The Clock’s Ticking on Homebuyer Tax Credits
By Kimberley Edgar
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| AAA offers free seminars for first-time homebuyers. |
When it comes to securing federal-housing tax credits, there’s still time for many first-time and repeat homebuyers to spring into action.
When they do, AAA is ready to assist them — and other homebuyers — in understanding new consumer disclosure rules.
The countdown is on for qualified first-time and repeat homebuyers to take advantage of tax credits.
The window of opportunity is closing for those buying a principal residence under the Worker, Homeownership and Business Assistance Act of 2009.
First-time homebuyers – those who haven’t owned a principal residence during the three-year period before the purchase – who sign a purchase-and-sales agreement by April 30 are eligible for up to $8,000 in tax credits.
“They have to close on that agreement by June 30,” advised Deb Imondi, Vice President of the AAA Southern New England Bank.
And new this year, some repeat homebuyers who meet the same April and June deadlines might be eligible for up to $6,500 in tax credits.
These buyers must have owned and lived in their previous home for five consecutive years in the last eight.
“This is great for some people who might be wishing to buy up,” Ms. Imondi said.
Both tax credits carry income caps. At press time, interest rates were around 5 percent. Consult your tax adviser for IRS guidelines.
AAA Southern New England Bank provides free educational seminars and materials to those who may be interested in buying a home. Experienced mortgage consultants guide prospective borrowers through the several stages in the process. Topics include ways to check your credit, pre-qualification versus pre-approval, choosing a real estate agent, purchase and sales agreements, home inspections, mortgage products, homeowner insurance requirements, and more. For a schedule of upcoming seminars, visit AAA.com/register. 
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AAA hosts several free financial seminars this month. A Home Buyers seminar will be held from 6:30-8:30 p.m. March 4 at AAA Burlington. A seminar on Financial Award Letters will be held from 6:30-8:30 p.m. April 1 at AAA Burlington. And there will be two Webinars, both from 6-7 p.m.: Financial Aid Award Letters, March 23; and Scholarships 101, March 31. To register, visit AAA.com/register or call (877) 888-8609.
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Take 5: Homeowner’s Insurance
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First-time homebuyer? AAA Insurance Managing Director H.C. Hansen answers your questions on homeowner’s insurance.
1. We just put down a deposit on our first home. When should we start looking at homeowner’s insurance?
Now. Your mortgage company will require you to have an insurance binder at the closing, and your insurance agent should have up to 30 days to inspect the home for insurability. This is different from the home inspection, where uncovered faults help you negotiate some money off the price. The insurance inspection will verify that the home does not have any major issues — such as an aging roof — and is insurable.
2. What will the insurance agent need from me?
Keep in mind your policy will cover the cost of rebuilding the home — which is not necessarily the amount of the mortgage since that includes land value. Your agent will use “replacement cost” software to determine the cost of rebuilding the home to a similar state. Things you should know include the square footage, number of stories, whether the floors are hard wood or carpeted, if the countertops are granite, and if there are decks, porches or swimming pools. You’ll also be asked if you own any pets; dangerous animals, like certain large dogs, may make you ineligible for homeowner’s insurance in the standard market.
3. What about insuring my personal belongings?
The formula for determining the correct amount of property coverage — which covers the home’s contents — is generally 70 percent to 80 percent of the home’s value. If you’re buying a $300,000 house, your contents could be insured at $240,000. While some may look to lower that amount, reducing the coverage will not save you any money. Also, remember that jewelry must be scheduled separately on your policy.
4. How will I know if I need flood insurance?
If the home is in a hazardous flood zone, your mortgage company will require flood insurance. Otherwise, your agent may recommend flood insurance, as necessary. It typically costs less than $400 a year when you’re in a preferred flood zone, and may turn out to be a lifesaver with some of the major flooding New England has been prone to in recent years.
5. How can I save money on homeowner’s insurance?
The best thing you can do is to combine your home- and auto-insurance policies through the same insurance agent. Some AAA members have saved upwards of $1,000 by reviewing and combining policies with AAA Insurance.
