4 Signs Refinancing Is The Wrong Move

4 Signs Refinancing Is The Wrong Move – SmartAsset

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Refinancing your mortgage can bring your interest rate down, lower your monthly payments and generally save you some money. With rates still low, you may be pondering whether now’s the right time to try for a better deal on your home loan. But you don’t want to pull the trigger too soon. If any of the following apply to you, you may want to think twice before jumping on the refinancing bandwagon.

Compare refinance mortgage rates. 

1. Your Credit’s Not in Great Shape

Refinancing when you’ve got a few blemishes on your credit report isn’t impossible, but it’s not necessarily going to work in your favor either. Even though lenders have relaxed certain restrictions on borrowing over the last year, qualifying for the best rates on a loan can still be tough if your score is stuck somewhere in the middle range.

If you took out an FHA loan the first time around, you might be able to get around your less-than-spotless credit with a streamline refinance, but approval isn’t guaranteed. Interest rates are expected to rise toward the end of the year, but that still gives you some time to work on improving your score.

Getting rid of debt, limiting the number of new accounts you apply for and paying your bills on time will go a long way toward improving your number so that when you do refinance, you’ll be eligible for the lowest interest rates.

Related Article: The Costs and Benefits of Refinancing

2. You’re Not Sure You’ll Stay in Your Home Long-Term

Refinancing involves replacing your existing mortgage with a new one. The interest rate, payments and loan term may be different but the one thing that remains the same is the fact that you’ll be required to pay closing costs to finalize the deal. Closing costs can run between 2 and 5 percent of the total loan amount, but that varies and is based on the lender you choose. If you’re refinancing a $200,000 mortgage, for example, it’s possible that you’d have to cough up anywhere from $4,000 to $10,000.

Since you’re reducing your payment and interest rate, you’ll hopefully eventually recoup the money you spend on closing costs, but it’s going to take some time. If you end up selling the home and moving before you hit the break-even point, all that money that you put out up front to refinance is basically gone. It could take a few years to break even so if you don’t think you’ll stick around that long, you may be better off keeping your cash and paying your current loan as is.

Learn more about refinance closing costs.

3. A No-Closing Cost Loan Is Your Only Option

If you don’t have a few thousand dollars to spare to cover the closing costs, you can always look into a no-closing cost loan. With this type of refinance, the lender folds the costs into the loan itself so you don’t have to pay anything extra out of pocket. While that’s a plus if you’re short on cash, you may be really putting yourself at a disadvantage in the long run. Increasing your mortgage (even if it’s just by a few thousand dollars) means you’re going to pay more interest over the life of the loan.

For example, let’s say you refinance a $200,000 mortgage at 4 percent for 30 years. Altogether, you’d pay $143,000 in interest if you don’t pay anything extra. Your closing costs come to 3 percent but you roll them into the loan so you’re refinancing about $206,000 instead. That extra $6,000 would cost you another $11,000 in interest so you have to ask yourself whether the monthly savings from refinancing justify the overall added expense.

4. Compare Your Refinance Loan Options

Once you’re ready to refinance, it’s important to take the time to compare what’s available from different lenders carefully. Checking out the rates and fees each lender charges ensures that you won’t spend any more money on a refinance loan than you need to.

Photo credit: ©iStock.com/goldyrocks, ©iStock.com/SolisImages, ©iStock.com/DOUGBERRY

Rebecca Lake Rebecca Lake is a retirement, investing and estate planning expert who has been writing about personal finance for a decade. Her expertise in the finance niche also extends to home buying, credit cards, banking and small business. She’s worked directly with several major financial and insurance brands, including Citibank, Discover and AIG and her writing has appeared online at U.S. News and World Report, CreditCards.com and Investopedia. Rebecca is a graduate of the University of South Carolina and she also attended Charleston Southern University as a graduate student. Originally from central Virginia, she now lives on the North Carolina coast along with her two children.
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Here Are the States That Americans Are Fleeing the Fastest—and Why>

The pandemic hasn’t stopped fed-up Americans from fleeing colder, more expensive parts of the country and moving to warmer, cheaper locales. Instead, it’s sped up the exodus for many folks who would have otherwise waited.

