Tips to Pay Your Car Loan on Time

Because the world we live in now has become very fast-paced, cars have become more of a necessity than a luxury. A car would make it easier for you to get around the city. Commuting to work can be taxing and even dangerous at times. Cars are great for families as they do not only provide security for each family member they are also very convenient for them. Having your own car would also come in handy during emergency situations.

However, a car doesn’t come cheap and most people aren’t lucky enough to buy their own brand new car. Though people have their reasons, most of the time it’s because of financial problems. In such situations, applying for a car loan is a great solution.

Of course you can’t just get a car loan and go. Getting a car loan would require certain responsibilities. The most important responsibility would be to pay your debt on time. You don’t want to risk lowering your credit score. It’s not always easy to pay back a car loan. To help you out, here are some friendly tips you can use:

· Choose the Right Car Loan Financing Company

The key to paying back on time doesn’t start when you have your car. It starts before you even get the loan to buy one. This is the first and probably the most important step to take. A good way to search for one is by searching the internet. If it doesn’t have a website, then it’s probably not worth your time.

Take advantage of the information given on their websites and browse through important and useful stuff like their policies and services. You can also find out certain requirements you need to accomplish, learn about their rates and payment options. Knowing all these can help you better prepare for paying back your loan and can even save you from unexpected situations.

· Pay Attention to Interest Rates

This is particularly important to you as interest rates basically determine the extra money you pay the company apart from the actual principal you owe.

It would be wise to know the interest rates of different companies so you can compare them and find the best one for you-the one you can pay with no trouble.

· Choose a Practical and Realistic Car

Yes, car loans can help you get the car of your dreams quick and easy. However, it would be a wise decision to go for a car that is practical and realistic-one that meets all your needs in a car yet is also easy to pay back. If you live on a shoestring budget, it’s unpractical to go for a Mercedes Benz. You will most probably regret it later on.

· Set your Priorities Straight

Remember that a car loan is a responsibility. You have to be serious about it. Learn how to budget your money wisely so you will always have enough money to pay. Do not take it for granted just because you are given a lot of time to pay back. Most people make the mistake of not preparing for their payments in advance because they think that they still have tons of time to pay. They spend on unnecessary things and when the time comes for them to pay, they aren’t ready and they panic.

· Get Help from a Loan Calculator

If you’re bad with dates and deadlines, you can use a loan calculator to help you keep track of everything. This device can help you remember due dates and other important payment details. This allows you to know how much you have to pay ahead of time. It’s better to be prepared.

Buyacar specializes in selling brand new and used cars. And we all know that cars are quite the necessity for people nowadays. Without them, it would be hard to get around town. Not everyone can afford one, though. For those who are in dire need of a car yet do not have the financial resources to get one, they can opt to apply for a car loan from reliable financing companies like Capitalife.

 

Tips On Types Of Payday Loans

It’s not my day. Today, I got into an accident and had to pay the tow company, fines and my deductible and I used this money that was supposed to pay the electricity for my apartment. I need money fast! Help! ~ Marj Janey.

There are many payday loan types in the USA. You can go to a brick and mortar check store in your local town, or simply go online.

Going to the physical check loan or payday store is sometimes a hassle because you would need to physically visit the store. Although there should be a store close to you, that might not always be the case. And if there was one they might not even have the ability to give you the amount you need.

You would need to physically go and apply for a loan in person. Usually they would require your paycheck or income verification, in addition to other personal information so that you can obtain your paycheck loan.

As for getting a loan via traditional banks, the Bank of America’s, Wachovia’s and BB&T’s of the world, to get a personal loan “as they categorize it” you would need to get a credit check, of course all of your personal information and you physically need to be present. And on top of that, you would need to wait days or weeks to get that loan! And guess what? After days or weeks of waiting you may very well discover that you were denied the loan!

Then there is the much easier way of obtaining a loan, which is obtaining a loan online.

The need for emergency financial assistance is unavoidable especially since the world’s economic outlook is still unstable. As such, many people with less than perfect credit are in need of quick cash and the good news is that it is readily available, although this is not the case from traditional financial institutions such as banks and credit card companies. More good news is that technological advances have made it possible for people to obtain the money they need to fund various financial obligations quickly and easily.

