Eric Mitchell Real Estate

Money Matters for Millennial Parents As a young parent, you may just be learning about all the responsibilities parenthood requires. When it comes to financial planning, setting your sight on the future can help immensely. Demolish debt.  Slaying your own debt will positively impact your family’s financial future. While it may take years to pay off those student loans or credit card debt, creating a plan can help. Tackle your lowest balance first to gain momentum then take on the next smallest. Additionally, pay attention to higher interest rates that are costing you a lot of money. Build a budget.  Creating a budget doesn’t have to be hard. There are many budgeting apps available on the market to help you track your expenses, or you can try the trusty envelope system with monthly allowances for groceries, entertainment, utilities, etc. Build an emergency fund.  Setting a fund for potential emergencies will never backfire. Aim for a small, achievable goal as...

6 Small and Easy Steps to Improve Your Credit Score The best way to improve your credit score is simple, but not always that easy: Reduce your debt. Paying off your credit cards, or at least paying them down substantially, will not only increase your credit score, but having less debt will probably be more satisfying than a great credit score. And not using your credit cards anymore and paying off the balances is easier said than done. But there are smaller, easier steps that can improve a credit score. Here are six: Set payment reminders:  Making credit payments on time is one of the best ways to improve your credit score. Set payment reminders on your phone or whatever calendar you use, and check if your bank offers online reminders through email or text messages. Don’t open new accounts:  If you have a short credit history, then opening a lot of credit accounts too rapidly will lower your average account age and can drop your scores if you don’t have a lot o...

Options If Your Mortgage Is Underwater Owing more money on your mortgage loan than your home is worth—commonly referred to as being “underwater” on a home mortgage—can seem hopeless. There were 6.7 million underwater homes in the U.S. at the end of the first quarter of 2016, representing 12 percent of all properties with a mortgage, according to RealtyTrac. The numbers are dropping since a peak of 12.8 million homes in 2012, when 28 percent of all properties with a mortgage were underwater. For people still underwater, those numbers don’t offer much solace. However, there are some options for underwater homeowners, including: Short sale:  If you have to sell your home, a short sale may get you the most money. Your lender has to agree to let you sell it for less than you owe, which may lead to the home being sold quicker than it would otherwise. Your lender must agree to the lower price, and it will take the loss, and your credit score will fall. Lenders can also rej...

Should You Borrow the Maximum a Lender Will Approve? When you apply for a mortgage, a lender will decide how much money it’s willing to give you to put toward the purchase of a house. That doesn’t necessarily mean that you should take out a loan for the full amount. In some cases, borrowing the maximum a lender will allow could leave you overwhelmed by debt. How Lenders Decide How Much You Can Borrow Lenders base their mortgage decisions on several factors, including credit score and length of credit history, but the most important factor is a borrower’s debt-to-income ratio. This is the sum of all debts, including a mortgage, credit card minimum payments, and vehicle, student, and personal loans. Most lenders want borrowers to devote no more than 28 percent of their gross income to a mortgage, property taxes, and homeowners and private mortgage insurance. They also want total debt payments to be no more than 36 percent of gross income. If your debt-to-income ratio is highe...

Boomers Share 5 Lessons on Retirement The unanimous advice from Baby Boomers when it comes to retirement? Expect the unexpected. A survey of 1,200 investors conducted by Capital Group, revealed the many facets of retirement, including what causes sticker shock, the factors that affect why people end up retiring earlier or later than they had planned, and what keeps Boomers up at night when it comes to financial security in retirement. Here are five of the biggest lessons Boomer investors have learned when it comes to saving for a secure retirement: Be in it for the long-term —   Don’t expect much from quick hits. Nine in 10 (92 percent) retired Boomer investors stress the importance of getting and staying invested in the market. When markets fluctuate, stay put; only three in 10 (32 percent) say they would adapt their strategies based on market conditions. Know your fees —  Being able to easily understand fees is crucial to your peace of mind and financial se...

What Is a Negotiated Debt Settlement? If you’re buried by credit card debt, a negotiated debt settlement with your creditor may be worth checking into. Negotiated debt settlement is a general term for discharging debt in a way that appeals to the credit card holder and the card’s issuer. It’s best to negotiate from a position of strength by not having submitted late payments or having missed them, which can cause a credit score to fall. If that happens, cardholders will likely have a harder time getting concessions in a negotiated debt settlement. Instead, they should start talking to their creditor soon after realizing they’re having trouble repaying their debts. -Forbearance There are a few types of negotiated debt settlements, and the simplest one is called forbearance. Banks offer these programs to reduce interest rates, waive late fees and extend repayment terms. Forbearance doesn’t forgive any debt, but offers better terms for repayment. Unemployed cardholders ty...