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Consider Resale Value Before You Buy a Car
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Financing, gasoline, insurance and repair charges are all costs of owning and driving a car, but they’re rarely the most significant ones – at least not during the first five years of a car’s life.
Depreciation, or the loss of a car’s value, is by far the greatest expense for most motorists. The typical vehicle retains only about 35 percent of its original value after five years, according to Kelley Blue Book data. For a $25,000 car, that’s a loss of nearly $16,250. Not even a gas-guzzler or a lemon is likely to come close to needing $16,250 worth of fuel or repairs over five years.
Unfortunately, resale value is an after-thought for most new-car shoppers, who tend to select the vehicle of their dreams or what fits their budgets, not the car that’s the smartest investment.
But if you consider the resale value before you buy a car, you might keep money in your pocket down the road when you sell it or trade it in on a new model, said Jack Nerad, executive editorial director of Kelley Blue Book’s Web site, kbb.com. For example, if you buy a $25,000 car that retains 45 percent of its value instead of 35 percent, you could save about $2,500.
So, how can you find out what a car is expected to be worth several years from now? Amid the recent economic turmoil, predicting automotive resale values has become trickier. Still, most models from certain automotive brands consistently have high resale values. Why is that? A solid reliability/dependability record helps, Mr. Nerad said. But even more important, he added, is a certain stylishness or perceived desirability that makes used-car buyers willing to pay a little extra.
That could explain why 2009 Mini and Volkswagen models – brands with spotty reliability records – hold their values so well. Vehicles from both automakers are seen as stylish and fun to drive; they should retain about half their original sticker price after five years. Other brands with better-than-average resale values include Acura, Audi, BMW, Honda, Infiniti, Lexus, Scion, Subaru and Toyota.
Nevertheless, if you’re one of those uncommon individuals who is content to drive a car until its wheels fall off, you can forget about resale value and depreciation. No matter the brand, a 10-year-old jalopy with 300,000 miles on it won’t be worth more than the value of its scrap.
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10 Planning Tips to Make the Most of Your College Tour
By Shelley Honeycutt
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| With the right preparation, you can help your teenager find a college that’s a perfect fit. |
Applying to college can be stressful and time consuming. Students are faced with stiff competition, action-packed schedules and life-changing decisions. Planning a successful college tour can help your student make better and more informed choices. Making the most of your campus visit can be essential to your student’s long-term college success.
Tip #1: Call Ahead
Contact the Admissions Office to set up your tour. Most colleges prefer about two weeks notice. Set up appointments to meet with Admissions, Financial Aid and a professor or adviser in the major you plan to study. Once you finish the guided tour, take your own tour. Plan time to walk around campus, eat on campus and see other facilities that weren’t on the tour.
Tip #2: Think Green
Narrow the number of colleges on your list by participating in virtual college tours and fairs before deciding which campuses to visit. Most schools offer virtual tours on their Web sites. Consider participating in a virtual college fair such as CollegeWeekLive.com. This is a way to save time and money and reduce your carbon footprint!
Tip #3: Get Directed
Many campuses are sprawling. Don’t waste your time getting lost. If you are renting a car, rent a GPS with it or print a TripTik before leaving home. This is a great time saver and could cut down on stress for everyone. And, know where to park on campus. Most colleges will have a campus map you can download.
Tip #4: Check the Calendar
If you are visiting a college with a big sports team, you may not want to visit during the State Championship. Look at the other events booked for that time. Lectures, political debates and other similar events can cause traffic and make hotel rates climb.
Tip #5: Go Off Campus
When you choose a college, you are deciding where your child will live for the next four years. Take time to go off campus and explore the community. Use public transportation if this will be the primary mode of getting around. Pick up local publications. Visit nearby points of interest like the local walk-in clinic, dentist or other services your student may need during the year.
Tip #6: Fewer Frills
Consider booking hotels with fewer frills. Since the purpose of your trip is to visit the campus and see the surrounding community, your time in the hotel will be minimal. Look for lower cost hotels with fewer amenities to help minimize costs.
