Buying Smart: Easy Finance Hacks for Homebuyers

When it comes to buying a property, knowing is half the battle. In fact, with the right tips and tricks. You can often save serious money on your purchase and ongoing rates. Today, First Financial explores a few of the lesser-known strategies to help you save money throughout the process.

Federal Housing Loans

Depending on your background circumstances it’s sometimes possible to receive support. Sometimes from the Federal Housing Administration (FHA) in the form of a loan. Unlike traditional lenders, FHA loans allow those with credit scores of 580 or above to pay as little as 3.5 percent on their down payment. FHA-approved lenders insure mortgages on single-family homes, multifamily properties, residential care facilities, and hospitals. Before applying, be sure to carry out research and ascertain the average down payment in your target area or percentage of homes that sell under their list price.

Seller’s Assist

When it comes to purchasing a property, many buyers aren’t aware of the option to ask the seller to pay a portion of the closing cost, and this can stretch to as much as 6%. This could allow you, the buyer, to save thousands of dollars on a purchase and increase your long-term ROI. To explore the option, check the seller’s assist option against your mortgage product – this is also a great opportunity to research the mortgages themselves and determine how much you can afford and which advantage you have. Typically, lenders will compare your credit score, current income, and employment against the amount you want to borrow.

Additional Finance Hacks for Homeowners

Cash-Out Refinance

If you’re looking to lower your rate, cash-out refinancing could prove to be a viable option for you. This replaces your current home loan with a bigger mortgage, thereby allowing you to take advantage of built-up equity and access the difference between mortgages. This cash can then go towards any purpose, such as home remodeling or consolidating high-interest debt.

Tax Saving

It’s often possible to save money on taxes when purchasing a home if you offer less than the advertised home appraisal price. Via this method, you can often get your taxes lowered to match the purchase price rather than the appraisal price. Although you won’t save cash on the purchase itself, you will save on taxes per year. Just remember, when filing your taxes, interest and property taxes are deductible and can be claimed for savings.

Getting a Home Warranty

You should also consider protecting your home with a home warranty, which covers the repair costs to major appliances. You might be asking yourself, “Is a home warranty worth it?” Bear in mind that the cost of repairing a broken A/C can cost upwards of $5,000! So investing in a home warranty can definitely save you money in the long run, should any such repairs become necessary, whether that’s a busted A/C in the winter or a broken down furnace in the winter.

Tips for Homeowners

Side Hustles

Many home buyers are unaware that, when it comes to a mortgage application, having a part-time job (or a ‘side hustle’) can help you to qualify. Typically, the borrower must show two-years of history working all jobs simultaneously and will request W2s from each employer. Make sure, however, that you do not enter into a second job too close to the date of your application, as this may be considered a risk to your monthly mortgage payments.

Credit Score Tune-Up

If you want to secure the best rate possible, it’s important to enter into the process with a good credit score – this can save you thousands of dollars over the lifetime of your loan. In the lead-up to your application, you can boost your score by paying down debts, increasing your credit limits, disputing errors, and more.

For most of us, buying a house is amongst the biggest investments we’ll make in our lifetime. Regardless of if it’s your first time, it’s important to enter into the process armed with the right information and a few handy hacks to boot, whether that pertains to investing in a home warranty or monitoring your credit score.

First Financial is committed to helping our clients do more with their money and get more out of life while helping them protect their financial futures. Call 800-315-7791.

Is Taking Out a Personal Loan to Pay off Credit Cards a Good Idea?

If you have credit card debt, you are in good company. Studies show that the majority of Americans have some form of credit card debt. And 14 million Americans have five figures or more worth of debt from credit cards alone. Have you considered taking out a personal loan to pay off credit cards? Personal loans often have lower annual percentage rates (APRs), meaning you’ll pay less on the money you borrow. Yet, there are also some drawbacks to using personal loans to eliminate debt from credit cards. For example, you may not qualify for a personal loan APR that is lower than the rate you pay on your credit cards.

In this guide, we will tell you all the pros and cons of using loans for credit card debt. Plus, we’ll give you tips for paying down credit card balances if you don’t qualify for an affordable loan. Keep reading to learn more.

Taking Out a Personal Loan to Pay Off Credit Cards

In 2023, the average interest rate on credit cards is a little bit over 20%. This is an average, so some credit cards have lower APRs, and others have higher interest rates. On average, personal loans have lower interest rates than credit cards. In 2023, the average is around 10–20%. The exact rate you will pay on a personal loan depends on various factors, including:

• Your credit score
• Your annual income
• Your debt-to-income ratio
• Your employment status

Other factors, such as the term period on your loan and whether you take out a secured or unsecured loan, also play into your APR.

