By Paul Mulligan, Senior Vice President, Consumer Lending
Buying a home can be a stressful experience. Even if you’ve done it before and are looking to move, upgrade, or downside, it takes some work. If you’re a first-time buyer, it’s likely to be an even more nerve-wracking experience because you don’t know what to expect. Whether you’re ready to start shopping for a home now, or if it’s part of your future plans, here are a few things to consider that can help make the process a little smoother for you. Especially in the current environment, with fewer houses on the market, being prepared can make it easier to act quickly on the house you want.
Down payment – Look at how much you have saved for a down payment. If you haven’t started, that may be the first place to start. Putting more down on your home initially will reduce your monthly mortgage payments, but you want to make sure you don’t drain your bank account completely, because there are always things that seem to come up when buying a home, whether it’s repairs, additional furniture, or other things. Also look into how different down payment amounts might change your interest rates, mortgage insurance, and other variables.
Know your costs – There are any number of additional expenses that can come up during the home buying process. In addition to your regular monthly expenses, make sure you know what to expect in terms of insurance, inspections, legal fees, and other costs you might incur during the process. Some are small, but others can be larger expenses that could impact your down payment or savings. Don’t forget moving expenses.
Assistance programs – The local bank in the area you’re looking to buy a home may have first-time home buyer programs that might provide a number of benefits. The Milford Bank, for instance, offers an application fee refund, discounted interest rates, prequalification certificates, and low down payment options. Milford, Stratford, West Haven, and Orange and eligible for the first time homebuyer program.
Check your credit report – One of the first things your lender is going to do is check your credit report. Make sure your report isn’t showing any inaccurate or fraudulent activity. If there is something suspicious, you will want to give yourself enough time to address it. You may also want to avoid opening new lines of credit before applying for a home loan, since that could impact your credit score. The truth is, you should check your credit report regularly. Since each of the three major credit agencies is required to give you one free credit report each year, you can easily do it three times a year without incurring any cost.
Compare lenders – There are plenty of lenders out there. Do your homework, don’t overlook your local bank, and consider more than rates. Local institutions, such as The Milford Bank, often offer more personalized service and are certainly much more easily accessible if you have questions or if problems come up. They can also provide easy access to additional financial services, including future home equity loans when you’re looking to make larger improvements or renovations.
Plan ahead – As you start thinking about and looking for homes, think about your future plans. For instance, if you’re also thinking about starting a family, you may want to make sure you have enough space without having to immediately move again. That could mean giving up a few nice-to-have features in exchange for a little more space, in order to stick to your budget. On the other hand, if you’re serious about relocating when you start a family, or for any other reasons, you may want to consider a slightly smaller home that will allow you to save a little more
The fact is, if you’re currently renting, you may find you can get into a home of your own for something very close to what you’re paying in rent – or less – especially if you’ve prepared well and planned ahead. You’ll also have the added benefit of being able to deduct mortgage interest from your federal income tax. But, don’t go into it without having all the information you need. Talk to your bank’s mortgage specialists professionals and your tax planner. They can help answer any questions you have, including how much you can reasonably afford to spend on a home.
By Tina Mason
It’s been a crazy few months, with most of us stuck at home and most businesses closed. Even now, as some places start to re-open, many of the restrictions, especially on group gatherings, remain in place, and it could be some time before things get back to normal.
In the mean time, what can you do to pass the time? You’ve already streamed the entire Netflix library, read several books, and could really use something new to break up the monotony. You may have some larger projects you want to get done around the house, and this is a good time to work on those. If you’re ready for a major home improvement project, and need a home improvement loan or home equity line of credit, one of our specialists can help you with great rates. There are probably many contractors looking for work right now, so it could be a good time to get those projects started.
But, given we’re still in the middle of so much uncertainty, maybe you’re not ready for such a large investment. There are still plenty of ways to give your home an upgrade without spending a lot. Here are just a few projects you can do on your own that will give your home a new look.
Paint the front door – Your door is the first thing most people notice, even if they’re just passing by. It’s certainly how most people enter your home. So, if it’s looking a little faded or run down, try giving your door a fresh coat of paint. You can even go with a completely different look with a color change. Don’t forget your shutters.
