bad credit sad face

What Is Considered a Bad Credit Score?

In the popular credit score spectrum of 300 to 850, when does a score start breaking bad? You might read 670 or 630 or 600, but each lender makes its own evaluation of credit scores considered to be risky.

For example, you’ll usually need a credit score of at least 620 to get a conventional mortgage (one not backed by a government agency), but someone with a credit score as low as 500 to 579 may be able to qualify for an FHA or VA loan.

One thing’s for sure: A borrower with a “bad” credit score has limited choices and will likely pay substantially more over a lifetime than one with a higher score, thanks to higher interest rates charged and less favorable terms.

The Highs and Lows of Credit Scores

The most commonly used credit scores are calculated by FICO® and VantageScore®, but the two companies rank scores a little differently.

FICO® 8 VantageScore® 3.0
Exceptional 800-850 Excellent 781-850
Very good 740-799 Good 661-780
Good 670-739 Fair 601-660
Fair 580-669 Poor 500-600
Poor 300-579 Very Poor 300-499

To complicate matters, lenders may choose from multiple scoring models and industry-specific scoring models, which makes it tricky to know which one you’re being evaluated on. And your credit scores vary—-yes, you have multiple scores.

A score in the 600s is typically high enough to qualify for some loans and credit cards. And generally, the best rates go to borrowers with scores in the mid-700s and above.

What’s the nationwide average? “Good.” As of this writing, Americans had an average FICO Score of 711 and VantageScore of 688.

Wait. What Exactly Is a Credit Score?

A credit score is a number that summarizes a bunch of information about your financial history in order to help lenders gauge the risk of extending you credit. The higher your credit score, the more confident they are that you’ll repay your debt, and on time.

Your credit score is based on factors like how often you pay your bills on time, how many loans and credit cards you have, your debt relative to your credit limits, and the average age of your accounts. It also considers negative financial events such as judgments, collections actions, and bankruptcies.

Three major credit reporting agencies, TransUnion, Equifax, and Experian, compile the information on your history of borrowing, and then a company like FICO or VantageScore translates that data into a number.

Your credit score is just one factor that lenders consider when evaluating your application for things like a loan, but it carries a lot of weight.

Why Is a Credit Score a Big Deal?

Your credit score not only affects your odds of approval for loans and credit cards; it plays a big role in determining the interest rate and repayment terms you’re offered.

As noted, your credit report holds information about your credit activity and current credit situation, like loan paying history and the status of your credit accounts: In short, your credit history.

Here are some of the things that take your credit history into consideration:

•  Credit cards

•  Car loans

•  Home loans

•  Personal loans

•  Private student loans

•  Federal PLUS loans

•  Car insurance premiums (in some states)

•  Homeowners insurance

In addition, your credit history may be weighed during a job or rental application.

Nonprime borrowers—generally defined as those with credit scores of 660 or under and who have negative items on their credit report—shouldn’t expect to get the lowest rates or most ideal terms when procuring a home or car loan.

For example, the interest rate on a subprime 30-year mortgage can be double or triple the average rate. A bigger down payment is usually required, and the repayment term may stretch to 40 or even 50 years, so the amount of interest paid over the life of the loan can be extraordinary.

As for auto loans, Business Insider summarized the stark differences in loan rates by credit score for new and used car purchases, according to Experian, which tracks auto finance trends each quarter.

What If I Have a Low Credit Score?

If you fall into the so-called bad credit score range, remember that it isn’t set in stone.

There are steps you can take to help build your credit. It won’t happen overnight—any promise of a quick fix could be a scam.

But with a sustained effort, you may see improvement within six months to a year, according to the Consumer Financial Protection Bureau (CFPB), a government agency. Here are some ideas.

Paying Bills on Time

An effective way to improve your creditworthiness in the eyes of lenders is to pay all your bills by the due date, every single time. If you have been late with any payments, consider getting caught up.

If you tend to forget bills, consider brushing up on how autopay works and set up payments through an app, a checking account, or the entity billing you. Putting reminders on a paper or electronic calendar can help as well.

Paying Attention to Revolving Debt

Part of your credit score depends on the amount of credit you have relative to the amount you’re using. This is known as your credit utilization ratio. (The ratio is derived by dividing your total credit card balances by your credit limits.)

It’s generally a good idea to use no more than 30% of your total available credit.