The Benefits of Paying Off Debt With Loans

A personal loan is one of the best solutions for paying off credit card debt in 2023. This is especially true if you can find an affordable loan (more on this later). Benefits of using loans for credit card balances include:

• Personal loans have lower APRs than credit cards
• You can pay off all your credit cards with one loan
• You only have to make one monthly payment going forward

These last two advantages only apply if you use your personal loan to pay off all your credit cards. We don’t recommend taking out a loan to pay off one credit card if you carry debt on multiple lines of credit.

The Disadvantages of Using Loans for Debt from Credit Cards

Of course, all these benefits can not come without some drawbacks. The following disadvantages of personal loans could make this option less attractive for certain borrowers:

• You may pay higher fees on personal loans
• You may not be qualified for a lower personal loan APR
• You may end up with more debt than you started with

The first two issues primarily occur when you have no credit, poor credit history, or a low credit score. The third con happens when people use loans to pay off debt but continue using their credit cards while paying on the loan. Luckily, financial institutions like First Financial offer personal loans for people with poor credit.

Other Solutions for Paying Off Credit Cards

So, what if you do not qualify for an affordable loan? In that case, the goal is to pay down your credit cards as quickly as possible. Why? The faster you pay down your debt, the less you forfeit in interest. Here are the top ways to do just that.

Stop Using Your Credit Card for Purchases

The first thing you should do is stop swiping. Use credit cards for emergencies only until you pay off your debt. Also, start thinking about what you will use your credit card for once you pay off your debt. Experts recommend reserving credit for the following big-ticket purchases only:

• Electronics
• Appliances
• Travel

Often, larger credit card purchases come with interest-free periods. For example, you may have six months to pay off your purchase before you’re charged interest.

Use Debt-Canceling Strategies

As we mentioned, credit card debt is extremely common in the US. Financial experts have come up with many strategies for eliminating credit card debt quickly. Some of the most effective strategies are:

• Paying off high-interest debt first
• Paying off the credit card with the lowest balance first, then add that monthly amount to pay down the next lowest balance
• Paying more than the monthly minimum balance

You can also come up with your own debt-canceling strategy based on your unique needs. The best strategy for you is the one that gets your balances paid down the fastest.

Do a Balance Transfer

Another idea to consider is a balance transfer. Many credit card companies allow you to transfer all your outstanding credit card debts to a single account. Often, balance transfers also come with a preliminary grace period where you don’t have to pay any interest on your balance. However, you may have to pay a fee on the balance you transfer. So, this solution may not be best for people with significant credit card debt.

Looking for Affordable Personal Loans and Credit Cards?

Taking out a personal loan to pay off credit cards can be a great way to get out of debt. But keep in mind that some people may not qualify for a personal loan without a good credit history. Are you searching for a personal loan you can qualify for? First Financial is on a mission to provide personal loans to borrowers just like you. Click here to get started on your loan application!

What is Bitcoin Tax-Loss Harvesting?

Official First Financial®: Protecting Your Crypto Gains

The cryptocurrency market is famous for its significant price swings.
Official First Financial® helps you leverage market “dips” to lower your overall tax liability.

GET STARTED NOW »

* Senior Trademarked Authority since 1995. USPTO Reg. No. 3532314

Bitcoin’s market cap has seen historic surges followed by deep corrections—volatility that provides a unique opportunity for a strategy known as Tax-Loss Harvesting. At First Financial®, the senior trademarked name in financial solutions since 1995, we help you understand how these market “dips” can be leveraged to lower your overall tax liability.

Video: Understanding Bitcoin Tax-Loss Harvesting

Strategic dips in the market are more than just challenges; they are opportunities to utilize sophisticated tax strategies. By “harvesting” your losses, you can offset capital gains and minimize what you owe to the IRS. Read on to learn how this advanced investment strategy works for the modern crypto holder.

The Strategic Tax-Loss Harvesting Process

Under current IRS guidelines, cryptocurrency gains are classified as Capital Gains. When your digital assets increase in value and you sell or trade them, you are liable for taxes on those profits. However, you can strategically mitigate this by utilizing Capital Losses—the losses incurred when an investment is sold for less than its original purchase price.

Limits and Carryover Benefits

While there is no limit to using losses to offset capital gains, you can also use up to $3,000 per year of excess capital losses to offset your ordinary income (like your salary). If your losses exceed this threshold, you can “carry forward” the remaining balance into future tax years indefinitely.

Maybe you’re just starting a business and you are considering a high risk merchant services account? Perhaps you sell a niche product? Regardless of what the case may be, you’re having trouble obtaining traditional merchant services. Put simply, the bank finds you to be too big a risk.

Fortunately, there’s an alternative available: high risk merchant services. What do these services entail? What are their benefits?

