Tis-the-season to start holiday shopping and for most, this means pulling out the credit cards. But did you know that as of this October, 14 million Americans were still paying off their holiday debt from last year? In fact, a Consumer Reports poll found that actual spending from 2010 was 22 percent higher than intended.  Don’t get caught up in this year’s plastic swiping spending frenzy!  Here are a few holiday shopping DO’S and DONT’S to keep intended spending on track:

DO: Make a shopping list and check it twice! Decide how much you want to spend on each person and stick to it. Take some time out to put together a budget for holiday shopping. A smartphone app can help you keep track of spending as you shop.

DON’T: Let guilt drive spending. Money does not speak louder than your intentions so shake it from your system before you hit the stores!

DO: Pay with cash. Consumers spend 30 percent more when using a credit or debit card versus paying with cash.  And with banks considering implicating monthly fees for using debit cards, sticking to cold hard cash is the best way to keep YOUR money in YOUR pocket.
DON’T: Open a store credit card! The additional holiday discounts might be attractive but in most cases, retails credit cards come with a high interest rate which means that tempting discount offer in front of you will more than likely cost you a lot more down the road!

DO: Try to use a credit card that gives back. Using cards that offer cash back or rewards points are a great way to save a little cash while you’re out spending.

DON’T: Wait until last minute! The less time you have to spend on shopping for that perfect gift, the more likely you spend outside your price range.

DO: Shop online! Many online retailers offer discounts that are not available in stores. Even if you don’t actually buy online, you can successfully do some comparison shopping before you head out to dare the crowd.

DON’T: Shop for yourself! It’s one of the fastest ways to blow your budget and it adds up quick! Sticking to a shopping list might be tough but resist the temptation- your bank account will be happy you did!

DO: Consider making gifts for people on your list. If you are on a strict budget, being creative and making gifts can keep the real meaning of gift giving in check and can be a great way to spend some fun time with the family preparing.

DON’T: Rule out the value of a group gift. Large families can be expensive to buy for. A good way to save money is to buy one big gift for the whole family to enjoy or go in on a gift with other relatives.

The efforts you make to curb your holiday shopping now will get you off to a good financial start in the New Year. What better gift you can give yourself and your family than that? 

One of the most popular home loans for first time homebuyers are FHA loans. FHA loans are government backed so that if buyers default for some reason, the lenders still get their money. This encourages lenders to give mortgages to people who might not otherwise qualify. These loans are great because they have more flexible credit guidelines and come with a minimum 3.5% down payment; making home ownership more attainable upfront. In addition, there are programs associated with FHA that can offer you down payment assistance and also help you with your closing costs. There are also other government mortgage programs like the Veteran’s Administration’s Program. This program was specifically designed to make owning a home affordable for aspiring homebuyers who have served in the U.S. Armed forces. A Shore Mortgage Loan Officer can help educate you on all the various home financing options available.

In addition to selecting a loan program, you can also choose the term in which you will pay your mortgage off. Most fixed-rate mortgages come with a fixed (TERM) for 15-30 years. With a fixed rate mortgage, you don’t ever have to worry about your monthly payment changing because the rate is fixed for the term of the loan. Unlike the fixed rate, an adjustable rate mortgage (ARM) is only fixed for a set amount of time and will begin to fluctuate after the term is met. The advantage of an ARM is the initial interest rate is lower, which offers an extremely low monthly payment in comparison to that of a fixed rate.

You will want to get preapproved if purchasing a home is in your near future. Getting a preapproval will let you know what price range to be shopping in and will also give you some negotiating power with sellers.  Your offer will be taken more seriously because you have already completed the initial steps to purchasing a home.

No matter what type of home loan you qualify for, there is some important documentation you will need to move forward. Here are some of the initial items you can expect to have:

- Last 2 Years Tax returns, W2’s

- Last 2 months Bank Statements

- Asset Statements (401k, Stocks, or Bonds)

- Copy of Driver’s License & Social Security Card

- Current Paystub

Purchasing a home should be exciting. Working with an experienced loan officer will help make your transition into home ownership a smooth and easy process.  A Shore Mortgage loan officer is available at 855-SHORE-55 to answer any questions you might have about buying a home. You can also check out the Shore Mortgage Guide to Home Financing to learn more.

One of the best advantages of an FHA loan is the down payment requirement. When you buy a home with FHA, you are required to put down a minimum of three and a half percent of the purchase price. Conventional loans require a five percent down payment minimum; making it more costly to purchase a home.

Whether you choose FHA or conventional, you will be required to pay mortgage insurance if your down payment is less than 20%. The added cost of mortgage insurance will be factored into your monthly payment. With FHA loans, the monthly mortgage insurance payments are lower than conventional; making them more flexible for monthly budgeting.

Another important comparison between conventional and FHA is the FICO score requirement.  The minimum FICO for FHA is 640, and 680 for conventional. So, if you have less than perfect credit, FHA is more than likely going to be the best option for you.