The CFPB says that paying off credit card balances in full each month helps to keep the ratio low and strengthen a credit score.

Credit utilization involves credit card and other revolving debts, not installment loans like mortgages or student loans.

Checking Credit Reports and Scores

Between identity theft on the rise and the possibility of human error, it may be worth reviewing your credit report for any unfamiliar charges or records, since the information in your credit report is used to generate your credit scores.

You can order a copy of your credit report from each of the three major reporting agencies for free at AnnualCreditReport.com. Look for mistakes in your contact details, accounts that don’t belong to you, incorrect reports of late payments, or accounts you closed being shown as open.

Credit reports do not show credit scores. How to get credit score updates then? A few options:

•  Buy your FICO Score from myfico.com.

•  Get your FICO Score for free from Experian.

•  Look for your scores on a loan or credit card statement.

•  Sign up for SoFi Relay, which provides weekly credit score updates and tracks all of your money in one place at no charge.

Many factors affect your credit score.
Check yours in the SoFi app.


Closing and Opening Credit Cards Carefully

The average age of your accounts plays a role in your credit score, so you may want to keep some of your oldest cards open, even if you don’t use them often. Remember that closing cards also reduces your available credit, affecting your credit utilization ratio.

Opening cards affects your credit score as well. Every time you apply, the credit card company runs a hard inquiry on your credit, and your score takes a slight hit. Applying for a bunch of cards in quick succession can make it look like your financial situation has taken a turn for the worse.

Building on a Limited Credit History

Millions of Americans have no credit score because they don’t have enough of a history to calculate one. If this is your situation, you have at least two options.

You may want to consider taking out a secured credit card that will allow you to access a modest line of credit by putting down a deposit.

Making on-time payments is one way to potentially build credit over time that eventually may help you qualify for unsecured credit cards or loans with more favorable terms.

Another option is a credit-builder loan, offered by some smaller financial institutions. The lender loans you a particular amount of money, which it deposits into an account it controls. You make payments on the loan, and the lender reports them to the three main credit bureaus. When the loan is paid off, the lender gives you the money.

You could also ask a friend or family member to add you as an authorized user to their credit card account. An authorized user can use the account but does not have any liability for the debt.

The Takeaway

What is a bad credit score? That can mean a fair or poor credit score, as defined by FICO or VantageScore, which is south of the American average. It can mean loan denials and high interest rates, but with dedication the tide can be turned.

If you’re struggling to reduce high-interest credit card balances or other debt, an unsecured personal loan may come in handy. SoFi fixed-rate personal loans can be used for almost any purpose.

Looking for ways to improve your credit score? A SoFi Personal Loan can help you reduce credit card balances quicker or avoid racking up high-interest debt.


External Websites: The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
SoFi Loan Products
SoFi loans are originated by SoFi Lending Corp. or an affiliate (dba SoFi), a lender licensed by the Department of Financial Protection and Innovation under the California Financing Law, license # 6054612; NMLS # 1121636 . For additional product-specific legal and licensing information, see SoFi.com/legal.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s
website
.

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Everything You Need to Know About Remodeling Recessed Lighting

Everything You Need to Know About Remodeling Recessed Lighting

For homeowners looking for relatively small projects to better enjoy and increase the value of their homes, remodeling with recessed lighting is a good move. That’s because upgrading your current lighting to recessed can lighting has the potential to create a more functional—possibly more energy-efficient—lighting scheme that could make your home feel more welcoming to buyers when the time comes to sell.

What Is a Recessed Light?

Recessed lighting is a lighting fixture that is set into a ceiling, virtually flush with the ceiling rather than hanging down from it. They’re often referred to as “can lights” or “downlights.”

Installation requirements for and the recessed lighting fixtures themselves are different for a remodel than new construction, depending on access to the area above the ceiling.

Generally speaking, it’s more common to have access to that space while a house is being constructed than for a house that’s already built. But for remodeling projects that do have that access, recessed lights for either new construction or remodels should work.

There are two main parts to a recessed light—housing and trim—with multiple options for each. The two parts can be purchased together in a kit or they can be purchased separately.

Housing: The housing is the portion set into the ceiling and, depending on the type of fixture, can be visible or fairly hidden, and plain or decorative. It’s the part that is actually mounted to the ceiling and houses the bulb socket.