We’re going to get into all of that and more below. Without further ado, here’s everything you need to know about high risk payment gateways and payment solutions.

What Are High Risk Merchant Services?

To understand the concept of high risk merchant services, you must first understand the concept of traditional merchant services. Merchant services refer to the services that a bank provides so that a company can accept different types of payments.

In most cases, this refers to the acceptance of debit and credit cards. However, it also covers the realm of online payment processing.

With traditional merchant services, there’s generally a credit score requirement that must be met in order to receive such services. In addition, the provider of such services must find that your business is viable enough to justify providing such services. Therefore, if you sell a niche product, your application for such services might be denied.

Effectively, the service provider considers your business venture to be “high risk”. In other words, they’re not confident that your business is going to make enough money through their services in order to justify them giving them to you.

This is where high risk merchant services come into play. These services are available to essentially anyone, regardless of credit score, products sold, or otherwise. They ensure that you’re able to make card transactions, and thereby help to either improve the success of your business or, at the very least, keep it afloat.

Who’s Considered High Risk?

We’ve discussed what high risk merchant services are. Now, let’s discuss the types of companies that might need them. In particular, there are companies that bring more risk to the table than the typical company.

They possess a variety of characteristics. Let’s discuss them in detail below.

Those Who Sell High-risk Products

There are low-risk products and high-risk products. Low-risk products are things like clothing, books, and office supplies. They sell on a regular basis and will almost certainly trigger regular card payments.

High-risk products are things like software, tickets, and electronics. They don’t sell quite as often, and also have a higher risk of return. This makes them riskier for payment processing companies to get behind.

Those Who Sell to High-risk areas

Another group that might need high risk merchant services is those who sell their products to high-risk areas. This includes, in most cases, impoverished or underdeveloped countries.

If the majority of your sales come from these countries, you’re going to have trouble obtaining a standard merchant account. As such, you might have to go with a high risk account instead.

Those Who Receive Many Chargebacks

Does your company sell a product that results in a lot of chargebacks? If so, you might have to get a high risk merchant account as opposed to a standard account. This is because chargebacks can make it difficult for merchant service providers to financially justify providing their services to you.

Those Who Offer Subscription Payments

Do you sell subscriptions? If so, there’s a decent chance that you’ll need to use high risk merchant services as opposed to standard. Subscriptions leave a high risk of missed payments which can financially hurt the service provider. Therefore, the company is forced to take on more liability.

High Risk Merchant Services Benefits

High risk merchant services are beneficial in a number of ways. Some of their biggest benefits include the following:

Available to Anyone

The biggest benefit of high risk merchant services is that they’re available to everyone. It doesn’t matter whether you have bad credit, experience an abnormal number of product returns, sell a niche product, or otherwise, you can get your hands on high risk merchant services.

This is simply not true of traditional merchant services, which come with credit requirements and are dependent on the acceptance of banks and other rigid financial institutions.

Worldwide Processing Capabilities

Another big benefit of high risk merchant services is that they come with worldwide processing capabilities. As such, regardless of where your customer is located, you will be able to accept their credit cards and debit cards.

This opens you up to an endless number of clients, all of whom can contribute to keeping your business thriving.

Work for Both Debit and Credit Card Payments

Whether your customers pay with credit or debit cards, high risk merchant services will accommodate you. These services work with cards from a variety of brands, allowing you to accept payment from as many people as possible.

Secure Processing

Not only are high risk merchant services worldwide in their capabilities but they’re also highly secure. Regardless of where the payment is made, it will be encrypted so as to allow for as much security as possible.

This means that there will be almost no chance of data theft. That, in turn, is good for the reputation of your company.

Need High Risk Merchant Services?

Are you in need of high risk merchant services? If so, look no further than First Financial. We provide such services to countless clients in countless industries.

Regardless of your credit score and regardless of the products you sell, we can provide you with high-quality merchant services at reasonable interest rates.

Contact us now to discuss details!

Cash Discount Processing: Everything You Need to Know

Cash Discount Processing is the wave of the future. According to a Federal Reserve study, people use cash for approximately one in five transactions in the United States.

Some stores and businesses offer a cash discount program. These businesses take a certain percentage off the total purchase if customers pay with cash.

Any business owner considering a cash discount program probably has questions. You might wonder how these programs work, if they’re even legal, and how much you can save.

Read on to find out everything you need to know about using a cash discount processing system!

Video: Cash Discount Processing: Everything You Need to Know

Cash Discount Programs: An Overview

Cash discount programs are a way to offset the cost of credit card fees. Any business or individual who accepts credit cards can offer a cash discount.

Essentially, with this kind of program, customers paying with cash can save a percentage of the total price. When customers use a credit or debit card, they cover the cost of the transaction fee.