Tip #7: Talk to Students
Who knows the campus better than the students who live there? You can get candid feedback on a variety of topics. Talk with them at the dining hall, campus bookstore or student center.
Tip #8: Take Notes
Taking notes can be a family activity. With all of the information you take in on one college tour, it is likely you will not remember everything. Take notes during each tour and discuss them during your trip back home.
Tip #9: Take a Break
Whether you’re taking a long road trip or flight, everyone needs a break from the routine. Plan to take a hike or sightsee between colleges A and B. You’ll get some exercise and new perspective.
Tip #10: Let a Professional Help
Planning a college tour can be challenging and time consuming. Consider getting a professional to help with car rentals, hotels, plane tickets and estimated travel times. College tour planning is available through AAA and Best Western, who have partnered to save you even more money. Visit AAA.com/financialaid. Ms. Honeycutt is AAA’s Student Lending Manager.
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Insurance Appeals Allowed for Recalled Cars
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Massachusetts insurance regulators will allow some Toyota drivers who were involved in accidents linked to unintended acceleration to appeal insurance surcharges assessed by their carriers.
The move follows Toyota’s decision to recall 4.2 million vehicles with potentially dangerous gas pedal mechanisms.
Any driver who has unsuccessfully appealed their surcharge can request to have a re-hearing, if they were driving a vehicle subject to the recall. Appeals are also allowed for drivers who have been determined to be at-fault by their insurer but did not appeal that decision to the state.
Request for re-hearings must be filed by April 1.
Hearings will be limited to issues involving unintended acceleration. Drivers will be required to demonstrate that the vehicle involved in the accident is one of the models and types recalled by Toyota and that the accident was related to the acceleration problem outlined in the recall notice.
While the recent recall was issued by Toyota, it covers several Lexus models as well the Pontiac Vibe.
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Combined Coverage Equals Insurance Savings
By Kimberley Edgar
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AAA members long have found savings by combining their auto- and home-insurance coverage through AAA Insurance.
But since Massachusetts adopted its managed-competition system in April 2008, many members are saving even more.
The reason: Before, they received a discount on their homeowners coverage. Now, there’s also a discount on their auto insurance.
“It’s a double discount,” said H.C. Hansen, AAA Insurance Agency’s Managing Director. “And before, with the homeowners, it was a flat discount. Now, the discounts can vary, depending on the type of policy you have and the company it’s with.”
According to a Massachusetts Office of Consumer Affairs survey, residents saved more than $270 million in insurance premiums in the first year of managed competition, and the average premium per vehicle dropped 8.2 percent during the first year.
Another report, on the 2008 Market for Home Insurance, states more than 14,000 additional home insurance policyholders in urban areas obtained premium credits in 2008 than in 2007 because they had related private-passenger coverage.
And in coastal areas, more than 4,000 additional home-insurance policyholders obtained premium credits in 2008 than in 2007 because they had related private-passenger coverage.
“It often connects,” said Frank Doyle, Senior Vice President of AAA Insurance Agency. “Overall, people do have more choices, and there are a lot of positives: Rates have continued to come down.”
Victor Smith, of Sandwich, is one AAA member reaping the savings. The former community college professor watched the premiums he paid for his coverage through the teachers’ union rise for several years before turning to AAA for help last year.
After working with a AAA insurance agent for a couple hours, he walked away with new policies – through Commerce Insurance Co. – equal to or better than what he had before – and they cost $1,664 less than what he was paying.
“The other thing I really appreciated was the face-to-face contact at the local branch,” Mr. Smith said. “I did not feel rushed, and I felt like things were explained clearly – that’s a nice touch in today’s world, where a lot of things are done over the Internet.
“I’ve also had the occasion to call customer service a couple times on the 800-number in Rhode Island, and the service there has been great,” he said.
Vinod Patel is reaping the benefits of carrying combined coverage for auto and homeowners insurance through AAA.
The Acton resident visited his local branch office, in Acton, and worked with Insurance Agent Elaine Firnstein late last year to walk away with a better deal, better coverage and better service, he said.