Trim: The trim is the most visible part of a recessed lighting fixture. Some types of trim are merely a ring covering up the edge of the housing, allowing more of the inner housing to be visible. Other types of the trim cover more of the housing, placing the emphasis on the level of illumination or where the light is directed.

Homeowners who want to change the look of existing recessed lighting can usually change the trim without needing to replace the housing. This is called retrofitting.

Recommended: Renovation vs. Remodel: What’s the Difference?

What To Consider When Deciding To Add Recessed Lighting

There are a host of factors to consider when planning to add recessed lighting to an existing home, from what function the lighting will perform to the style of light that will work with the architecture of the home, as well as project cost and more.

Function

Will the light be to generally light up the room? Or will it be to draw focus to a piece of art?

To add general lighting to a room—a living room, for instance—ambient downlights will provide even lighting throughout the room. The number and placement of lights will depend on the size and shape of the room.

If the goal is to have better lighting when performing certain tasks, such as in a kitchen, spotlights placed in areas above where those tasks are done will serve this purpose well.

A good example of this is bright lighting placed over the kitchen sink area so those dirty dishes can come out sparkling clean, or over a counter section where most of the food preparation is done.

Some people might have artwork or architectural detail to accent. For those purposes, recessed lighting that can be pointed in the desired direction would be optimal.

Lighting

There are four main bulb categories: incandescent, halogen, compact fluorescent (CFL), an LED, all in a variety of wattages. Recessed lighting kits may also come with integrated lighting is soft, bright, or daylight color temperatures. Custom installations are available with lighting that can be adjusted with smart technology. It’s best to check the package information for the correct type of lightbulb and maximum wattage for the fixture.

Incandescent bulbs, the long-time classic, provide general lighting with a warm glow. Halogen bulbs have a similar color temperature to incandescents. The main difference between the two is the gas inside of each: Incandescents are filled with a gas such as argon or nitrogen, while halogens are filled with … a halogen gas. Halogen bulbs are more energy-efficient than incandescents, using 20% to 30% less energy.

Both of these types of bulbs are being phased out across the US, however, with outright bans proposed in some states, in favor of more energy-efficient bulbs.

CFLs were introduced in the mid-1980s, but their relatively high price tag—$25 to $35 per bulb—was a hard sell, even to consumers who were starting to become more energy conscious.
A main advantage to the CFL is that they are easy to fit into a regular socket because they have the same size base as old-style incandescents. Their reputation for having a long life, 6 to 15 times as long as incandescents, has enabled them to remain a popular choice.

The drawback, and a reason they have begun to fall out of favor recently, is that they contain small amounts of environmentally harmful mercury. For this reason, they should be recycled instead of disposed of, which some consumers find inconvenient.

Another option for recessed lighting is an LED bulb, and it’s quickly becoming the standard. These light-emitting diode (LED) bulbs use semiconductors to convert electricity into light, a process that doesn’t emit heat as incandescents or CFLs do.

They’re much more energy-efficient than other lighting options, as well, using 80% less energy than incandescents and lasting 25 times as long. Unlike CFL bulbs, LEDs don’t contain mercury, nor do they contain wire filaments like incandescents and halogens, so it’s safe to dispose of them in regular household trash.

Installation

Including recessed lighting in an existing home remodeling project typically requires fixtures that are supported by metal clips that are pushed through the housing onto the top of the drywall or plaster of the ceiling. This differs from new-construction fixtures in which the fixture’s frame is screwed or nailed to the ceiling joists, which are accessible during the construction process.

Homeowners who have access to space above the ceiling where the fixture will be placed, such as attic space, may be able to use new construction fixtures. An advantage to this option is that fixtures made for new construction are generally less expensive and offer a wider range of trims than remodel fixtures.

Insulation is also a factor. If the lighting fixtures will be installed in an area where they will be in contact with insulation, they should be insulation compatible (IC)
rated. If not, an alternative solution would be to use a fire-rated recessed light cover to go over the fixture’s housing in the attic.

Another rating to look for is the AirTight (AT) rating. This rating indicates that the fixture should keep heat from escaping. This might be less of a concern if there is living space above the room with recessed lighting, but when installing recessed lighting in a room with unfinished attic space above, the AT rating may be something to take into account.

Recommended: Four Ways to Upgrade Your Home

Cost

The cost to install recessed lighting in an existing home is dependent on several factors. How many lights will be installed? What type of recessed lighting will be installed? Will there be labor costs if the job will be done by a professional? How much drywall repair and repainting will be needed after the installation is complete?