Faxless payday loans are fast becoming one of the best solutions for funding quick emergency cash needs. The beauty of faxless paycheck loans is that everything from application to processing is done online which cuts the waiting time significantly. Gone are the days where borrowers have to wait in line for hours just to determine if they are fit to be granted a loan, and fax bulky paperwork back and forth. These days, you do not need to leave the comfort of your own home to obtain the money you need. You could be spending the money you received from these easy loans rather than waiting weeks for traditional financial institutions.

One notable feature of faxless paycheck loans is that typically there is absolutely no paperwork. Borrowers are not required to sign physical documents… It can all be done online with the click of a mouse! It is not uncommon for borrowers to receive the money they borrowed the same day that they sent in their application. This is great news particularly for emergency situations such as when you need immediate medical attention or for funding housing or car repayments.

What is more, turning to faxless payday loans is a safer option because all there is for you to do is simply fill out an application form online. You do not have to physically drop by your lending company’s office to answer various questions because you are mostly corresponding with your lender via email, phone or on their website. You will also often receive a prompt to remind you the repayment date as well as the repayment options that the lender implements.

The requirements for these types of loans are very basic. Borrowers are required to be at least 18 years old, hold an active checking account and be permanently employed. However, the criteria will vary from company to company so it is best to read and understand the terms and conditions before you do business with the company of your choice to avoid any surprises.

Paycheck loans are perfect for unexpected expenses and are typically payable upon receipt of your next paycheck. If you want to obtain money in the fastest, most efficient, hassle free way, your best bet is no fax payday loans.

 

Tips on Getting the Lowest Car Loan Interest Rate

When thinking about getting auto finance, some people are very concerned about getting the lowest car loan interest rate. While shopping around can certainly help you secure your auto finance at the lowest price possible, there are also some other things that you can look at if auto loan interest rates are the most important thing to you.

If you want to get the lowest car loan interest rate that you possibly can then you will need to know when the right time to borrow is. The prime interest rate that is set by the Federal Reserve is what lenders will base the rates they charge on and so borrowing at a time when the prime interest rate is low will mean that you will be able to get the lowest car loan interest rates. While in some cases, people may not have a choice of when they will need to purchase a car, but if you do, this can be a very worthwhile consideration in order for you to get the lowest car loan rate.

Another factor that will determine the lowest car loan rate that you will be able to obtain is your credit rating. Those people who have a good financial history will be able to borrow at the lowest car loan rate around, and so it may be worthwhile for you to look at getting your credit rating to a desirable level before looking for car finance. A bad credit rating will stay with you for about 5 to 7 years, and often people cannot wait this long in order to purchase a car through finance. If you have a bad credit rating and want to get the lowest car loan rate that you can you should shop around with specialized lenders and companies who deal exclusively with bad credit loans will offer the best rates for your circumstances.

There are other important considerations that will affect the lowest car loan rate that you will be able to obtain. There are some instances where lenders will charge higher rates of interest on older model cars, and so this is something that you will need to look into before selecting the vehicle you would like to buy. This can be easily checked with a finance company before you take out your loan.

Another thing you will need to look into is whether or not the term of your finance agreement will alter the interest rate that your lender will charge. There are many lenders that will charge higher rates for longer term loans and in these cases getting the lowest auto loan interest rate will mean getting a shorter loan term.

The most important thing that you can do when you are after the lowest car loan rate is to shop around. You should approach the big banks and financial institutions as well as the smaller non-bank lenders in order to find a company who can provide you with the best price on your motor vehicle finance. You will be able to find a vast majority of these lenders on the internet, and shopping online will certainly save you time and allow you to find the best deal on loans that will suit you.

Car Loans for ANY Credit!

Tips and Advice For Negotiating With Car Dealers

It is healthy to negotiate before financing a car. Instead of negotiated value of the vehicle, some dealers try to charge for the Manufacturer’s Suggested retail price (MSRP). Some dealers may mislead you to believe that factory- to- customer rebate is a part of their dealership discount and they need to subtract it from the MSRP. And then they announce that the negotiations are over. Dealers are already earning from their holdback checks. Right on the offered rebates go to the consumers and are not to be subtracted from the MSRP. Always have an eagle’s eye before going for the financing.