The state people can’t seem to get out of fast enough is none other than New Jersey, according to United Van Lines’ 44th Annual National Migration Study. For the third year in a row, the moving company found that residents were leaving the snowy state, known for its high taxes, home prices, and cost of living.

(United Van Lines based its findings on the percentage of inbound/outbound state moves compared with the overall number of state moves. Only states with at least 250 or more moves with United Van Lines were included.)

New Jersey’s median home price tag was $442,500 in November, according to the latest realtor.com® data available. That’s nearly $100,000 more than the national median list price of $348,000. As many people are able to work entirely remotely for the first time during the pandemic, some are seeking to relocate to more affordable places to fire up their laptops.

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Watch: Sacramento’s Secret: Why This California Market Is No. 1 for 2021

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Folks are also moving out of New York, where the median home price was $570,050, and Illinois, where homes go for $249,500, according to realtor.com data. And they’re going to the South and the West, in particular states that offer a lower cost of living, warmer weather, and strong, local economies.

Those relocating during the pandemic are more likely to be retirees and younger workers seeking high-paying jobs in areas with strong economies, says economist and public policy professor Michael Stoll at the University of California, Los Angeles.

People have also moved to be closer to their families, particularly in the middle of these twin health and financial crises. In many cases, the pandemic has sped up their relocation timelines.

“COVID has prompted people who are at or near retirement age to move to places where they would have moved later,” says Stoll. “If you have to stay at home and you can work remotely and you were thinking of moving in two years, why not do it now?”

Where are Americans moving?

No, the top destination isn’t Florida. People are going to Idaho for the second year straight.

The state, which is known for its potatoes and ski resorts, isn’t exactly a warm-weather hot spot. But Idaho is a whole lot cheaper than California and has a strong economy—drawing both retirees and highly skilled workers. The state capital, Boise, also boasts a burgeoning tech job market.

Idaho’s median home list price was $433,600 in November, according to realtor.com. While that’s certainly not a bargain, it’s significantly more palatable than the median $728,500 in nearby California.

“Those who tend to move [for work] are younger and have greater incomes,” says Stoll. “Job growth has been robust in the South and the West.”

(Vermont would have topped the list, overshadowing Idaho, but it didn’t meet United Van Lines’ 250 move threshold to be included on the list.)

South Carolina’s warm weather, beautiful beaches, and lower taxes and cost of living thrust the Palmetto State into the second most popular destination. The state’s median home price was $285,000. Oregon, another California alternative with a stronger job market, came in third, with a median $475,050 home price.

“They’re warmer, more temperate climates, and they’re cheaper places,” says Stoll. Some of the top destinations also appeal to baby boomers. “[They] have the retirement infrastructure [with] retirement communities, health care systems, and amenities.”

Source: realtor.com

Current Mortgage Rates Continue to Move Lower

It’s been good news this week for home buyers and home owners looking to refinance as mortgage rates have improved. It hasn’t been a big swing lower but mortgage rates have mostly remained lower after a drop on Monday morning. Read on for more details.

Where are mortgage rates going?                                             

Mortgage rates move lower in the Freddie Mac PMMS

Current mortgage rates have moved lower for second straight week, according to the Freddie Mac Primary Mortgage Market Survey (PMMS).

Here are the numbers:

  • The average rate on a 30-year fixed rate mortgage moved lower by two basis points to 4.51% (0.5 points)
  • The average rate on a 15-year fixed rate mortgage ticked lower by three basis points to 3.98% (0.5 points)
  • The average rate on a 5-year adjustable rate mortgage fell by five basis points to 3.82% (0.03 points)

Here is what Freddie Mac’s Economic & Housing Research Group had to say about rates this week:

“Mortgage rates inched backward this week to their lowest level since mid-April.

Backed by very strong consumer spending, the economy is red-hot this month, which is in turn rippling through the financial markets and driving equities higher.

Unfortunately, the same cannot be said about the housing market, where it appears sales activity crested in late 2017. Existing-home sales have now stepped back annually for the fifth straight month, and purchase mortgage applications this week were barely above year ago levels.

