What to Buy In February

The shortest month has an extra day this year, and some really great bargains thanks to President’s day sales.

Hopefully you purchased your Valentine’s Day jewelry during the sales in December and January because prices are back up for February. If not, don’t despair!

Since many Valentine’s Day gifts are at their most in-demand during the first two weeks of February, the discounts on these items are generally pretty modest. However, that doesn’t mean you should give up and pay full-price; at the very least, you should be able to find a coupon that slashes 20% to 30% off the gift of your choice.

Of the many deals we listed last year, jewelry and flowers were the most dominant category-wise. For jewelry, while most broad coupons and sales will be in that 20% range, sites like Szul, Ashford, Kay Jewelers, BlueNile, and Kohl’s will cut up to 90% off select items. Flowers and gift baskets will see 20% to 50% off from sites like 1-800-Flowers, 1-800-Baskets, FTD, Groupon, and Proflowers.

Presidents’ Day deals arrive early and stay late. In years past, we’ve seen them start as early as February 5, and last through February 22. Mattresses are the classic category to shop during these sales, and last year we saw discounts of up to 60% off at Sears, and up to 50% off with an extra 40% off at US-Mattress.

But other product categories saw an uptick in Presidents’ Day sales for the last two years, with as much as 85% off a wide assortment of apparel, home items, and furniture. Some retailers tend to offer deeper discounts on existing sales, while others will lean towards modest coupons (likely an extra 20% to 30% off) that are applicable store and website wide.

Also look to clothing and department stores for a big Presidents’ Day sale push.
Tax software will still be priced lower than it will in April. TurboTax already had a 50% off sale in January, so it’s likely to return again for eagle-eyed shoppers. Plus it never hurts to get a start on your taxes, right?

Winter clothes are on the clearance racks right now as Spring apparel is being showcased. And the Presidents’ Day Sales will make the discounts even deeper.

And what about televisions?

The beginning of February is Super Bowl season, and  many retailers will have you believe it’s a great time to upgrade your TV. DealNews data shows that most consumers treat it like any other month. Moreover, our deal data indicates that February prices are nowhere near November’s best prices, making February an ordinary month for TV shoppers.

That said, January’s Consumer Electronics Show was bustling with new TVs and technology, so while February isn’t an ideal month for TV deals, it’s still possible to find some good deals if you look in the right places. And now that 4K is becoming the new norm (and even 8K is appearing on the scene), 1080p (Full HD) is becoming the new value option.

DealNews reported that in general, mid-size TVs (in the 40″ to 55″ range) have plateaued in discounts, so they are a decent buy any time. Last month, we saw 40″ 1080p sets for consistently around $250; so look for offbrand sets for $240, and name brand sets for $275. Buying refurbished in either of those categories will further increase discounts. For 55″ sets, the spread is a little wider, with off-brand HDTVs going for $300, and name brands starting at $550.

What not to buy?

Don’t buy a new model cell phone yet. Even though the Consumer Electronics Show was last month, typically the spring is when we see the big Android and Windows flagship models debut. That means, if you’re interested in a new HTC or Samsung phone, for example, you should wait until these manufacturers release their new models, so you can score a deal on the previous generation

And free stuff?

Chipotle has given their managers the ability to give out free food to bring people back into the stores. The exact giveaways will be up to each store’s discretion, allowing managers to create their own campaigns, so you’ll need to go in to find out if your local store is offering it. They are also running a Super Bowl promotion where the first 1,500 catering orders of 20 burritos or more will receive a $50 discount.

And to save money on groceries, buy what’s in season. There’s more than you might think.

