We’re only a month into 2014 and changes are afoot, so it shouldn’t be long before we can start to see how these changes affect the housing market. Banks are loosening credit criteria because of the economic recovery, which makes it easier to get a loan; however, new Dodd-Franks regulations have tightened the debt to income ratios (you need to have less debt compared to how much money you make), which makes it harder to get a loan.
Basically, if you’re thinking about buying a home, it’s more important than ever to streamline your finances, to cut expenses and increase the amount you can put toward a down payment.
One of the best ways to save money (and safeguard your credit rating) is to run your household on a budget. To create a budget, review your recent credit card bills and checking account statements to see where you are spending most of your money. You will also need to keep track of the cash you spend (and what your spouse spends) from your pocket. This is the toughest part to keep track of because you don’t leave a paper trail.
Once you know what you spend, you can begin to determine how you can reduce or eliminate unnecessary expenditures. Do you really need a landscaper or can junior mow the lawn? Do you need all those pay cable channels or could you live with a smaller package (I realize I’m on shaky ground here – if you and your partner differ on the “essential” nature of your current cable package, maybe see if you can cut elsewhere first)? Once you’ve cut or reduced non-essentials, it’s time to look at essentials. Are you paying too much?
Recently, one of my realtors was shocked when she received her propane bill and saw that she was charged $4.04/gallon. The reason for her shock was that we compared bills and I was paying $2.46/gallon, and we live next door to each other.
So, while it’s easy, don’t allow yourself to be complacent regarding recurring bills. Shop around for everything from car and home insurance to utilities to yard service. Remember you want the best value, which may or may not be the lowest price.
Another helpful tip along these lines is to remember to pay attention when you pay bills online. Some vendors will give you a discount to sign up for online payments, especially when they are automatic (don’t require your approval each time). That’s great, but not if you’re paying too much for the product or service in the first place.
So, that’s it. Just pay attention. You may or may not find areas to save, but you won’t know unless you’re paying attention.
And, in case you’re interested, the 41st Annual Crab and Tri-Tip Fundraiser Feast and Auction is scheduled for this Saturday, February 9 from 12:30 – 2:30 pm at Carl Purdy Hall. Tickets are $35. Contact the Ukiah Redwood Empire Lions Club for details at firstname.lastname@example.org or 707-463-2238.
If there’s something you would like me to write about or if you have questions about real estate or property management, feel free to contact me at email@example.com or visit our website at www.realtyworldselzer.com. If you’d like to read previous articles, visit my blog at www.richardselzer.com. Dick Selzer is a real estate broker who has been in the business for more than 35 years.