Factors that Impact your Mortgage Rates

Since every lender has the inside knowledge of how a mortgage interest rate is determined, it is only fair that you, as a customer, have the same understanding. So, how is your individual interest rate determined? 

There are several factors that go into the decision, and knowing what they are can help you learn what to expect going forward so you can better negotiate your loan.

Here are just six of the basic components that are considered:

Term

The duration of your loan, which is referred to as a “term,” is how long you have to pay it back. Those that are shorter term may have higher payments due each month, but they tend to have lower costs overall, including lower interest rates.

Down Payment Amount

If you put down a larger down payment, you will most likely receive a lower interest rate. This is because you will increase your stake of ownership in the property, therefore you appear to be a much lower-risk recipient for a home loan.

Type of Interest Rate

There are two different types of interest rates, which are “adjustable” and “fixed.” As the names imply, adjustable rates change after a time, and fixed rates are locked in. An adjustable rate fluctuates depending on the market.

Size of the Loan

If your loan is especially large or small, you may end up paying higher-than-average interest rates. Remember, your loan amount will depend on not just the price of the home, but also includes closing costs. And, you should also subtract your down payment amount.

Type of Loan

There is a plethora of loans out there, including VA, USDA, FHA, and conventional types. Rates tend to change in accordance with the type of loan that you acquire.

Credit Score

Your credit score can certainly affect your interest rate, because it acts as a predictor of how likely you are to pay back your loan. That is because credit scores reflect your payment history on your bills, including credit cards, utilities, and other loans.

Just keep in mind that it isn’t any one of these factors that determines your interest. It is the combination of all of them that culminates in your particular rate. 

Taking the time to understand each of these reasons will help you to find the best mortgage for your personal situation. And, understanding these factors is one way to take control of your future when it comes to determining your interest rate.

Get Out of the City: Finding a Home When You Retire Somewhere More Rural

Heading to the mountains no longer has to feel like a far away dream. Now that you’re ready to retire from the constant noise of the big city, you get the opportunity to start a new lifestyle. 

Country living no longer means having to do without your favorite things. Instead, you can look for a house that supports both luxury living and a sense of simplicity. Finding the right home is easier when you use these ideas to start narrowing down your options.

Think About the Essentials

Rural living has many benefits, but you will need to expect a few differences compared to living in a city. When you start looking for homes, one of your first questions should be about the utilities. 

Finding a home that already has features such as a backup propane generator, modern well water, and solar panels means that you can move in right away without having to worry about a lapse in essential services. 

You’ll even be able to coast through the occasional winter storm without a worry as you sip on a warm cup of your favorite beverage and enjoy the wintry weather.

Choose a Home That Complements the Area

Rural homes should stand out while also managing to blend into the natural surroundings. While a streamlined modern home might fit into your old urban environment, you’ll want to think about finding something cozier when you are moving to the mountains or countryside. 

Luxury log houses come with all of the floor plans and features that you’d expect in a modern home, yet they have that lovely touch of charm that lets everyone know that you have an appreciation for the great outdoors. 

Real estate agents, like those at Why the Smokies, LLC, can help you find a log cabin or house that fits both your needs and the setting.

Find Houses With Scenic Views

One of the biggest reasons why you may want to move to a rural area is to enjoy spending time enjoying nature. Look for a house that has spacious wraparound porches and expansive balconies where you can set up your favorite outdoor chairs and enjoy the fresh spring and summer weather. 

You can also look for large picturesque windows that help you catch a glimpse of local wildlife when you are spending more time inside.

Get Enough Space for Entertaining Guests

You might be retired, but your house is likely to become a favorite family vacation destination. Make sure to pick out a house with an extra room or two so that you have a lovely place for your adult kids or grandkids to stay for a visit. Houses with big open kitchens and living rooms also give you room to entertain your loved ones.

House hunting takes on new meaning after retirement when you can choose a home anywhere your heart desires. With newer rural homes, you can enjoy a blend of the outdoors lifestyle while also having everything that you need to live out your golden years comfortably. 

