How to Best Prepare for Your Mortgage Process

Obtaining a fair mortgage can be the biggest challenge while purchasing a home in today’s unstable economic environment; the real estate market has been nothing short of a roller coaster ride over the last decade with several notable ups and downs. While mortgage rates are still currently low, making it a buyer’s market, many lenders are more careful than ever when it comes to approval. Unfortunately, it seems that the past errors that left thousands ill equipped at ever succeeding in repaying their mortgages have created a cautious atmosphere in which buyers need to tread lightly. It is in this light that we offer 4 helpful tips to consider when preparing for and applying for a mortgage loan.

  1. NO Big Financial Moves
    When dealing with down payments and approvals, banks will pay very close attention to any large sums of money moving in or out of your bank account in the time leading up to your application. Experts suggest that you make sure to cash in any savings bonds or stocks you plan on using at least 4 or 5 months ahead of time. The same rule applies if you are lucky enough to have a generous uncle, parent, or grandparent willing to help with your initial down payment; depositing this money early will also save your family member or friend unnecessary “gift letter” paperwork.
  1. Maintain Your Current Credit
    The same rules mentioned above apply to your current credit profile, as you should absolutely avoid anything that may have a negative effect on your credit score during the months leading up to your mortgage shopping. A lower score could lead to a negative change in rates and increased fees, as well as even a loss of loan qualification. Experts state that maintaining a consistent “debt to income ratio” is vital, meaning you must avoid opening or closing any current cards, as well as any big purchases like a car or even a wedding.
  1. If Possible, Wait Until You Have 20% for a Down Payment
    We know that this one is much easier said than done depending on your own individual family and financial situations, but there is very good reason to hit that 20% mark before applying. Often, loan insurance comes into play when a down payment is less that 20% of the overall home cost; this is understandably forced by lenders to protect them from instances of default. While Freddie Mac and Fannie Mae will be offering loans to people with as little as 3% for a down payment later this year, the insurance can be quite costly in the long run. Therefore, if you can afford to wait and avoid any FHA Insured Loans, a private mortgage premium with 20% down is the most efficient way to go.
  1. Secure a High Quality Pre-Approval
    Getting a pre-approval will not only make you more desirable to lenders, it will also help you close faster when you actually go into contract. The reason for this is that a pre-approval will actually let your broker or bank review your full debt obligations, credit score, and income when determining the terms of your mortgage rather than using estimates on an application. The lender will have your full financial analysis completed earlier in the process, resulting in fewer headaches as you go deeper into the process.

Why We Shop: Understanding the Psychology of Spending

psychology-of-moneyEver wonder why it is so hard to control spending? There are many factors that loosen our purse strings and open our wallets. Knowing what these forces are and keeping them in mind can help you stay on budget – and out of debt.


Countless dollars are being spent to understand your buying habits and create a psychological connection between you and a product. Advertisers use “psychographics” – the study of lifestyle, ambitions and world-view to help marketers focus in to specific psychological triggers. And once those ads tap a deep psychological level, it becomes difficult to remain rational. You respond without knowing just what you’re responding to.

Shopping as Experience

Shopping is not simply an act of purchasing what you need and then going home. It is entertainment and social involvement. The shopping mall has become “experiential.” They are vast, complex and complete. Studies have shown that most actual purchases occur in the 3rd hour of shopping. Therefore, malls are designed to keep a shopper there for at least that long, with winding architecture, appealing music, and sometimes even adding pleasing aromas.

The Media

Popular television shows and movies display images of “the good life,” yet the lifestyle they depict is often way out of line with reality. These projected images deeply influence the way we see our personal level of success. For most people, attempting to keep up with fictional characters and the possessions they have is a recipe for credit card debt.

The Proliferation of Consumer Goods

There is simply so much to buy! Walk into any large children’s toy store and count the types of dolls alone. Or an electronics store – the variety of stereos and DVD players is staggering. Goods and services that used to be luxury items are now more in the financial range of most consumers. This leads to increased spending because everything is “so affordable.”


What is “success”? Walk into a store to request service when you are wearing an expensive watch, designer clothes, and stylish accessories. Walk into the same place wearing rags and see if you get equal treatment. Society defines success by what we look like, how much money we make, and what we own. There is no doubt that we have more clout when we convey an air of “success.” It is not surprising that we are often tempted to buy things that will make us appear wealthier.