“She reduced my overall cost, and she optimized my overall coverage,” Mr. Patel said. “There’s so many factors involved in coverage, and she helped personalize mine – she took some things I wanted and merged them with other products and saved so the umbrella didn’t cost me. She knows her products really well, and I’m thinking of getting life insurance now.”
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Take Five: AAA’s Deposit Program
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AAA Southern New England Financial Services Director Gerald Zeoli answers your questions about AAA’s deposit program with Discover Bank.
1. I knew AAA offered Financial Services, such as auto loans and mortgages, but I didn’t know about your deposit program. What does it entail?
AAA and Discover Bank have partnered to bring you exclusive member-only rates on high-yield deposit products — money market accounts, CDs and IRAs. Discover Bank carries a five-star rating from Bankrate.com and is FDIC-insured up to $250,000 — so you can feel confident knowing your money is invested with a trusted financial institution. And every account comes complete with the outstanding service you’ve come to expect from AAA and its partners.
2. Are there special benefits for AAA members?
You’ll receive exclusive, high member-only rates on personal accounts. The interest rates offered through the AAA Deposit Program beat the national average when comparing similar terms. There is no minimum deposit required to open a CD, and with money markets, you can open an account with no minimum deposit as long as you achieve an average daily balance of at least $1,500 by your third statement cycle.
3. What’s the difference between a money market account and a CD?
A money market account is a savings account with check-writing capability that offers a higher rate of return than the traditional savings account. As long as you maintain that $1,500 average daily balance, you can write checks and use online banking from the account and use a AAA debit card to withdraw money or make purchases wherever the Discover Card is accepted.
With a CD, you deposit money with the intention of keeping it there until it matures — and you can choose maturities ranging from three months to 10 years. Your money earns interest at a fixed rate, offering predictable returns; the longer the maturity, the higher the interest rate. You can keep interest payments in your CD account or transfer it to another account of your choice. There is a fee if you withdraw your deposit early.
4. How can I keep track of my investment?
You can watch your money grow with 24/7 online banking, and you can view up to six months of activity online for both CD and money market accounts. Money market account statements are mailed monthly. CD statements are printed annually.
5. How do I take advantage of this program?
You can open an account in the way that’s most convenient for you: Log on to AAA.com/deposits, call (888) 728-3230 or stop into your local AAA office and ask for an application.
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It’s FAFSA Time: AAA Can Help With Financial-Aid Process
By Kimberley Edgar
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| Applying for financial aid need not be overwhelming. |
Gathering documents. Checking deadlines. Visiting Web sites. Searching for scholarships.
“And don’t miss filing the Free Application for Federal Student Aid, no matter what your family makes,” said Shelley Honeycutt, AAA’s Student Lending Manager. “Every family should file the FAFSA every year, no matter what.”
There’s so much involved in planning to attend college, and the AAA College Planning Center has plenty of resources to help navigate the dates and deadlines.
Visit AAA.com to:
• Find information about different federal and private loans.
• Browse a section on Financial Aid 101 with information on how to apply, types of aid, scholarships and award letters.
• Cull information from resources that include the financial-aid checklist for high-school seniors and their families, a guide on how to choose a college and a glossary of terms.
• Learn tips on planning your college tour.
• Download your free copy of AAA’s Financial Aid guide.
“The guide is critical, especially if you’re a senior in high school or parents of a senior in high school,” said Cathleen Dionne, Student Lending Specialist. “The college tour also is big for juniors – it has some good tips, particularly if this is your first child heading to college.”
The Web site also lists AAA’s education and communication opportunities – free seminars and Webinars, newsletters and podcasts.
“We offer this information in different media to meet everyone’s needs,” Ms. Honeycutt said. “If you’re time-stretched, the Webinars are there for you. If not, the seminars are available for you to attend in person.”
One of AAA’s newest resources – Spanish podcasts on financial aid – also is available at AAA.com and has been quite the hit.
Within hours of AAA posting the podcast, several education-community leaders responded asking if they could use it.
Versions of the five English podcasts also were expected to be available in Spanish by the beginning of this year: “Scholarships,” “How Financial Aid Works,” “All About the PLUS Loan,” “All About the Stafford Loans” and “10 College Tour Tips.” All podcasts are available for download.
