7 Tips on Budgeting and Saving Your Money

Everyone wishes they could have an unlimited bank account. Unfortunately, it’s time to get back in the real world. If we want something we have to work hard and earn it. Our goals and desires in life often come with a price tag attached to it and in order to achieve them we need to learn to budget our money. Yes, budgeting is hard, but it doesn’t have to be. More often than not, a substantial amount of our money is being spent on unnecessary expenses such as coffee trips. Uncovering these unnecessary expenses is the first step to learning how to budget and save your money.

1) Read your statements:

Reading your monthly statements will enable you to see exactly where your money goes. Add up all the unnecessary expenditures such as daily coffees, magazines, ATM withdraws and that expensive sandwich from the local deli that you could make at home for a quarter of the price. What’s the total? Compare that to the cost of making coffee at home, buying a hot flask, and preparing your meals at home. Ouch, it hurts right? Spending an extra 30 minutes a week prepping lunch meals and making a coffee at home can save you tons of money and give you more time to relax on your lunch break.

2) Analyze your bills:

Bills, unfortunately, are something that goes hand in hand with growing up and something you cannot avoid. However, how much you are paying for your bills is something you can change. Sit down and scrutinize every bill that comes through that door. Are you being over charged for a service you did not use? Do you really need an all inclusive phone plan? Does the A.C. really need to be on high when you’re not in the house? Stop paying more than you need to for these services and utilities by being more conscientious about your usage. You’ll be surprised how much you’ll save by opting for a cheaper phone plan, dropping those channels you never watch and turning the A.C. off when you leave the house.

3) Distinguish between luxuries and necessities:

Yes, I understand you want that new pair of shoes or the latest phone, but do you really need them? Be honest, the answer nearly always is no. Being brutal about what you actually need can reduce your monthly living costs drastically. Go one step further by cutting down on how often you pay for necessities such as getting a haircut every 6 weeks instead of every 4 weeks or by carpooling with co-workers to save on gas.

4) Prioritize:

If you know you want to buy a new home, but you also want to take a vacation abroad, and purchase a new car, prioritize! Sit down and be realistic about what is top priority for you. Can you compromise on anything? Find a budget trip to a nearby state or visit friends and family? Do you really need a brand new car or could you settle for an older model that’s been lightly used for two-thirds of the price? Do you really need a home that has 2 spare bedrooms and space for an extra car in the garage? By compromising you may find that you can achieve all these desires within your budget.

5) Open a savings account:

Open a savings account and have a percentage of your wages direct deposited straight into that account. This way the money won’t be available for you to just spend at will and you’ll find you won’t even miss the money if you don’t see it. Aim for at least 10% of each paycheck to go into savings. But, make sure you still have enough to pay all your bills and living costs.

6) Shop around:

If you must make purchases that are not necessities then do your homework and shop around for the best price. Online search engines will help you to determine the best prices for what you are looking for. Go one step further by taking these to a competitor and ask them to make you a better offer. Save money on shipping by taking the price to local stores that offer price matching services such as Best Buy and Fry’s Electronics. The savings you make, no matter how small or big, will mean you are one step closer to purchasing that house, sparkling new car, or the vacation of your dreams.

7) Budget:

Here’s the big one. Sit down and strategically allocate a sum of money for each bill and living cost. By doing this you will be able to see exactly where your money is going. You’ll also be able to tighten the strings on what you spend on each cost. Think about groceries: do you end up throwing away half the fridge by the end of the week because you shopped on impulse? Setting a budget means you’ll be more cautious to strategically buy your food shopping for the week. A great way to keep track of your budget is to use a personal finance and budget tracking app on your smart phone. JasonRPrice.com recently reviewed the best personal finance and budget apps to manage your money on the go.

By taking the time to go over your finances, living costs, and shopping around you could end up saving hundreds of dollars a month. Putting that in a high interest savings account for a year will earn you interest, improve your credit score, and help you buy that dream home. For more information on financing your next purchase contact Premier Mortgage Lending today at 702-485-6600.