On average, recessed lighting costs about $360 per fixture when installation is being done by a professional. A typical kitchen, for instance, might require six fixtures, for a total cost of $2,160. This cost can vary, of course, based on the number and type of fixtures, trim, and bulbs chosen.

Recessed lighting is a common feature in kitchen and bath remodels, both of which have a high return on investment. While the lighting itself might not be the ultimate selling point for someone thinking of purchasing a home, updating the lighting when undertaking a remodeling project just might add to that ROI.

Recommended: The Top Home Improvements to Increase Your Home’s Value

The Takeaway

Adding recessed lighting to your home is one way to increase the cozy factor while maintaining the home’s value for a relatively small investment. Understanding the scope of the job will make it easier to estimate how much it might cost and how best to pay for it based on your particular financial situation.

Looking into rebate programs or federal and state financial assistance programs might help with the costs associated with adding recessed lighting to a home. Another option may be a personal loan to help pay for the project costs.

SoFi unsecured personal loans have no fees and low rates, with funding in as little as three days. Checking your rate takes just two minutes via an easy online process.

Learn more about personal loans from SoFi.

Photo credit: iStock/Yulia Romashko


SoFi Loan Products
SoFi loans are originated by SoFi Lending Corp. or an affiliate (dba SoFi), a lender licensed by the Department of Financial Protection and Innovation under the California Financing Law, license # 6054612; NMLS # 1121636 . For additional product-specific legal and licensing information, see SoFi.com/legal.

External Websites: The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
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Interior Decoration Tips for Furnishing a New Home

Interior Decoration Tips for Furnishing a New Home

Figuring out where to start when turning your new space into a home doesn’t have to be daunting. Moving into a new house or apartment can be an exciting new chapter, whether HGTV-worthy, minimalist, or maximalist.

A good first step could be deciding on a budget and priorities.

This may take some trial and error—there’s no shame in starting a project and realizing it’s not what you want to spend your money and time on.

6 Tips for Furnishing Your Home

The key to finding the right furnishings is to follow your instincts. There isn’t one universal definition of good taste. This is your taste, and where you will live.

Here are a few tips for furnishing your new home.

1. Consolidate Your Stuff

Part of setting your furnishing budget is identifying what you would like to keep and what you will need to purchase. This new home you’re moving into is the perfect opportunity to say goodbye to pieces that don’t suit your lifestyle anymore. (Remember WWMKD: What would Marie Kondo do?)

Start with key pieces of furniture like beds, couches, dining tables, and area rugs. Review what you have. Did you recently purchase your dream bed or have you had the frame since college? Decide what to keep and what to chuck.

You can sell or donate what you’re saying goodbye to.

2. Prep Before the Schlep

As a rule of thumb for interior decoration, taking up carpeting or painting the walls are much easier to do before any furniture is brought into the house.

Before move-in day, it may be smart to create a list of any changes you would like to make to the existing interior. Here are some basics to consider:

•  Walls and ceilings: Choosing a paint color, patching existing holes, removing popcorn ceilings

•  Floors: Removing or adding carpet, putting in hardwood floors, refinishing floors

•  Appliances: Selecting kitchen appliances, bringing in a washer and dryer, installing ceiling fans and lighting fixtures

•  Bath and kitchen upgrades: Retiling the bathroom, choosing a backsplash, redoing the kitchen counters

•  Laundry room reimagining: A laundry room remodel could create a more efficient space or a room that has a dual function.

Once you’ve made the list of changes, determine what needs to be tackled now and what can wait. You may be able to live with the blue tile in the kitchen, but maybe the pink walls in the bedroom aren’t going to cut it.

Next, determine what you can do yourself and what will require professional attention.

Need extra financing help to furnish
your home? Check out SoFi Personal Loans.


3. When Buying Furniture, Start With Key Rooms

The living room and main bedroom are two places you likely spend the most time in, so these are good rooms to prioritize. (You don’t want to have a fully organized pantry before you have an acceptable place to sleep.)

A bed and a couch may be worth spending extra money on in order to get something that will last for years and tie the room together.

Bedroom: A good bed frame and mattress are probably your investment pieces. It may be a good idea to choose a bedroom vibe before buying new pieces so that you have a cohesive theme.