Once you find the right home, your biggest question will be how to convince yourself to leave it when you need to run to town to stock your walk-in pantry.

Items to Budget for When Remodeling Your Store

From a modest upgrade to a major remodel, renovating your store can help to improve the customer experience and even boost sales. 

While major remodeling projects often come with a hefty price tag, knowing which items to budget for can help to ensure that you are able to make better use of your money.

Layout and Floor Plan

The general layout of a retail environment often has a bigger impact on the customer experience than many store owners might realize. A floor plan that serves to flatter a showcase or display or one that makes it easier for customers to find what they need can often lead to increased sales. 

If your shop suffers from an outdated or poorly organized interior layout, budgeting for a remodel may prove to be very worthwhile.

Roof Repairs and Replacement

Remodeling projects that result in significant changes to your business's layout, especially those that involve new additions or interior extensions, may require you to upgrade your existing roof. 

Working with professional service providers, ones like those that can be found at Commercial Solutions, Inc. can provide you with the insight and detailed information needed to budget more effectively. Repairing, upgrading, or even replacing your existing roof entirely could end up being a key part of your next remodel.

Climate Control and Utilities

Failing to provide your customers with a comfortable environment could lead to no end of problems and a new floor plan or a larger interior environment could find your existing HVAC equipment struggling to keep up. 

Outlining any climate-control equipment or utilities that need to be upgraded in order to complete the project is not a concern that should go overlooked.

Decor and Design Scheme

An attractive and stylish decor can go a long way towards ensuring that potential customers and new visitors are more likely to form a positive first impression when visiting your store. 

Decor that has begun to feel stale, dated, or that leaves your store looking shabby or rundown can be a serious liability. A major remodel can often be the perfect time to update the look, style, and design of your shop's interior.

An outdated storefront or an inefficient interior layout could be having more of an impact on your sales figures than you might realize. 

Modernizing your store, upgrading the space, and remodeling your interior layout can often be a worthwhile investment. Knowing which items to budget for makes it much easier to upgrade your store without breaking the bank.

The Dos and Don’ts of Cashing in Your Retirement Funds

The age of 65 is significant for many of us; it can signal it’s finally time for retirement or time to sign up for Medicare vs traditional health care insurance. But what are the rules about withdrawing money from your retirement funds when the time comes?

With the elation that comes with retirement, and the opportunity to start a new chapter in life, it can be easy to forget that retirement funds are finite. Yes, you’ve been dutifully paying into your accounts for years, but it’s important not to stay mindful of your spending habits.

Resist These Temptations in Retirement

Did you know that if you withdraw money from your retirement account before you reach age 60, the funds will be subjected to a 10% penalty in addition to income tax? However, there are some ways you can navigate early withdrawal without the 10% fee tacked on.

Ways to Avoid Early Withdrawal Penalty

• Wait until age 59 ½ to withdraw money from your IRA
• Use the money for medical expenses that exceed 7.5% of your adjusted gross income
• If you’re unemployed, early withdrawals can be made to pay for insurance premiums
• After 12 weeks of unemployment, penalty-free withdrawals can be approved
• Early withdrawals can avoid the penalty if used for education (room and board, textbooks)
• An individual can avoid the 10% fee when up to $10,000 is withdrawn early to build/purchase a first home
• Up to $5,000 can be withdrawn after the birth or adoption of a child
• Military service exemptions
• Inherited IRAs are only subject to income tax, not a penalty fee, for early withdrawal

Obviously, it’s ideal if you can avoid dipping into your retirement early, but life sometimes throws unexpected surprises at us!

Treating Retirement Like a Windfall

If you’ve resisted the temptation to withdraw money from your retirement funds early, the next tip is to avoid treating your retirement money like an unexpected financial windfall. Yes, you’ve planned for this season of life, but you should still budget responsibility so the money lasts. 