Patio/deck accent lighting – There are many styles of outdoor string lights available that can give your outdoor area a new look and add character for your summer nights. Even if you’re not entertaining right now, you’ll enjoy being outside with just your family more than ever.
Build a fire pit – Sure, you can buy a fire pit, but why not enjoy the satisfaction of making one yourself? You may also save a little money doing it yourself using inexpensive wall blocks or pavers from your hardware store. When you’re done, you can set up your outdoor furniture around your fire pit and enjoy the ambience year-round. But, make sure you follow common safety procedures when lighting and putting out your fires.
Plant a garden – Have a little extra space in your yard or an old garden area you haven’t maintained in years? This is a great time to get a new garden going, and you don’t need much to do it. With some wood or plastic edging and maybe some decent soil, you’ll be ready to plant your own vegetables and herbs in no time. For a little extra visual appeal, you can build a raised bed garden. You might also want to consider building a fence around it using 2×2 posts and some garden fencing.
Window or deck boxes – If you don’t have room for a garden, you could always start with deck or window boxes. You can plant herbs or certain vegetables, depending on the size of you boxes, or you can put in flowers to add some color around your patio or deck areas. You can find fairly inexpensive boxes, or if you have a few simple tools, make one.
Solar lights – You can create a totally new look for your gardens or walkways by adding some inexpensive solar landscape lighting. They will not only look great, but can make it easier to navigate in the dark – especially if you need to get to the fire pit you just built.
Organize your basement – Over the years, your basement, shed, garage, or closets have probably become cluttered with various items. This is a great time to turn those into projects by cleaning them out, organizing them, and probably finding you can get rid of some unused or old items that are just taking up space. When you’re done, you’ll be able to find things more easily, and probably have created more space for storage. You can add new shelves if you need even more space.
Accent walls – Are you tired of the same old look in your living room or bedroom? Think about painting one of the walls a different color to create contract and give the room a new look. If your ceilings are looking a little old and grey, try giving them a new coat of paint, too – especially if you have an older home with popcorn ceilings you just can’t stand.
Update your kitchen cabinets – A simple way to give your kitchen a brand new look is by refinishing your cabinet doors. It can be as simple as a new coat of paint to give them a totally new look, or you can replace them with a different style at much less cost than replacing the entire cabinet. Want an even bolder new look? You can make inexpensive glass front doors using plexiglass. Adding new knobs completes the touch, or you can just start with that if you want to keep it simple. While you’re at it, replacing your doorknobs is another way to give your entire home a bit of a new look.
Rearrange your furniture – Sometimes, all it takes is a little creativity with the furniture you already have to completely refresh your home. Try different arrangements, keep an open mind, and you may be surprised at how easy it is to create a totally redesigned living space with no investment at all.
There are countless other ways you can improve your home inexpensively. Get creative, get advice from friends, take a look at what you have around the house that you can repurpose, and you may be surprised at how easy it is to turn any room into a brand new experience.
By Pam Reiss
As the world continues to cope with the COVID-19 pandemic, life as we know it has come to a grinding halt. Millions of us are working from home, our children are getting their schooling through videoconferencing, and our normal social and sports activities are in limbo.
Unfortunately, the situation can create some uncertainty around how to manage financially. Whether you’re currently working or not, it’s very likely you’ve been thinking about how to manage your finances during this time. The good news is at least some typical spending has naturally been cut because we’re all staying at home. But, there are many ways you may be able to keep your financial situation as stable as possible and stretch your budgets a bit.
Takeout vs. cooking – Ordering takeout or delivery is a great way to support local businesses during the crisis, but if you need to cut your spending, since you’re at home anyway, try limiting how often you order out. Instead, enjoy more home-cooked meals. There are many resources online for inexpensive, healthy meals. You can plan your entire week’s meals, make a complete shopping list, and make just one trip to the grocery store. You can even have one night of the week reserved for leftovers. If you want to continue to support a few local restaurants, set aside one or two days of the week for that.
Buy what you need – We’re still able to go to the grocery store, despite having to follow public safety guidelines. If you initially stocked up on non-perishables or frozen items, start using those instead of constantly buying more. Also, when you’re at the grocery store, there are still many items on sale each week. You can check out your grocery store’s flyer online to see what’s on sale, and plan your meals for the week accordingly.