Living room: A couch is the centerpiece here, so that’s the investment piece (and a good decor starting point). Consider size, comfort, and color. A big TV or entertainment center may also be part of the equation.

Will you need a nursery?

4. Keep Things Organized While You Unpack

The two elements that really shape the feng shui of a home are organization and decor. An organized pantry or closet makes life easier, while a curated bookshelf can subtly affect the entire feel of a room.

See what you already have that can be functional—baskets, bins, and such. As you unpack your belongings, use these tools to stay organized.

Depending on your lifestyle, organizational outlays for your new home could range from slimline hangers to a closet remodel.

5. See the Big Picture

Lay out all decor pieces you own, including art, books, family heirlooms, photographs, trays, candles, and vases. Ideally, you’ve gone through most of this stuff in the consolidation phase and kept only things that are meaningful to you or fit your home’s aesthetic.

Once you see everything in one place, begin picking out things that go together. There are no wrong answers here—you might choose travel books for your office and a series of family heirlooms and photographs for your bedroom. This is the most forgiving aspect of interior decoration because smaller decor pieces can be easily shifted.

Once all of your belongings are in place and the art is hung, you can browse online to find some great pieces that resonate with you and your space.

It may be time to frame that print you’ve been hanging on to, or to splurge on the perfect pillows for your new couch. These may seem like small additions, but they can make a huge difference.

6. Space Out the Purchase of Big-Ticket Items

It’s OK if your home looks like a work in progress for a few months. Once you’ve consolidated, organized, and decorated, it may be time to buy your investment pieces.

You may want to pick your three or four non-negotiables—like a bed, sofa, television, or live edge dining table—and get those into the house, and then focus on buying art, rugs, and lights you’ve been eyeing.

How Much Does It Cost to Furnish a House?

Here are some potential costs for furnishing a new home to help you create a budget. Keep in mind that these are estimates.

Painting: $500 to Thousands

Paint supplies depend on the size of your home, number of rooms, amount of trim for doors and windows, and the quality of the paint. Paint costs from $15 to $40 per gallon on average, but a designer brand may cost much more than that.

A gallon of paint covers about 400 square feet, and two coats may be recommended. Factor in all the myriad paint supplies to buy if you DIY.

Expect to pay a painter $2 to $6 per square foot for labor and materials, according to HomeAdvisor, which adds that to have 2,300 square feet painted, the cost could range from $4,000 to $11,000.

Bed: $200 to $2,000 and Up

Simple bed frames are available from Ikea or Wayfair in the $100 to $200 range. You can also find medium-range selections from $200 to $1,000 at those retailers as well as more design-driven vendors such as West Elm, Raymour & Flanigan, and Crate and Barrel.

Mattress: $300 to $2,000 and Up

Newer brands such as Zinus, Casper, and Nectar offer mattresses starting at a few hundred dollars. High-end brands like West Elm, Raymour & Flanigan, and Tempur-Pedic can run upward of $3,000.

Sofa: $200 to $3,000

The Ikeas, Wayfairs, and Targets of the world offer numerous options for a starter piece for a few hundred dollars.

Midrange selections run from $300 to $1,000 from these and other retailers such as Ashley Furniture, West Elm, Raymour & Flanigan, Crate and Barrel, and CB2. At the higher end of the spectrum, there are more sophisticated designs from Roche Bobois, Ligne Roset, Design Within Reach, and many other luxury brands.

Bedroom Set: $500 to $5,000 and Up

Bedroom sets can be found at most of the same kinds of retailers and run from modest to extravagant.

Rugs: $30 to $1,000 and Up

Rugs are a cost that’s easy to forget about, and they can be a lot more expensive than you expect. A high-quality Persian rug can run thousands of dollars, but some of the midrange retailers discussed have area rugs starting at $100. Look out for Labor Day and Black Friday sales, too.

Organizational Pieces: $20 to $300 and Up

Baskets, bins, storage ottomans, vanity sets, and free-standing closet systems can add methods to the madness. The Container Store offers inspiration.

The Takeaway

When furnishing a new home, you may want to start with a budget, cull your belongings, prepare the new space for move-in (taking up carpet, redoing countertops, remodeling a closet), and identify initial key purchases. Interior decoration and design can take shape over time.

When you’re making your new house a home, a personal loan may help to ensure that you don’t have to cut corners.

