January 5, 2009

Credit Card Companies Closing Accounts

Have you had a credit card company notify you they were cancelling or closing an account you had with them?

Many card issuers are doing just that. Credit-card companies lose money on dormant accounts, and as they feel the economic pinch, they’re more apt to close them. Unfortunately, closing a credit card account can lower your credit score. The length of time your accounts have been open is the third most heavily weighed factor in your FICO score (after timeliness of payments and the amount you owe). Plus, eliminating a card reduces your available credit, which could also lower your score.

Some card companies will consider reopening inactive accounts, especially if the account was recently closed and the customer had been with the bank for a long time.

Tip: If you have a lot of other cards and a credit score of 720 or higher, one closure won’t have much effect on your score. But if you have a slim credit history and few cards, it’s wise to make sure your oldest accounts stay active. So use your card at least once every three or four months. Then be sure to pay it off every month so you’re not racking up big interest charges.

What about you? Have you had a card canceled by your credit card company? Tell us about it. Were you able to get them to change their tune? Use the comment link below to sound off. Your email address will NOT be revealed when your comment is published here.

Filed under Most Recent Post by RE/Max equity group, inc.

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January 4, 2009

How the Fed Rate Affects Mortgage Rates

Fixed-rate mortgage rates, though not directly tied to the Fed Funds Rate, have been responding positively to market rate cuts over the past few months.

Just as an overview, the Fed Funds Rate has a strong (if not direct) affect on the following:

credit card rates
adjustable-rate mortgages
interest on savings accounts
Prime Rate (home equity lines are based on this)

If you're considering refinancing or purchasing a home, now is the time. With rates at these levels, you'll enjoy more house or mortgage for the same payment. Just lowering your rate 1% on a typical $200,000 mortgage can save you about $125 a month or $45,360 for the life of your loan.

And don't forget, housing prices are the lowest they've been in generations. The opportunity to purchase a home with a low price and low rate is unprecedented. Real estate investors who do their homework and invest wisely can also get deals they couldn't have even dreamed about just a few years ago.

Thanks to the Fed Funds Rate dropping to the lowest level in history, mortgage rates have also dropped.

Waiting may be one of the costliest decisions you've ever made!

Filed under Mortgage Info, Most Recent Post by RE/Max equity group, inc.

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January 3, 2009

Appliances: When to Repair - When to Replace

The hot water is no more, or the furnace makes you pull out the blankets. Perhaps your washing machine just spun it's final load.

The question becomes, Fix it, or junk it?

If an electronic device cost less than $200, junk it without further thought. Repairing a relatively inexpensive item like a cordless phone or countertop microwave is not cost-effective.

The repair-or-replace question is directly tied to how much longer you can expect the product to last. You can get data on the life expectancy of all sorts of home components, from faucets to refrigerators, at the National Association of Home Builders website (nahb.org). Your results may vary, depending on the quality of your model and how religious you've been about routine maintenance.

In a few cases, there may be new bells and whistles that render your old appliance obsolete — or simply unwanted. For example, most professional advice will tell you it's never worth making major repairs to a top-loading clothes washer. In addition, clothes dryers haven't improved much in basic function over the years.

If you have any questions about whether to repair or replace an appliance or component in your home, do some research. Try posting your dilemma at Applianceguru.com, or post your question or comment here… someone may just answer you with the advice you need.

Filed under Home Improvements, Most Recent Post by RE/Max equity group, inc.