Beating the Credit Crunch

For the average American family, pretty much every regular expense — from gas and groceries to utilities — is significantly pricier than it was a year ago.

The price of regular unleaded gasoline has been erratic, of course, but has been up 30% at an average price of $3.60 a gallon, according to AAA.  Meanwhile, the price of another gallon-portioned product — milk — is 10% higher at $3.87, according to the USDA.

The end result: Consumer spending remains at its weakest level in six months (this, of course, is also a result of rising unemployment, the housing meltdown and the credit crunch).  Nearly 60% of Americans are worried about running out of money, according to a recent survey by market researcher The Harrison Group.  And forecasters expect consumer spending to actually fall by 1% to 2% during the third quarter — the first decline in 17 years.

Much of that pullback will occur as families opt to forgo nonessential purchases such as vacations and clothing.  However, some of monthly expenses — like utility bills and prescriptions — can’t be so easily cut.  Here are ways to reduce spending in five essential categories — without feeling too terribly short-changed.

Internet, cable and phone services

Odds are good that your cell phone, cable, Internet and telephone plans offer you more services than you actually need or use, says David Carnoy, executive editor for CNET, an electronics review site.  Check each service agreement to ensure you’re not paying for unused extras.  A common culprit: the speed of your high-speed Internet.  Providers offer several tiers.  Unless you’re an online gamer or frequently download large files, choosing the slowest speed will often do, he says.  For a New Jersey family, the difference between Comcast’s basic and faster high-speed Internet packages is $10 a month.

Also, to save on your cable bill, try calling your provider and threatening to cut back on your plan or to take your business elsewhere.  Carnoy was immediately offered a $10-per-month discount when he called to cancel a premium-channel subscription.


For a long time, buying store-brand items meant sacrificing quality, says Mandy Walker, senior projects editor at Consumer Reports’ ShopSmart magazine.  Now, the same manufacturers that produce your favorite brands also churn out store-label goods.  “They’ll literally stop the conveyer belt and slap on a different label,” says Teri Gault, founder of shopping site The Grocery Game.  “Most are nearly identical.”

That improved quality — along with the 20% to 50% discounts over big-name brands — is good news for shoppers.  Here are a few nearly foolproof swaps that Walker and Gault like:

Paper and plastic goods.  Even store-brand paper towels are just as absorbent as the big-name brands, says Walker.  Frozen fruits and vegetables.  There’s no noticeable difference.  Organics.  They must pass the same USDA standards that brand names do, says Gault. Spices.  They impart the same flavor.


Unless your ride is a Ferrari or other luxury, high-performance car, stick to regular gasoline.  Premium fuel does boost engine performance — but only in vehicles designed for it, says Phil Reed, consumer advice editor for auto pricing information site  Even models that recommend (but do not require) high-end fuel usually run fine on regular.  “In most cases, it would be completely unnoticeable,” he says.

Where you will see a big difference is your wallet: When the national average for a gallon of regular unleaded was $3.60 according to AAA, premium was 27 cents higher.  Someone filling the 18.5-gallon tank of a Honda Accord once a week would save $20 a month.

Prescription Drugs

The FDA must certify all generic medications (including over-the-counter products) as having the same quantity of active ingredient, and no significant difference in performance, says Gabriel Levitt, vice president of research for pharmacy-rating site  Going generic could cost you as much as 50% less.  Just ask your doctor to note on prescriptions when the generic equivalent is OK.

Even if you’re insured, tiered co-pays can offer substantial savings for switching to generics, says Tod Marks, senior editor for Consumer Reports.  Blue Cross Blue Shield New England, for example, charges $5 for most generic medications, compared with $10 to $25 for brand names.  Fill a prescription through Target’s or Wal-Mart’s $4 generic prescription program, and save even more.


Dialing back your thermostat a single degree cooler for an eight-hour period each day during the winter heating season can slash your bill by up to 5%, depending on your climate, according to the Alliance to Save Energy.  Use a programmable thermostat to control your inside temp that way and save an average of $180 a year.


By: Kelli B. Grant,



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A little humor.

Doctors’ Opinion of Financial Bail Out Package:

The Allergists voted to scratch it, and the Dermatologists advised not to make any rash moves.
The Gastroenterologists had sort of a gut feeling about it, but the Neurologists thought the Administration had a lot of nerve, and the Obstetricians felt they were all laboring under a misconception.
The Ophthalmologists considered the idea shortsighted. The Pathologists yelled; ‘Over my dead body!’ while the Pediatricians said, ‘Oh, Grow up!’
The Psychiatrists thought the whole idea was madness, the Radiologists could see right through it, and the Surgeons decided to wash their hands of the whole thing.
The Internists thought it was a bitter pill to swallow, and the Plastic Surgeons said, “This puts a whole new face on the matter.”
The Podiatrists thought it was a step forward, but the Urologists felt the scheme wouldn’t hold water.
The Anesthesiologists thought the whole idea was a gas, and the Cardiologists didn’t have the heart to say no.
In the end, the Proctologists left the decision up to the “folks” in Washington .

