By: Jared Dryer
Bellco Portfolio Manager
It’s no surprise that, at almost ten years since economic conditions changed due to the recession, the Prime Rate increased by .25% to 3.75% in December 2016, with potential additional increases to come this year. So what does it mean, and how are you impacted? Let’s review, product by product, focusing on opportunities where you can still benefit and set yourself up for financial success!
MORTGAGES: If you’re in the market for a new home, mortgage rates are still arguably historically low. Plus, if you’re selling your home and have a large amount of equity available for money down on your next house, you may be able to get a great mortgage on your purchase.
The true value though is in a refinance. Many homeowners refinanced between 2008 and 2013, which means they likely had their mortgage for more than five years. With rates still very low, now is a great time to consider shaving years off your mortgage in a term refinance.
If you have between 20 and 25 years left on a current mortgage, consider refinancing into a 20- or 15-year mortgage. Shorter terms typically have lower rates, so you could still lower your rate while shaving off a few years of total payment. That could save you thousands of dollars over the life of your loan while still making a similar monthly payment.
My recommendation: A Bellco Mortgage, with multiple options for terms less than 30 years, can shave years off your loan and save thousands in interest!
DEPOSIT ACCOUNTS (CHECKING, SAVINGS, ETC.): Eventually, as loan rates continue to rise, the interest rates on interest-bearing checking and savings accounts will increase, but at a much slower pace. In time, your liquid assets will earn a slightly better return. Take advantage of available high-rate accounts while you still can!
My recommendation: Bellco’s Boost Checking, which provides up to 2.25% APY* on the first $25,000 held in the account.
CERTIFICATES OF DEPOSIT (CDs): Like other deposit accounts, CDs will also eventually start to pay better interest rates. CDs provide a means to earn a fixed return on your deposit, which means your return will not be impacted by the turbulent stock market. Also, as an insured product, CDs continue to be one of the lowest-risk investment opportunities available.
In a rising-rate environment, you should consider taking advantage of higher returns in middle-term CDs. This means buying into 12- to 18-month CDs and forgoing the shorter and longer terms. Why is this a sound approach to consider? On the one hand, even though longer-term CDs might provide a slightly higher return today, they will restrict you from getting a better return in the near future should the market improve. On the other hand, short-term CDs won’t provide as strong of a return today, but you will have the flexibility to move your money as the market changes. Middle-term CDs could provide the best bang for the buck, allowing for better returns today and the flexibility to improve your position should rates continue to increase.
My recommendation: A traditional Bellco 12- or 24-month CD, which will pay 1.15% or 1.55% APY, respectively. (Minimum $500 to open.)*
CREDIT CARDS: With only a .25% rise in Prime Rate in 2016, the impact to credit cards was minimal. So, for a quick and easy way to borrow money, a credit card is still the vehicle of choice. Bellco offers an introductory 1.99% APR and $0 in fees on balance transfers made in the initial 90 days of opening a new Platinum Credit Card account. That introductory rate is good for 12 months! If you have variable credit card balances with higher rates, transfer these balances and lock in Bellco’s introductory rate for 12 months to protect yourself against the potential of rising rates on your other cards through the rest of 2017. Even if rates don’t rise in 2017, you may still save money over this 12-month period because of the low 1.99% APR.
My recommendation: Bellco’s Platinum Credit Card. Variable rates starting as low as 10% (Prime Rate + 6.25%) for well-qualified borrowers. Introductory balance transfer APR of 1.99% for 12 months on balance transfers made in the first 90 days.**
AUTO LOANS: Bellco prides itself on providing Members with a way to obtain funds for larger purchases; in fact, auto loans have been Bellco’s connection to the Denver community for decades. Despite recent rate changes, Bellco offers competitive auto loans and auto leases to fit your needs. Whether you’re the Member who likes a new car every two years or the Member who will drive the vehicle until it quits, Bellco has a lending solution to fit your needs. Bellco offers competitive leases and auto loans across the board.
My recommendation: A Bellco auto loan with APRs starting as low as 3.09% for well-qualified borrowers.†
HOME EQUITY: Now’s the time to look into a Bellco ChoiceLine to consolidate debt, remodel a kitchen or basement, or have cash available in case of emergencies. Quickly becoming the product of choice in Denver, Bellco’s ChoiceLine offers Members access to the equity in their homes convenient to their needs. Members can choose payment type as well as whether they prefer a line with a lower rate or a fixed loan with a slightly higher interest rate. This puts the power back into the Member’s hand to make their equity work for them based on their needs.
My recommendation: Bellco’s ChoiceLine with a $5,000+ advance at closing to waive closing costs.††
Despite December’s Prime Rate increase, now is a great time to act. Bellco is passionate about helping our Members succeed financially, and we are happy to review your individual financial situation today to identify what’s best for you. So reach out to us now before rates move again.
*Please speak to a Bellco employee for further information about applicable fees and terms.
**All applications are subject to credit approval and different credit terms based on the creditworthiness of the borrower at the time of application. Late payment will cause your introductory Annual Percentage Rate (APR) to convert to the standard APR on purchases and balance transfers prior to the end of the promotion. The following rates and terms are accurate as of 2/28/2017 and are subject to change after that date.
Balance Transfers: 1.99% introductoy APR for the first 12 months on any balance transfers that occur within the first 90 days of account opening. After 12 months, the introductory APR converts to our standard variable rate. The standard APR range on balance transfers is 10%–21%. This standard APR is based on creditworthiness and will vary with the market based on the Prime Rate. 1.99% Introductory APR is for balance transfers only (not purchases or cash advances). All balance transfer fees will be waived within the first 90 days of account opening. After the first 90 days, the balance transfer fee will revert back to your standard balance transfer fee.
