Home Financing Tips

Ever hear of debt-to-income ratio?

Because, of course, nothing is perfect!

Don't let a good market pass you by!

“Millennials may perceive home buying as more risky than previous generations because we were raised on infinite choice, frequent change, and came to age with a lot of financial volatility.”

Plus, how to know if this myth is keeping you from buying a home.

I know perfectly well that there's a point when enough is enough and a home becomes functionally obsolete... but I just can't help myself.

The more appealing a home is on the market to the majority of buyers, the higher price it may fetch.

Yes, you'll save on commuting—but probably not as much as you think you will.

Turns out, the 30-year mortgage is so not the norm.

That three-digit number isn't always as stable as you'd like it to be.

There are no “hacks”, per se, when it comes to reaching a perfect credit score, but there are habits you can start now that will pay off over time.

What started as seemingly random talk has literally revolutionized the way I think about expenses.

While you may think your proximity to cauliflower gnocchi and Candy Cane Joe Joe’s is draining your bank account, a new analysis says it may actually be making you money if you own a house.

If there's one thing I feel passionately about (besides existential theater, cheesecake, and hot dads), it's that many people could probably buy a home if they realized it's possible.

Though adjustable-rate mortgages have gotten a bad rap post housing crisis, experts say they can actually make financial sense in certain situations.

We went through all the credit score-focused articles we've published in the past year and rounded up the best tips experts have shared with us. Here, the best of the best credit score tips and tricks.

If you understand what's keeping your score down, you might be able to bounce it back up quickly.

Finance is boring, but our Real Estate Editor, Liz, sure isn't! In our new series called Liz$plaining, Liz will guide you through all your toughest financial questions.

To keep on track with my savings goals, here are six budgeting strategies I enacted (with insight from a personal finance expert)

Though I know my grandparents came up in a different time, I've learned a lot about real estate investing from them.

Real Talk: The chances that you could commit mortgage fraud unknowingly are minimal. The industry has become much more highly regulated in recent years to prevent issues like this. “If you’re working with a reputable lender or a bank and you’re a fairly savvy consumer, it’s probably not something you’ll come across,” say Ed Deveau, a realtor with Century 21 Mario Real Estate in Boston.

These are super useful, real estate agent-approved reasons all happy homeowners should spend time at open houses in their neighborhoods.

"You only have one credit score." True or false?

While stuck in the middle may not sound too appealing, it's exactly where you want to be when it comes to real estate.

Every year, you’re entitled to a free credit report. You can consider it a financial wellness exam of sorts as the comprehensive report details your credit activity, getting into the nitty-gritty details of on-time payments and credit limits. But, this all-encompassing report won’t just automatically arrive in your mailbox. You’ve got to ask for it. Here’s what you need to know about requesting your Annual Credit Report, and what it all includes.

If you’re under 30, buying a home might sound like a far-fetched dream: Fewer people between ages 25 to 34 are buying homes now compared to older generations at that age, according to a July 2018 report from the Urban Institute.

No doubt, credit can be confusing. Not only are there various factors that make up the anatomy of your credit score, there are also different credit scoring companies. Making things even more convoluted, achievements like paying off your student loans can actually cause a drop in your scores, plus there’s plenty of myths circulating about credit. Suffice to say, people have a lot of questions about credit.

The real estate process begins well before you make your short list of dream homes and start attending open houses—and it can end there, too, if you’re not prepared. Many people worry about saving enough money for the down payment, but there’s more to learn about the process of buying a home, requirements for loan approvals and how to overcome obstacles to home ownership. Weigh your financial history carefully, because with the right knowledge comes home-buying power.

Have you ever wondered what your real estate agent is thinking — like really thinking? Well, now’s your chance to find out. Agents have to stay pretty neutral with their buyers—there are legal protections governing some of what agents can and cannot say in order to ensure buyers are making their own decisions. But we reached out to a few real-life agents to learn the truth: What’s the one thing you wish you could tell your clients?

If you’re in the market for purchasing a home, looking into foreclosures and short sales might seem like a more affordable way into homeownership. The properties can be quite inexpensive in comparison to the traditional housing market, and if you’re a seasoned buyer, the idea of a fixer-upper might sound appealing.