It is clear affordability constraints have cooled the housing market, especially in expensive coastal markets. Many metro areas desperately need more new and existing affordable inventory to break out of this slump.”

Rate/Float Recommendation                                  

Lock now before move even higher     

While mortgage rates have improved for the second consecutive week, the long-term outlook continues to be for them to gradually increase as the Federal Reserve gets ready for and follows through with increases to the nation’s benchmark interest rate. The first hike is expected to take place next month, with another likely in December.

Learn what you can do to get the best interest rate possible.  

Today’s economic data:           

Jobless Claims

Applications filed for U.S. unemployment benefits for the week of 8/18 came in at 210,000. That’s 2,000 lower than the previous reading, bringing the 4-week moving average down to 213,750.

FHFA House Price Index

The FHFA House Price Index increased 0.2% from the previous month in June. That brings the year over year increase to 6.5%.

PMI Composite Flash

The PMI Composite index hit a 55.0 in August. Manufacturing came in at 54.5 while Services hit 55.2.

New Home Sales

New Home Sales for July came in at an annualized rate of 627,000. That’s slightly below the consensus reading of 649,000.

Jackson Hole Symposium

Kicks off today and ends tomorrow.

Kansas City Fed Mfg Index 

11:00am

Notable events this week:     

Monday:   

Tuesday:   

Wednesday:         

  • Existing Home Sales
  • EIA Petroleum Status Report
  • FOMC Minutes

Thursday:     

  • Jobless Claims
  • FHFA House Price Index
  • PMI Composite Flash
  • New Home Sales
  • Jackson Hole Symposium
  • Kansas City Fed Mfg Index

Friday:          

  • Fedspeak
  • Jackson Hole Symposium

*Terms and conditions apply.

Carter Wessman

Carter Wessman is originally from the charming town of Norfolk, Massachusetts. When he isn’t busy writing about mortgage related topics, you can find him playing table tennis, or jamming on his bass guitar.

Source: totalmortgage.com

Coronavirus has “die-hard urbanites” moving to the ‘burbs

When it comes to buying a house, people are increasingly giving up downtown and headed for the hills. Also the beaches, small towns, and rural ZIP codes.

Maybe you’ve been thinking it’s time to quit the city, to get more room to breathe in a house of your own.

But what does it mean to pack up and move during coronavirus?

How difficult will it be to buy a house and get a mortgage in the middle of a pandemic?

The fact is, plenty of people are doing it. And you likely can too. Here’s how.

Verify your home buying eligibility (Jan 14th, 2021)


In this article (Skip to…)


Why move during coronavirus?

Moving during coronavirus increasingly makes sense for many people.

It’s the chance to re-boot, take a different career path, and make new life choices. It’s also a time when the housing market is surprisingly attractive.

  • Interest rates have been at or near record lows for weeks. Financing below 3% is now available for those with solid credit, little debt, and healthy cash reserves. Rates have never been this low for this long in the U.S. 
  • Low down payments make it easier to buy. Accessible loan programs are available to almost all homebuyers. Think of low rates plus USDA and VA financing with zero down, FHA loans with just 3.5% upfront, and conventional mortgages with as little as 3% down
  • Home prices and values have been going up. According to the National Association of Realtors (NAR), the typical existing home sold for $295,300 in June — up 3.5% from a year earlier. “June’s national price increase,” said NAR, “ marks 100 straight months of year-over-year gains
  • When you buy in a market where home values are appreciating, you gain equity more quickly. You also avoid paying more for the same house if you buy a year from now
  • There are new home buying options in affordable markets. Rising prices mean buyers may want to consider buying in selected opportunity zones, census tracts with lower-cost properties that may benefit from development

Lots of renters are taking this as an opportunity to make the move to homeownership. And current homeowners are using record-low rates as an opportunity to size up.

In July, home buying activity was up 21% compared to a year ago. That’s huge.

So not only is buying a home during coronavirus attractive — but it’s also doable for many.

Verify your home buying eligibility (Jan 14th, 2021)

Potential challenges of moving right now

Of course, moving in the middle of a pandemic is going to be a tough process. We don’t want to over-simplify it.