Special financing is offered to those who pay at least 20% in cash. You may carry this cash for your down payment. In case you are also opting for the same then you can save your money over the course of your loan.

But in case you are going other way round like if you are in short of sufficient cash foe your down payment then you may apply the rebate to the cash down payment. Ensure the applied rebate should not get deducted from the MSRP.

There is a way to get the deal with rebate on the paper. The dealership sums up the negotiated purchase price with the applicable taxes, license fees, document fees etc. And then all the rebates and the cash that you have submitted before will get subtracted from the total giving you the final price as your balance amount.

When you are sure that you can adorn your home with a car then it will be the best time to buy it. To escape from the dealer tactics, safest and the best time to go for the desired deal is at end of the month. It is so because the dealerships generally submit their sales report to the manufacturer on the monthly basis. Not all that glitters is gold. We fall for advertisement and discounts that are published in the paper with expecting to get a better deal. It can be unhealthy for the Auto enthusiasts. We should go for this step when we are planning to have year-end model closeouts. When a new model comes out, it depreciates the old year model value and perhaps your savings.

Common Dealer Tactics

There are many tricks that a dealer employs to befool the customers. Some of them can be:

The guilt trip

Generally, a dealer keeps his desk covered with the photographs of teenagers and children. A good sales person tries to influence the customer emotionally to stop him negotiate further. The sales person basic meaning is if the customer tries to bargain more and more it will directly affect their salary and ultimately to their source of income. Where the question of family and children comes many of the customers lend a soft corner for the sales person feeling guilty to hack away at their commission, which they might need for running their homes.

The lost keys routine

You get your car keys by the sales person, when going on your test drive. You like the car and start negotiating about its price. But if the negotiation is not serving your interest and you want to leave, then this is the time when sales person tries to run their defined tactic. They will mislay the keys. Then an intensive search will be held by the car manager and in the meantime, the concerned sales person will try to make the customer ready to buy the car. This led you to spend more time at the dealer’s counter. This way you are serving their purpose as a sales person are well versed to befool the customer either this way or that.

Once a sales person gets a hint that a customer is not getting trapped in their laid net, they start their procedure in a pre-defined manner. They start giving you the details about all the schemes and discounts associated with that product. To your surprise, these offers get approved by the manager. Nothing is going from their pockets, but you are surely wasting your time over there. You can escape this wastage by letting the sales person know that you want to have words directly with the manager and that also within the given time duration. In case you are still kept waiting then you must leave the place.

Monthly Payments

Sales person starts the deal with the discussions about the monthly payments. They usually employ this trick to influence the customer. At times, they succeed in their trick as every one is interested in getting known about the money they need to spend. They will begin lowering the said amount if you will not get lured by their offered payments. Do not allow them to influence you with their oily tongue. You may tell them that you only want to get involved with the dealer asked price. Let them know that you are surely interested in owing a vehicle but on fair terms. If still your sales person become stubborn is not telling you about the dealer’s invoice then you may go at another dealer’s counter.

Good Bargain- Start with the invoice price

You may start negotiating from the invoice price instead of beginning it from the sticker price. In case you are looking for a vehicle in short supply then you may take notice of MSRP in other cases you may ignore the MSRP. At times the demand for a vehicle like a sports car may exceed the supply, and then the dealers do not feel pressurized to sell any vehicle for less than MSRP. They serve their purpose especially in case of the cars that are hard to find.

You need to do an intense research about the dealings as knowing about the 2% to 3% holdback payments to dealer by the manufacturer may get you the best deal. Being dear to the manufacturer, high-volume dealerships are eligible for the incentives and discounts. Your little compromise can get you the best deal. You may allow the dealer to add some advertising costs to their invoice totals and show them that you do not have any kind of objections in their earning reasonable profits. Let them know that you are mainly interested in their asking price that should be based on dealer invoice.

Going for negotiating from dealer invoice allows you to save your time and money in actual price negotiations. In case the dealer responds with lower prices, you may offer higher prices and vice-versa. You may keep your price increases under $100 a crack. To keep the dealer in confidence, you may repeat that you want to have a car in next few days.