• Arugula
• Asparagus
• Artichokes
• Beets
• Bok choy
• Broccoli
• Brussels Sprouts
• Cabbage
• Cauliflower
• Carrots
• Celery
• Cilantro
• Clementines
• Dill
• Fennel
• Grapefruit
• Kale
• Lemons
• Lettuce
• Leeks
• Oranges
• Onions
• Parsnips
• Pears
• Shallots
• Sweet Potatoes
• Tangelos
• Tangerines
• Turnips
• Rhubarb

And there are cycles to what’s on sale in your supermarket.
National Canned Food Month: Canned Fruit, Pie Fillings, Vegetables, Meats: Tuna, Chicken, Salmon
National Hot Breakfast Month:  Malt O Meal, Oatmeal, Eggo Waffles, Syrup
Valentines:  Chocolate,  flowers
Chinese New Year: Soy Sauce, Teriyaki Sauce, Noodles, Canned Water Chestnuts
Heart and heart-healthy products (American Heart Month): aspirin, supplements,low cholesterol oils and spreads
Westminster Dog Show February promotions: Dog food from Eukanuba, Pedigree, Purina, and Iams

What do you usually buy in February?

9 Factors That Can Make or Break Your Home Purchase

When it comes to buying a home, we always think about the big things: sales price, location, mortgage qualification. But it’s often the little things that rise up to make living in that home a great joy or a huge letdown.

Positioning of the house

Everyone wants a house that’s light and bright, but what you might not want is a sun that sets right in your living room. If you’re in a warm climate, you can plan on being hotter than you’d like to be in that room during the summer and having higher electric bills.

Closet space

Closet space isn’t necessarily a small thing (for many of us, it’s an absolute necessity!). But, it can also be one of those things that is easily overlooked when seduced by a big kitchen or a pool in the yard. If the closet space seems like it may be a problem when you tour the house, it most likely will be a problem when you’re living in the house.

Your welcome to the neighborhood

There are neighbors who bring warm cookies to welcome you to the neighborhood and then there are the Homeowners’ Associations that welcome you with a stern warning to move your storage unit immediately even though it’s only been in your driveway for a few hours and you haven’t even arrived from your cross-country drive (true story).

The friendliness of your neighbors

Beyond your initial impression, is living in your neighborhood going to give you the kind of lifestyle you want? In many cases, you won’t know until after you’ve moved in. Spending some time there and getting to know your potential neighbors/asking questions before you purchase may give you the info you need.

Where to put the dog bowl

Does it seem like a frivolous thing to be considering when buying a home? Only until you move in and realize there’s nowhere to put the food and water bowls that won’t end up spilled, kicked over, or constantly in the way.

Think about it in terms of a car purchase. You might not notice the number/placement of drink holders in the new car you’re buying, but you’re sure going to notice how lacking they are when you’re driving a car full of people around in the 100-degree summer and there’s nowhere to put your Big Gulps. When your pets are a part of your life, considering where they will graze (and sleep and run) may help you make the best decision.

Placement of the laundry

Is it a deal breaker if your laundry room is downstairs and the bedrooms are upstairs? Probably not, but it does make things more challenging. If you’re trying to decide between a couple of homes, this may be one of the little things that helps you finalize your decision.

Commute time to and from work

Your daily commute is something you’ve probably spent considerable time thinking about, especially if you’re considering moving farther from work. But even if you’re moving equidistant from your existing home, the commute could be very different. And it’s not something you want to discover AFTER you’ve moved. Doing a few test runs before you make an offer can help.

The schools aren’t great

If you don’t yet have kids, or they’re babies, or already grown, or you don’t plan on kids, the quality of the schools may not seem like a big deal in relation to other items on your must-have list. But, you never know how long you might live there. A “starter” home that’s supposed to be a springboard to a large home in a few years may not end up springing you so quickly. And studies show that good schools can help home values, so even if you’re not packing lunches and preparing backpacks, being near people who are might be a good move.

Really high ceilings

This is another feature people tend to want in their home… until they actually have them and realize:

• It’s cold in the winter since all the warm air gets sucked up.
• It’s hot in the summer since conditioned air has a hard time doing its thing in such a vast space.
• You’ll never be able to paint the room without renting scaffolding
• Ditto for changing light bulbs

Market Commentary for the First Week of February

 

This week brings us the release of six monthly or quarterly economic reports that are likely to influence mortgage rates. The week opens and closes with key reports for the markets to digest and in between is some moderately important data. With relevant data scheduled for release four of the five days, we should see another active week for mortgage rates.