Your processor will give you a lower rate on processing fees if customers pay with cash. Some people prefer to pay with cash, and these customers are more likely to choose your business if you offer a cash discount.

Businesses that offer a cash discount can also use it to attract new customers. Not only can you use this program to save money on your transaction fees, but you can also generate more business.

How a Cash Discount Program Works

Many transactions use credit cards, especially with online sellers, but the fees can make businesses less profitable. Cash discount programs are a great way for businesses to encourage customers to pay with cash.

The simplest form of a cash discount program is something like, “If you pay with cash, you get 10% off your purchase.”

This type of program is useful for any business that accepts credit and debit cards, but some are better suited for them. Businesses with a product or service that rarely changes are good candidates for a cash discount program.

Examples of businesses that should consider cash discounts include:

• Restaurants
• Cafes
• Service businesses (plumbing, HVAC, pest control, etc.)
• Medical clinics
• Automotive shops
• Salons

Businesses with a more extensive inventory might have a harder time implementing a cash discount. Large retailers, for example, have a constantly changing inventory that makes it more difficult.

The reason certain businesses are better suited for cash discounts is because of how pricing works.

When you offer a cash discount, you include the cost of credit card processing in the advertised price. If a customer pays with cash, they pay a discounted price.

To cover the cost of card processing, businesses must alter their pricing structure. A business that moves a large volume of products will therefore have to work much harder changing their prices.

As a result, food vendors and businesses with a small selection of services are a better choice for this program.

Surcharges vs. Cash Discount Programs

Many business owners confuse cash discounts with surcharges. However, cash discounts and surcharges work in very different ways.

It’s important to understand the differences before you decide which one is right for your company. Cash discounts are easier and more common, and have fewer legal issues.

A surcharge is a fee added to the advertised price if a customer pays with a debit or credit card. With a cash discount, on the other hand, customers paying with a card pay the advertised price.

This makes cash discount programs more flexible merchant services overall. They can be implemented with minimal changes to your business model (and without any need for additional equipment).

Surcharges can also be difficult if they’re applied across multiple products or services. For example, products with varying amounts due at checkout can confuse and frustrate your customers.

Cash discounts also allow users more flexibility when planning out their purchases in advance. They also don’t require any change in customer behavior, such as making sure they know about all applicable fees.

With a cash discount, customers view your payment options as a chance at saving. With a surcharge, it seems more like a hidden fee.

Are These Types of Programs Legal?

When you offer different prices to customers based on their payment method, it can raise legal questions. Businesses may be hesitant to implement a cash discount because they aren’t sure if it’s entirely legal.

Businesses using a surcharge are more likely to run into legal issues. Although legal in most states, surcharges for credit cards have to be clearly displayed at the point of sale.

Some states have outright bans on surcharges for credit card transactions. Cash discount programs, however, are legal anywhere in the United States.

With a cash discount program, the vendor adjusts the price of each product or service to account for the cost of processing fees. When a customer pays cash, the vendor applies the discount at checkout.

Because the customer never pays more than the advertised price (except with regard to taxes), there are no legal issues.

Save on Credit Card Processing

A cash discount program is one of many tools available to help you save money and make your business more profitable. Unlike a surcharge, customers don’t pay an added fee when they pay with a credit card.

Instead, customers who use a card pay the advertised price, while cash-paying customers get a discount. Businesses can use their cash discount program for advertising while saving money on credit card processing.

First Financial offers merchant services with 24/7 customer support. If you need a way to accept credit cards, we can help, even if you’ve been turned down by traditional banks.

Contact us today to learn about our financial services!

What is Bitcoin Tax-Loss Harvesting?

Turn Market Volatility into a Strategic Advantage

Leverage market “dips” to lower your overall tax liability.
Official First Financial® bridges the gap between complex IRS rules and your portfolio growth.

OPTIMIZE YOUR PORTFOLIO »

* Senior Trademarked Authority since 1995. USPTO Reg. No. 3532314

Bitcoin’s market cap is famous for historic surges followed by deep corrections. This volatility provides a unique opportunity for Tax-Loss Harvesting. At First Financial®, the senior trademarked name in financial solutions since 1995, we help you understand how these dips can be leveraged effectively.

The Strategic Tax-Loss Harvesting Process

Under current IRS guidelines, cryptocurrency gains are classified as Capital Gains. You can strategically mitigate these by utilizing Capital Losses—the difference when an asset is sold for less than its original cost basis.

Limits and Carryover Benefits

You can use excess capital losses to offset up to $3,000 per year of ordinary income. Any remaining balance can be carried forward into future tax years indefinitely, building a long-term “tax shield” for your wealth growth.