We had a brief moment of panic about our mortgage statement while we were unpacking. It had arrived a few days before we moved and got put with a pile of papers, but then we couldn’t find it in the pile after we moved. I unearthed the payment instructions and payment website from the loan documents, after which we found the statement. The bank offered us an array of payment options to ensure we didn’t miss a payment, and we also took precautions to ensure that we’re never late.

Automated Payments through Your Mortgage Servicer
The first option we set up was automatic payments. The mortgage account site let us create an automatic debit from our checking account. All we needed was our bank tracking info, which is found on the bottom of your checks. We arranged to have our checking account automatically debited on the 1st of every month. We also do this with our student loans. This way we never have to worry about a late payment.

One-Time Online Payments through Your Mortgage Servicer
When we set up the automated payments, it didn’t kick in until October 1. We set up a one-time payment for September 1 through the same site to make sure this month was paid on time. We had to enter our checking account information again, but the payment went through. Because we had the servicer debit our checking on the 1st, it considered the bill paid on time even though our bank didn’t process the payment until the 2nd.

Online Banking
With online banking, you usually have two options – scheduled recurring payments or one-time payments. As a back-up, I set up our mortgage in our online banking account so we can click a few buttons to make a payment from our checking account if something goes wrong with the mortgage servicer. I didn’t set-up any payments, though. Don’t want to get double-billed!

Accelerated Payment Services
I don’t recommend using a service to accelerate payments. We received an offer in the mail to do this, but it wasn’t through our bank. We shredded the info. We also had the option to do this through our online mortgage interface, but for right now we’re doing regular monthly payments. If we ever do accelerate, I won’t pay the bank’s fee to accelerate either. I’ll simply send them an extra payment through online banking.

Mail a Check
You can still pay your mortgage the old-fashioned way by mailing them a check. Given the vagaries of the US postal system, this would be my last option for paying this bill. I’d call the bank to pay by phone before I mailed a check, but if online banking fails you, make sure you send the payment at least seven days before it’s due.

Balancing Your Mortgage with Other Bills
If you’re like us, you probably have a slew of bills due on the 1st. What would happen if one of your paychecks was late? What if your direct deposit got screwed up? We actually receive one of our paychecks at the end of the month, and one a few days into the month. Although we have a large enough cash cushion in our checking account to cover a delayed paycheck, we also took the precaution of staggering our bills. I simply called our primary credit card company and asked them to move our bill due date to after my husband’s pay date. We’ve always paid on time, so they were more than happy to push it back a few days. They didn’t even charge us interest for the extra few days of grace that first month.

Plan Your Cash Flow
As a last tip, make sure you budget your cash flow around all of your bills, including the mortgage. That way you’ll know if you need to shuffle money into your checking account to cover the mortgage payment before you receive an insufficient funds notice.

With all the moving hubbub, I was very worried we’d accidentally pay late. Fortunately, we found the payment site and account number in time, and had the cash on hand to pay the bill without trouble. If you want to maintain good credit and avoid fees, make sure you pay your mortgage on time every month. The banks make it so easy, so let them help you out with this.

While in the process of moving, and now as I unpack, I find myself willing to part with more and more stuff. I unpacked my bookcase this weekend and it didn’t have quite as many books as it used to. I unpacked my keepsake box and realized I had no idea why I’d won a plaque for Social Studies in the eighth grade. Seeing as the nameplate had fallen off, I figured I didn’t need it anymore. Of course, there were some things I would never part with, like my computer. But I challenged myself to come up with five things I could part with. Here they are:

Useless Kitchen Gadgets
It’s happened to anyone who cooks. You see a cool looking thingy in a catalog and you must have it. It gets used once and then stuffed in the back of the utensil drawer. When I found those items, I tossed them out. For example, the egg-beater my mom gave me when I moved. She fished it out of her utensil drawer and it found its way into mine. Thirteen years later, it had been used once, so I tossed it.

Old Bedding
We’d been saving old bedding for our next move, thinking we could use it to wrap furniture. Except that we hired movers to do the moving for us. A couple of the comforters could be useful for camping or as cushioning while painting baseboards, but the rest are now in the trash. I have no need for a ripped top sheet.

I gave up a good 30-40 books during the moving process, which whittled me down to a mere ten boxes of books. Most of them had either never been read or I didn’t like enough to keep. Some will be sold, some were donated to the library, and some were so battered that they had to be recycled. I don’t miss them at all.