Going for haggling in case of Used Vehicles

There is no dealer invoice in negotiations for a used car price. However, negotiations for a used car and negotiations for a new vehicle share the same features. Dealers calculate every single expense follow on fixing up a used vehicle. The only remaining fact is that they will never show you that worksheet. As a matter of fact, the franchised dealers make most of their profit from the sale of a used car. They usually offer factory certified used vehicles. These certifications are as good as warranties offered by third party. It is always safe to visit a specialist dealer to get bargain on buying of a used car as they do not make much profit but just see to the fact that their overhead expenses are less. Their offered warranties do not sound good as they exclude repair facilities.

If a person is well versed in his research related to the desired vehicle, then he will surely get a best deal. Your mechanic reports should be well equipped with the significant data. In case your mechanic has already proved the purchase then you may go for selecting other cares if the deal is less favoring you and more to your dealer. If you think that your desired used car needs some repairs then you should always deduct the repairing costs from the cost asked by the dealer. It depends on your haggling skills. You may start with subtracting 80% or 90% of the repair costs from the asked cost and may vary it to the 100%.

Acceptable Deal Best Deal

Dealers Asking Price: $10000
Repair Estimate : – $1800
Sub Total: $8200

Fair Market Value: $9400
Repair Estimate: -$1800
Sub Total: $7600

You may show off your mechanical skills to the dealer. This way you have the best deal ahead of your way. If a dealer is asking you for the $10000 with a fair market value of $9400 but in case you think that your repairing cost will turn out to be around $1800 then start with offering the dealer $7600. If still the dealer is not ready for the offered payment then you may increase the amount to $100 but not more than this. In case the settlement is not coming on the way as you desired it to, then you may see the next dealer. Just leave your contact number.

The End of Choices

Finally, you have decided to buy the car. So, first think of your preferences and budget. This helps you a lot in compressing the huge list into small one. Now, you have decided for a brand new car. Do not waste your time in thinking. Simply, log on to a relevant site and find out the latest details about the car. Along with the internet, also visit local dealers of that car. Try to get maximum information, as it will help in attaining the conclusion. Write all the details of this vehicle along with other vehicles in a notebook. Compare notes of both the vehicles.

Compressing

At this stage, you must have driven all the desired vehicles of yours. Suppose you have compressed the choices to two vehicles. Take a drive of both the vehicles on the same day. Observe both the vehicles carefully. Select one that makes you comfortable, as well as suits your lifestyle. Along with the cost, that matches your budget. The most important things to consider are the safety equipments and the gas mileage. Buying a SUV means you must have an appropriate garage. The length of new quad-cab pick-ups and SUV of long wheelbase are more than 18 inches.

After a lot of consideration, you will decide on one vehicle. The work does not end here. You need to begin your research on pricing.

The Cost

On the internet, you can simply get the invoice prices of dealers for the new vehicles. If you want to buy the vehicle from an online catalog then log on to reliable sites.
There is no harm buying from internet. Otherwise, the local dealers are always there to serve you. You can also get information about insurance. Thus, making you capable of knowing the over-all cost.

Cost of Used Vehicle

The vehicle’s market value resides between the selling prices in retail and its wholesale value. According to IRS, Market value of the vehicle is the price that both the buyer and seller are willing to buy and sell, after having relevant information about the vehicle. Moreover, there is no compulsion, neither on buyer nor on seller. If you want to know the rate of used vehicle then it need some kind of research. You can easily find out the rates of used vehicle through an online catalog.

Things to Know About Taking a Second Home Loan

If you own your home and you find yourself in financial difficulty someday, and urgently require a sum of cash in order to get yourself out of trouble, then there the option of taking out a second Colorado home loan is always open to you. This is not a choice you should make lightly, however, as taking a second Colorado mortgage loan can leave you extremely exposed financially, and vulnerable to possible accidents or disasters that might befall you when you least expect them.

This does not mean that you should discount the option of taking a second Colorado home loan entirely, only that you should be very careful about taking out such a loan. You need to be very sure that you have exhausted all other options before you resort to this one, as this is definitely an option of last-resort. If you are serious about getting a second Colorado mortgage loan, then the following are some things that you need to pay attention to when you take out the loan.