Planning Checklist |
Here’s a checklist of admissions and financial-aid dates to help navigate the seasons:
WINTER
• Attend AAA’s Student Lending “Financial Aid 101” seminar/webinar.
• Check your colleges’ filing deadlines for the Free Application for Federal Student Aid, which can be submitted anytime after Jan. 1. If possible, complete your tax forms first for the most accurate information.
• Receive your Student Aid Report several weeks after filing the FAFSA. It outlines the amount of money your family will be expected to contribute to education costs.
• Check whether your colleges require you to file a College Scholarship Service PROFILE or other supplemental financial aid forms. Be aware deadlines vary by school.
• Search for scholarships.
• Send SAT/ACT scores to your schools.
SPRING
• Acceptance letters arrive.
• Financial-aid award letters arrive, summarizing the amount and type of aid you’re receiving. This may include grants, scholarships, work study and loans.
• Consider attending AAA’s “Comparing Award Letters” seminar.
• Accept, deny or appeal award letter.
• Attend AAA’s college-funding options seminar.
• Search for scholarships.
• Once you’ve selected a college, send in your deposit by the deadline.
SUMMER
• Send final transcript to your college.
• If you need additional funds, apply for unsubsidized Stafford Loans (for students), federal PLUS loans (for parents), or private loans.
• Make a plans to attend college orientation.
• Make a moving day list.
• Contact new roommates.
• Search for scholarships.
FALL
• Narrow college list.
• Ask for recommendation letters.
• Write application essays.
• Create master calendar of deadlines.
• Attend financial-aid events.
• Learn about PROFILE/FAFSA deadlines.
• Check early-action/decision deadlines. |
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Tips to Help Your Home Weather the New England Winter
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The Farmers’ Almanac predicts another frigid winter.
If it’s anything like the equation last winter – long cold periods plus expensive oil plus a less-than-favorable housing market – it could equal disaster for some.
“Those things combined made for some expensive losses,” said Frank Doyle, Senior Vice President of the AAA Insurance Agency.
Here are some tips to help your home weather this New England winter:
Temperature
Frozen water pipes spell serious damage when they burst. Inexpensive, battery-operated “temperature alarms” help monitor them, triggering a light to turn on or the telephone to ring and alert the owner if the temperature falls.
Also, avoid setting the heat too low – it could prove costly if those water pipes burst.
Instead, keep thermostats at a minimum 55 degrees.
Checking In
People who will be away for a stretch should have a trusted relative or neighbor check on their home.
Shut off the water main and washer valves and the outside faucets from inside to avoid water damage.
Last year, one home-owner returned from a 12-hour Thanksgiving feast to find the second-floor laundry washer hoses had burst – causing $300,000 in damage, Mr. Doyle said.
Another homeowner was left in the cold when the furnace exhausted its oil, and the pipes froze and burst after the family moved to California.
Their house was considered vacant because they hadn’t been there for more than 30 days, which affects coverage – even when premiums are paid.
“It was ugly – water is messy, and there’s not much recourse if a home is considered vacant,” Mr. Doyle said.
Be Shovelrous
When snow and ice blanket the driveway and sidewalks, clear it away as soon as possible to help keep the home looking lived in, to prevent “slip-and-fall” injuries and to be in compliance with town ordinances. Keeping roofs clear helps prevent collapse or ice dams from forming.
Hot Stuff
And for all those homebodies who stick around, be careful with those space heaters, which when used improperly, can be dangerous.
The U.S. Consumer Product Safety Commission estimates more than 25,000 residential fires are linked to space heaters annually and cause more than 300 deaths.
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Reverse Mortgages Can Help Seniors Stay at Home
By Kimberley Edgar
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| Reverse mortgages may help homeowners 62 and older stay in their homes. |
It used to be AAA’s reverse-mortgage professionals saw one in five people they worked with have an existing mortgage to pay off.
But that has risen to four in five, as increasingly more seniors have to mortgage their properties to make ends meet, said Deb Imondi, Vice President of AAA Southern New England Bank.
