller to quickly remedy any problem areas in order to receive all that is owed.

Posted in Home Buyer
Oct. 30, 2015

How to Balance Your Finances Without a Budget

1. Hide the Money 

It’s harder to spend what you don’t have easy access to. So be sure to set aside a percentage of your pay in savings before it ever hits your pocketbook.



Simply have your employer withhold money from each paycheck for your 401(k) or 403(b) retirement account. Make sure to reserve enough to get the full company match, if your employer offers that benefit. If you use direct deposit, you can request that your funds be funneled into both a checking account and a savings account (which doubles as an emergency fund). Another option: Have your bank set up a standing automatic withdrawal that will transfer a sum from checking to savings. Schedule this transaction for the day after each paycheck is generally posted, so that the money goes away before you’re aware of it, says Meg Favreau, the senior editor of the financial website. Even after your emergency account is fully funded (that is, with enough money on hand for about eight months’ worth of expenses), keep setting aside at least $25 per paycheck to have a more secure safety net, says Brian J. O’Connor, the author of The $1,000 Challenge.


2. Make a Choice: Paper or Plastic?

In an ideal world, financial pros say, you would live a cash-only lifestyle to minimize the risk of overspending. But in the real world that’s almost impossible. You can’t shop online with a stack of greenbacks. However, it’s best to choose one payment method and stick to it as much as possible, says O’Connor, since that makes it easier to track your total spending.

Use (mostly) cash if you carry a balance on your credit card or find that charging things encourages you to buy more than you can afford. Here’s how: Once you’ve socked away some money in savings (see step 1) and paid your regular bills, withdraw the amount that remains from your paycheck, says Favreau. (Just be sure to leave in enough money to avoid bank fees and overdrafts.) Put the cash in one envelope and use it for all your discretionary outlays: food, clothing, going out. Or, if you want to designate a specific dollar amount for different expenses, give each category a separate envelope.

Use (mostly) one credit card if you pay your bills in full each month. Credit cards famously prompt poor spending choices, but they also allow you to look at your account transactions and see where you’re spending money, says O’Connor. (Especially helpful: Some providers send out year-end statements, often organized by spending category.) Plus, if you use a rewards card, you can rack up points in a hurry. Don’t have one?

3. Tally Your Regrets

Chances are, you’ve heard of the “latte effect.” This is the phenomenon in which people habitually fritter away small amounts of money on frivolous things and are barely aware of the cumulative cost until they add it all up. This is often cited as an expense that can be reduced by budgeting. But there’s another way to eliminate mindless expenditures, according to Gregory Karp, the author of The 1-2-3 Money Plan . Just look at your credit-card and bank statements several times a year. For each purchase, he says, “ask yourself, ‘Do I regret buying that?’” You may be shocked to realize that in one three-month period you spent $95 on iTunes downloads and 10 percent of your take-home pay on takeout.

Write down any purchases that make you wince, and keep that list posted by your computer or on your cell phone. “Being aware of where you’re spending too much should deter you from making the same mistakes again,” says O’Connor.

4. Maintain an Extra Savings Account for Long-Term Goals

Maybe you wish you could afford a new computer. Or you’re hoping to celebrate your wedding anniversary by taking a cruise. One easy move can make it more likely that you’ll succeed. Instead of just stashing money in an undesignated savings account, Brad Klontz, Psy.D., a financial psychologist in Kauai, Hawaii, and a coauthor of Mind Over Money , suggests that you create a new one with a name that specifically refers to your goal: “Tom and Samantha’s Trip to Greece,” say, or “Elinor’s Laptop Fund.” (At many banks, if you transfer a specific amount into this account each month or maintain a minimum balance, you won’t be assessed maintenance fees.)

“Saving money is an abstract concept, but doing this exercise taps into the emotional part of your brain,“ says Klontz. “You are less likely to feel like you’re doing without, because you’re saving toward a clear goal that you genuinely want to achieve.”

Posted in finance