The first report comes early Monday morning when December’s Personal Income and Outlays data is posted at 8:30 AM ET. It gives us an indication of consumer ability to spend and current spending habits, making it relevant to the bond market and mortgage rates. Current forecasts call for an increase in income of 0.2% meaning consumers had a little more money to spend in December than they did in November. The spending reading is expected to also rise 0.2%, indicating consumers spent more. Stronger readings would be good news for the stock markets and could hurt bond prices, driving mortgage rates higher. Weaker than expected increases or declines would be considered good news for the bond market and mortgage rates as it would hint that consumer spending is weaker than thought, limiting economic growth.

Also set for release Monday is the Institute of Supply Management’s (ISM) manufacturing index for January. This index tracks manufacturer sentiment by rating surveyed trade executives’ opinions of business conditions. It is usually the first economic data released each month and is one of the very important reports we get monthly. Current forecasts are calling for a reading in the neighborhood of 48.3, which would be a slight change from December’s reading of 48.2. The lower the reading, the better the news for the bond market and mortgage rates because weaker sentiment indicates a slowing manufacturing sector.

Next up is Wednesday’s ADP Employment report at 8:15 AM ET. This release has the potential to cause some movement in the markets if it shows much stronger or weaker numbers. It tracks changes in private-sector jobs of the company’s clients that use them for payroll processing. While it does draw attention, it is my opinion that it is overrated and also is not a true reflection of the broader employment picture. It also is not accurate in predicting results of the monthly government report that usually follows a couple days later. Still, because we see a reaction to its results, it is included in this week’s calendar. Analysts are expecting to see 190,000 new jobs. Good news would be a much smaller number of jobs.

Employee Productivity and Costs data for the 4th quarter will be released early Thursday morning. It can cause some movement in the bond market, but should have a minimal impact on mortgage pricing. If the productivity reading varies greatly from analysts’ forecasts of a 1.7% decline, we may see some movement in mortgage rates. Higher levels of worker productivity is good news for the bond market because it allows the economy to expand while keeping inflation subdued.

December’s Factory Orders data is also scheduled to be posted Thursday morning but at 10:00 AM ET. It is similar to last week’s Durable Goods Orders release in giving us a measurement of manufacturing sector strength, but this data includes new orders for both durable and non-durable goods. It is not one of the more important reports we get each month, however, it can influence mortgage pricing if it varies greatly from forecasts. Analysts are expecting a 2.6% decline in new orders, indicating a softening manufacturing sector. The bond market would like to see a larger decline, meaning that manufacturing activity was even weaker than many had thought.

Friday has the big news of the week. The Labor Department will release the almighty Employment report for January at 8:30 AM ET Friday. Some of the important portions of the report will give us the unemployment rate, number of new jobs added or lost and the average hourly earnings reading. The best combination for the bond market and mortgage rates would be an increase in the unemployment rate, a much smaller increase in payrolls than expected and little or no increase in earnings. Current forecasts are calling for no change in the unemployment rate of 5.0% and approximately 188,000 new jobs added to the economy. Stronger than expected readings will likely fuel a stock market rally and selling in bonds that would cause a sizable upward revision to mortgage rates. On the other hand, disappointing numbers would raise concerns about the strength of economy and would likely lead to a sizable improvement in mortgage pricing.

Overall, Friday is easily the best candidate for most important day of the week although we could see plenty of movement in the markets and mortgage rates Monday also. The calmest day will probably be Tuesday. I am fully expecting to see another very active week for mortgage rates, so please maintain contact with your mortgage professional if still floating an interest rate and closing in the near future.

How To Keep Your Home Clean And Fresh

Keeping your home clean and tidy can sometimes feel like too tough a challenge. But no matter how often you clean, the house seems to get dirty again before the floors have even dried. For those who don’t have hours to spend cleaning, worry not! There are simple, effective ways to keep your home clean on a daily basis. Here are some tips to consider:

Buy doormats. Placing doormats at your back and front doors helps cut the amount of dirt and debris trailing into your home. Placing additional mats outside can help cut even more.