Friends and Family

Pressure from friends and family members can be overwhelming. You may feel a strong sense of expectation from them, believing that they deserve to live with certain things and in a particular way. You may not want to disappoint them or cause conflict so you spend to their desires. Saying “no” to the people you love is an extremely difficult thing to do – and many people don’t.

Tools to Overcome Overspending

There are many techniques to help even the most entrenched spender transform negative habits into positive behavior:

  • Avoid the Hot Spots. If you know you can’t go into a store or mall without exiting with an armload of unnecessary objects, don’t go in.
  • Use Lay-away, or a store’s “hold” policy. In other words, give yourself time to think before you buy.
  • Write a shopping list. Nothing ruins splurging like a little forethought. Make a list of what you need before you leave the house. Buy only what’s on the list.
  • Splurge … but economically and consciously. The pleasure of saying “yes” to the urge to splurge is the same, whether you’re at the Salvation Army or Saks Fifth Avenue, and the morning after is a lot less painful.
  • Count your money. Know how much you’re earning and spending. Each dollar represents a portion of your life – you traded your energy for it. Where is it going? Are you getting fulfillment for each dollar spent? Are you spending your energy (money) in ways that support your values?
  • Phone a friend. If you’re on the verge of splurging, phoning a friend is a good way to purge the urge.

Now you don’t have to wonder why it is so easy for spending to get out of hand. The reasons are many. But by understanding all these factors and working against them, you – not outside forces – can make conscious and sound shopping decisions.

Copyright 2006 Balance

Study Finds Complex Passwords Not So Complex After All

passwordA study by a Texas-based information security company has determined that all the chatter about creating complex passwords may actually make them easier to crack.

The study involved analysis of 34 million stolen passwords from three separate data breaches: LinkedIn, eHarmony, and Rockyou. Out of that 34 million, they found that 50 percent of them followed the same structure.

The advice for making complex passwords is not bad. It is still best to use a combination of characters including upper and lower case letters, numbers, and special characters. However, the issue the researchers had was that when applications and websites require users to create a password using those rules, they don’t specify the placement of the various characters. And perhaps they should not. Creating complex passwords is frustrating enough for some people. However, it doesn’t mean it’s advised to ignore a well-structured one.

The study found that the structure most people used when following the strong password guidelines is that they used exactly one upper case letter and it was at the beginning of the password. As a result, passwords are easier to crack.

The guidelines are still the same, however and there is no reason to panic. Just keep in mind when you are creating and changing passwords that it’s worth shifting the placement of those special characters and consider using more than one of each to make it even more complex. And remember to always use at least eight characters and consider using pass phrases. It may make it easier to remember that way too.

© Copyright 2015 Stickley on Security

Declutter and Save

declutter_life_2What is the current state of your closets? Are they stuffed to the brim with clothes, shoes, suitcases, cleaning supplies, your high school chemistry textbook, etc., or can you do cartwheels in there? Is every horizontal surface covered in piles and piles of stuff or bare except for a few knickknacks?

If your house is filled with clutter, you probably know you won’t make the cover of Better Homes and Gardens, but you may not be aware that it could be costing you money too. Many people buy or rent bigger (and usually more expensive) places so they can have more closets or other storage space. Or they may opt for the smaller space and pay rent on a storage unit. A clutter-filled house can also lead to increased entertainment costs – you don’t want your friends to see the mess (or are sick of seeing it yourself), so you go out. Duplication is another way clutter can cost you. Have you ever spent money on something you already had because you had no idea where it was and did not want to spend hours looking for it?

If the thought of actually having to go through all your stuff makes you sweat, don’t worry. Here are some tips that can help make the decluttering process as painless as possible:

  • Do a little at a time: You are less likely to get discouraged and give up if you set a series of small goals spread out over time (e.g., clean the closet in the master bedroom tomorrow, clean the garage next weekend) instead of trying to clean up the whole house at once.
  • Take a picture of sentimental items: Do you have some items that you never use but nevertheless have a hard time getting rid of because of their sentimental value (such as the doll you bought for your daughter who is now 25)? Taking a picture can make it easier to part with them since you know you will have a reminder even if they are no longer collecting dust in your closet.
  • Donate or sell: While some of your items may be worn out and only welcomed by the trash bin, there may be many things you can sell to a consignment or thrift store or donate to charity. Think of your cleaning as putting money in your pocket or helping others, instead of just a chore.
  • Use the “one in, one out” rule: After you go through all that effort to get rid of what you don’t need, you probably don’t want the house to revert back to its former messy state a few months from now. A good way to prevent this is to get rid of something whenever you purchase something new. You buy a new t-shirt at the mall – when you get home, go into the drawers and get rid of an old one.

