Holiday Spending: Beware of the Dangers


Holiday Spending: Beware of the Dangers 


A recently released financial report provides stark insights into current financial realities as we head into the holidays this year ...


The report, a collaboration between PYMNTS and LendingClub, states that:

  1. 79% of their survey respondents said they will be shopping during the 2022 holiday season.  That's nearly a 9% drop from the 88% that shopped last year
  2. Roughly 40% of those holiday shoppers will use financing tools of some sort (credit cards, personal loans or buy now, pay later (BNPL) options) to put gifts under the tree  

The statics concerning the use of financing tools ... credit ... is cause for real concern.  I've addressed this specific concern in prior posts, but my message bears repeating given the rising numbers of those considering credit as a means of paying for their holiday expenditures.  

Credit and financial "dangers" lurk 

everywhere while Holiday Shopping!  

And as a loan officer, I've seen these dangers manifest themselves negatively way too often (even once is one too many).  I know for a fact after viewing many mortgage applicants' credit reports and banking account(s) that:  

Holiday-related expenditures can (and have) contributed directly to applicants' ongoing financial and credit challenges.  Both their credit reports and bank accounts provided spoke to that being so.  The accounting reads like a timeline of their spending activities and credit actions.  

Whether it was overspending, spending dollars they really didn't have, opening new credit to take advantage of discount offers, or more, they did damage to some degree to their finances, credit, and options for mortgage financing and home buying.  As holiday shoppers, they didn't guard their credit or protect their finances.  

So how do you avoid the same fate when you shop?

Just say "NO" to overspending and new holiday credit offers unless one of the following applies: 

  • Your Credit/Credit Score can withstand a new credit inquiry
  • You can handle the new debt caused by the new card
  • You can make monthly payments on time, consistently, and faithfully
  • You will NOT be making application for a mortgage
  • You are NOT already in the mortgage process
  • You are NOT hoping to buy a home in the near future
  • You are NOT maxed out on present credit cards
  • You have NOT already applied for other stores/credit cards
  • You know ALL the terms of the new credit account associated with the offer
  • You know what other credit obligations you have and the total of ALL your debt
  • The "enticement" offer is so valuable it offsets the negatives of taking on more debt
  • You have NO credit history and are trying to establish one for a future home purchase

Times are challenging right now.  There's no denying that.  And while planning, preparing, and establishing spending rules for holiday shopping expeditions and spending is always wise, this year it's become even more so. 

Planning how and where you're going to shop will help.  Compile a shopping gift list that includes:
  • A budget:  What is the total dollar figure you have to work with?
  • Names:  Who will you want/need to buy gifts for?
  • A Breakdown:  How much of that allotted budget will you spend on each individual gift recipient?
  • Gift Ideas:  What ideas fit the planned expenditure for each gift recipient?  

No matter your future plans and goals, but especially if hoping to buy a home soon or at some point down the road, you'll be so glad that you established and stuck by the holiday shopping rules you set.  Your overall budget will remain intact and your credit report and scores will prove advantageous to meeting all your financial needs and goals.

Shop smart and enjoy your Holiday Season!



Are you hoping to Construct, Buy, Refinance or Purchase
 a home or investment property in Chicagoland or somewhere else in Illinois or Wisconsin?

Looking for mortgage financing answers, options, solutions, and experienced assistance?  
Contact me! I'll put my 40 years of Mortgage experience and expertise hard to work on your behalf.
I'm easily found at:

Gene Mundt

Mortgage Originator -NMLS #216987 - IL Lic. 031.0006220 - WI License #216987

American Portfolio Mortgage Corp
NMLS #175656

Direct: 815.524.2280
Cell/Text: 708.921.6331
eFax: 815.524.2281


   



Gene Mundt, Mortgage Originator, an Originator with 40+ years of mortgage experience, will offer you exemplary mortgage service and advice when seeking: Conventional, FHA, VA, Jumbo, USDA, and Portfolio Loans in Chicago and the greater Chicagoland region, including:
The Lincoln-Way Area, Will County, (New Lenox, Frankfort,
Mokena, Manhattan, Frankfort Square, Joliet, Shorewood, Elwood, Lockport, Wilmington, Crest Hill, Symerton, Braidwood, Channahon, University Park, Beecher, Plainfield, Bolingbrook, Romeoville, Tinley Park, Homer Glen, Crete, Peotone, Naperville, etc.), DuPage County, Kane County, Grundy County, the City of Chicago, Cook County, and elsewhere within IL & WI.

#WillCountyCommunities #PreApproval #mortgageconsultation #positioning #housingmarket #mortgageapplication #InterestRates #homebuying #refinancing #homeloans #talkwithalender #stoprenting #newconstruction #securerate #househunting #mortgage #ratelock
#GeneMundt #NewLenoxMortgageLender #ChicagolandMortgageLender #NewLenoxRealEstate #MokenaRealEstate #mortgageexpert
#FrankfortRealEstate #LincolnWayHighSchoolDistrict #LincolnWayHighSchoolCommunities #howmuchhomecanIbuy 
#whatinterestratecanIget #timing #mortgageexpert #moneytalk #homeloansmadesimple #experiencecounts 
#homebuilding  #askquestions #housegoals #VAloans #home #homeloanpro #JolietMortgageLender #WillCountyMortgageLender #DuPageCountyMortgageLender #GrundyCountyMortgageLender #ChicagoHomeLoans #mortgageinfo #newconstructionloans #endloans #credit #creditreport #40YearsOfExperience #WisconsinMortgageLender #ChicagoMortgageLender #FHAloans #condoloans #investmentproperty #mortgageconsultation #LincolnWayAreaMortgageLender #personalfinance #mortgageprocess #homebuyingprocess #housingmarket 
#FHA #condominiums #FHACondoFinancing #investmentproperty #WillCounty #HolidayFinances #HolidayShopping #HolidayCreditOffers 
 #JustSayNoToNewCredit #holidays #stayingsafe #ChristmasShopping #credit #debt #ShoppingList #budget


  

No comments:

Post a Comment

Thank you for taking the time to read and comment on my post!

Procrastination Does Not Pay When You Hope to Finance a Home

  Procrastination Does Not Pay When  You Hope to Finance a Home   “If you want to make an easy job seem mighty hard, just keep putting off d...