I finally admitted that I will never fit into certain pairs of jeans again. Even if I got back down to the size I was at 18, my body isn’t the same so they wouldn’t fit right. It was tough, but I put them in the donation box.

Curling Blow Dryer
I don’t style my hair. I brush it and that’s about it. I can count on one hand the number of times I’ve voluntary curled it. Yet, a hairdresser and my best friend both insisted that I buy a curling blow dryer to style my hair about a decade ago. This is a curling iron with a brush on the end and hot air blows out through holes in the brush. It’s supposed to style and dry at once. Except I could never figure out how to work it. My hair got tangled, I got frustrated, and it sat in a drawer for the next nine years. I did use it for about three weeks two years ago when I left my blow dryer at my mom’s house after a visit. It didn’t work well as an actual blow dryer. I don’t have that thing anymore.

Most of these things should have been thrown out years ago. I held onto them partly out of the idea that I could find a use for them, and partly from the sunk cost fallacy. If I’d paid for it, or it had been given to me as a gift, it must have a value. Except that something sitting in a drawer unused has no value. What do you have that no longer has value? What could you give up? My list is fairly inconsequential, and that’s the point. It’s a lot easier to get rid of the useless stuff first, then later you can get rid of the stuff you’re attached to but no longer has real value.

If you own a home with a mortgage, then your lender requires you to have fire insurance to protect your/their investment. However, many people find that they are underinsured after a fire. If you’ve had your home for more than a few years, you should call your insurance company and a few others to compare current rates at the current home value/reconstruction cost. The last thing you want to do is lose your home and then discover that your insurance won’t fully replace your home, but you’re still on the hook for the full mortgage.

What Fire Insurance Covers
I just received my first policy last month. Rather than the purchase price, which includes the cost of the land, the policy only covers the structures on the property. Specifically, my fire insurance policy covers: dwelling, additional structures, personal property, loss of use, and code enforcement. There’s also a 10% overage included in case of construction cost increases. The dwelling figure is based on the square footage multiplied by the cost to rebuild per square foot. All other figures are extrapolated as a percentage of the dwelling value. So, the shed is insured for 10% of the dwelling value. My personal property is 25% of the dwelling value. The policy is written for extended replacement cost, not current replacement cost, to ensure that I’m covered for future values and costs rather than current values and costs.

Make sure that your policy includes code enforcement. Building codes change regularly, but the updated codes typically don’t apply until the home is remodeled or rebuilt. For example, if you had a 1927 house with the original wiring, you wouldn’t have to rewire the house unless you a. did extensive remodeling that required a building inspection, or b. your house burned down and needed to be rebuilt. Depending on the age of a house, bringing it up to the new code can be very expensive.

Why You Need Fire Insurance
Not everyone needs flood insurance, or earthquake insurance, or hurricane insurance, etc. Everyone needs fire insurance. If you live in a fire zone, then it’s especially vital. One look at the fires that rage through Southern California every year should tell you that. But it’s not just a SoCal problem. It’s 100 years of bad fire policy nationwide. For a long time, firefighters stomped out every small lick of flame in a forest. They didn’t realize that a forest needs to burn periodically to spread seeds and clear out overgrown underbrush. That means, unfortunately, that today’s fires have huge amounts of fuel to burn through and sometimes firefighters can’t stop fires that threaten homes and other structures.

However, even if you don’t live in a fire zone, you’d have to live in a concrete bunker to avoid all risk of fire. A spark from a bad electrical wire, a dryer hose pulled loose by a pet, a cigarette ember hitting a dry tree in your yard, a lightning strike. Any of these things can set your house on fire. Although you can take reasonable precautions, there is still a very real danger of a fire in your home.

Even though fire insurance covers a much more expensive possession than a car, the cost is significantly lower. Our homeowner’s insurance is 1/3 the cost of our auto policy, presumably because we don’t drive our house around town where we might bash it into things. I’ve heard people argue that they don’t need fire insurance because they don’t have a mortgage, but unless they have the full replacement cost of the house saved up in cash, foregoing insurance is not a wise move. Spend the few hundred dollars a year. Even if you never need it, the peace of mind is worth something.

If you already have a fire policy, it’s time to review it. Make sure it includes today’s value, not the value eight years ago. Even your home price is the same, the rebuilding costs have most certainly gone up.

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