By taking the time to declutter, you’ll be cleaning all the way to the bank.


© 2014 BALANCE

Making Summer More Energy Efficient

making-your-home-more-energy-efficient-this-summerIt’s expected to be a hotter summer this year, but don’t confine your money-saving efforts to the thermostat.

The warm months can be the best time to focus on cutting year-round energy costs. Free of snow, ice and wind, it’s easier to spot problems, do repairs and budget for energy-efficient appliances and fix-up projects that can save considerable money in the future.

Your first step should be better tracking and analysis of the energy you buy. The most common sources of energy spending are home utilities and fuel costs for vehicles. However, if you own a vacation home, operate a business within your residential space or have different vehicles for land or water, see if you can separate those numbers so you can more clearly identify usage patterns month to month and find ways to cut back.

Think about an energy audit.

Whether you do it yourself or pay for the services of a certified professional summer is the best time to do a basement-to-rooftop energy audit. Some utility companies have home energy audits online so you can see where your energy is going. Prospective homeowners might make an energy audit part of their home inspection process. According to the U.S. Department of Energy, in 2014, the average American spent 60 percent of their energy dollars heating rooms and water. Another 16 percent goes to lighting, cooling and food refrigeration. The remainder – nearly a quarter of total home energy uses – covers all miscellaneous energy use in the house.

Then focus on the thermostat.

In the summer, confine heavy air conditioning use to the hottest nights, and the rest of the time, try to set the thermostat a little higher than you do now. For example, the U.S. Energy Department says that setting your air conditioning to 78 degrees instead of 72 can save between 6-18 percent on your summer cooling bill. Before you spend money on a programmable thermostat or convert your real-time utility billing to a budget plan, note that some research questions their value. First, see how much you can save by shutting off vents and doors and drawing curtains in unused rooms and spaces. If you don’t have pets, you may consider setting your thermostat significantly higher than 78 before you leave for work.

Lights out.

We’ve all been admonished to turn off the lights when we leave a room, but there are other things we can do to capture random, or energy waste. Sensors, dimmers and timers can reduce lighting use, and installing power strips can keep computers, microwaves, cable boxes, DVRs and high-end TV sets from sucking energy even when they’re not turned on. Unplugging between uses works too. Also, swapping conventional incandescent bulbs for compact fluorescent bulbs (CFLs) can provide lighting that lasts longer and saves money on replacements.

Check for tax credits and rebates.

Make a call to your tax professional, check the Internal Revenue Service’s website and for news on residential energy credits for specific replacement appliances and energy-saving improvements to your home. Keep in mind that Congress traditionally acts late each year to renew old credits or to approve new ones.

Consider energy-smart landscaping.

Keep in mind that well-placed trees and shrubs can shield a home from the sun and the elements year-round and potentially save 25 percent on energy costs annually.

Cars, gas, and public transportation.

If you drive, consolidate errands, fill up your tank at cheaper times and consider smartphone apps to find low gas prices for commuting and vacation use. And if you don’t regularly use public transportation, start testing it during the summer. The additional walking most people do when they take public transportation has health benefits as well.

Bottom line: This summer, don’t just try to keep cool. Save money by changing your year-round energy behavior.


By Nathaniel Sillin

Scam Of The Week: Internet Capacity Warning

scamHere is the latest scam, possibly fueled by the recent news that we have run out of IPv4 addresses in the U.S.: Employees receive an email which claims to be from the “IT Services Support Department”. Obviously this is not legit, and a phishing scam tricking users so they enter their email account login credentials.

It tells the recipient their Internet capacity has reached 70% and that is why they need to contact support to avoid further problems. There is a “contact us” link in the email message so that the user can resolve the issue. Clicking the link redirects the user to a bogus “Help Desk” webpage asking them to submit their email account username and password, and when done, a Thank-You page appears.

The user may think the issue has been resolved, but the data has been harvested by cyber criminals and they will try to hijack the user’s email account for other criminal purposes.