Other ways to save – Take a look at some of the other things you’re spending on each week and see where you can cut a little out of your budget. Things to look at include video services. If you’re a cable subscriber, you might think about switching to a lower service tier, at least temporarily, or if you have multiple streaming services, consider cutting one of more of them. The monthly savings can add up quickly, and you can certainly find other ways to entertain your family.
Low interest rates – With interest rates dropping, this may be a good time to look into refinancing your mortgage or student loan, or even consolidating multiple loans. While there will be paperwork involved, lower interest rates can provide significant savings each month.
Emergency fund – If you’ve been following good financial habits and have built up an emergency fund, don’t automatically fall back on it. First take a look at ways you can reasonably adjust your spending. Then, if you find you need to dip into it, you can hopefully use just a little of it. If you’re fortunate enough to be working, this is a good time to add to or start your emergency fund. Since at least some of your normal extracurricular spending has been put on hold, consider putting that toward your emergency fund. You never know when you’ll need it.
Investment funds – It can be difficult watching retirement accounts and other investments lose money with the current market instability. The good news is they have historically bounced back reasonably quickly. Before you move or sell your investments, talk to your financial advisor, who can give you advice on whether it’s a smart move or not. Making a rash decision could actually end up hurting your investment funds.
Protect your credit – If at all possible, continue to pay your bills on time. If you’ve been using your credit cards, at the very least, pay the minimum on those to avoid hurting your credit score. If you are in a situation where you can’t pay some of your bills, contact your lenders. some lenders are allowing extra flexibility with payment terms or interest rates to help during the pandemic. You should also check your credit reports regularly. Fraudulent activity often increases during crises, and consumers and businesses are under a constant barrage from cyber criminals. Be extra cautious with emails, websites, and phone calls. There are thousands of malicious COVID-19 websites out there, and many phishing emails and phone calls looking to exploit uncertainty and fear.
The good news is most of the financial resources you normally have at your disposal are still available, though not in an in-person capacity. But, you can still contact us if you need advice. Even though we’re all dealing with this pandemic, you can do things to help keep your finances in order and limit any long-term impact.
By Paul Mulligan
Buying a home is one of the biggest milestones in your life – right up there with marriage and starting a family. Being a homeowner has several benefits, including possibly lowering your monthly payments compared to renting and earning equity as your home value rises and you pay down your principal. The immediate benefit, of course, is the happiness and security of owning instead of being beholden to a landlord. As a homeowner, you have the ability to do what you like with pets, landscaping, renovations, and anything else that will make your house a home.
But, buying a home is also probably the biggest financial commitment you’ll make. There are many things to think about as you begin the process that can help make the process as enjoyable as it should be.
Here are several tips that can help make your first home purchase a positive experience.
Buy within your means – Many people tend to look at houses they can’t afford or that are too large. Do the math to determine how much you can realistically spend while still allowing you to meet your monthly budget needs, as well as continuing to save for retirement and other future needs – including home maintenance and repairs.
Understand all your costs – In addition to the basic monthly mortgage payments, be aware of all the other costs that may impact your budgeting. That includes property taxes and homeowners insurance, as well as mortgage and hazard insurances, depending on your financing need and location of the home. You should also expect an increase in your utility bills, including heating and HVAC maintenance contracts – especially if they were previously included in your rent payments.
Plan ahead – Don’t rush into a home purchase. Make sure you have all the information, have the financial resources to comfortably support the purchase, and are buying a home you will be happy in for many years. Try to avoid draining all your savings and make sure you still have an emergency fund to fall back on should the need arise. That’s particularly important as a homeowner so you don’t risk losing your house if you’re suddenly unable to make payments for a short period. In fact, it’s even better if you can continue to grow your savings, so you have the resources to make improvements.
Manage your credit – It’s always important to follow good spending and credit habits, but especially when you’re looking to buy your first home. Lenders will pull your credit reports, possibly several times, to make sure you are credit worthy and nothing has changed during the buying process. Make sure you pay your bills on time, and be cautious opening up any new lines of credit before your loan is approved.