In one instance, a 71-year-old woman juggling the pressures of caring for her ailing husband – who has Alzheimer’s – and physically handicapped daughter – who battles multiple sclerosis – came close to losing her home in a scam, Ms. Imondi said.
AAA teamed with a prominent Boston law firm working pro bono to help the woman secure a reverse mortgage.
It let her satisfy existing liens, reclaim her house of more than 50 years and have peace of mind – and she had some money left over, Ms. Imondi said.
While it’s a heroic example of AAA saving the day, it’s one of many where AAA’s reverse mortgages help seniors stay at home.
Homeowners at least 62 years old are eligible to tap into their equity and take a reverse mortgage. Earlier this year, the loan amount limit rose to $625,500, which translates to potentially more equity available for higher-valued homes.
Those opting for the Home Equity Conversion Mortgage from the start are ensured they won’t have to make a monthly mortgage payment for as long as at least one of the owners lives on the property. These represent the majority of reverse mortgages in the United States.
Homeowners must continue to pay taxes and insurance, but it’s more feasible without a monthly mortgage payment.
“With sufficient equity, existing mortgages can be paid off, relieving a homeowner of their monthly outgo, thus improving their cash flow,” Ms. Imondi said.
AAA’s trusted professionals can help seniors determine what works best for them.
“Each mortgage is structured to the borrower’s needs; therefore, it is important to speak with an experienced professional who has dealt with issues of estates, trusts, liens and family situations that can impact the transaction,” Ms. Imondi said. “It’s important you know with whom you are dealing and that you bring trusted family or advisers into the discussions.”
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Good Idea to Consider Flood Insurance
By Brandie M. Jefferson
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| Flood damage is not covered in homeowners insurance. |
Sure, you had some water in your basement this summer, but there were record amounts of rainfall throughout New England. Does a little rainwater mean your house is at risk for a flood?
Maybe. Maybe not.
But, especially since flood damage is not included in homeowners insurance, it’s always a good idea to find out.
“Even if you don’t think you’re at risk, take a look,” said Frank Doyle, Senior Vice President of AAA Insurance Agency.
Last year, you may not have been required to buy flood insurance. But if you plan on moving, or even refinancing, it’s an especially good idea for you to check again.
The federal government is reclassifying flood zones in cities and towns across the country, and New England is no exception.
An insurance agent can determine whether your classification has changed, Mr. Doyle said. That goes not only for homeowners, but for renters, too.
Who should get insurance? “Look at the exposure and consider the costs and benefits,” Mr. Doyle said. But in general, he added, fewer homes are insured than should be.
The Federal Emergency Management Agency has designated the entire state of Rhode Island as flood prone, but as of 2006, less than 4 percent of households — about 15,100 residences — had flood insurance policies. In Connecticut, about 37,400 homes are insured against flood damage and in Massachusetts, 50,200.
Some people have already had to deal with the effects of flooding after southern New England experienced the wettest July on record, according to the National Weather Service.
But autumn is typically when New England sees the heaviest rainfall, Mr. Doyle said, so if you didn’t have any flooding, you’re not out of the woods yet. And if you did have flooding this past summer, be prepared for more.
Homeowners should be aware that water damage in the basement is not covered by flood insurance. If you know your basement is prone to water, don’t keep valuables on the floor, and don’t put too much work into refinishing it.
For flood maps and other information on flooding, visit www.fema.gov/hazard/flood/ or www.floodsmart.gov.
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Insurance Agents Can Help You Choose the Right Auto Policy
By Kimberley Edgar
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| Make sure your auto insurance policy has the proper coverages. |
In this day of drive-through convenience, it can be easy to sacrifice common sense to save a few dollars and cents.
It’s no different with insurance purchases, so take some time to understand the nuances of various coverages and what offers the best protection for you before buying them. They are more complex than Happy Meals, and while there are some things that can be do-it-yourself projects, choosing the right coverage is something that’s best achieved working with a knowledgeable professional.
“The last place you want to learn you aren’t covered is at the scene of an accident,” said Frank Doyle, Senior Vice President of AAA Insurance. “You want the peace of mind you get from working with an insurance professional when choosing the right coverages, deductibles and taking care of the risk we all have on the road.