Groom pets daily. Pet hair — especially cat and short-haired dog hair — can invade your home in an instant. Brushing your pets every day — and giving your dogs a bath every now and again — can do a lot to help.

Keep ducts and fans clean. Air vents and ceiling fans build up dust over time. When they’re turned on, that dust is then transferred to your floors and furniture. Cleaning them regularly will reduce the amount of dirt flowing throughout your home. If you need professional help, you can generally get your ducts and vents cleaned for about $330 (the national cost average).

Replace air filters. If the air feels stale or musty, there’s a chance you need to replace your air filter. Do so frequently to avoid too much debris entering into the air. You can also hire a pro to do this for you.

Remove window screens. Window screens don’t really prevent dirt and debris from entering your home — just bugs, really. Unless you have small children, it’s better to remove them; removing the screens will keep your windows cleaner.

Keep storage handy. Storage boxes are always good to have on hand. Keep some broken down in your closet or under the bed for easy access. You can also build shelves for a relatively inexpensive cost.

Organize the coffee table. Coffee tables get cluttered quickly. Make sure you keep only the bare essentials on the table — and clean the table’s surface often.

Make sure your floor is showing. If you have kids or pets, there’s a good chance that your floor is littered with toys. You can teach kids how to pick up after themselves, depending on their age. But with pets, you may need to keep another storage box handy.

Dust Regularly You shouldn’t have to spend hours dusting your home on the weekends. Take a moment or two to wipe off surfaces once a week. This keeps the dirt down and makes your house look a bit shinier.

Create a place for every item. You should have a designated place for every item you use. Racks, shelving — whatever you need to keep everything organized. That way, items don’t end up piled on your dining room table or in the living room.

Written by Andrea Davis

Market Commentary for the Week of January 25th

 

This week is quite busy with six economic reports along with other events that are relevant to bond trading and mortgage rates. In addition to those six reports, there is also a two-day FOMC meeting and a couple of Treasury auctions that have the potential to affect bond trading enough to slightly move rates. There is nothing of importance set for release Monday, but we still should see some movements in the markets due to this weekend’s weather-related news and expected volatility in stocks.

The week’s calendar kicks off Tuesday with January’s Consumer Confidence Index (CCI) at 10:00 AM ET. This report is considered to be of moderate importance to the bond market and therefore can move mortgage rates if it shows any surprises. It is an indicator of consumer sentiment, which is important because waning confidence in their own financial situations usually means that consumers are less willing to make large purchases in the near future. Since consumer spending makes up over two-thirds of the U.S. economy, market participants are very attentive to related data. Analysts are expecting to see a small rise from December’s reading, indicating consumer confidence was a little stronger than last month. A reading much smaller than the expected 96.8 would be ideal for the bond market and mortgage rates. A higher reading than forecasts would hint that consumers are more likely to spend in the immediate future, fueling economic growth and possibly pushing mortgage pricing higher Tuesday.

December’s New Home Sales will be released late Wednesday morning. It is considered to be the sister release to last week’s Existing Home Sales, giving us a small snapshot of housing sector strength. It tracks a much smaller portion of home sales than last week’s report did and is forecasted to show an increase in sales of newly constructed homes. However, this data is not important enough to heavily influence mortgage pricing unless it varies greatly from forecasts.

This year’s first FOMC meeting that begins Tuesday will adjourn Wednesday at 2:00 PM ET. There was a decent chance of this meeting yielding another quarter point increase to key short-term interest rates before the recent sell-off in stocks and oil costs. However, I believe the significant selling in stocks may alter the Fed’s monetary policy plans, at least temporarily. A rate hike is still possible though, so we need to be prepared in case it does happen. Afternoon volatility in the markets Wednesday is a strong possibility following the post-meeting statement release.