SoFi offers no-fee personal loans that come with a fixed rate.

Prepping and furnishing a new home can seem daunting. Paying for it doesn’t have to be. It’s easy to check your rate on a personal loan.


SoFi Loan Products
SoFi loans are originated by SoFi Lending Corp. or an affiliate (dba SoFi), a lender licensed by the Department of Financial Protection and Innovation under the California Financing Law, license # 6054612; NMLS # 1121636 . For additional product-specific legal and licensing information, see SoFi.com/legal.

Third Party Brand Mentions: No brands or products mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third party trademarks referenced herein are property of their respective owners.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
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moving box with packing tape

7 Common Moving Costs to Know Before You Pack Up

Every year, about 40 million Americans move. Many of them will underestimate how much it costs to make a transition, since the expenses are often broken down into many small items.

It can cost several thousand dollars to move across the country, or even across town, when all is said and done.
Between selling furniture, packing boxes, and changing your forwarding address, getting ready to move is a lot of work. Amid the chaos, it’s easy to forget some of the many moving expenses you might face.

The key to paying for a move without a load of stress? Planning.

Your Moving Expenses Checklist

To help you prepare, here is a list of common moving costs.

1. Moving Your Stuff

There are at least three choices here: Rent a moving truck, pay professional movers, or rent and move a storage container.

Renting your own truck. It might be cheaper, but keep in mind that you’ll be putting in a lot of sweat and hours to make up for it.

Renting a moving truck for across-town moves starts low, but you’ll also have to pay for gas, damage protection, and cost per mile. If you enlist friends and family to help, factor in the price of snacks, beers, or gift cards to thank them.

If you’re moving far away, you may also want to ship some boxes, which can add up.

Hiring pros. You might want to get estimates from a few companies to make sure you’re getting the best deal.

A local move is usually considered under 100 miles, and a long-distance move, more than 100 miles.

Expect to pay an average of $550 to $2,000 for a basic local move, and $2,000 and up for a long-distance move.

(The price of a local move is often based on a flat dollar amount per hour; some companies may offer a flat rate. In some states, if you’re moving more than 50 miles, the cost will be based on the weight of the truckload instead of the hourly rate.)

A packing service can add a chunk to these costs (but may be well worth it to you).

You may also want to purchase “full value protection” insurance through your mover to protect your belongings in case they are lost or damaged.

Hauling a container. Moving a self-storage container, those units popularized by PODS®, is typically less expensive than using full-service movers. A local container move could range from $500 to $1,500, and a long-distance move could range from $1,500 to $5,000.

If you’re comparing quotes, know that each company handles costs differently. Some itemize the costs for each part of the move; others include everything in one quote.

2. Transporting Yourself

Short or long move, you’ll have to get yourself there, too. That could mean a road trip, which includes gas, tolls, possibly lodging, and meals along the way.

An online fuel cost calculator can help you tally how much you will spend on gas.

Otherwise, it means the cost of a plane ticket, getting yourself to and from the airport, and possibly the price of shipping your car.

3. Moving Supplies

You probably know that you’ll need boxes. But don’t forget the oodles of tape, bubble wrap, packing peanuts, labels, and markers. You may need to rent or buy a dolly if you’re planning a DIY move.

You may be able to save by asking for free boxes from local grocery stores and using recycled newspaper as packing material. But the little things can still add up.

4. Costs Upon Arrival

If you’re renting, you might owe a security deposit and first month’s rent to your new landlord. You may also be responsible for a pet deposit or fees for getting utilities hooked up.

If you’re moving into a home of your own, you may need to make repairs before you settle in. Some new homeowners also invest in changing locks, putting in security alarms, or replacing smoke detectors.

You may also want to take care of renovating some areas before all your stuff is in the way, and if you have a lawn for the first time, you might need to buy a mower or hire a service.

Will you need a storage unit? Plan on about $100 to $300 a month.

5. Cleaning Costs and Supplies

You might be responsible for leaving your old place in tip-top shape. That means paying for stuff like floor cleaner, mops, brushes, and wipes. You may also need to hire a carpet cleaner or house cleaners if you’re short on time or your place needs serious attention.

On the other end, you might need supplies to clean your new apartment or house before you unpack everything.

6. Furniture and Other Items

Even if you’re bringing a lot of things with you, chances are you’ll need to buy some furniture for your new home. You might save by searching online or perusing garage sales and flea markets.