In this modern era of home improvement TV, where homes go from beast to beauty in the amount of time it takes to do a quick scroll through Instagram (what? It’s called multitasking), what often gets lost is the immense amount of work and money that goes into an actual home renovation, let alone building a home. Beyond that, many of the everyday issues that DIYers, developers, and owners run into are edited out of the final cut—making things seem a lot rosier than in reality.

Understanding what affects your credit score in order to rent an apartment or secure a mortgage shouldn’t be a mystery. After all, that three-digit number is what lenders use to determine your creditworthiness, so transparency should be the name of the game. Still, credit can be complex and there’s a lot of misinformation out there when it comes to how credit works and what drives your score up (and down). Here are seven common credit myths—busted.

Turns out, millennials aren’t spending all their money on that infamous avocado toast. However, they are a lot more spendy than all other living generations. According to a new analysis from GOBankingRates, millennials spend $208.77 each day, on average—about $44 more than the average American, who spends about $164.55.

You thought doing your taxes was a nightmare? Wait until you apply for a mortgage.

My first foray into credit freezing came in 2015, when I found out my background investigation records were stolen in a massive government hack that affected 21.5 million people. In order to get security clearance for a government job, I had to fill out a standard form with personal information including financial records, mental health history, and international travel.

You’re set to start saving for your future. You already put money aside for retirement every month, but you’re probably already wondering how you should invest it. Which type of retirement savings account is best for you? Should you start a 401(k), an IRA, a Roth 401(k), or a Roth IRA? What even are the differences? What about if your first home is your savings priority right now?

Whether you’re a serious buyer or daydreaming to pass the time at work, a common part of buying a home is trying to predict your monthly mortgage payments. Is it going to end up being cheaper than your rent? Are you going to need to downsize a bit? You probably want a ballpark number before you call your mortgage lender and hire a real estate agent, so you plug the numbers into an online mortgage payment calculator.

Establishing credit poses a tricky Catch-22: You need credit to get credit. This can prove to be quite a conundrum if you’re trying to rent an apartment, buy a home, or, heck, simply need car insurance but don’t qualify because of a thin credit file.

You see homeownership in your future. But, after looking into your crystal ball—err, savings account—are you envisioning yourself at the closing table in the next month? Year? Five years? TBD depending on if you win the lotto? Fewer than four out of 10 millennials own homes, according to research from the Urban Institute, a Washington, D.C.-based social and economic policy group.

As far as credit is concerned, there are no hacks that can cause your score to magically skyrocket overnight. (Ahem, we’re wagging our fingers at schemes promising you a “new credit identity.”) But, what does exist is good, sound credit advice that advocates for responsible borrowing and takes into account the anatomy of your credit score, like utilization and payment history.

Think of the term “financial planner” and what comes to mind? Somebody in a suit talking about complicated money matters with somebody rolling in dough. Think again, according to Certified Financial Planner Professional Shannah Compton Game, host of the Millennial Money podcast. I got to chat with Game about all things financial, and ask her my embarrassing money questions—which actually didn’t feel at all embarrassing with her.

In the world of credit, establishing a credit score of 850 is like being granted a lifetime achievement award. Both FICO and Vantage—widely used credit-scoring models—consider 850 to be the highest possible credit score. The score is perfect. Exceptional. Untarnished. But… is it possible? The short answer, according to experts: Well, yes. But an 850 credit score takes time and strategy.

You consider yourself responsible with credit: You pay your bills on time and you don’t rack up any major credit card debt. And since you’re looking to apply for a mortgage sometime in the near future, you’ve been actively monitoring your credit. But since you’ve checked last month, your score has gone down. What gives? Why is your score acting so sensitive? Sheesh.

Even if you’ve just started to save for a big purchase like a home or for retirement, you’ve probably already run into plenty of bad advice. Everyone, especially your family, seems to have an opinion on where your hard-earned money should go. But not everyone knows what they’re talking about. (Sorry, Nana!) Luckily, five money experts weigh in on the worst savings advice they’ve ever heard.