The perfect home vs. the right home – It’s rare that you’ll find the absolute perfect home for all your current and future needs. Have a reasonable list of must-have features, and a second list of nice-to-haves. Look for a home that checks off the first set, and maybe some of the second (you can always make improvements to check off more items later). But don’t forget location. Your neighborhood can be as big a factor in your long-term happiness as the house itself. Do your homework and learn about the school system, commuting options and time, crime rates, tax rates, and other geographically dependent variables that may influence your decision.
Start the loan process early – As you start thinking about buying a house, don’t think you have to find the house first. In fact, you may be better off starting the loan process while you’re looking, or even before you start. Good houses can sell quickly, and once you find the house you love, you want to be able to move quickly. Being pre-qualified for a home loan may give you an advantage over other potential buyers, especially if the seller wants to move quickly.
Seek advice – Especially as a first-time buyer, you will have many questions of your own, and many more you don’t even think to ask. Contact one of our mortgage specialists, who can give help you find all of the information you need and help you throughout the process. Also ask about our first-time home buyer program, which offers:
- Refund of $475 application fee upon closing
- Discounted Interest Rates
- Pre-Qualification certificates to help you shop for your home
- Low Down Payment options
Keeping these tips in mind will help you have an enjoyable home buying experience and avoid complications that could arise.
*The Milford Bank is an Equal Housing Lender
By Paul Mulligan,
Senior Vice President, Consumer Lending
Now that the holidays are a distant memory, everyone has settled back into their “normal” routines, which inevitably includes paying the bills. Hopefully, you didn’t max out all your credit cards, but if you did, that may create strain on your budget, especially if you also have other debts you’re paying off as well, like college loans.
The reality is this situation can happen to anyone, at any time. You may run into some unexpected expenses or you simply aren’t budgeting wisely, or you haven’t figured out how to save enough and the next thing you know, you have multiple debtors hitting you with high interest rates every month. It can make it hard to make a dent in your balances and become financially secure.
If you own a home and have built up equity, there is an option that could help get you out of debt faster than paying off all your credit cards each month. You could look into a home equity loan. Especially if you’ve been paying of your mortgage for several years, or your home value has increased significantly, you may actually have an easy time securing a home equity loan.
Using a home equity loan to pay consolidate multiple debts has some advantages. For instance, home equity loans often come with lower interest rates than credit cards, making the interest you’re accruing each month lower. With a home equity loan, you are also only paying a single creditor, making your monthly budgeting a little easier to manage, and a longer repayment period may help you reduce your monthly payment, giving you a little breathing room in your budget. In addition, if you are also using the home equity loan to fund a major home improvement project, the interest may also be tax deductible.
But, you should be aware there are risks with consolidating debt into a home equity loan. Perhaps the biggest is that, if you default on the loan, your home can go into foreclosure. Unlike credit card debt, it’s almost impossible to discharge a home equity loan. In addition, if your home’s value drops, you could end up paying more than it is actually worth at that point.
Perhaps the biggest drawback is loan consolidation doesn’t address the spending habits that got you into a debt problem to begin with. In addition to paying off your loans, you should also get into better spending habits to make the most of your paycheck and avoid getting into even more debt. It’s very easy to start running up credit card balances if you aren’t careful. So, if you are having a hard time putting money into savings, there are several ways you can help yourself become more financially responsible, including using a savings app like Plinqit.
But, if you think a home equity loan could be the right option for you, come speak with one of our financial specialists, who can help you make a smart decision and get your finances back on track.
By Dave Wall
As the school year comes to a close, families will be preparing for their annual summer vacations. Whether they’re heading off to a golf resort, a Caribbean island, a tour of Europe, an amusement park, or anywhere else, they’re all looking forward to some down time away from work and school to spend with their families. Regardless of their destinations, one thing is certain – they’ll want to stay in touch with friends and family members, and many will even spend a few hours each day working.
That means they will be looking for ways to connect to the Internet, which also means there’s a good chance they’ll cross paths with hackers targeting unsuspecting vacationers. As mobile device use continues to grow, and as an increasing number of tasks can be accomplished on them, users are constantly looking for ways to connect, whether it’s to post the latest vacation photos to Facebook, pay a credit card bill, make dinner reservations, or play online games.