Still, if you need any substantial pieces, like a bed, couch, or table, you could be looking at a few hundred dollars. Beyond furniture, if you’ve moved far away, you might need to stock your new place with all kinds of everyday items, from pantry staples to toiletries.

7. New License and Vehicle Registration

If you’re moving to a different state and have a car, you’ll need to apply for a new license and register your car with the local department of motor vehicles. This comes with a fee, of course.

Vehicle registration can cost up to $225, depending on the state. A new driver’s license can cost around $30 to $60.

Preparing for Moving Costs

If you don’t prepare for all of the expenses, you risk overdrawing your checking account or draining your emergency savings.

Worse, you might be tempted to take on high-interest credit card debt, which means you could be paying more for the move in the end.

But no need to panic. If you’re aware of what’s in store, you could plan ahead and make sure your move is affordable. The first step might be to go through the above list and estimate how much your move will actually cost based on your specific situation.

If you don’t have that sum in the bank, that number might become your savings goal.

You could create a budget by listing all your monthly expenses as well as your take-home pay for each month.

If your pay exceeds your expenses enough to make room for your monthly savings goal, you could earmark that money for a move.

The Takeaway

Moving might be a major financial commitment, but it doesn’t have to break the bank. Preparing for all of the moving costs you face can help you change your address without adding emotional baggage.

Planning a move and need money to help? A SoFi personal loan could be a good option.

Get a move on to see what a personal loan could do for you.


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Understanding Bankruptcy: Is it Ever the Right Option?

Filing for bankruptcy can be a chance to eliminate a great deal of financial stress, put an end to collection calls and letters, and provide an opportunity to remake your financial life.

Even so, declaring bankruptcy is not something you should take lightly.

While bankruptcy can, in some cases, reduce or eliminate your debts, it also has serious consequences, including long-term damage to your credit score. That, in turn, can hamper your ability to obtain new lines or credit, and even make it difficult to get a job.

As you think about filing for bankruptcy, here are some things to consider.

What Does it Mean to File Bankruptcy?

For individuals, there are two main kinds of bankruptcy:

Chapter 7: Also known as “liquidation bankruptcy,” this is bankruptcy in its most basic form. With this type of bankruptcy, your nonexempt possessions, such as homes and cars, are sold to repay existing debts. After this, many (if not all) of your debts are canceled outright in a four- to six-month process.

Chapter 13: Also known as a “reorganization bankruptcy,” this is a court-approved plan in which you use your income to make payments on your debts over a three- to five-year period. Some of your debts may also be discharged.

The main difference between the two options is that Chapter 7 allows the debtor to eliminate all dischargeable unsecured debt, whereas Chapter 12 allows for payments to be made on those debts.

You may be prevented from filing for Chapter 7 bankruptcy if you earn enough income to repay your debts in a Chapter 13 bankruptcy plan. On the other hand, you may not qualify for Chapter 13 bankruptcy if your debts are too high or your income too low.

Some debts, like child support obligations, alimony, student loans, and some tax obligations, cannot be wiped out in either type of bankruptcy.

Also, bankruptcy won’t relieve you of your obligation to pay your mortgage, though it might make your mortgage payments easier to make by getting rid of other debts.

If you have substantial equity in your home, you could potentially lose it if you file for Chapter 7. If you file for Chapter 13, you can keep your home and pay off any mortgage arrears through your repayment plan.

Chapter 13 bankruptcy stays on your credit report for seven years, while Chapter 7 bankruptcy stays on the report for 10 years.

When To Consider Bankruptcy as a Solution

Life circumstances and financial situations can vary significantly from person to person, so there is no hard and fast rule for when to declare bankruptcy.

However, you may want to start by asking yourself the following questions:

• Are you unclear on exactly how much you currently owe?
• Are you only able to make minimum payments on your credit cards?
• Are you getting calls from debt collectors?
• Does the idea of solving your financial problems make you feel hopeless, out of control, or scared?
• Are you using your credit card to pay for necessities?
• Are you thinking about debt consolidation?

If you answered yes to two or more of these questions, you may want to at the very least give your financial situation more thought and attention.

You may also want to start doing some research (or, if possible, speak with a consumer law attorney) to see if your debt qualifies for bankruptcy, as well as how filing for bankruptcy would affect your life and financial situation.