Signs of the Las Vegas Housing Market Recovery

Over the recent months we have seen a number of signs that the Las Vegas housing market is starting to recover. With an influx of investors, a decrease in the number of foreclosures and a shortened housing supply of just 5 weeks, it’s the sign of a positive future that Las Vegans have been waiting for.

In May 2013, foreclosed homes represented just 11% of home sales. This is a massive drop from the recent years of foreclosed homes representing half of all home sales. This drop in the number of foreclosed homes has also been met with a shortened housing supply of just 5 weeks. The shortage of homes for sale has resulted in a very healthy boom in the new homes market. So far the sales of new homes has jumped 87% this year and is expected to continue to rise over the next few years.

The improving employment market means more and more people are flocking to the region and boosting the local economy. This improvement paired with the rise of new home sales is creating a very healthy construction industry and a thriving employment rate within this industry.

Last week, 109 of the 134 acres of land offered by the Bureau of Land Management (BLM), sold for $21.4 million in a sealed bid auction. “The 134 acres of undeveloped desert are located in the southwest valley near the Mountain’s Edge master-planned community”, said the BLM’s Karla Norris, Assistant District Manager for the Southern Nevada Public Land Management Act.

With Las Vegas Valley home builders buying at least 74 acres of public land at auction, it’s yet another sign that the Las Vegas new build market is highly sought after. Home builder companies D.R. Horton and Pardee Homes, bought 51.25 acres for $9.4 million and 22.5 acres for $4.6 million respectively, according to the BLM.

For more information on financing your next purchase contact Premier Mortgage Lending today at 702-485-6600.

7 Questions to Ask Your Mortgage Adviser.

Taking out a mortgage, or any type of loan, is a big step. With that step is a lot of information that you’ll need to be clued in with. Asking the right questions will help you to be clued up on the contract you are about to sign.

What should you ask your mortgage adviser?

1) What types of loan programs do you offer?

Asking your mortgage adviser what types of loan programs are offered will help you to decide which loan is right for you. Every loan comes with a different set of features, fees and requirements. Learning about each type of loan will give you the tools to decide which loan will work best for you and your financial status.

2) Can you estimate and explain your fees?

The fees that come attached to a loan vary depending on the type of loan, your credit score and many other factors. Asking about all the fees tied to the loan you are considering will ensure you are aware of the total cost of the loan and where your monthly payments are going.

3) How much will my monthly payments cost?

Every loan has a different interest rate, and while the 15-year fixed loan may be a drastically better rate, it may not be a realistic loan to take. When applying for a loan, you should ask your mortgage adviser what the monthly payments will be on each loan you are considering. Sit down and realistically calculate your monthly income and your monthly expenditure. While the 15-year fixed loan may be cheaper in repayments than a 30-year fixed loan, it may not be if you cannot afford to make the monthly payments.

4) Are there any prepayment penalties on this loan?

Yes, everyone likes to be repaid on their loan early, and yes, it looks great on your credit score. However, when you repay your loan before the contracted repayment term is finished, many loan companies will have a prepayment penalty. Ask your adviser what this will be, as it may not be worth it to make a prepayment on the loan.

5) Could you estimate closing costs on this loan?

With every loan you take out there are a set of closing costs attached to it. These closing costs are charged on top of the loan you are taking out and are generally between 2-5% of the purchase price of a home and are due after you have closed on the home. Lenders are required by law to give you a good faith estimate (GFE) of what the closing costs on your home will be within three days of when you apply for a loan. However, remember that this is just an estimate and actual closing costs may vary up to 10%.

6) Can you close on this loan within my timeline?

If you’re on a tight timeline to buy a home, make sure that the lender can close on the loan within your schedule. If they can’t, you either need to look at a new lender or work on a new schedule.

7) What am I paying in points?

