Best Way to Save Money when Buying Home Insurance

There are many ways for homeowners to save money when buying home insurance for their property. Here are a few ways that a homeowner could reduce their home insurance quote.

TIP ONE – Shop around online.

One of the best ways that a homeowner can reduce their premium is to take the time to shop around and get a few different quotes from other providers. Your current provide may seem like the cheapest deal, but just try and get a few quotes, perhaps three or more and see how the price differs.

TIP TWO – Compare quote with a comparison engine.

Rather than visiting each provider individually and getting a quote from each one can take a bit of time, so consider visiting a home insurance comparison engine and let them compare multiple policies for you on your behalf. This can save you time and money.

TIP THREE – Secure your property.

Securing your home with the aid of a burglar alarm can in most cases save homeowners a bit of money, when getting a home insurance quote. Homeowners that have an alarm fitted at their premises can obtain a discount from the insurer. This is because the insurer considers them to be less risk.

TIP FOUR – Increase your voluntary excess.

Homeowners should consider increasing the voluntary excess on the policy in order to reduce the price of the policy. Please note though that the amount of excess you agree to would need to be paid to the insurer when you make a claim. This is a good tactic for some homeowners to use when their buildings and contents insurance premium is over their budget, and they need to reduce the price somehow. Well this is a god way of doing it.

Finance Reviewed offers homeowners lots of information on how to buy and save money when buying buildings and contents insurance. Why not visit their website for more home insurance deals and guide information.

3 Ways to Increase Your Household Budget

Many families nowadays are struggling to pay bills and the economic meltdown has led to mass redundancies all over the world. Managing your household budget has never been more important as most people have less disposable income. However, it’s a skill that everyone should master as increasing your household income in this economic climate is difficult. Using some creative ways to save money and managing your finances better is the best way to increase your household budget so that you can afford some more necessities. Here are 3 ways to do it:

1. Review Your Budget – If you don’t have a clearly defined budget already, it’s time to make one. You can use an online budget planner to easily plan your budget and identify areas of high spending. Your household budget planner should provide charts and graphs of your spending so you can easily see which items are not essential and reduce them.

2.  Use Coupons – Couponing is the new buzzword for savvy savers. You can save money on a whole host of household items by looking for deals and coupons online. An easy way to search for coupons is to use google and input the name of the item you are looking for and “coupon” next to it. You can also subscribe to coupon blogs and sites such as Groupon for local deals. Another way to get coupons is to search classified ads sites such as Craigslist or auctions such as eBay. These sites allow users to sell their coupons. You’ll find that you can buy them at a low price and redeem them on items where you would have normally paid full price. This is especially good for rarer items which would not usually be discounted such as brand name clothing or electronics. Just remember to check the expiry dates and ensure that they are valid in your area.

3. Reduce debt – Interest on debt is the an unnecessary expense and it can really mount up. It’s basically money that gets wasted because you do not get anything in return. If you can’t pay off debts quickly, then try to move it to a credit card or another loan facility with a lower interest rate. For example, you could take out a loan with a lower interest rate to pay the higher interest rate loan off completely. The difference between these two amounts will become money saved every month.

Using the 3 tips above you should be able to drastically improve your budget. Remember to keep good records of your spending and always stick to your budget.

Reloadable Debit Card Security

Prepaid debit cards are fairly new on the financial scene but they’re gaining ground – fast. You can use them basically everywhere you can use a credit card. They’re also cheaper to keep than credit cards because you won’t pay interest on a monthly balance. Plus, you don’t need any established credit to get a reloadable debit card, just proper identification. These features make debit cards really easy to use.

There is one thing however that people wonder about when it comes to these cards. They wonder if they’re cash is truly secure when it’s locked up in a debit card account. Most people experienced with banks feel secure about their money sitting in checking accounts but the newness of prepaid cards makes some people uncomfortable about their security. Let’s see if we can address some of those fears.

Carrying Cash vs. a Prepaid Card

People tend to feel uncomfortable carrying around a large sum of money in their wallets. It’s not terribly secure and it can attract unhealthy attention. But for a lot of people who have been living in the “cash-only” world, this has been their only option; that is until the advent of prepaid debit cards. Now, prepaid cards make it easy to carry around just about any amount of cash without attracting any undue notice.

What About Lost Cards?

There are procedures for handling lost (or stolen) prepaid debit cards. All card companies have them. They usually revolve around the requirement to notify them within a set amount of time after you discover the loss or theft – usually within 48 hours. When you do that, you reduce your potential loss as the company will put a freeze on your account and move to issue you a replacement card with a brand new card number. Your funds transfer to the new card and you’re good to go. That of course would never happen if you misplaced your wallet.

