Tips & Tools : Budget

Moving on a Budget

RE.com Tips & Tools — Tue, 04 Aug 2009 02:16:00 GMT

By Gina Cappiello, 123Movers.com

Let’s be honest: money is tight right now for everyone. We are all thinking twice before making purchases, putting every expense under a microscope, and saving like never before. But what if you have to move? It can often be a huge expense with the cost of trucks, packing, and planning. Here are some smart and clever ways to save (and make) some money during a move:

Use free materials
Think you need to buy special boxes and packing peanuts to get your beloved items from point A to point B? No way! You can pick up a variety of boxes at local supermarkets, shops, and wholesale outlets for free. Be sure to ask before taking them, though. Use that old stack of newspapers to wrap fragile dishes, glasses, and knick-knacks with. You can also utilize your suitcases, backpacks, and reusable bags to pack items. The bags are coming with you regardless, so why not put them to good use?

PYO (Pack Your Own)
Packing services can get up to the thousands depending on how many things you have to pack. Spend a few weekends before your move sifting through all of your possessions to decide what’s staying and what can go. Once you decide what is coming with you, pack it up and put the boxes aside.

Purge and profit
Now that you have decided what is necessary and unnecessary, it’s time to make some money. Sell everything you cannot take or do not want by having a moving sale or post everything with prices on free online marketplaces. Anything left over you can give away to a charity. Not only is your donation tax-deductible, but some charitable organizations will even arrange for a truck to pick up all of your unwanted items for free.

Eat up
Remember those canned goods, boxes of pasta, and non-perishables you stacked your pantry with thanks to recession-busting sales at the grocery store? It’s time to reap what you have sown! Create some delicious dishes with your pantry staples instead of buying tons of groceries that may go to waste. Not only will you save money by saving on food, but you may discover some creative meals to make on a budget.

Shop around
You don’t have to choose the first moving company you come across to take care of everything. Speak with multiple moving companies to get an idea of how they operate and how they charge. Choose a company that you feel the most comfortable and confident about. Also, be sure to ask plenty of questions so you won’t be surprised about the bill after the move.

Saving on a move doesn’t have to be hard. Just a few adjustments to your moving plan can help you save hundreds of dollars without compromising anything.

Big House or Small House?

RE.com Tips & Tools — Fri, 25 May 2007 20:18:00 GMT

More living space has benefits, but entails higher costs too.

A fundamental question many home buyers need to confront is how large a home they want to buy. A bigger residence offers the benefit of more living space, but is likely to be more pricey than a smaller home, assuming a comparable location and condition. That higher price may come in the form of higher financing costs, insurance premiums and property taxes.

Consider your lifestyle and budget when determining square footage
The choice of a larger home may seem obvious for buyers who have a large family or who want to rent a portion of their home to housemates. A larger home also includes more space that could be used for a home office, entertainment, craft or music room or home gym. Many homeowners also want guest quarters for parents, adult children or other overnighter visitors. Smaller homes don’t often have spare rooms that can be dedicated to such activities and purposes.

Many buyers think small due to affordability constraints or limited financial means. But some buyers prefer smaller homes for other reasons. Smaller homes may feel cozier and more comfortable for smaller families or for people who live alone.

The question may be most challenging for people who could afford to buy a larger home, but don’t have an immediate need for extra living space. For those buyers, here are some other factors to consider:

Utility bills. Larger homes typically are more costly to heat in the wintertime and cool in the summertime, though local weather patterns, insulation, roofing materials, windows and window coverings, and energy-efficient heating and cooling systems can affect the cost as well. A larger home also may have larger appliances, multiple telephone lines and cable television hookups, more landscaping and other amenities that result in higher monthly utility bills. On the flip side, a roomier home may be more accommodating and comfortable during long periods of harshly cold or hot weather.

Maintenance and repairs. Larger homes typically are more costly than smaller homes to maintain and repair. A larger roof is more expensive to replace than a smaller one if comparable materials are used. Also, larger electrical, plumbing and heating and cooling systems and more appliances may require more servicing calls and repairs. It may seem obvious, but homebuyers often forget that a larger home may be more expensive and time-consuming to keep clean and tidy.

Furnishings and furniture. Larger homes typically are more expensive than smaller homes to decorate and furnish not only because they have more space, but also because larger furniture is more suitable for larger spaces. First-time home buyers may be surprised to discover their apartment-sized furniture doesn’t fit the scale of a single-family home and a small furniture budget may not stretch very far in a large home. Also, a new-built home may include only minimal carpets, flooring, window coverings and landscaping.

All of these factors are important to consider when deciding whether a smaller or larger house is right for you. Also be sure to consider both your current and future needs when choosing the size of your home. You may not need much space now, but do you want to move again if the growth of your family necessitates more space? Or, if your children are about to head off to college, the opposite might be true. You may want to buy a smaller house that will better fit your needs a few years down the road.

Needs vs. Wants

RE.com Tips & Tools — Fri, 26 Jan 2007 00:19:00 GMT

Most of us cherish the notion of a dream home. In our mind's eye it may have big windows, fireplaces and airy open spaces

But in reality, an ideal home is one that allows us to comfortably express our lifestyle. That’s why it’s so important to make a list of your needs before you go house hunting.