It can be tempting to indulge in splurges such as gambling or new cars when you retire. Better use of your retirement might be to invest in yourself, your relationships, or ventures with the potential for future earnings.

There’s nothing wrong with treating yourself in your retirement, but remember that a car loses value as soon as you drive it off the lot, so if you need or want to upgrade after you retire, do so wisely. 

If you want to travel and spend money on your hobbies, do so responsibly. If you want to help out family members financially, consider setting up repayment plans and treat the financial support as a personal loan vs a gift.

Waiting Until 65 to Enroll in Medicare

Did you know that you need to enroll in Medicare before your 65th birthday? This is an oversight many people make due to myriad reasons. Often, if an individual is still working at age 65, they have insurance through their employer. 

In this case, they are eligible to enroll in Medicare after turning 65. It’s when a person is not currently employed that they run the risk of paying a penalty for enrolling in Medicare late.




To avoid paying a higher monthly premium for Medicare, be sure you know the window of time during which you need to apply. Even if you have supplemental coverage between the time of retirement and your 65th birthday, start the transition to Medicare. 

If you’re already claiming your Social Security benefits prior to turning 65, you should automatically receive notice from Medicare about coverage when you turn 65.

How to Enroll in Medicare

If you’re not already receiving Social Security benefits before your benchmark, 65th birthday, you will need to take the reigns of enrolling in Medicare. 

Since many people are not accessing SS benefits until age 67, it’s important to contact Social Security regarding Medicare during the enrollment window, which is typically the span of three months before the month you turn 65, and three months after you turn 65. 

This seven-month period has different deadlines for different types of coverage, so it’s best to contact Social Security in the three months leading up to your birthday to avoid any lapses.

If you’re not sure how or when to enroll in Medicare, and what coverage you need, there are services such as MedicareCU, which partners with credit unions to offer education about Medicare.

The Dos of Retirement Spending

We’ve talked about what to avoid, now let’s focus on what you should do with your retirement money.

Invest in Yourself

We mentioned before that you deserve to spend your retirement money on yourself and your loved ones. After all, you’ve spent decades working toward your Golden Years, and now it’s time to enjoy them!

Education

No matter what formal learning you already have under your belt, it’s important to continue learning after retirement. You now have the time to dive deeper into your hobbies and interests, so take classes for your favorite language, to learn more about technology, or how to grow the garden you’ve always dreamed of.

Exercise

Investing in your health is always money well-spent. In retirement, be sure you’re staying active not just for your physical health, but your mental health as well. 

Participating in group fitness classes, taking solo walks, or lifting weights at the gym is not only good for you but good for your wallet. Regular exercise can help prevent costly health expenses in the future.

Experiences

If you’re not used to having the freedom to do what you want once you retire, you may find yourself feeling aimless or depressed. Use your time and savings to experience the things you didn’t have time for when you were working full-time. 

Travel to visit family and friends, purchase a membership to a museum, or get season tickets for your local sports team. Having trips, exhibits, and games on your calendar can help you find a new schedule to live by that offers a sense of purpose and fulfillment.

No matter how you decide to spend your retirement, or when you access it, seek financial advice from a trusted advisor to avoid fees and overspending. 

If you’d rather keep track of your budgeting yourself, there are retirement calculators and apps readily available, or you can simply call your credit union or bank for updates on your account balances.

How to Prepare to Pass On Your Legacy and Assets

It is a sad fact of life that we all must one day pass on. Planning for your legacy and assets is important to ensure you have the right people in place to carry out your wishes. 

If you're not sure where to start, this article offers some advice about preparing for passing on what matters most.

Consider Leaving a Will

A will is a legal document stating not just how your assets should be distributed after you pass on, but also discusses animal care and even child guardianship. 

It is an important document that will allow your friends and family to adequately mourn your death without having to worry about all the loose ends because you would have already dealt with that for them.

Create an Estate Plan and Gather Important Files

An estate plan outlines what happens to your assets and property when you die, including appointing the executor of your will and naming beneficiaries for insurance policies, bank accounts, and retirement plans. 