Unlike conventional financing, FHA loan requirements state that the home must pass specified standards in order to be financed. This requirement is designed to protect home buyers against purchasing a home that needs unexpected repairs.

Clearly, FHA loans can have some advantages over traditional conventional loans. What’s most important is to educate yourself and work with a loan officer to learn all your options. They can help you determine which type of home loan best suits your needs.

To learn more about FHA loans or other home financing options, call or get started online now!

With this in mind, November 2011 will bring a company-wide effort to move over to a direct deposit only payroll system. According to a recent study, mandating direct deposit for a company that employs 300 people would in one year:

• Save 121 pounds of paper
• Avoid the release of 1,159 gallons of wastewater
• Eliminate 346 pounds of greenhouse gases in the atmosphere

The total environmental impact would be equivalent to not driving 1,231 miles in a car, preserving 151 square feet of forest, and planting 15 trees and growing them for 10 years.

As we continue to grow our business, we look forward to making eco-friendly changes that offer an enhanced team environment.

1. Look for Errors on Your Credit Report: Nearly every consumer has an error on at least one credit report from one of the major credit bureaus. You are entitled to a free copy of your credit report from all three credit bureaus; Equifax, Experian and Trans Union Corp.

2. Calculate your Debt to Income Ratio (DTI): Lenders look closely at your income and total debt to determine how much you can afford to finance by calculating your debt to income ratio. Your DTI ratio allows lenders to get a better idea of the risk potential in terms of what you can afford to borrow and realistically pay back. Our Minimum Income Calculator can give you a general idea of how much income you need to secure a loan.

3. Eliminate the Mistakes: One of the fastest ways to increase your credit score is to make sure it’s accurate. According to a 2005 study by the Federal Trade Commission, an estimated 8.3 million Americans are victims of identity theft each year. Of those victims, 1.8 million have new credit cards, loans, or financial accounts opened in their name without their knowledge. An easy way to prevent paying off debts you didn’t incur is to keep tabs on your credit score through agencies which give consumers one free credit report from each of the three major credit scoring agencies each year.

4. Diversify Your Credit: People don’t realize that 10 percent of your credit score is determined by what types of credit you use,” says Gail Cunningham, Marketing Director for the National Foundation for Credit Counseling. It’s not only determined by how you manage revolving debt like Visa, MasterCard, and store credit cards, but also how you handle fixed payments like your car payments or your mortgage payments over time. Instead of putting long-term purchases on cards, taking out short-term, one to two-year loans, will help you build a diversified credit portfolio. In addition to receiving lower interest rates and more flexible payment terms, consumers who use loans over credit cards also build positive credit and gain better credit terms in the future.

5. In with the Old, Out with the New: Another 15% of your credit score is determined by how long you’ve been managing credit. Those who can manage cards wisely by paying on time and keeping balances lower than their allowed limits can increase their credit score. It’s to your advantage to get a credit card to start building credit early. People who start building credit in their early 20’s will have a significant advantage when it comes time to apply for a home mortgage. Learning the basics of credit early can benefit in the long run.

6. Add Some Positives: You may be able to increase your credit score by simply showing credit scoring services what you’re doing right. If you have positive payment histories like on rent and utilities, adding those histories can greatly help your credit score. Many people are unaware that there are companies designed to get positive information on your credit score that can have a significant impact. Organizations like PRBC in Annapolis, Maryland can help you add daycare, insurance, rent, and cable credit histories to their score and set up online bill pay services to make sure those debts keep getting paid on time.

7. Flex Your Negotiation Muscle: Making a late payment can not only affect your interest rate on the account you’re paying late on but it can also affect other credit cards you own.  If you anticipate trouble making your payments, contact your lender right away to have a discussion about it. One late payment could lower your credit score. Preventing disaster before it happens can protect your credit for years to come.

8. Prioritize the Debt: If you’re already in the plastic trap, it’s time for a plan of attack! Start by making a list of all of your credit debts, then pick out which is harming you the most. If you have a card where you owe more than 30% of your credit limit, pay that one down first to keep your credit score intact. You will see the largest positive impact in your credit by paying off your largest debts first. Otherwise, tackle your smallest bill first while making minimum payments on everything else. By focusing your financial resources on eliminating one problem debt at a time, you can eliminate long-term debt from impacting your credit score.

9. Shop for the Best Rate Available:Credit inquiries are a major obstacle that prevents consumers from comparing loan rates and terms. While inquiries on your credit report can lower your score, consumers have a 30-day window before choosing their loan when all mortgage and auto loan inquiries only count once. The best way to avoid necessary inquires is to comparison shop as much as possible before filling out a formal application. Talking to lenders and customer service reps to get as much information as possible before having several lenders pull your credit to qualify you.

Like it or not, learning how to repair your credit and maintain it is a true reflection of you and how you mange financial responsibilities. Keeping it clean is not only worth the investment, it’s a must if you are an aspiring home owner.

If you would like additional help managing your credit, online resources like creditrepair.org are available to help you get back on track.