The very first thing you need to do before you even approach your local bank about obtaining a second Colorado home loan is to calculate the remaining payments on your first mortgage loan, calculate the total amount of your savings, factor in your income, and calculate exactly how large a second Colorado mortgage loan you can afford to ask the bank for. Doing this will ensure that you only take out a second mortgage loan that you can comfortably afford, so that you will not find yourself in even greater financial trouble even if something untoward happens to you.

Do not jump at the very first mortgage rate a bank or mortgage lender offers you. You need to do the necessary research to find out more about the mortgage market. Details such as the prevailing interest rates and generally accepted mortgage criteria and conditions are important when you actually attempt to obtain your second Colorado mortgage loan.

You also need to make sure that you have a very good reason for taking out a second mortgage. The added strain that this will put on your financial resources and the greater risk that you put yourself at are the price that you pay for taking out a second mortgage. This is not a small price to pay, so you should only pay it if you stand to lose much more by not taking out the loan. Trivial matters such as not being able to afford the latest model of car or a more luxurious home do not qualify as good reasons for you to take out a second mortgage loan.

Some good reasons that might justify taking out a second home loan are funding your child’s college education, paying off a credit card bill that is about to rollover, or making necessary renovations and repairs to your first home. All of these reasons make the added risk of a second home loan worthwhile, and whatever happens, you will most probably not regret your decisions to take out a second loan.

To know more on Colorado home loan do visit our site. The author is an colorado mortgage loan Expert and you may read more on him by visiting his blog.

Finance Budget 2015: Super Flop For The Automotive Industry

The very first full-term budget of FY-16 laid down by the new central government was lack-luster for the automotive industry.

Many issues were raised in the past by the Indian automobile manufacturers, like the lowering of base interest rates on sale of cars, additional excise cuts, faster implementation of Goods and Services Tax but none of them seem to have been met apart from allocation of Goods and Services Tax.

The Finance Minister of India, Mr. Arun has stressed on the faster implementation of infrastructure projects to promote industrial growth in this budget.

Budget Details

• An assurance for speedy implementation of the Goods and Services Tax has been given by the central govt. which will bring it into effect from April 2016.This implementation will help to create an unbiased and uniform tax structure across all the various states of India.

• The excise duty was lowered by a narrow margin. Now it is 24%for the SUVs, 20% for the mid-sized cars and 27% for the large cars. For the smaller-sized cars, it has been hiked up from 12% to 12.5% this means that car prices will either remain the same or increase marginally, but will not decrease at any cost.

• Excise duty on the chassis for an Ambulance has been cut down from 24% to 12.5%.

• Corporate tax has been reduced (30% to 25%). This will help to indirectly promote growth within the automotive industry and will give them a chance to recover 5% of their funds. This tax-cut is expected to begin from next year.

• The custom duty for all fully built and imported commercial vehicles has been increased to about 20%.

• An impetus for production of green vehicles has been proposed to the tune of INR 75 crore under the Faster Adoption &Manufacturing of Electric Vehicles (FAME) scheme. The excise duty discount EVS will be maintained.

• The demand to ask banks and other financial institutions to lower the interest rate on vehicles and vehicular loans has not been secured.

• INR70,000 crore will be invested in laying of about one lakh Kilometres of asphalt roads across the country especially rural areas.

To summarize, this budget was really measly for the Indian automotive industry. Nothing has become cheap for the hardworking consumers. The companies can somehow hope to recover a lost revenues due to the cut in excise duty but that will amount to INR 1000 per car only.

For companies grappling to meet their demand-supply schedule, this isn’t enough. Only a miracle can now save the automotive industry from the current turbulent state it is currently in. The chump change allocated in this budget won’t make a very big difference!

Aprit Jain is a blogger and loves to write about automobiles. He has written many articles and blogs for Mahindra Parts and Mahindra spare parts as well as online portals.

 

The Truth About Our Economy A View of the Future of Sandpoint and the Inland NW’s Economic Outlook

Recently, I attended a lecture by Anthony Grasst, a very astute MBA who runs a mortgage division of MetLife. It was gratifying to hear words of wisdom that offered another view of our economy besides the doom and gloom one hears on the radio waves or sees on the tube.