†APR is the Annual Percentage Rate. All loans are subject to approval, and final rate may vary based on several factors, including personal credit history, term of loan and age of vehicle. Advertised rates are subject to change without notice.
††All loans are subject to approval. Rates, terms, and conditions are subject to change and may vary based on creditworthiness, qualifications, and other factors. Variable Annual Percentage Rate for well-qualified borrowers as of 2/28/17 is 4.25%. Maximum APR for the variable rate advances is 21%. The variable rate for advances is the Prime Rate as published in the “Money Rates” section of The Wall Street Journal plus a percentage point margin based on your credit qualifications. Rate may vary after account opening. Property insurance is required. Annual Percentage Rates for the three non-variable rate advances will be set on the lock-in date and will not change during the repayment period of the advance.
What alarms and sensors do you need in your new home? The answer is different for everyone. But, whatever your situation, today’s technology has you covered. Here are some common alarms, including two everyone needs to have and three many people should at least consider:
SMOKE ALARMS: No matter where you live—house, condo, apartment—you need smoke alarms. Place one in every room where people sleep and at least one on every floor of your residence.
CARBON MONOXIDE (CO) DETECTORS: Here’s another MUST-have. Carbon monoxide is a deadly, odorless gas generated by the burning of fuels such as wood, natural gas, or propane. This deadly gas kills hundreds of people every year. You should have at least one carbon monoxide detector on every floor of your residence.
NATURAL GAS DETECTORS: This type of alarm usually detects carbon monoxide and propane leaks. Consider one if you have natural gas appliances in your home. You also need one for your RV, camper, or travel trailer if you use propane to cook or heat.
WATER ALARMS: Leaks from appliances or pipes can do extensive, expensive damage to your new home. Water-alarm systems typically use sensors placed near appliances or other trouble spots to alert you when they sense moisture. This type of alarm could save you thousands of dollars, not to mention the aggravation of a water claim.
SECURITY SYSTEMS: Whether you want a do-it-yourself system or one that is professionally monitored 24/7, you’ve got more options than ever before. Technology allows you to check in on your home and property from wherever you are by using an app on your smartphone.
When you decide to purchase a new home, these important alarms and sensors can not only bring you peace of mind, they can also save your life. Many alarms and sensors qualify for extra discounts on your homeowners insurance.
If you would like to learn more about these options, or if you’d like an insurance quote on your new home, feel free to contact Bello’s preferred partner, First Line Insurance Services at 1-800-488-9838 or online at FirstLineIns.com. Be sure to mention you are a Bellco member!
The days are getting longer, the birds are filling the air with song, and the weather here in Colorado is at its springtime best. Which means for many Coloradans that it’s time to start spring cleaning. Unfortunately, all too often, the byproduct of that is just more waste in the landfills. This year, if you’re planning to do some cleaning and decluttering, consider other ways to let go of your unwanted items—and help ensure our landfill waste is reduced.
The quickest way to let go of many of your goods is to donate them to local charities such as Goodwill, ARC, or the Salvation Army. If you’re willing to keep them in your house a little longer—and if you’re willing to put in a little extra effort—you can sell your items in a garage sale or on Craigslist or eBay. However, you’re still left with the problem of what to do with the things that are no longer usable. Often, these are the things that wind up in the trash.
One great way to eliminate waste is to recycle. You’re used to recycling the usual things like old magazines, newspapers, cardboard, and plastic. But what about some unusual items? Did you know that UPS franchisees will accept clean foam packaging peanuts and bubble cushion for reuse? Here are a few other things you can do with your unwanted goods:
» Nike runs a “Reuse a Shoe” program. You can drop off your old, unusable shoes at a Nike Factory Store (four locations throughout Colorado); through the NIKE GRIND program, Nike will break down the shoes into new materials for footwear, apparel, and more.
» To get rid of towels, linens, blankets, and sleeping bags that aren’t fit for human use, contact a local animal shelter or rescue organization. Many will accept those items for use as animal bedding.
» Habitat for Humanity ReStore accepts new or gently used furniture, appliances, housewares, and building materials. In some cases, they’ll provide pickup service for larger items.
» If you’ve got an old mattress, even if it’s stained, consider taking it to Spring Back Mattress. You’ll pay a small fee; however, you can rest assured that all of the components of the mattress—the foam, wood, metal, and fabric—will be repurposed to things like carpet padding or landscape mulch.
» Upcycle—breathe new life into old pieces by creatively re-creating them. For inspiration, go to UpcycleThat.com or TerraCycle.com.
This year as you declutter, make it a game—see how little garbage you can create simply by finding the right path for your unwanted stuff.
In April, Bellco will collect donations for Girls on the Run of the Rockies, a transformational activity-based youth-development program developed for girls in grades 3–8. Participants learn life skills through interactive lessons and running games, and the program culminates with the girls being physically and emotionally prepared to complete a celebratory 5k running event. The goal of the program is to unleash confidence through accomplishment while establishing a lifetime appreciation of health and fitness.
Please consider donating to this charitable cause through Bellco’s Charity of the Month page. To learn more about Girls on the Run, just visit their website.
In addition, all Bellco branches will help raise money and awareness through Running Shoe Icons! Just stop by any Bellco branch, donate $1, and write your name and how running makes you feel on the Running Shoe Icon. Everyone who donates will have their Icon proudly displayed to show support for the girls and families in our community!