Thursday’s only relevant monthly report is December’s Durable Goods Orders at 8:30 AM ET. It helps us measure manufacturing strength by tracking new orders at U.S. factories for products that are expected to last three or more years. These are also known as big-ticket items and include things such appliances, electronics and airplanes. The data is known to be quite volatile from month-to-month, but is currently expected to show a decline in orders of approximately 0.5%. A large drop in orders would be considered good news for bonds and mortgage rates. Even though this an important report, a slight variance likely will have little impact on Thursday’s mortgage pricing because of the large swings that are common in the data. Bond traders would prefer to see a large decline that would indicate weakness in the manufacturing sector.

Friday has the remaining three reports, starting with what is arguably the single most important economic report that we see regularly. This would be the initial quarterly Gross Domestic Product (GDP) reading. Friday’s release is the first of three we will get for the 4th quarter. This data is so important because it is considered to be the best measurement of economic activity. The GDP itself is the total sum of all goods and services produced in the United States. Its results usually have a major impact on the financial markets and can cause significant changes in mortgage rates. This initial reading will be followed by two revisions, each released approximately one month apart. Last quarter’s first reading, which usually carries the most significance, is expected to show the economy grew at an annual rate of only 0.9%. A noticeably weaker reading would be great news for the bond market, questioning the strength of our economy. That would likely fuel stock selling and a rally in bonds that should push mortgage rates lower Friday morning. However, a larger than expected increase, indicating the economy was stronger than thought, will probably fuel bond selling and lead to higher mortgage rates.

The second release of the day will be the 4th Quarter Employment Cost Index (ECI), also at 8:30 AM ET. This index measures employer costs for employee wages and benefits, giving us an indication of the threat of wage inflation. If wages are rising, consumers have more money to spend and businesses usually need to charge more for their products and services. The report is considered moderately important and usually has more of an impact on the bond market than the stock markets. Current forecasts are showing an increase of 0.6%. A lower than expected reading would be favorable to bonds and mortgage rates Friday, but unless we see a large variance from forecasts and no surprises in the GDP, I am not expecting this report to have much of an influence on rates.

The final economic report of the week is the revised reading to the University of Michigan’s Index of Consumer Sentiment just before 10:00 AM ET Friday. This index is another measurement of consumer confidence that is thought to indicate consumer willingness to spend. I don’t see this data having much of an influence on the markets or mortgage rates unless we see a large revision from the preliminary reading of 92.6.

Also worth noting, there are two relatively important Treasury auctions for the markets to digest. The Fed will auction 5-year and 7-year Treasury Notes Wednesday and Thursday respectively. If the sales are met with a strong demand from investors, the broader bond market may improve during afternoon hours. If they draw a lackluster interest, they could lead to bond selling and higher mortgage rates mid-afternoon Wednesday and/or Thursday.

Overall, Wednesday is a pretty safe bet as most important for mortgage rates but Friday is also a key day. Wednesday has the FOMC meeting adjournment that is always big news and Friday’s GDP report is highly important also. And stocks can affect bond trading and mortgage pricing any day, as we have seen with all the recent volatility. With all of this scheduled, there is a decent chance of seeing a very active week in mortgage rates this week. Therefore, please maintain constant contact with your mortgage professional if still floating an interest rate and closing in the near future.

Easy Ways to Pay Down Your Mortgage

 

It may seem a huge task – paying down your mortgage early. But you’d be surprised how small things can make a big difference and give you a great sense of security and freedom.

The first is one you’ve already heard. Instead of paying one payment a month, split the amount in half and pay twice a month. You may think you’re paying the same amount wouldn’t have any impact, but you’re paying down the principal faster thus making the interest accrue less quickly.

If you get a windfall or bonus, instead of spending the money, make a lump sum payment on your mortgage. If you got a holiday bonus, make an extra payment on your mortgage in January. It will go completely towards the non-interest portion of your loan and reduce the amount you owe for the rest of the year.

 

For example, a $500,000 mortgage with an interest rate of 4.53 percent (the rate as of January 2, 2014 as reported by Freddie Mac), would have a monthly payment of $2,542. By making an extra payment of the same amount at the beginning of the year, you will shorten the loan payoff from 30 years to 26 years.