Cyber criminal recognize the need to stay connected and look for ways to target unsuspecting users. Vacationers can be an easy target. They are often looking for easy access and depend on public WiFi access points to get online and, despite constant education from media and government organizations and service providers, many people aren’t careful enough when signing onto WiFi hotspots, ignoring the risks of connecting to unknown or unsecured networks, which make it very easy for hackers to intercept communications and steal sensitive data.
Often, they’ll set up open networks (access points with no password encryption) with SSIDs that appear to be legitimate networks – they might include a hotel or restaurant or some other name that sounds official – hoping to lure users onto their networks. Hackers then need only be within range of the hotspot to intercept data, or they may send users to a false landing page with a link to “register,” which actually installs malware on their devices, allowing the thieves to access any stored data, including bank account and other financial information.
Here are a few tips to help you keep your devices and sensitive data secure when you travel anywhere outside your trusted home network.
- Never use open WiFi (those without password protected access).
- Make sure lock screens and security are active on any devices.
- Avoid any online shopping or other financial activity.
- Use cash, travelers checks, or gift cards in lieu of credit cards to avoid account information being stolen, especially internationally.
- Don’t use, accept or click on links, websites, attachments, or flash drives that could give hackers access to your devices.
- Consider connecting through a VPN, even if you are using a secure WiFi connection. Most public access points aren’t yet using the latest encryption technology. A VPN will help protect your information even if it is intercepted.
While these guidelines may require a few extra steps when you’re getting online, they will help protect you falling victim to identity theft and subsequent fraud, which can take years to overcome. Staying informed of the latest fraud schemes and security threats can also help. Sign up for our security eNewsletter to keep yourself up to date on everything you can do to help keep you and your family safe on vacation, at home, or anywhere else you find yourself.
By Dave Wall
Scammers are constantly looking for new angles to exploit in their efforts to swindle unsuspecting victims. The Better Business Bureau says scams are a $50 billion burden on the American economy, a number that is very likely to grow as we continue to shift to a digital economy and online activity continues to grow, along with tools to perpetuate fraud. In fact, scams reportedly already have an impact on one-quarter of U.S. households. Surprisingly, while the elderly continue to be a major target, recent reports show millennials are actually more susceptible to scams than senior citizens.
Among the reasons scammers are so successful is they are able to convince their victims their intentions are legitimate. Often, they pretend to represent well-known, reputable brands and target people’s emotions. But, there are several ways to avoid falling into these carefully laid traps, including knowing what information is typically requested by phone or email, and verifying requests for information separately with the organization before providing any personal details. It also helps to be aware of what the latest active scams are. Here are a few that are at the top of the list currently.
Publisher’s Clearing House imposters
This is one of the many prize scams and one that seems to never go away. “You’ve won!” is always an easy way to get someone’s attention. The financial part of the scam can some in one of two ways. The first is a requirement to pay taxes and fees up front in order to collect winnings, which is typically requested via Western Union or some other wire service because they are virtually untraceable. The second is by sending “winners” a fake check and request for fees to be sent back. When the fake check bounces, victims have already paid the fake fees. A simple rule to follow is if you are asked to pay fees for winning a prize, it’s probably a scam.
9/11 Victim Compensation Fund
This is a situation where scammers are trying to collect valuable personal information that can lead to identity theft and fraud. Callers identify themselves as being from the September 11th Victim Compensation Fund and tell people they may be entitled to compensation. They ask for personal information, like social security numbers, bank accounts, medical histories, employment verification, and other details, claiming it will allow them to verify their eligibility. Organizations like this will never ask for sensitive information like this over the phone.
Scammers are increasingly using the growth of Bitcoin and other cryptocurrencies to cheat people. Basically, they are promising huge returns on a cryptocurrency invesment when victims also help recruit additional people into the scheme. It’s a crptyo version of the old chain letter. Others simply promote a cryptocurrency project, looking for investors with the promise of doubling or tripling the investment, but shut down the operations after collecting large sums of money. Because people are required to send funds in cryptocurrency, the transactions become nearly impossible to track or recover. Scammers often try to lure targets into investing in the latest tech trends. In the first two months of the year, more than $1.3 billion had been stolen in cryptocurrency scams.