Alternatives to Bankruptcy

While bankruptcy can sometimes be the best way to get out from under crushing financial burdens, it is not the only way. There are alternatives that can often reduce your debt obligations without some of the negative consequences of bankruptcy. Here are a few you may want to consider.

Credit Counseling

A counselor or counseling service specializing in helping people with debt problems might be able to come up with a solution that has not occurred to you, such as a modified payment plan or debt consolidation.

According to the Federal Trade Commission , you’ll want to look for a nonprofit credit counseling program, such as those offered by universities, military bases, credit unions, housing authorities, and branches of the U.S. Cooperative Extension Service.

You can also find a nonprofit agency that offers bankruptcy counseling through the National Foundation for Credit Counseling .

You may also want to keep in mind that not all not all nonprofit organizations offer free services, so it’s a good idea to do your research before you sign up for counseling services.

Negotiating with your Creditors

Creditors would often rather settle a debt with you than have it discharged in bankruptcy. Debt settlement is an agreement between you and your creditors that you will pay a lump sum, possibly far below what you owe, in order to settle the matter.

But it may not be quite as lovely as it sounds. The creditors take a loss, and likely so will your credit score. You’ll also still need to pay taxes on the forgiven amount, because it will be considered revenue (money you’re getting back).

There are debt settlement companies out there to help you negotiate with creditors, but not all of them are created equal—some of them charge steep fees and can’t guarantee they will get you the settlement that makes the most sense for you.

It’s a good idea to carefully vet any debt settlement company you are considering working with.

Cutting Back on Expenses

You may want to give some deep thought to the way you live and currently spend your money. Your lifestyle and financial habits may be what inched you toward bankruptcy in the first place. A good way to start is to set up a personal budget, which involves looking at what’s coming in and what’s going out each month, and then looking for places to trim spending.

Even small steps, like making your own lunch, walking instead of burning gas, keeping the heat or air conditioning use to a minimum, and brewing your own coffee could help you free up money that can go toward paying your debt.

While it can be tough to live on a budget at first, with time, you may find yourself becoming more solvent and less burdened.

Debt Consolidation

With debt consolidation, you roll all your debts into one new loan account, preferably with a lower interest rate. This can enable you to pay off your past-due amounts and make one monthly payment going forward.

Having just one payment may make it easier to manage your existing debt, and could possibly save you on interest as well.

Refinancing or Modifying Your Mortgage

If your credit is still good enough, you may be able to refinance your mortgage to a new rate that could get your monthly payment low enough that it saves you from bankruptcy.

If you’re not able to refinance at a lower rate, you may be able to qualify for a mortgage modification. A mortgage loan modification is a change in your loan terms that could reduce your monthly payment.

If your lender allows it, it could involve extending the number of years you have to repay the loan, reducing your interest rate, and/or forbearing (or reducing) your principal balance.

You may want to keep in mind, however, that if you receive a loan modification and you still can’t make the payments, you could be at risk of losing your home

The Takeaway

If you have large debts that you can’t repay, are behind in your mortgage payments and in danger of foreclosure, and/or are being harassed by bill collectors, declaring bankruptcy might be a good solution.

Bankruptcy can help you get out from under crushing debt. The process involves either liquidating (or selling off) your assets to pay your debts or adhering to a court-ordered repayment plan.

However, bankruptcy comes with consequences. The information stays on your credit report for seven to 10 years. It can also make it difficult to get credit, buy a home, or sometimes get a job.

Before considering bankruptcy, you may want to first explore other debt management options.

If you’re looking for a better way to manage your spending and saving, you may also want to check out SoFi Money®.

SoFi Money is a cash management account that offers a competitive interest rate for savers and tools to help you track and manage your weekly and monthly spending.

Learn how SoFi Money can help you stay on top of your finances today.


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SoFi Money is a cash management account, which is a brokerage product, offered by SoFi Securities LLC, member FINRA / SIPC .
Neither SoFi nor its affiliates is a bank. SoFi Money Debit Card issued by The Bancorp Bank. SoFi has partnered with Allpoint to provide consumers with ATM access at any of the 55,000+ ATMs within the Allpoint network. Consumers will not be charged a fee when using an in-network ATM, however, third party fees incurred when using out-of-network ATMs are not subject to reimbursement. SoFi’s ATM policies are subject to change at our discretion at any time.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
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