When the adviser tells you the par rate they can offer you, you may want to ask for a lower rate, known as an underwater rate. When you ask for an underwater rate you will pay points in order to lower your monthly payments. One point is equivalent to 1% of your loan. Depending on your credit, you’ll be offered an underwater loan for a certain amount of points which are either paid up front or added onto your loan.

 

8 ways the government is trying to help homeowners

Foreclosing your home is a long process and contrary to popular belief, there are ways to avoid foreclosure. Lenders don’t want to foreclose on a property, they want to keep the homeowners in their homes. The Obama Administration has implemented a number of programs under the Making Home Affordable plan. These programs seek to assist homeowners who are at risk of foreclosure or are struggling to make monthly mortgage payments.

Refinancing your Mortgage

Refinancing your mortgage can help to lower mortgage payments to a more sustainable level. Refinancing your mortgage can secure a lower rate, longer term or a different type of loan.

1) Home Affordable Modification Program (HAMP): HAMP sets out to lower mortgage payments to 31% of your income before tax to make mortgage payments more affordable for the homeowner. This program is for those homeowners who are still employed but struggling financially to keep on top of their mortgage payments.

2) Principal Reduction Alternative (PRA): If your home is worth significantly less than what you owe on your mortgage, PRA sets out to encourage lenders to reduce the amount you owe.

3) Home Affordable Refinance Program (HARP): HARP is set up for those who are current on their mortgage payments but are not eligible for traditional refinancing due to a decline in the value of their home. The program sets out to help homeowners get a new, more affordable, more stable mortgage.

Underwater Mortgages

With the decline in value within the real estate market, many people are finding they now owe more on their mortgages than their home is worth. Along with the HARP & PRA programs, homeowners with underwater mortgages can apply for the Treasury/FHA Second Lien Program (FHA2LP).

4) Treasury/FHA Second Lien Program (FHA2LP): FHA2LP is for those who have 2 mortgages with different lenders, with one agreeing to participate in FHA Short Refinance. If that is the case then FHA2LP sets out to have your second mortgage provider do the same resulting in a maximum mortgage debt after the refinance of 115% of your home’s current value.

Unemployed Homeowners

Many homeowners have been made unemployed since the recession. Their struggle to maintain their mortgage payments have led to thousands of people foreclosing on their homes. Now the MHA has set out to ensure unemployed homeowners are given the chance to search for employment and keep their mortgage and home.

5) Home Affordable Unemployment Plan (HAUP): For those unemployed, HAUP will reduce your mortgage payments to 31 percent of your income or suspend them altogether for 12 months or more, depending on your situation.

6) FHA Forbearance for Unemployed Homeowners: The Federal Housing Administration (FHA) requirements now require servicers to extend the forbearance period for unemployed homeowners to 12 months.

Getting out of your mortgage

Some homeowners find they reach the point where they need to get out of their mortgage due to prolonging unemployment and crippling financial situations. The MHA will allow you to get out of your mortgage through the Home Affordable Foreclosure Alternatives and even offer the opportunity to buy your home back.

7) Home Affordable Foreclosure Alternatives (HAFA): Those who find their mortgage payments unaffordable and are looking to move to more affordable housing may be eligible for short sale or deed-in-lieu of foreclosure through HAFA SM. In a short sale, the mortgage company lets you sell your house for an amount that falls “short” of the amount you still owe. In a DIL, the mortgage company lets you give the title back, transferring ownership back to them.

8) Redemption: After your home has been sold at a foreclosure sale there is a period of time when you can still reclaim your home. In order to do this you will need to pay the outstanding mortgage balance and all costs incurred during the foreclosure process. 

Another Chance Nevada

Those that find themselves foreclosing on their property often think that they cannot get another mortgage. However Premier Mortgage Lending offers a Second Chance Loan Program which helps those wanting to purchase a home do so with their access to both private money and institutional portfolio lending. Through their extensive access to both private money and institutional portfolio lending they are able to help you to secure financing even with a recent history of foreclosure or short sale.