Chinese Consulate Impersonators
Another recent scam targets people with Chinese last names, pretending to be a representative from the Chinese Consulate and asking for personal information or even payments in order to avoid some form of trouble with the Consulate. While the current scam centers around the Chinese Consulate, scammers modify their schemes regularly and could very easily adapt this same scam to just about any population group. Regardless of the form of payment or information requested, realize the consulate it not going to request sensitive information or payment over the phone or email.
FTC Computer Access
This one involves scammers identifying themselves as FTC representatives claiming targets are owed a refund that can only be done through remote access to their computers. Specifically, many of these calls specifically reference the FTC’s Advanced Tech Support refund program. These and other requests to provide access to computers or install software are scams intended to allow access to computers and networks in order to steal personal (or corporate) information.
There are only a few of the latest scams that are being used to target unsuspecting targets. While it may be difficult to keep up with all of them, there are some keys to avoiding falling victim to them.
- Do not provide sensitive or identifying information over the phone, email, or social media.
- Never send money to someone you don’t know or haven’t met. Organizations won’t ask you to provide banking information over the phone in cases like these.
- Any time you send money for purchased good or services, use secure, traceable payment options.
- Avoid clicking unknown links or visiting unfamiliar websites, especially in emails you weren’t expecting or from senders you don’t know. Also be aware that email and caller ID spoofing is easy and intended to fool you into thinking the call or email is legitimate.
- Make sure any online transactions are done on a secure site (the URL should begin with “HTTPS”).
Follow the old theory: If it sounds too good to be true, it probably is. Follow these simple steps to reduce the risk of falling victim to these or any other scams. The bottom line is this: if you aren’t sure, independently verify with the organization that’s contacting you. You can always check the FTC’s list of latest scams to help protect yourself. If you suspect you are dealing with a scam, report it to the proper authorities immediately.
By Chaz Gaines
In the Savings Spotlight Series, we’ve made the case that there are numerous stepping stones throughout our lives that lead us down the path to financial well being. At every point, you’ll need to take a different approach. A teenager, for instance, might be saving for their first car. An individual nearing retirement is going to have a drastically different goal, and method, for reaching their savings objective.
Already in this series, we’ve provided useful savings tips for both first-time banking customers and recent college graduates. In Part 3 we’re going to fast forward a decade or two along our path to retirement, focusing in on the savings needs of individuals in the middle of their careers.
Maximize employer benefits: Most of the businesses that offer retirement benefits will no longer contribute after you’ve left the company. Now, nearing the height of your earning power, you should be doing all you can with the remainder of your working years to take advantage—especially if your employer will match your contributions.
Balance retirement and college funds: Many individuals at this stage in their lives must reconcile the need to have a forward-thinking retirement-oriented saving strategy while simultaneously helping their children get started on their own path. It can be challenging, but your focus when crafting a budget and savings strategy should balance both.
Bolster your emergency account: Many individuals at this stage in their working life have been at their jobs for twenty years or more—making them feel quite secure. But sometimes, business decisions are out of our control, and many families get blindsided by that false sense of security. Even if you expect success, a failure to keep an emergency cash account funded could put your family at risk. Many experts believe you should have at least six to nine months salary readily available in case of emergency.
Expect the unexpected: Just like it’s important to plan for emergencies throughout your life, it’s important to plan for the end of your life too. If you were to pass away today, your grieving family would still have to keep paying the mortgage, fund college accounts and plan for retirement—all without your income. While this is a sensitive matter in which thinking about money should be secondary, it’s nonetheless a reality that your family will have to cope with. Securing life insurance will provide the coverage your family will need in the event that the worst comes to pass. Some policies, like whole life insurance, even have features to assist with your savings goals.
Shift investments to meet changing goals: Every investment vehicle offers a unique benefit. So if your financial goals are shifting, shouldn’t your savings strategy? When we’re young, we have more ability to rebound from a risky investment. We also have more time to let a certain, conservative investment grow. Now, in the middle of your working life, it’s important to take a moment to reflect on whether the vehicle that got you this far is going to be the vehicle that gets you all the way to the finish line, or if it’s time to trade in.
To learn more about crafting the best saving strategy for you and the needs of your family, check out our Online Learning Center or stop by any office of The Milford Bank in Stratford or Milford today.