Saver in the City’s five for Friday
Welcome to the “numbers edition” of Saver in the City’s five for Friday. Have a great weekend!
I once rear-ended a car while driving home from swim practice and I spent the next 30 minutes on the side of the road getting honked at by insensitive a-holes. Although the experience left me scarred (figuratively, not literally), it might have been a little more bearable if I’d had Squakfox’s 14 things to do before and after a car accident.
Laid off and have a little extra time on your hands? Now’s the perfect time to improve your investing skills with one of The Penny Saved’s suggestions of 5 great investment books for these troubled times.
If you’ve ever been fired – which I have although I prefer to say we “parted ways” – you know it’s not exactly one of those pleasant experiences you want to repeat. Avoid the dreaded pink slip with Her Every Cent Counts 10 tips for not getting fired.
Few things stress me out more than clutter. It may be borderline ADD, but I physically can’t go to sleep at night if my room is messy or cluttered. Now at least I can have financial zen with The Dough Roller’s 10 tips to declutter my finances.
Rolling in your tax refund money? Sound Money Matters has 10 ideas to help you spend your tax refund. If you don’t like any of those, you can always send it to me…
April 2009 Net Worth
It may just be a matter of timing since the stock market was up 3.1% last Friday (when I calculated my net worth figures), but things are looking good this month with a net worth increase of 8%!
Assets: $310,587
Cash and Cash Equivalents: $26,583
Invested Assets: $31,004
Use Assets (car, house, furniture, etc.): $253,000
Liabilities: $173,459
Credit Card Balance: $3,718
Home Mortgage: $169,741
APRIL NET WORTH: $137,128
(March Net Worth: $126,195)
Percent Change: +8%
Too good to be true usually is
Last week was pretty exhausting with work starting at 5 or 5:30am every single day thanks to a big event I oversee each year. But somehow in the midst of the craziness, I managed to look into the drop in mortgage rates.
To give a little background, when I bought my house in 2006 I chose a 5-year ARM at 6.25%, a rate that at the time was considered pretty good. Last September, though, there was drop in rates and I was able to refinance to a 30-year fixed at 5.625%. I signed the papers on my birthday and I considered the savings of $80 a month a nice birthday present to myself.
Fast forward to this week, though, and my birthday present is not seeming so special anymore. The reason? Well, if you’ve been within spitting distance of a newspaper this week, you’ve probably read that rates are dropping and some borrowers have been able to secure a 4.5% rate on a 30-year fixed mortgage.
This is why I don’t gamble or play the stock market. The inner voice that nags and says, “if only you’d waited to double down or to sell that stock…” would drive me crazy. And right now, the voice is saying “if you’d just waited to refinance until now…” Hindsight is 20/20 though, and who knows, even if jumped into the fray and refinanced this week, a month from now the rate could be that much lower.
So instead of playing the “if only” game, I decided this week to squelch that voice and to make the most of my situation. As attractive as the low rates are, I have no desire to pay thousands of dollars of closing costs again since I have no idea how long I’ll own this house, which makes it hard to estimate the time it would take to make the new lower rate worthwhile.
While looking around on my current lender’s (Wells Fargo) website, I came across a program that lets current borrowers in good standing apply for a free (no closing costs, application or appraisal fees) refinance. While the rates are not as attractive as the full refinance option, they are still lower than what I pay now.
I actually looked into this option over three months ago, but getting a real-live person on the phone was almost impossible. By the time I did, the rates had risen again so it wasn’t worth the effort.
Somehow this week I mustered up the energy to try again. I called the customer service line and Chad answered the phone. He took me through all the questions only to find out the free refinance rate he could offer was 5.625%. He offered to take my number and call me if that rate went down and although I happily gave him my number, I never expected to hear from Chad again.
The next evening around 5:45pm, the rates dropped to new lows and to my surprise, Chad gave me a call. He could now offer me a 5.375% rate with no closing costs or fees. I asked a ton of questions because it seemed like one of those too-good-to-be-true offers. After all, mortgage brokers don’t exactly rank with nuns and teachers on the selfless list.