It will likely be harder to pack, clean, hire a moving company, and deal with the standard moving logistics when everyday life is already so complicated.

And then there are challenges in the housing market itself. Here are two big ones to keep in mind:

  • Inventory is tight, down 18% from last year. That means home buying and bidding wars are more competitive, especially in the most affordable markets
  • Mortgage standards may be a little tougher than normal. Coronavirus has added more risk to the economy. Jobs are no longer as secure as they once were. As a result, many lenders have tightened their qualifying standards to make lending an extra-safe prospect. However, shopping with multiple lenders may help you get around this issue if your credit or finances are borderline

Despite these drawbacks, many Americans have decided it’s still the right time to buy a home.

Ask yourself: Do the long-term benefits outweigh the immediate challenges?

If you’re looking for extra guidance on whether or not to buy a house during coronavirus — and how the process works — see:

Where everyone’s moving

In the midst of buying and selling, financing, and refinancing, something else is happening.

People are voting with their moving vans — and often that means shifting to places far from metro cores. 

“Busy high-rise apartment buildings and cramped square footage have lost their luster,” says Mansion Global.

It adds that “with working from home increasingly the norm and some companies offering their employees the opportunity to work remotely for good, many Americans are weighing a move to areas where they can buy properties with more space, privacy, and security.”

For instance, think of Idaho. According to the United Van Lines, 67% of the moves it did in Idaho in 2019 were inbound — the highest percentage in the country.

“With no access to the usual perks of urban life (nightlife, museums, sports events), spending a small fortune for a cramped apartment or condo seems to make a lot less sense.” –Realtor.com

People were going the other way in states like New Jersey, where 68% were moving elsewhere.  

Pandemic life “is leading more and more city-dwelling Americans to reevaluate their living situations — and the long-term ramifications for the nation’s hottest urban hubs could be vast and transformational,” explains Realtor.com.

“With no access to the usual perks of urban life (nightlife, museums, sports events), spending a small fortune for a cramped apartment or condo seems to make a lot less sense.

And early, preliminary data suggests more die-hard urbanites are seeking new homes in towns or smaller cities,” continues Realtor.  

Homebuyers are taking advantage of a mobile office

Coronavirus has changed the work/life dynamic for most households. It’s one of the biggest reasons renters are becoming homeowners in droves.

The new office environment

The pandemic has changed the big city workplace. It’s no longer a question of spending more time or less time at the office. In many cases the office is closed and the building is sealed.

In their place the home office has now become the office; there’s nowhere else to go.

This has families looking for more space than an apartment can offer. With kids ‘at-home-learning’ in one room and adults working from home in another, a house offers some much-needed breathing room.

The new workday

It turns out that buying a house in a distant location can have big advantages for both workers and employees.

The workday is being restructured. Instead of spending time on the road or otherwise commuting, we now have more time for actual work. In many cases, this is a win-win.

Employers may be seeing higher productivity, and employees get more flexibility — and the freedom to work in sweatpants.

“Residents of all ages and incomes are moving in record numbers to suburban areas and small towns.” –Kristin Tate, The Hill

Kristin Tate, writing in The Hill, explains that “a combination of the coronavirus pandemic, economic uncertainty, and social unrest is prompting waves of Americans to move from large cities and permanently relocate to more sparsely populated areas.

The trend has been accelerated by technology and shifting attitudes that make it easier than ever to work remotely.”

As Tate says, “Residents of all ages and incomes are moving in record numbers to suburban areas and small towns.”

Are big cities finished?

In June the Business Insider named “the 50 best places” to live in America.

At the top of the list were big cities such as Denver, San Diego, and Austin. But also among the fabulous 50 were much smaller places, such as:

  • Grand Rapids, MI
  • Pensacola, FL (population 53,000)
  • Manchester, NH
  • Portland (the one in Maine)
  • Boise, ID
  • Asheville, NC

Does this mean big cities will empty out as people flee to small and distant locations?

Not entirely.

Big cities, merely because of their size, can support businesses and institutions that are not possible in smaller locations.