Graast explained that the job losses after the dot.com boom/bust and 9/11 was, if not worse than we are having now, at least comparable.

According to E-commerce News, 2001 went into the record books as the most devastating year in terms of Internet jobs lost.

In an article released in 2002, “For the year (2001), 100,925 positions were cut — about 250 percent higher than the 41,515 cut during all of 2000, when the dot-com shakeout began in earnest.”

Figures were much higher than that according to ComputerWorld.com, spanning many sectors and totaling over 2 million job cuts for 2001.

True numbers are often fleeting. Certainly hundreds of thousands lost jobs from the dot.com debacle, and probably millions. Post 9/11 job losses were also staggering. Our current recession passed that benchmark for total job losses in November 2008. Still, many forget we had these two recent large downturns in employment: the dot.com bust and 9/11. We recovered.

There is no doubt we experienced a double whammy. As our national economy began to recover from the dot.com bubble burst, 9/11 sent us right back down the tube. Yet we recovered.

In fact, the financial losses from these two events may have been even worse than our current crisis, with many experiencing greater losses because the stock market affected more real wealth in much greater fashion than today.

According to Wikipedia: “Several communication companies, burdened with unredeemable debts from their expansion projects, sold their assets for cash or filed for bankruptcy. WorldCom, the largest of these, was found to have used illegal accounting practices to overstate its profits by billions of dollars. The company’s stock crashed when these irregularities were revealed, and within days it filed the second largest corporate bankruptcy in U.S. history. Other examples include NorthPoint Communications, Global Crossing, JDS Uniphase, XO Communications, and Covad Communications. Demand for the new high-speed infrastructure never materialized, and it became dark fiber, impacting companies such as Nortel, Cisco and Corning, whose stock plunged from a high of $113 to a low of $1.” It wasn’t only internet and tech related companies that caused national financial pain. Who can forget Enron?

The financial losses from 9/11, hurricanes Gustav and Katrina, and other disasters during the Bush administration, as well as the true costs of the war in Iraq, have some comparisons to our dismal condition today. While the press appropriately covered these disasters, the overplay and total consuming coverage of today’s crisis makes those pale in comparison.

For those trying to buy homes, money is tight. However, according to Grasst, liquidity is changing. True liquidity right now is not as tight as the press would have you believe. Stated Grasst, “The money supply has increased by 20% over the last few months, but takes 6-9 months to show in the market.”
The message Grasst related in his lecture was that financing is available; you just have to have a job, pay your bills, and you can’t lie. What a concept. Other sources of money have become available from companies like MetLife, which came into the credit and mortgage business in 2007, after all the bad loans had already been made. Other revamped sources are the loans from the USDA that has revised its rules, making their loans a great alternative. Most local and Inland Northwest banks for the most part did not make the kind of questionable loans that put other banks in jeopardy, according to Jack Dyck V.P. and Regional Sales Manager for Mountain West Bank in Sandpoint.

Our problem, it seems, is that we have become a society that expects instant gratification; we demand results that occur instantaneously. The Great Depression lasted at least six years, from 1931 to 1937. While one can argue that the stock market is responding to President Obama’s policies and actions, only those born yesterday would not reason that these problems and issues were years in the making. How sad we as adults and intelligent Americans, so educated to instant gratification, now believe that in just sixty days in office, one man can fix what we as a nation took years to bring to fruition.

Grasst pointed out that according to the press, our banks and financial institutions are broken, much like the Great Depression. The Great Depression had four years of banks going broke. We have had one. The stock market lost 90% of its value during the Great Depression. Currently our losses are at 40-50%. In both cases, stocks were extremely overvalued. Remember when the stock market first broke 7,000, then 10,000. As a younger investor fresh out of business school, I didn’t think I would ever see 10,000. After all, the market had hovered between 500 and 1,000 from the late 1950s to the mid 1980s. Then, for ten years it was between 2,000 and 3,500. The remarkable run up to 14,000 points took place in a little over ten short years. (See this historical chart) One could say the same happened to home values. Too much, too fast? This is the opinion of many economists.