Debt Security

One of the most underrated benefits to using a prepaid reloadable debit card is the debt security it provides. You can’t spend yourself into a large balance with a prepaid card – you can only spend money you’ve already loaded onto the card. Without a balance, you’ll never be subjected to interest charges or onerous fees. And you’ll never have to worry about making a minimum payment. In the long run, that will save you a lot of money.

In the final analysis, prepaid debit cards are very secure financial vehicles. They’re true MasterCards and Visa cards and as such, come with the same safeguards provided by those networks. Each card company also works hard at protecting their products so that their customers can feel safe about using them. After all, they make no money if people aren’t buying and using their cards. I invite you to go out and try one of these cards for yourself; you’ll see why they’ve become such a great alternative to cash.

Mortgage Rates Drop Even Further

National Mortgage rates have dropped a bit more than my last post a few weeks ago. I don’t know about you but I haven’t seen rates this low, ever! Below is a screenshot from Pentagon Federal Credit Union’s Mortage Page.

I use Penfed as my basis for mortgage rates, since they seem to have some of the lowest around. Can you believe 4.375% for a 30 year conventional mortage with no points??? I just refinanced at 4.5% and am now kicking myself since rates seem to keep dropping. If you are in a rate over 5% and want to reduce that monthly mortage payment then you may consider refinancing. You can even refiance into a lower term mortgage as the 15 year rate is at 3.875%.

If you are a believer in the dobule-dip recession that everyone thinks is coming, then you may decide to wait. Unfortuently you never know if they rates are going to go up or down. It may definetly be worth a discussion with your current lender or possibly shopping around for others.

Should You Refinance That Mortgage?

Many people are dropping everything to refinance their house since Mortgage rates have dropped again. The question is, should everyone jump on that bandwagon? Here are some things to think about…

You usually have to pay for an appraisal when you refinance. A lot of people are finding that when the appraisal comes back, their house has lost so much value that they don’t have enough equity to refinance. They then end up being out the cost of the appraisal which can range anywhere from $150-$400.

If you are wanting to refinance from a 30 year to a 15 year, remember the depending how many years you have been paying on that mortgage, moving to a 15 year most likely will require a higher monthly payment. My advice would be to keep the current mortgage, but just over pay it to effectively make it a 15 year. That way if you ever come across financial issues, you can revert back to the regular (lower) payment without being on the hook to the bank for a higher amount. Sure it is no longer going to get paid in 15 years, but there is that piece of financial security that is priceless.

As always, verify closing costs first and line that up with the number of years you think you are going to stay in the home. For example if closing costs are $6000 and you only plan on being there 5 more years, well that $6000 closing costs equate to $100 per month plus compounded interest over those 5 years, if your new payment after the refinance is not $100 less than your previous payment, there is no reason to finance since it won’t benefit you.

I always use a mortgage broker. I have used the same guy since I have bought my first home back in 1995. I use him since I always have a few things that I want when I refinance. My requirements are: No Escrow, No Prepayment Penalty.  When he does his rate search, he always finds me a lender at the lowest advertised rate with this conditions. He gets paid by the lender so I pay him nothing more than I would if I found the bank myself. I highly recommend you ask around for a reputable broker to help you in your search. In most cases states have increased laws to make sure they your interests are protected when using a broker.

These are just some things to think about before refinancing. Sure the lure or 4% mortgage rates is enticing, but you should always do your research to make sure that refianncing doesn’t cost you more that your current mortgage.

Mortgage Rates Still Dropping

I received a call from my mortgage broker last week telling me that rates had fallen quite a bit in the last week. I usually use Pentagon Federal Credit Unionas my basis, since they seem to have the lowest rates around. Well sure enough, to my surprise, a 30 year fixed rate mortgage has dropped to 4.5%. I guess I had to do a double take on that since this seems extremely low and I can’t remember a time when I saw a 30 year fixed rate at 4.5%.

My current mortgage rate is at 5.5%, which at the time (2 years ago) was a very good rate. I have decided to refinance to the 4.5% rate which will save me about $175 per month on my payment. Since I am refinancing over 30 years, I have decided to make payments using my current payment to help pay it down faster. I currently have a reward checking account at 5%. This is the first time ever that I have had a savings/checking account with a rate higher than my mortgage. I still need to see whether the advantage of paying down the mortgage is greater than just saving that extra money now. That is a post for another day!

I have a great mortgage broker where I all ever have to pay is for the appraisal and title costs which equates to around ~ $1000. If you refinance, that is one thing to keep any eye on. Some banks can try to charge you in upwards for $3000 for closing costs. My advice to you is to find a mortage broker and let him shop around for the best mortgage for you.

The 20 year and 15 year rates are around 4.25% and 4% respectively. If you are planning on staying in your current home for a while, you might think about refinancing at this point. Of course rates can still go lower, but they can also start going up.

If you want to crunch some numbers, try using the Bank Rate Mortgage Calculator. It lets you play around with the interest rate and payment amount to help you determine what best works for your situation.

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