Think of major museums, a large array of restaurants, huge medical facilities, entertainment, and the opportunities to network. 

Big cities will always be attractive. But the idea of the distributed office with people buying a house far from traditional office centers will become more common.

For many, the small(er) town life simply makes more sense now than ever before.

Getting a mortgage during the pandemic

Getting a mortgage is one of the few things that actually became more convenient during the pandemic. At least, for the most part.

Although qualifying can be a little tougher in some cases, the actual mortgage process has gotten easier.

Most lenders are doing all-online mortgages right now — so you can shop, apply, turn in documents, sign, and close without ever having to sit down in a loan office.

If you’re planning to buy, start by checking in with a lender to see what rate you qualify for and what you can afford.

With mortgage rates still near record lows, homeowners can afford bigger houses than they could just one year ago.

Verify your new rate (Jan 14th, 2021)

Source: themortgagereports.com

MBS RECAP: Bonds Playing it Extra Safe Ahead of Biden’s Stimulus Details

As we discussed yesterday, the strong mid-week rally suggested a good amount of short covering was behind the move.  This merely means traders who bet on rising rates were finally cashing in.  It doesn’t mean there are lots of new buyers interested in owning Treasuries.  Today’s weakness supports this narrative.  Traders are indeed hesitant to buy bonds until they have more clarity about the stimulus plan that the new administration will attempt to pass.  Biden is expected to offer additional details tonight after markets are closed, but the real question is whether or not the plan can get moderate democratic votes in the senate.  That may be the talk of the town tomorrow.

Econ Data / Events

Market Movement Recap

08:19 AM

Slightly weaker overnight.  The whole move happened in an instant (at 9:24pm ET) as bonds reacted to rumors about Biden’s stimulus announcement today.  Total damage?  A whopping 1.3bps in 10yr yields.  MBS are starting the day down 3 ticks (.09).

12:44 PM

Very calm and very sideways so far.  European bonds making a case for gains, but US bonds shying away as they wait on tonight’s stimulus details.  Stocks are flat as well.  Powell is speaking  currently, but no reaction so far.

01:42 PM

A bit of weakness during and after Powell’s comments on rates and bond buying, but correlation is questionable.  European market close and corporate bond issuance could also be contributing.  10yr at highs of day +2.23bps at 1.114%.  UMBS 2.0 down 3 ticks (.09) at 102-28 (102.875).

02:59 PM

Additional weakness now with 10yr yields just inching to news highs after the 3pm CME close.  At this point, we’re probably seeing traders moving into a defensive position ahead of Biden’s 715pm stimulus plan unveiling.  MBS down 6 ticks (0.19) but not many negative reprices reported yet.


MBS Pricing Snapshot

Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.

MBS

UMBS 2.0

102-27 : -0-04

Treasuries

10 YR

1.1270 : +0.0390

Pricing as of 1/14/21 4:01PMEST

Today’s Reprice Alerts and Updates

2:09PM  :  ALERT ISSUED: Negative Reprice Risk Increasing

1:33PM  :  ALERT ISSUED: Bonds on The Move as Powell Speaks

8:46AM  :  Small Reaction to Weaker Jobless Claims Data


Economic Calendar

Time Event Period Actual Forecast Prior
Thursday, Jan 14
8:30 Import prices mm (%) Dec 0.9 0.7 0.1
8:30 Export prices mm (%) Dec 1.1 0.4 0.6
8:30 Jobless Claims (k) w/e 965 795 787

Source: mortgagenewsdaily.com

Six Suburbs for Generation Z

Are you thinking about buying your first home? If you’re a member of Generation Z, you’re not alone. Post-millennial adults have learned a lot from the unexpected delays and disappointments that are keeping 19 million mortgage-ready millennials in rentals. Planning well is one of them.

One question to answer is where you want to live. Conditions for first-time homebuyers vary a lot from one place to another. Affordability, employment prospects, and proximity to friends and family are three variables that can help you decide where to settle. In deciding where to buy a first home, each generation has likes and dislikes that reflect its values and priorities. Recently Homes.com surveyed more than 1,000 members of Generation Z to find out more about their home-buying plans, including what kind of neighborhood they prefer.