Job losses hurt, but a more important factor is consumer spending. While seven or eight percent unemployment is caustic, keep in mind we still have 92% employed: consumer confidence is key.
Grasst states, “Changing the sentiment of the public, and in my business of real estate, the most important thing we can do is to educate buyers. We are close to the bottom when it comes to home prices. Has gas begun to go back up?”

“Recently, about two months ago, we were informed we have been in a recession for over a year. Were the pundits a little bit behind on that info?”

So, where is the bottom? Yahoo Education posts the United States population growing at an annual rate of .92%, though other sources quote .88% annually, with Wikipedia putting the number closer to 1%. With a current population of over 306 million, this increases our population by 3 million every year. This puts US housing needs well above our current levels of construction.

Chris Kaucnik, former marketing director of the National Association of REALTORS®, on February 11, 2009 wrote, “The average number of months for inventories to fully shift during this 56 year period is 35. Optimistically, we could be entering the downward curve of the bell beginning in the second quarter of 2009, especially with some added government incentives.” See this article published by RIS Media written by Chris Kaucnik, currently director of marketing for Home Warranty of America, Inc.

Current numbers in North Idaho around Sandpoint back up the premise that our inventory is low, or at least at normal levels. According to the Selkirk Association of REALTORS®, closed sales of homes, condos, and townhomes for 2004 was 1,241 units, 1,190 units in 2005, 920 in 2006, 936 in 2007, and 605 in 2008. Certainly there is strong evidence for up to 1,000 homes a year to be available for our market’s growth. We currently have 1,097 residences for sale. Are we oversupplied? It doesn’t take a statistician to divine we currently have a one-year supply of housing. Last year, in spite of declines in pricing coupled with low interest rates, we saw a substantial decline in sales. We all know the reasons. How long can a downturn last for an area that is touted as the next Lake Tahoe? Predictions make sense for having a better year than 2008. (The Selkirk Association of REALTORS® deems these numbers reliable, but not infallible.)

Unemployment is another great concern. Spokane just hit 9.6%, (Reported by the Spokesman Review on February 24, 2009) so our local figure, basically matching current national levels at 7.8% is a bright spot. (Figure taken from the February Newsletter of the Idaho Department of Labor) This is due in large part to our manufacturing base. While many think of Sandpoint as a tourist economy, tourism-based employment is actually in fourth position, behind manufacturing employment (See this Bonner County Profile published by the Idaho Department of Labor)

With such a diverse employment picture, coupled with our continued success as a tourist destination, the needs for more homes available outweigh the bleak national picture. To date, our units sold for this same time period year over year is the same at 79 sold. However, our market is already ahead of last year’s figures by $3,000,000, and the average sold price is up by almost $54,000 per home. Even the median sold price has increased by $35,000. Any way you look at it, thus far we are ahead of 2008.

This brings up another great worry for potential buyers of real estate in the Bonner County area of North Idaho; that is the concern that if they buy now, they could be upside down in their purchase very quickly. Many of our buyers are coming to North Idaho from parts of Arizona and California; places that have seen declines of up to fifty percent. According to the OFHEO’s Home Price Index, the United States saw a decline in home values of 4.5% for 2008. Washington State declined 3.7%, Idaho lost 1.76%, Spokane at 1.26%, and the closest community to Sandpoint that was measured, Coeur d’Alene, went down 4.45%. Our own numbers showed a decline of 4.4% for 2008. With predictions taken into account, many economists are predicting this trend will change in the Inland Northwest by the end of the year. The most consistent economist giving analysis about North Idaho has been Jeff Thredgold, CSP and self-described economic futurist who puts out quarterly info for Zion’s Bank. His prediction for Idaho is a turnaround by the latter half of 2009. (Read his Winter Predictions)

Still, even if North Idaho housing values decrease by a couple of points, many REALTORS® point out homes are at the best price levels in years.