So after going through all the practical questions (There’s really no costs? I can apply for this again if the rate drops even further in the future? The loan terms all stay exactly the same? etc.), I point blank addressed the pink elephant in the room…er, on the phone. I asked Chad, “So, what exactly is in it for Wells Fargo?” According to him, the reason they offer such a program was because they wanted to retain good customers – i.e. those who paid their mortgage each month on time and were in no danger or foreclosing – to offset the “bad” customers and restore confidence to their financial position as a company.
On the surface, that made some sense to me, and even though I was still skeptical I decided there was no reason I shouldn’t at least look into it so I started the application process.
Yesterday in the mail I received my loan packet with a Good Faith Estimate and Truth in Lending Statement (sounds suspiciously like an oxymoron…). The Good Faith Estimate checked out and according to the document the only up front fee I was responsible for was a notary fee for the final closing documents.
The Truth in Lending Disclosure Statement was a bit more cryptic and for the first time I felt a little empathy for the people who signed up for loans they didn’t understand and now find themselves in a difficult situation. The difference is, I have absolutely no intention of signing anything until I understand exactly what it means.
My confusion is a result of two boxes right next to eachother with very different figures:
Box 1
Finance Charge – the dollar amount the credit will cost you: $172,628
Box 2
Amount Financed – the amount of credit provided to you or on your behalf: $169,928
The Box 2 total is the outstanding balance on my current loan, and to me a no fee, no closing cost, no BS loan would mean that this amount stays the same while my interest rate adjusts to 5.375%. No?
I’m the first to admit I’m not a genius when it comes to mortgage terms and fees, but I can’t for the life of me figure out where the phantom $2,700 figures in. My mom is a realtor and my dad has his broker’s license so I know exactly where to go for (hopefully) some answers, but if any of you have an idea I’d love to hear your theory!
Filed under Finances | Comment (0)Can you say Spaaah? Book now for Spa Week
Stressed out about the economy? Pamper yourself on the cheap during the bi-annual Spa Week sponsored by Allure magazine. Here’s the deal:
Between April 13 and 19, 2009, approximately 700 day spas around the country will offer two to three different treatments – usually $100 to $200 – for just $50 each.
Confession: I’ve scheduled both a 50-minute facial and a 50-minute massage, but the bonus is the place I selected is also a wellness center so included in those prices is access to a variety of yoga classes, life enhancement lectures, all the spa facilities, hiking trails, etc.
While it’s cheaper than usual, it’s still a bit of a splurge but I refuse to feel guilty because:
a) Lent will be over by then so I’ll have reached my guilt quota for the year,
b) I plan to cut back on other expenses throughout the month so that I still fall within my budget, and
c) after the March I’ve had, $135 (which includes a 15% tip on the regular price of the services) is well worth the body, health and mind benefits.
Anyway, Spa Week started in New York in 2004 and is the brainchild of Cheryl Reid, owner of Spa Week Media Group Ltd. The goal was to introduce a new generation of consumers to the many benefits of a healthy spa lifestyle. And new in 2009, many spas are following the “green” trend by offering organic, detoxifying and vitamin-enriched treatments.
Spaces book up quickly, so make an appointment soon if you’re interested in taking advantage of this offer. For more information and to search for participating spas, visit www.spaweek.com.
Filed under Deals, Finances | Comment (0)Saver in the City’s five for Friday
No means no…except when it doesn’t. Learn how to increase your chances of turning a no into a yes in this post by I’ve Paid for This Twice Already.
A lot has been written in the media about the government’s stimulus plan, but what does it really mean to you, me and Jane public? The Dough Roller breaks it down in a very handy Economic Stimulus Package FAQ.
If you’re carrying a balance on a credit card and paying high interest rates, you simply can’t afford not to read The Simple Dollar’s tips for getting your credit card interest rates reduced.
Think you’re on track for retirement? Use Fabulously Broke in the City’s informative post to do a little check-up on your nest egg.
Confession: I hate flying. And since I’m taking one of those dinky little planes to Phoenix today it’s not surprising Master Your Card’s post about what to do before you die caught my eye. I haven’t done some of these things yet, so keep your fingers crossed for my safe travels!
And with that, I’ll leave you to a wonderful weekend! I won’t be posting again until early next week because I’m in Phoenix attending Angels’ spring training, but I’ll be sure to have a beer (or snowcone for PG-13 readers) for you to make up for it :-)
Filed under Economy, Finances, Investing | Comment (0)