The survey found preferences centered around four characteristics:

  • Diversity. More than half prefer neighborhoods and communities that are racially and ethnically diverse;
  • Accessibility. Three out of four want a location that is accessible to work as well as to friends and family;
  • Safety. This is a priority when Generation Z-ers evaluate neighborhoods
  • Affordability. Generation Z is very aware of rising home prices that have kept millions of millennials from becoming homeowner.,

If you haven’t yet settled down and are open to moving, you might be interested in learning about options. In no particular order, here are six suburban locations that rank high in the four characteristics identified by the survey.

Lilburn, Georgia (Atlanta)

Located in Gwinnet County, northeast of Atlanta, Lilburn is a bedroom community with an approximate 30-minute drive to the city. With a population of about 12,000, it grew following construction of the Lawrenceville highway that radiated from Atlanta. Its median income, unemployment rate, home value, and age of its residents are slightly higher than the state average. Lilburn has been recognized nationally as one of the most diversified communities in the nation by Niche.com and one of the safest in Georgia by BackgroundChecks.org. Its population is only 49% white. Hispanics account for 30% of its population, Asians for 20%, and African Americans 18%.

atlanta, georgiaatlanta, georgia

Florin, California (Sacramento)

A city of 47,000 in Sacramento County, Florin is only 5.5 miles and an average commute time of 27 minutes from Sacramento. Florin (derived from “flora” or flowers) is in a rich agricultural district in the Central Valley, not far from the base of the Sierra Nevada. Florin flourished between the late 1890s and early 1900s, producing record crops of strawberries and grapes. After the turn of the 20th century, it developed a size-able Japanese community, which was devastated by World War II and the internment of its Japanese citizens in camps. Today, Florin’s unemployment rate is 3.8%, its median income level is about $20,000 lower than the state average, and its median home price is about equal to the national median. Asians account for 30% of its population, and Hispanics 28%.

Shaker Heights OH (Cleveland)

With a population of more than 28,000 residents, Shaker Heights is only a 25-minute ride on one of town’s two RTA lines or a ten-minute drive from downtown Cleveland. Its nine distinctive neighborhoods feature classic architecture, tree-lined streets and access to a variety of amenities from biking and ice skating to a 200-acre nature center. Healthcare, management, and teaching are the top fields of employment, and its crime rate is close to the national average. Shaker Heights is the sixth most ethnically diverse in Ohio. Only about half of its residents are white, a third are African American, and 5% are Asian. Two-thirds of its residents are college graduates and its median household income is $30,000 higher than the national median. However, its real estate is comparatively affordable. The median home value is about $260,000, about the same as the national median.

Glendale Heights, Illinois (Chicago)

Glendale Heights is a western suburb of Chicago with a population of about 35,000. The city is the most important passenger and freight transport hub in the country with over 30 Fortune 500 companies have headquarters there. It is recognized locally for its economic and cultural diversity, arts and culture and historic preservation. Until 1958, the site of Glendale Heights was mostly rural, but over the years, it has experienced significant economic and population growth. The average commute time to downtown Chicago is about 25 minutes by car. The median home price in Glendale Heights is about $225,000, equal to the statewide median and lower than the median of $263,000 for the Chicago metro. Glendale Heights’ population is 35% white, 32% are Hispanic, 23% Asian, and 7% are African American.

chicago, illinoischicago, illinois

Valley Stream, New York (New York City)

Located in Nassau County on Long Island, Valley Stream is a village of about 40,000 in the town of Hempstead, along the border with Queens. Living in Valley Stream has an urban feel and most residents are young professionals who own their homes. Median household income is about $100,000 and median home values are around $400,000, which is approximately $50,000 lower than the median for Long Island. Valley Stream’s population is 32% white, and 23% are African Americans. Hispanics account for 25% of the populace and 15% are Asian. Valley Stream’s crime rate is about one-third of the average for New York State.