Maybe you’re afraid of racking up too much debt. Or, perhaps you fall into an “anti-credit card” category who loathes the potential of paying interest. It could just be that your debit card is at the front of your wallet and, by default, gets swiped far more than your credit card.

Coming up with a down payment for your first home is no easy task. In fact, according to a recent study from HotPads, renters spend about six and a half years saving up before they have enough. (I personally predict I’ll be eligible for AARP before I could build up a nest egg hefty enough to become a homeowner.) Finding clever ways to cut back and save everywhere you can is helpful, but at a certain point, you may realize that you simply need to rake in more dough.

It’s not unusual to live with a roommate to cut down costs. Hey, life is expensive! But 2018 demonstrated that an unlikely population is taking on roommates in order to make ends meet: married people. Economists at Trulia determined that in 2018, over 280,000 married couples (or 0.46 percent of all married U.S. households) lived with a roommate or boarder. Now, you may think that number sounds minuscule. But it’s a serious jump compared to just over 20 years ago.

You know a strong credit score will help you get into your next home. To get specific, if you’re renting, landlords like to see a score of at least 650 before they start asking for extra deposits and guarantors. If you’re taking out a mortgage, a score that’s 760 or above is the magic number that will get you the best interest rate on a home loan. But establishing and maintaining a good credit score isn’t just necessary for keeping a roof over your head.

Before you know it, your down payment savings account will be a bit more full.

There have been two points in my adulthood when I monitored my credit like a hawk: When I was preparing to buy my house, and when I was going through a background investigation for a government security clearance. Keeping my credit score stable, or even bumping it up, was the name of the game as low-interest rates and, potentially, a job were at stake. (I’m not giving away any government secrets!

Any renter with an internet connection and a passion for painting the walls dark green (or black or maybe just wallpapering a bit) can attest to the bit of confusion you feel when first encountering a mortgage calculator or payment estimator online. You approach the thing with some very rough estimates researched in haste about what a modest little 2-bedroom in an up-and-coming neighborhood might cost.

When my husband and I decided to take out a home equity line of credit for a renovation, we assumed we’d get a great interest rate based on our good credit scores. We’ve always paid our bills on time and don’t maintain any credit card debt. There’s just one demerit on my report; a medical bill in collections I’ve unsuccessfully disputed. But even with that blip, the credit monitoring service I use—CreditWise—said my score hovered in the high 700s!

It’s no secret that the dream of home ownership is increasingly a daunting prospect. From overwhelming student loan debt, to less-than-stellar credit scores, to steadily-climbing home prices, there’s no shortage of factors keeping a lot of us from achieving that hallmark of adulthood. However, some markets are tougher to pull off this particular aspect of “adulting” in than others.

We’ve all heard it. If you’re looking to buy, you should always go for the worst house in the best neighborhood. But have many of us ever stopped to question that conventional wisdom? I thought I was bucking convention when I bought one of the lowest priced houses in a neighborhood that many locals steer clear of (and to my eternal frustration that Uber drivers tell my Airbnb guests they should avoid) — but is it true?

Everything on “The Brady Bunch” always seemed so perfect, down to the family’s sprawling Los Angeles-area home. Though the home wasn’t really designed by Mr. Brady, it is a real five-bedroom, three-bedroom home on Dilling Street in Studio City. While the interior scenes were filmed on a sound stage at Paramount Studios, the interior layout of this house is pretty similar to the one portrayed in the show.

You’ve saved a good chunk of money, or at least are on a path to do so. Now, you might be wondering what’s better: Invest in real estate or put your money in the stock market? It’s a question you can wrestle with to no end since several factors come into play. Helping to frame the debate and lend advice below are a host of real estate and finance experts. Here are six questions they suggest you ask yourself if you’re exploring your investment options.

Sure, there’s plenty of parental advice that will never grow old: Learn to prioritize your time. Follow the Golden Rule. Wear sunscreen. But when it comes to financial tips, some of those age-old lessons fail to fit in with a millennial’s reality.