This allows for the smooth transfer of your assets and often prevents unnecessary taxes upon your loved ones. Make copies of all vital records such as birth certificates, marriage licenses, and passports so they can easily be retrieved by family members in case there's a need for them later.

Provide Information About Next of Kin

If possible, provide contact details for close family members who may not be aware they are listed as emergency contacts with financial institutions or other service providers where personal information must be provided to them upon request.

Consider Leaving a Letter of Instruction

A letter of instruction is typically left for family members to let them know what they can expect after you pass on, including how your assets are managed and any information that may help ease the transition into their new lives without you. 

Discussing with beneficiaries about who will inherit which accounts is important, so as to remove any confusion about where each account belongs once it comes time to transfer funds or close accounts.

Discuss With Your Legal Advisor the Best Options for You

Discussing your options with an estate planning attorney is important to ensure you have the right plan in place that suits your needs. Also, creating an accurate list of all physical and financial assets can help family members access accounts, transfer money, or claim property without issue after you pass on. 

Another option is to set up a trust where certain assets are transferred to the trustee, and it dictates who administers the afore-mentioned assets for the beneficiary.

It is important to prepare for the passing on of your unique legacy and assets. Whether you have dependents or not, it is important to be prepared for when tragedy strikes. You may be and feel young, but we never know when it is our time to move on.

Can You Plan Your Own Funeral Service?

Funeral plans are rarely discussed until the time comes when they are necessary. Most often, this is not during the best of circumstances. 

However, to alleviate some of the stress on their loved ones, some people make their wishes clear in a will and testament or by expressing their wishes before that time comes. 

It is possibly one of the kindest things you can do to plan your own funeral service in advance so that your loved ones are not adding that detail to the required affairs at a time when there is already enough distress.

Why Should You Plan Your Own Funeral Service?

Since funeral arrangements are so rarely discussed ahead of time, the people attending are typically left wondering if the deceased would have wanted it this way. 

There are times when someone has voiced their desires, and the effort is put toward making sure those desires are met. This is a time of the utmost respect. 

Planning your own services not only assures you will have the service you prefer, but it takes the burden off others who are grieving your loss. You can relieve their stress by planning in advance.

Planning Your Funeral Is a Relief

Planning your own funeral is not as tough as you might think. In fact, it is an opportunity to look toward the time you will be gone, which very often allows you the chance to reflect on where you are right now. 

It is not necessarily a perspective people take very often, but a welcome moment to consider your life in a broader view. You can make your choices alleviating your loved ones of the tough choices they would otherwise have to figure out in your absence.

Burial, Cremation or Donation?

For many, the idea of an elaborate burial is repugnant. The whole package has advanced in price to the point of being equivalent to the down payment on a new home. You can certainly plan for such an expense by including the choice of casket and the burial plot.

Cremation is a popular choice in part because it is a mere percentage of the cost of burial. You can select one or more urns if your family wants to hold onto your ashes. 

Lately, people have found having the ashes allows them to be used in jewelry so that a loved one can have you with them all the time.

Finally, you can choose to have your body donated to science. This is yet another need we rarely consider at the time.

You Have Much to Consider

Given all the options for a funeral, it is useful to consider all that is available. Burial varies from typical in-ground to either in-ground or above-ground lawn crypts. 

There are also private mausoleums for either a burial or cremation. Private mausoleums are generally intended for a single-family and are quite costly, however, they do provide exclusivity. 

There are also natural burials that make use of a biodegradable casket or shroud that allows for everything to naturally decompose.

All of these ideas can be discussed ahead of time with loved ones so that you can assure them they will have the chance to pay their respects, whether it is to allow people to visit your burial site or a memorial that you can establish in advance. 

You can finalize your arrangements to include all the details such as location, flowers, music, and the like. You can even specify who will be attending. 

You can establish a pre-need contract to ensure that everything is paid for in advance, taking yet another burden off your loved ones.