“By placing all of your insurance together, you avoid the gaps that can be created when looking at each policy on its own. The best savings and best coverage are usually available when combining your home, auto and other insurance with one agency.”
In Massachusetts, the dynamic of managed competition adds to the complexity of an insurance policy. Buyers can quickly follow a recipe for disaster when choosing coverage on their own because the best deal doesn’t always ensure the best coverage.
Licensed and trained professionals, AAA’s insurance agents will be able walk policy-holders through the coverages and explain how underinsuring often unwittingly exposes the policy-holder to risk, leaving them vulnerable.
One example is minimum limits to comply with state law. While a policy-holder might meet the letter of the law by taking out coverage to carry the legal minimum, the practical reality is if that motorist rear-ends and totals a $50,000 Cadillac during an ice storm, the policy-holder will be responsible for the outstanding balance.
In another scenario, a policy-holder might opt to carry lower bodily-injury protection and leave themselves vulnerable. Working with AAA’s trusted insurance professionals also means policy-holders aren’t hanging out there by themselves when there are questions or claims.
AAA’s insurance agents assist when there’s an accident. They help avoid disputes with the company. They are available to take payments and are familiar faces when you call or visit the office.
And when policy-holders compare apples with apples, part to part and coverage to coverage, they will find, most times, it is the same price – if not lower – to buy through AAA’s insurance agents.
And, in essence, they are getting the services of insurance agents for free.
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AAA’s Financial Service Counselors answer your questions.
Q: What advice would you give someone who is in the market for a new car and will need an auto loan?
Michael Woodhead: Research the vehicle and shop around with the dealers for the best possible price. Dealers need to move the vehicles off their lot and it’s a buyers market.
Nancy Turner: Knowledge is key and networking is extremely helpful. In addition to our AAA branch staff and call center, AAA.com provides valuable information on buying a car, as well as financing and protection options.
Q: At what point in the car-buying process should I start working on financing?
JoAnn Accetta: When you start thinking it’s time to buy a vehicle then get yourself pre-approved right away.
Mr. Woodhead: You can apply for financing 30 days before purchasing the vehicle. It will give you enough time to shop, drive the vehicle, determine what vehicle fits your needs and get a pre-approval with a guaranteed rate.
Q: What materials will I need to apply for a loan?
Mr. Woodhead: To apply for an auto loan, you’ll need basic information such as full name, address, work and home numbers, Social Security numbers, employment information and vehicle information, if known.
Mirna Arevalo: Once you’ve finalized on a vehicle, we’ll need to collect paperwork — like a purchase-and-sales agreement and an insurance binder — if the purchase is from a dealership.
Q: What can I expect when applying for a loan with AAA Financial Services?
Mr. Woodhead: You can expect an experienced Financial Services Counselor to offer low, flexible rates and fast approvals.
Ms. Accetta: We will work with the dealer and insurance agent to assure things go smoothly.
Ms. Turner: You can expect personal attention from beginning to end. It is customized for you. After your application receives a credit decision from a lender, you are contacted, given information that is needed to close your loan — via fax. A convenient time is scheduled to sign paperwork and receive your check.
Q: When should I consider refinancing a car?
Ms. Turner: Consider refinancing as soon as you’re aware the rate you obtained through the dealer can be lowered or that your term can be shortened. Once the first payment is made, the new loan can be processed. For optimum savings, refinance within the first year. After that, the savings will be less because a larger portion of interest has already been paid. We are ready to advise and assist in every way possible.
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Do the Math: Scholarship Searches Add up to Savings
By Kimberley Edgar
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| Scholarship searching can yield some great results. |
Few would turn down free money.
But while there are billions of dollars available, many scholarships go unclaimed each year – only about 7 percent of college students take advantage of these funds to help pay for tuition.
It’s like the Publisher’s Clearing House sweepstakes: The check doesn’t just arrive in your mailbox – you can’t win if you don’t apply.
The money isn’t going to transfer into your bank account on a wish – students need to undertake a scholarship search.