Sometimes, we have to remember that one of our greatest assets is our sense of humor.

Market Update, It’s going to be a Wild Ride!

After just returning from Disneyland with my family, this market reminds me of “Mr. Toads Wild Ride” or for older Disney fans, “California Screamin’ “.

Rates are going to be volatile this week. We will likely see many rate changes throughout the day. Last week rates hit a low of 5.75% but this morning we are at 6.375%.    The Feds are meeting this week and most analysts believe they will lower the Fed rate by at least .5%, unfortunately, this rate is not directly tied to mortgage rates.  Rates worsened again today because mortgage bonds continue to slide and remain near their widest levels from Treasuries.

Funds are starting to be injected to some of the banks this week; let’s hope that will help unclog the lending markets.

Consumer confidence was the lowest on record this morning for October.

Housing prices in 20 major metro areas fell 16%.

This week is full of reports and meetings, so what I guess I am trying to say, is to hang on and make sure you lock in a rate, so you are protected.  On a positive note, home sales were up 2.7% and inventories are down, getting the market closer in check.  It is still a great time to buy, even though rates are up this week, rates are still great!  Remember the 1970-80’s?




More about the USDA loan program.

 I briefly mentioned this program in my last blog. I thought I could address a few more details for those of you who may be looking at homes in a rural area or know someone that really wants to get into a home but doesn’t have a down payment.

 The United States Department of Agriculture (USDA) has a loan program targeted for rural communities. Yes, I know that they stamp the approval on the beef that we eat, but they also govern several non-food related sectors. The program is similar to other mortgages offered by Landmark Mortgage. Much like an FHA loan, USDA does not service the loan. The government entity provides a security or guarantee to the bank. If the borrower were to default then USDA will step in and fund the loss to the bank.
The USDA rural development home loan program is available for those who are looking to purchase a primary residence and do not own any other properties. It is a great option for a first time home buyer. To qualify for the loan the borrower’s income must fall below the maximum income limit based on the size of your family and county in which the property is located.
In the Willamette Valley there are several great opportunities for this program. With “rural development” being the key term in this program, it is important to know that most Salem, Keizer, and Albany homes will not qualify as being located in rural communities. However, most towns surrounding these areas qualify. USDA states that most towns with a population less than 25,000 should qualify. To check if a specific address is eligible for this loan visit the USDA property eligibility website.
Because other than the government guaranteed VA (veterans) loan, USDA is the only other option for 100% financing.

For specific details about this program or to see if you qualify please feel free to contact me at


Can I still get a mortgage loan?

A question on many peoples mind is whether or not they can still get a loan in todays market?  The answer is yes!  There are still many programs and plenty of money out there to lend.

 The dilemma(which is really just a mindshift) that consumers face now is that we have to return to basics.  We need to save money and have good credit and control of our credit, meaning we can’t have too much.  This is not a detriment, this is a good thing in our lives. We need to remember to not stretch ourselves too thin and return to the ideas of living within our means.  Without the stress of worrying about paying the bills, our lives will be richer and full of more enjoyment!

When I first started my mortgage career, in 1993, the only program that did not require a down payment was a VA (veterans) loan.  We have returned to that mind set in the mortgage industry.  A VA loan is a great benefit to those individuals that give so much of themselves to keep our Country free! 

FHA loans only need 3% (until Jan 1st when the down increases to 3.5%).  This is a great first time homebuyer program. This is how I purchased my first home and many others did as well. FHA has great interst rates, lower mortgage insurance and the down payment can actually be a gift from a relative. So you truly could still buy a home with little or none of your own money. 

There is one other program that will stll allow 100% financing. The Rural Development program. The only caveats are that the property must be in a rural area and there are income limitations as well. Please call me to discuss this option and see if it would work for you.

I don’t want this spot to be a laundry list of what we can do, but I did want to give you a brief taste that yes there are still loans out there for you! Call me today and we can discuss your personal situation and find a loan that would work best for you either now or in the future. 

A goal of home ownership is powerful, it gives you something to work towards and a reason to celebrate once its achieved!

My Introduction To The Blogging World

I have been serving the residential lending needs of clients for 15 years.  I have been at Landmark since 1997. My hope for this blog is that you will now have a reputable and truthful place to verify what is going on in the mortgage industry. We all know there are a lot of half-truths and misrepresentation out there. I will do my best to keep you informed and updated during this uncertain time for mortgage lending. Please check here regularly for updates and tips regarding the mortgage industry.