Some people were born to fit in. Others were born to stand out. The same goes for homes. For every 100 cookie-cutter McMansions, you might find one home that breaks the mold–which makes such architecturally significant homes priceless in our book. However, you don’t actually have to break the bank to purchase a house that stands out from the crowd.

You can shop for just about anything online these days, from your groceries to shipping containers-turned-houses. So, when it comes to home buying, it only feels natural for digital natives to crack open the laptop to start shopping for a mortgage. Once you tell Google you’re in the market for a mortgage, oodles of comparison sites will pop up, eager to get to know you better with icebreakers like “what’s your credit score?“, “where are you looking to buy?

Checking your credit score regularly is smart, especially if you’re planning to buy a home. You shouldn’t have to pay for a monitoring service to help you keep your credit on track, either. Fortunately, you can choose from a variety of free credit score sites and apps to keep tabs on your numbers. But with so many options, which is the best? By law, you’re entitled to view your credit report once a year on annualcreditreport.

Imagine my surprise when my real estate agent gave me a simple appraisal number—and all additional information in a completely jargon-free way.

Now that we’re settled in the New Year, you may have noticed that your credit score has taken a hit after some overly joyous holiday spending. You’re not the only one: A recent report from Marcus by Goldman Sachs says almost half of the U.S. (48 percent) carries a balance or goes into credit card debt over the holidays due to travel, entertaining, and gift costs. While this can make for an exciting holiday season, it usually leaves our wallets—and credit scores—hurting.

If buying a home is living the dream, paying your mortgage off early could seem like a next-level fantasy. Just imagine what life would be like without forking over monthly mortgage payments. More money for investments! Retirement savings! Home upgrades! Silk bow ties for your dog! But is paying your mortgage off quicker than is required actually a smart financial move? While there’s no “one size fits all” answer, financial experts say it’s not always the wisest decision.

Some bad advice you receive is NBD, honestly. Those bangs your best friend swore would look great on you will eventually grow out after an awkward phase. And maybe one day Dad’s method of filling out a March Madness bracket based on team mascots will actually pay off. But then there’s some bad advice that qualifies as a VBD—yes, a very big deal because it concerns your financial well-being.

Hamilton and Burr. Kanye and Drake. Freshly brushed teeth and orange juice. These are pairs never to be mixed. And generally one would say that debt and homeownership are one of these mutually exclusive pairs—but that may be changing, says a new report from the U.S. Department of Housing and Urban Development.

A new year is a great time to set resolutions (obviously), and if you’ve resolved to graduate from rental life to owner life, you’re going to want to set some savings goals ASAP. A new study from Apartment List found that many millennials want to buy a home, but don’t see that happening in the next five years. What’s more: A large portion of the generation isn’t even saving for a down payment yet.

Have you ever scrolled through social media and secretly wondered “How the heck are my peers affording that lifestyle?” Yeah, we don’t know how they are funding those Bora Bora vacations, either. But a recent report from Zillow gave us some pretty good intel on how people are actually affording down payments for homes in big cities. We’ll give you a hint: It has nothing to do with skipping avocado toast or cutting Netflix from the budget.

Contrary to popular opinion, millennials are buying homes. According to a study conducted by the team at LendingTree, an online loan marketplace, nearly one-fourth of all mortgage purchase requests made on their website between January and November of 2018 came consumers under the age of 35. And three American cities managed to rake in millennial buyers—making up almost one half of total new purchase requests.

Keeping your rental warm throughout the season can be a challenge when you're at the whim of your building's management.

You left school with a solid understanding of the Pythagorean theorem, and you could probably recite a row or two of the Periodic Table of Elements in your sleep. But one thing you likely didn’t pick up in class? A personal finance lesson centered on home buying and the importance of credit. Ready to go back to school and learn a few important home buying principles?

I'd managed to raise my credit score 30 points, and snagged a mortgage approval letter from my credit union. These experts agree with me.

When you’re house shopping, it’s easy to find faults with the homes you tour. Why is the master bedroom Cookie Monster blue? Whoever designed the kitchen didn’t know a thing about cooking. Did vampires live here; there’s hardly any natural light?! Sure, most design flaws could be remedied with renovations.