Another factor comes into play. Interest rates are at an all-time low. (See this news report from CBS) Tony Grasst points out, “Every one percent saved on interest rates translates to a 10% savings in value. So, when the Fed gets out of the mortgage business in June, we will probably see interest rates go up. We have artificially low rates currently.” Just Google the keywords ‘Artificially low interest rates’ and you can find zillions of articles on the web. Will rates go up? Probably. So, if buyers are buying homes at reduced prices, with incredibly low interest rates, does this mean it is the right time to buy? These indicators arguably point to a favorable yes. Does this mean it will be a bad time to buy after June? Interest rates historically begin to rise slowly. So, towards the last two quarters of the year, prices and interest rates will still be at historic lows. This suggests 2009 to be one of the best years to buy a home this decade.

Checking today’s interest rates, buyers can expect to get a rate between 4.85% and 5.17%. If we believe some of the predictions for next year, interest rates could be between 6.5 – 7%. Certainly the Fed doesn’t have much room to move rates down with the Federal Discount Rate at ½% and the Federal Funds current target rate of 0 – ¼%. Can you say, “Less than zero?” If rates do approach 7% by 2010, the real cost of buying a home could be 20-25% higher than today, even if the selling price remains the same. Put into perspective, a $300,000 loan at 4.85% for thirty years will have a total payout of $569,000 and a monthly payment of $1583.00. Change the rate to 6.85% and the total payout changes to $707,000 and the monthly payment to $1965.00. In real terms the amount paid to the bank would be $138,000 higher. Could you put a child through college for that additional amount? Even in a smaller, but still significant way, paying an additional $382.00 a month could put many buyers out of the market.

In conclusion, what is the truth about the economy? Numbers seem to be skewed for the highest possible drama by politicians and the national and local media. Looking closer, while times are disconcerting to some and devastating to others, the truth seems to be a more mixed bag. Certainly, we have been here before, and not so long ago. Locally, we are faring considerably better than other parts of the world. What is our job and commitment to our community? Personally, I believe it is our task to cut through the maligned figures and malaise, give out real numbers, and continue to work towards making our community what it is: the best place to live in the world.

Gary Lirette, host of North Idaho Business and North Idaho Arts and Adventure on KSPT and KBFI, economic researcher, and REALTOR® for Tomlinson Sandpoint Sotheby’s International Realty.

To learn more about Sandpoint, Schweitzer Mountain Ski Resort, and our North Idaho Panhandle Paradise, visit

 

The Basics of Student Credit Cards

Credit card companies consider students that are loyal and good customers, as they tend to upgrade the credit cards when the need arises to do so and the students are supposed to keep the credit cards for a longer period. Hence student credit card offers are found in every nook and corner of the college campus, social gatherings, through their emails and even in the book stores. These facts make the availability of credit cards to students within easy reach. Also the fact is that the students do not have a steady source of income making them go for a credit card. This is to the benefit of the credit card companies as they get more income on late payment dues and penalties, interest for the credit card balance which is not paid, annual fees etc All the above facts make the students the best customers for the credit card issuing companies.

For the students, it is of utmost necessity to own at least one credit card, as it is very much needed during the college days. The students need to spend for renting a car, buy books, for medical expenses, for entertaining his friends and for himself. Also the student starts to manage his own financial matters. Student-life owning a credit card prepares him into a seasoned adult as he learns to take control of his life and it makes it easy to create a credit history at the early stages. Credit scoring is done based on the happening to the accounts whether it is a late payment, or bill paying history, or number and type of accounts he is holding, the outstanding amount of debt etc. Once the student achieves a good credit score it makes him eligible for a house or car loan, insurance coverage and may even fetch a reputed financial job and so on.

It is very easy to obtain a student credit card but care needs to be taken in choosing the best credit card, it can be achieved by taking advice from fellow students who have already got a credit card and it is advised to go for a credit card with no annual fee and the option to customize the amount to be spent using it.

Students need to be careful in monitoring the amount charged by the credit card issuer at the end of every month and also the interest charged on it. It is advised to clear of the debt balance as soon as possible to avoid the levy of interest on the debt, if not fully at least the minimum possible. As a student, he should take extra caution not to provide information regarding his credit card to anyone through phone or by email as it might lead to malpractices. Since the credit history is involved, the student credit cards need to be handled in a wise manner.

It brings in the discipline of paying the bills on time, either in full or part by part in order to get a good credit history and score points.