Stafford, Texas (Houston)

Stafford began life in 1830 as a plantation with a cane mill and a horse-powered cotton gin. Today it’s a bedroom community in the greater Houston area with 18,000 residents, a performing arts theatre & convention center, and a Swaminarayan Mandir, one of four temples of the Hindu sect in the US. At $59,094. Stafford’s median annual income is slightly higher than the state median and its median house value is $195,527, higher than Houston’s but far below the national median of $260,000. Its violent crime rate is half as high as Houston’s and is the fourth most diverse community in Texas. African Americans constitute Stafford’s most populous race at 30%.


Steve Cook is the editor of the Down Payment Report and provides public relations consulting services to leading companies and non-profits in residential real estate and housing finance. He has been vice president of public affairs for the National Association of Realtors, senior vice president of Edelman Worldwide and press secretary to two members of Congress.

Source: homes.com

Financial Considerations When Getting a Divorce

What should you ask for in a divorce settlement? What is a typical divorce settlement? Here are some things you might consider when getting a divorce.

By

Cheryl Butler
April 2, 2017

5 Expert-Approved Ways to Talk to Your Kids About Divorce.  My second episode in this series was 5 Ways to Co-Parent with Your Ex-Spouse. 

There really isn’t anything easy about divorce. Thankfully, as I discussed in the first two episodes, there are strategies and thoughtful ways to navigate through some of divorces issues, especially if the two parents are willing to put their personal differences aside and focus on their kids. In addition to the emotional turmoil that encompasses divorce, there is also another difficult component that couples must deal with and that is the financial aspect. 

After 25 years of marriage and 8 kids, Mighty Mommy had to get her financial house in order and make some significant adjustments going from a two-income household to a single income.

Here are four financial considerations, as backed by the experts, to keep in mind if you are thinking of or getting a divorce.

1. Get Your Financial Documents in Order

The entire divorce process is completely overwhelming, and when you begin to delve into the financial ramifications, the stress is taken to a whole new level. Once we began having our small tribe of kids, we decided I would leave my career to be home with our family. During the last 10 years of our marriage I went back to work part-time as a freelance writer but by no means was I contributing significantly to our income. My ex-husband managed the majority of our financial affairs so when the reality of our divorce settled in, I knew the first thing I had to do was get a handle on every aspect of our financial status. I honestly wasn’t sure where to begin, but my divorce attorney recommended I start by gathering all my financial documents.

Maryalene LaPonsie, contributor to USNews.com writes in 7 Financial Steps to Take When Getting a Divorce that “as soon as you know you’re getting a divorce, collect all the financial documents you can.” She continues, by stating that these include:

  • “Bank statements”
  • “Credit card statements”
  • “Tax returns”
  • “Retirement account balances”
  • “Appraisals for valuable items, if available”

In addition, other documents to consider are:

  • Mortgage Statement, including any Home Equity Loans and purchase information
  • Checkbook Registry for the last year
  • Any other long-term debt account statements you may have, including car loans

2. Know Your Income and Expenses

When we began our divorce proceedings, I admit I was far more focused on my emotional state than my finances. 

When we began our divorce proceedings, I admit I was far more focused on my emotional state than my finances.  Because my ex was the one who paid all the bills and the sole provider for most of our marriage, I never worried much about the details of our 401(K) plan, life insurance policies or what our overall assets and debt totaled.

One piece of advice I received many times over was that I needed to know what our budget was so I could begin to realistically know what my living expenses would be. 

Jason Silverberg, CFP at Financial Advantage Associates, Inc. and author of The Financial Planning Puzzle, told me via email: “If there was one singular, most important piece of financial advice that I could offer someone going through a divorce, that would be to understand where everything is and what everything’s worth. Without knowledge of what you own and who you owe money to, you really are going to have a hard time moving forward. You’ll also want to understand all of your sources for income and all of your monthly expenses as well. This will help you have a good handle on your budget to provide you critical understanding, so you can make smart financial decisions.”

He went on to say, “This exercise should be done both prior to as well as after the divorce. This way you can get a sense for how your household budget will operate on one income.” To help divorcing couples realize these figures, Silverberg has created the Personal Financial Inventory (1 page worksheet) inside the Picking up the Pieces eBook.