“It’s seems like it might be a lot of work for a little result, but if it’s done right, scholarship searching can yield some great results,” said Shelley Honeycutt, AAA’s Manager of Student Lending.
When people do the math, it’s hard to argue the merits of applying for scholarships: Someone who secures three scholarships worth $1,500 annually not only sees a savings of $1,500 in today’s tuition, but also sees an estimated savings of $731.60 in interest. That translates to a total savings of $2,231.60 each year, or $8,926.40 over four years. The estimate is based on 10-year terms at 8.5 percent on a federal PLUS loan.
And the best time to search for scholarships is now.
For every 100 scholarships, a student should find 10 qualified scholarships. For every 10 scholarship applications submitted, a student will typically win one.
AAA Southern New England members who sign up at AAA.com to receive the student-lending newsletter by e-mail will see a general scholarship highlighted each month. Generally the application deadline will fall within 30 days of the e-mail.
“A lot of folks say, ‘It’s too late – all the deadlines have passed,’” Ms. Honeycutt said.
“But there’s no universal deadline for scholarships – they’re sprinkled throughout the year.”
Among other resources AAA offers members in its College Planning Center at AAA.com/financialaid is a section on scholarships.
One tool is a 12-minute podcast that reviews scholarship-searching methods.
AAA also offers free workshops on scholarships, and whether a member attends a live seminar or a Webinar, AAA will review scholarship searching techniques.
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Protect Your Home While Traveling
By Kimberley Edgar
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| Ask a neighbor to park a car in your driveway so it appears your house is busy with activity while you’re traveling. |
Members looking to enjoy some well-deserved R&R also can enjoy peace and security knowing their homes and cars are protected while they’re on the road.
A good first step is to speak with one of AAA’s trusted insurance agents about protections and coverages. But here’s some advice from AAA’s Senior Vice President of Insurance Frank Doyle.
Rent a car
Instead of worrying about possible damage to your vehicle while navigating the nation’s roads away from home, consider renting a vehicle while you’re away.
But if you choose this option, don’t assume you have the insurance coverage you need only to learn later you don’t.
“The last thing you want to have happen is to drop off the car at the end of your trip and experience a world of hurt because they want to secure the value of the vehicle on your credit card,” Mr. Doyle said.
Howdy Neighbor
If you’re friendly with your neighbors, let them know you’re going to be away and how to get in touch with you should anything arise. If your relationships are strong, you might ask them to park their cars in your driveway while you’re away so it appears as though the house is busy with activity. Family and friends are another good group to tap if you’re uncomfortable divulging these details in your neighborhood.
Shut off your water
This is more applicable in winter months when the snowbirds vacate their homes in the Northeast and head to Florida.
Toys
Those trampolines, motorcycles, bicycles and pools should be secured so they don’t leave the premises after you do.
Alarms
Be sure to turn them on while you’re away. And, of course, don’t forget to lock all doors and windows.
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Check Out Auto Insurance Quotes on AAA.com
By Kimberley Edgar
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AAA has mastered the art of connecting members to products and services and offering well-timed sage advice on a variety of matters.
And AAA has expanded its service online with the launch of a new insurance quoting tool for Massachusetts residents.
Since early this summer, the online quoting tool at AAA.com has become a popular service for people looking to investigate auto-insurance costs. It’s available 24/7, 365 days a year to provide flexibility for users to obtain auto-insurance quotes whenever and wherever they have access to the Internet.
“It lets drivers get an estimate of their insurance costs, featuring AAA’s program with Commerce Insurance,” said Frank Doyle, Senior Vice President of the AAA Insurance Agency.
Answer a series of basic questions to get a quick quote and gauge your auto-insurance costs, whether you’re adding a new vehicle to the garage or another user on your policy or evaluating current coverage.
Online help is available through a live chat. “It allows people to check out more scenarios than they might often ask an agent to quote and then go back and work with an agent,” Mr. Doyle said.
He advises people speak with one of AAA’s insurance professionals to ensure they understand the impact of dropping various coverages that might appear to save money in the short term but could prove more costly.
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