Family needs

Do you have a family or are you planning to start one? Both will affect the number of bedrooms you need. You may need a backyard for small children or dogs. If you have teenagers, maybe you could benefit from a basement rec room and an extra bathroom. If you have more than one car, you may need plenty of parking and/or a garage.

Location

Do you need to be close to certain schools for your children or near transit to get to your workplace? A downtown loft-condominium or trendy Victorian row house might be the answer if you are a single professional who wants to be close to your work and to nightlife -- just be sure to check that it’s in a neighborhood where you feel secure.

Work space

If you work from home, you may want an extra bedroom for a home office and wiring for the Internet and a second phone line. If you have hobbies, such as gardening or woodworking, you may require a utility room or a work area in the basement.

Timeline

Research shows that people tend to be in starter homes for an average of five years. Look down that five-year timeline. Will you be starting a family or having another child? Be sure to take such plans into consideration.

Maintenance

You’ll want to consider ease of maintenance. That huge lot may be gorgeous, but do you want all the mowing and weeding that goes with it? A beautiful, old home may require substantial upgrades and more costly repairs than a newly built home. Can you afford the extra expense?

Budget

Be realistic when making a list of your wants. Many people put fireplaces, a master suite with a large bath and open-plan main floor spaces on their list of wants. Wood floors, bay windows and renovated kitchens are also popular. If you can get a house that meets both your needs and wants, and fits your budget, that’s great. If not, be willing to compromise on the non-essentials.

What’s important

Look behind those cozy shutters. Are the window frames solid? You may love a home’s color scheme, but make sure the masonry and roof are in good repair. They are much more expensive to replace than the cost of repainting. Similarly, brass lighting may be appealing, but if the house doesn’t include that, it’s easy to install new fixtures. However, new wiring and a breaker box will mean fewer worries. Is the kitchen you’re viewing somewhat dated but has the space you need and pleasant natural light? You can always paint the walls and cabinets for a quick lift and schedule a renovation down the road.

It’s easy to fall under the spell of a charming house. Just remember to go over your list of needs. After all, you’re looking for more than just a pretty face.

Examples of needs	Examples of wants
Enough square footage for comfortable living	Specific color of carpeting, paint or exterior
Enough bedrooms to accommodate your family	Pool or hot tub
Space for a home office	Wood floors
Adequate number of bathrooms	Bay Windows
Eat-in kitchen	Built-in entertainment center
Garage or basement for storage needs	Decorative fixtures
Lot size to accommodate children’s play area	Skylights
Adaptation for disabled	An attractive view
Proximity to a specific school	Newly renovated kitchen
Close to transportation, office, shops	Fireplace
Adequate plumbing, wiring, insulation	Open floor plan
Good windows	Big master bedroom with adjoining bath

Staging a home on a budget

RE.com Tips & Tools — Mon, 15 Jan 2007 14:58:00 GMT

You don't have to shell out a lot of cash to make your home more inviting to buyers.

Staging a home is always a big help, but it can be especially important during a weaker housing market when there are many homes for sale and you want yours to stand out.

You can spend thousands of dollars staging a home if a professional company brings in furniture, artwork and decorative pieces for every room, as well as outdoor items such as nice patio furniture. But staging a home is also possible on a budget, whether you come up with ideas yourself or get advice from a professional stager or real estate agent and do the work yourself.

Home staging basics

The most basic element of staging a home is to get it sparkling clean and clear of clutter -- both things you can do yourself for little or no cost. If you’re lucky, you can haul away the extra items in a friend’s pickup truck and store them in a relative’s garage while you’re showing the home. You can often get free boxes at grocery or liquor stores.

A fresh coat of neutral paint is another inexpensive way to stage a home. If you’re handy with a sewing machine, you can make new, light window treatments to replace heavy, outdated draperies that overwhelm a room or block a great view. If sewing isn’t your strength, you may be able to find someone who can do the work inexpensively.

When you’re staging a home, you don’t have to spend a lot of money on decorative items, either. Home stagers often move items from one room to another; you can do the same. Place a bowl of fresh fruit on the kitchen counter or table. Stage the dining room by pulling out your nice silverware and setting the table for a party. You don’t need linen napkins and a silver tea service. Simple but nice pieces will look just fine for your staging.

Remember to consider curb appeal

Outdoors, staging a home is all about enhancing the curb appeal. The first step is to make sure the house and yard are clean and well-maintained. Staging the yard is as simple as trimming the bushes, putting down mulch, keeping the leaves raked and potting a few flowering plants to add color or interest in key areas. A new, traditional-looking doormat can’t hurt, either.

Finally, since staging a home can make it easier to sell, your real estate agent may be willing to spend some of the marketing budget on professional staging.

Checklist: Get ready to go house-hunting

RE.com Tips & Tools — Fri, 12 Jan 2007 20:29:00 GMT

Before you go house-hunting, use this checklist to make sure you are prepared to make a purchase:

Create a budget. You need to know where your money goes, where you can save, and how much you can afford to spend on your mortgage installment each month.