 

While four years may not seem like a huge difference, that time translates into big savings. By paying off this home loan four years early, you would save $67,582 in interest.

If you have an adjustable rate, and the amount you’re supposed to pay every month goes down, keep paying the same amount. You’re used to paying it, and once again, the extra will go towards paying down the principal.

So why do I keep bringing up paying down the principle? Did you know that with a 30 year mortgage at 7%, that about 80% of all your mortgage payments during the first 5 years of the loan are interest? The sooner you start chipping away at the base amount, the less you’ll pay over the term of the loan.

So what are some other ideas?

Talk to a reputable loan officer about refinancing. As we mentioned in a prior post, there are refinancing options out there that will allow you to get a lower interest rate for the same term that you’re at. So if you’ve been paying for four years, you can refinance for 26 years rather then 30 again.

If your credit card offers you money back, use the money towards your mortgage.

And finally, always round up the payment each month. So if you were paying $2349, you could round it up to $2400 or even $2500.

What are some other small ways you could pay down your loan faster?

What You Need to Know About Powers Of Attorney

  Imagine if you needed to sell your home, but your spouse is currently unable to sign the sales contract. This could be because he is physically and mentally unable to make decisions or sign legal documents or she is stationed outside the United States and unable to sign the documents.


What can you do?

You need a document called a “power of attorney”, whereby your spouse signs a legal document authorizing you to act on his/her behalf. The giver of the power of attorney is called the Principal.

The receiver is generally called the “attorney in fact”. The latter is given the right to act on behalf of the principal, for the purposes and functions spelled out in the legal document.

There are two types of Powers of Attorney:

General

Here, the principal authorizes the attorney in fact to take any and all actions as if the principal was taking them himself. This is also known as a Durable Power of Attorney.
Keep in mind that your own State law may have specific requirements in order to sell real property by way of a Power of Attorney. Some states will not permit real estate to be conveyed by a General power of attorney.

Specific

And here, the principal gives specific information and instructions to the attorney in fact. For example, sell my house located at 123 ABC Street; or write a $1,000 check to my insurance company from my bank account. The specific instructions are contained in the legal document, and the attorney in fact has no authority to exceed those instructions.

If you plan to sell your house, and find yourself in the situation where one party in title will not be available to sign contracts, deeds or other legal documents pertaining to the sale, it is best to have your attorney draw up a Power of Attorney that meets your needs, as well as the legal requirements in the State where your property is located.

The principal may want to put a time limitation on the Power — for example one or two months. However, with a durable power of attorney, the principal normally does not place any such limitations. The purpose of a durable Power is to assure that in the event the Principal becomes incapacitated, his attorney in fact will be able to step in without having to go to Court.

Let’s go back to our example. If your spouse knows in advance that he/she will be out of the country when you want to sell your house, have the Power of Attorney executed before the trip starts — and give a long lead time before the Power expires.

However, if you do not have a Power of Attorney and your spouse suddenly has a stroke — or is otherwise unable to comprehend and sign legal documents, then you will have to go to your local Court and seek permission to become the Conservator of the Estate of your spouse. This is a relatively easy (but potentially time consuming and expensive) process. The Courts, however, want to make absolutely sure that you are sincere in your efforts to represent your spouse and that your spouse is, in fact, not able to sign any legal documents. There is a lot of fraud involved, such as situations where children try to use the conservatorship route to take away property from their parents; accordingly, the Court will also look carefully at all of the facts, and if possible, will even interview the person to whom the conservator will be appointed. I once attended an interview where the Judge went to the hospital to make sure that no one was taking advantage of the sick person.

Preventive law is the key; consider obtaining a durable power of attorney now, while you both are in good health. Each spouse should sign a separate document, making the other spouse the attorney in fact. However, an alternative attorney in fact should also be designated, just in case both of you become incapacitated at the same time.

Your local attorney should be consulted to make sure you are using the proper forms and that you fully understand the consequences of your actions. A Power of Attorney gives someone else the right to sell your house, and you want to make sure that you are not giving away the store.

Written by Benny L. Kass