This exercise was extremely enlightening as I realized exactly where every penny (and then some) was going on a monthly basis. I was also able to gauge how much income I would need to start making in order to support these bills in addition to the child support and alimony payments I was receiving. One important factor to consider with child support is that it will decrease as your children get older, so I had to continually modify my budget based on this decrease. At first, it was overwhelming to see how much money I would need to keep our household running, but when you are armed with the figures and you pay attention to your monthly cash flow, it becomes easier to make adjustments. The fact of the matter is that some of the extra splurges such as frequent trips to the hair salon or buying my kids their usual top-of-the line items like sneakers or sports equipment had to be adjusted to what I could now afford. My kids have had some disappointments in this department, but they appreciated how we were trying to work together as a family-unit so that their lifestyle wasn’t affected as drastically as it could’ve been which balanced everything out.

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About the Author

Cheryl Butler

Cheryl L. Butler is the mother of eight children. Her experiences with infertility, adoption, seven pregnancies, and raising children with developmental delays have helped her become a resource on the joys and challenges of parenting. Call the Mighty Mommy listener line at 401-284-7575 to ask a parenting question. Your call could be featured on the show!

Source: quickanddirtytips.com

Can You Evict a Roommate Who’s on the Lease | ApartmentSearch

Woman with annoyed expression stares out the window resting her forehead on itHer share of the rent is always late—if it arrives at all. She’s noisy, she eats your food, and her friends are inconsiderate. Let’s face it: your roommate is a nightmare. If you’re already at the point where you’re wondering, “how can I evict a roommate that’s on the lease?” We’ve got answers for you.

There’s just one thing you need to know before we get started: If your roommate signed the same lease agreement you did, you can’t evict them yourself—not even if they stopped paying rent two months ago. However, just because you can’t decide whether your roommate gets evicted or not, doesn’t mean you can’t influence the situation.

Evicting a Roommate

The property’s landlord may still evict your roommate for breaking the lease in a variety of ways, including:

Unless the lease-breaking activity in which your roommate engages is blatantly apparent, you may have to bring it to your landlord’s attention. Make sure you document all the lease violations thoroughly; and uphold your end of the contract to prevent this strategy from backfiring.

Keep in mind, going directly to the landlord with a complaint about a roommate is something of an interpersonal relationship “atomic bomb.” Accordingly, treat it as a last resort that follows a diplomatic effort to resolve the issues that exist.

Engaging in Roommate Diplomacy

One way to address the issues that prompt your desire for a roommate eviction is to have an open and honest talk that features:

When a Roommate Becomes a Threat

There’s one instance in which you should disregard roommate diplomacy, though. That is when a roommate has threatened you, either implicitly or explicitly, or committed a harmful action against you.

If any such scenarios arise, contact the police and get to a safe place immediately.

According to Nolo.com, depending on the state you’re in, your landlord may be able to issue something called an unconditional quit notice. These notices are used to legally compel a tenant to move out without a lengthy notice or eviction process.

If you are a victim of domestic abuse, know that there are legal protections for tenants like yourself which can help you terminate a lease early and keep your abuser (and their friends) far away from you—both physically and digitally. If you’re unsure that what you’re experiencing is domestic abuse, check out this helpful page from The National Domestic Violence Hotline, and remember to always put your safety first!

Evict the Roommate from Your Life

If your roommate is annoying but not violating the lease, posing a threat to you, nor willing to compromise, you have one other option: evicting that roommate from your life.

Yes, this might require you to wait your lease out or break it ahead of time. Early lease termination laws vary across states but, here are a few general tips to help break your lease as smoothly as possible.

Don’t focus on the legwork required here. Instead, set your sights on how sweet your next place will be!

Let ApartmentSearch Help You Evict Roommate Problems

You’ve done your homework on how to evict a roommate who is on the lease. If you’ve decided you’re better off moving on and out—eviction or no eviction, ApartmentSearch.com can help.

Use AparmentSearch.com to search for 1-bedroom and studio apartments (if you’re tired of roommates), or browse multi-bedroom apartments (if you’ve read and used this guide on how to interview roommates and pick the right ones).

Source: blog.apartmentsearch.com