Check your credit rating and correct any errors in it. A good rating can help you get a mortgage loan; a spotty one may mean you end up paying a higher interest rate.

Assemble the documents you’ll need to get a mortgage loan.

Pre-qualify for a mortgage to find out how much you can borrow.

Make a list of what you need in your new home: number of bedrooms, eat-in kitchen, family room, garage, central heating and/or air, etc. You may also wish to make a second list of items that you want but are not essential, such as a fireplace, built-in cook surface and oven, en suite master bathroom and central vacuum.

Identify a neighborhood or two you’d like to live in based on price character, proximity to work, schools and daycare, recreation facilities, public transit, etc. Websites like Domania.com and Schoolmatch.com are good starting places.

Scan real estate ads in the newspaper or online to get a better idea of the kinds of houses that are available in the neighborhoods you like, and the selling prices of homes in those areas.

Engage a real estate agent who is familiar with the neighborhoods you’ve chosen.

Discuss your price range and housing needs and wants with your agent.

Ask your agent to walk you through the purchase process, from making an offer to closing a deal, and explain the costs involved.

View a number of houses with your agent so that he or she can get a better handle on your needs and preferences.

Narrow your search down to a few homes you can afford and like enough to make an offer to purchase.

Want to Buy a Home? Use Our Tips to Get Your Finances Ready

RE.com Tips & Tools — Thu, 11 Jan 2007 20:49:00 GMT

It's never too early to start planning when you want to buy a home. These seven steps will put you on track.

1. Decide on your price range

Calculate how much you can afford. For example, if you can afford a maximum monthly payment of $1,000, you will be looking at a total loan amount of about $167,000 (assuming a 30-year fixed rate at 6 percent). And, remember, owners have different monthly bills than renters. Along with the mortgage payment, you’ll have to pay homeowner’s insurance, utilities and property tax. If you are realistic about your limits, you can focus on the right price range.

2. Look at your current budget

Have a look at your income and both long- and short-term expenses. Include any expected changes. Will that new job mean a rise in pay? Are you planning an expensive wedding or making a big purchase, such as a car? A careful plan will show where you have flexibility in your cash flow.

3. Open a savings account

Keep a separate home-savings account and don’t dip into it. This is the time to cut back on your expenses as much as you can in order to save for the down payment. So, curtail dining out and delay the purchase of new furniture. Save tax refunds, cash gifts or bonus checks. Give yourself a financial goal and a fixed time to reach it, say six months or a year, and then assess your situation.

4. Check out down-payment assistance

Although it’s nice to have a 20 percent down payment, it’s not necessary. Many lenders offer low down-payment products. Start investigating.

5. Get pre-approved for a mortgage

If you know how much you can borrow, you won’t have to make an offer conditional on financing -- and your offer will be more appealing to sellers. A lender will base the pre-approved figure on your income, credit and debts.

6. Don’t forget the extras

Aside from the down payment and the first mortgage payment, there are fees that may surprise a new homeowner. Closing costs can range anywhere from 2 to 6 percent of your mortgage amount. Plus, a home inspection may cost several hundred dollars. You may also have to hire a moving van or even stay in a hotel for a few days. Plan to save enough money to cover all of these expenses.

7. Your REALTOR® can help

Look for a REALTOR® with whom you are comfortable. After all, you will be spending quite a bit of time together. A REALTOR® will discuss the available homes in the neighborhood you are interested in and provide information on recent selling prices of comparable homes.

Five Rules for Smart Home Buying

RE.com Tips & Tools — Thu, 11 Jan 2007 17:07:00 GMT

1. Arrange financing before you make an offer. Increase your chances of buying the home you want by getting pre-approved for a mortgage and waiving financing as a condition on your offer to purchase. In a competitive market, sellers have been known to ignore an offer that is conditional on obtaining financing. Some will even accept another offer for less money if there is a firm commitment behind it.

2. Know your limit. No matter how much you love a home, decide on the maximum amount you are willing to spend and stick with it. Write the number down as a reminder. If you act on emotion or find yourself in a bidding war, it’s easy to forget your limit and wind up paying a lot more than you bargained for.

3. Hire a home inspector. A home that has basic curb appeal and a stylish interior may also have a neglected roof, broken furnace or other hidden flaws in need of repair. Know what you’re getting before you buy. Make your offer to purchase conditional on a home inspection. Get the seller to cover the cost of any necessary repairs or deduct the estimated cost involved from your final offer. If the seller is unwilling to accept these terms and you still want to proceed with the sale, be sure to factor in repair costs on top of your mortgage.

4. Budget beyond the down payment. There’s more to affording a home than coming up with a down payment and negotiating a mortgage rate. Remember to budget in extra money to cover your moving and closing costs (which can often add up to between two and six percent of your loan). Ask your lender or mortgage broker to give you a Good Faith Estimate of the loan-related fees you’ll have to pay. Your REALTOR® can also help you compile a list of other expenses.

5. Get a move on moving. Try to synchronize moving/closing dates so you can move from your existing home to your new home on the same day. Otherwise you may have to arrange a short-term rental or camp out with family or friends and put your furniture in storage. You don’t want to have to move twice.