How Life Events Can Affect Your Mortgage

Home Blog How Life Events Can Affect Your Mortgage

Posted On: April 12, 2021 by Peoples Bank of Kankakee County in: Budget Family General Mortgages Personal Finances Saving

If you have a mortgage, you’ve committed to making a house into a home and settling in for at least the next few years – if not decades. You’re going to live a lot of life in that home! Did you know that different life events can affect your home loan? Peoples Bank of Kankakee County is here to help you understand how life events can affect your mortgage.

Getting Married

If you’re getting married, we suggest you sit down with your future spouse to go over finances and assets. It’s important to be honest about how much you earn and how much debt you have, as these two things play a huge part in how much home you can afford. Purchasing a home with a partner is a fun and exciting milestone!

If you already own a home and your spouse moves in with you, you can choose to add him or her as a co-borrower on your mortgage or simply add their name to the deed. Because this is a big decision that can have a lot of variables, we suggest consulting an attorney before visiting your lender.

Having a Child

Bringing a child into the family is a major financial undertaking. We love them, but they’re expensive! If you’re thinking of purchasing a home, think about current or potential costs for having a child. In Illinois, the average cost of childcare at a daycare center was $13,762 per year in 2019, which is the price of a second mortgage for many families. This doesn’t include the cost of setting up a nursery, clothes and food that are necessary for having a child.

Don’t get discouraged, though! Families have children and own homes all the time and you can live that dream, too. One financial strategy is to stagger a few years in between kids, if at all possible. This allows you to pay for childcare for one child at a time before they go to school. If you have friends or family with children, ask if they would want to do a hand-me-down or clothing swap system.

Lastly, it could be worth it to refinance your home loan. As we mentioned, having children is a major expense, so you may want to get advice on refinancing your home loan to lower the interest rate. Even a small decrease can save you a lot of money over the long run!

Getting Divorced

Going through a divorce is typically burdensome when it comes to working through how to handle financial assets, including your home. If you are currently separated or going through a divorce, it’s necessary to sit down and go over your individual finances with an expert. This is especially important if you previously had joint finances and home ownership with a spouse, because you need to know what you can afford without that additional income.

Two of the most common options include selling your current home to downsize or using child support to pay for the current home if you choose to stay. These options need to be worked out with your lawyer or mediator and both parties must agree to any arrangement you choose.

Death of a Partner

If you experience the tragedy of losing a spouse, finances are likely the last thing you want to worry about, but probably the most immediate issue you encounter. This is also a necessary time to sit down with an expert to go over your individual finances, as well as how to handle any financial benefits from a life insurance policy. You will need to decide if you would like life insurance payments to contribute to your mortgage, or if it makes more sense to downsize.

Mortgage insurance is also something to consider to help with the financial burden of a mortgage after losing a loved one. The right mortgage insurance will help pay for your home loan in the event you lose income due to a death in your family. It’s a good idea to obtain mortgage insurance as you are buying your home or shortly after, if your lender doesn’t require it already, as it won’t be helpful if you obtain it after your spouse passes.

If you’re anticipating a major life event, or would like to be prepared when it happens, feel free to talk to our friendly experts at People’s Bank of Kankakee. Or if you’re thinking of purchasing a home, feel free to check out your #1 Mortgage Lender in Kankakee County*! We’re here to help you through life’s changes with expert advice and compassion.

*Based on Standard Title Guaranty Company data for mortgages recorded in Kankakee Count January – December 2020.

An overdraft occurs when you do not have enough money in your account to cover a transaction, but we pay it anyway. We can cover your overdrafts in two different ways:

We have standard overdraft practices that are available after your account has been open for 30 days and as long as you maintain your account in good standing.
We also offer an overdraft protection plan, Overdraft Protection Sweep, a link to a savings account. It may be less expensive than our standard overdraft practices. To learn more, ask us about this plan.

This notice explains our standard overdraft practices.

What are the standard overdraft practices that come with my account?

After your account has been open for 30 days and as long as you maintain your account in good standing, we do authorize and pay overdrafts for the following types of transactions:

Checks and other transactions made using your checking account number
Automatic bill payments

We do not authorize and pay overdrafts for the following types of transactions unless you ask us to (see below):

ATM transactions
Everyday debit card transactions

We pay overdrafts at our discretion, which means we do not guarantee that we will always authorize and pay any type of transaction.

If we do not authorize and pay an overdraft, your transaction will be declined.

What fees will I be charged if Peoples Bank of Kankakee County pays my overdraft?

Under our standard overdraft practices:

We will charge you a fee of up to $30 each time we pay an overdraft.
The maximum daily overdraft fee per presentment or item paid using the Overdraft Reserve Program is $150.00 per day.
No per item handling fee will be charged on de minimis overdrafts. De minimis overdraft for this policy means transactions that overdraw your account by $30 or less.
There is an overdraft fee of $5 per day that will be charged beginning the 4th consecutive business day your account is overdrawn.

Nonsufficient funds (NSF) fees - if an item drafted by you (such as a check) or a transaction you set up (such as a preauthorized transfer) is presented for payment in an amount that is more than the amount of money in your account and we decide not to pay the item or transaction, you agree that we can charge you an NSF fee for returning the payment. Be aware that such an item or payment may be presented multiple times by the merchant or other payee until it is paid, and that we do not monitor or control the number of times a transaction is presented for payment. You agree that we may charge you an NSF fee each time a payment is presented if the amount of money in your account is not sufficient to cover the payment, regardless of the number of times the payment is presented.

PAYMENT ORDER OF ITEMS - The law permits us to pay items drawn on your account in any order (for purposes of this section "items" means checks, orders and electronic transactions). To assist you in handling your account with us, we are providing you with the following information regarding how we process those items. When processing checks and orders drawn on your account our policy is to pay lower numbered checks and orders in numerical sequence, but electronic transactions are paid first in the order received. The order in which items are paid is important if there is not enough money in your account to pay all of the items that are presented. There is no policy that is favorable in every instance. If the smallest items are paid first, you may have fewer NSF or overdraft fees, but the largest, and perhaps more important items (such as rent or mortgage payments) might not be paid. However, if the largest items are paid first, your most important items might be paid but it may increase the overdraft or NSF fees if funds are not available to pay all of the items. We think our policy attains a reasonable balance between minimizing additional costs to you and paying your more important items. We encourage you to make careful records and practice good account management. This will help you to avoid creating items without sufficient funds and incurring the resulting fees.

What if I want Peoples Bank of Kankakee County to authorize and pay overdrafts on my ATM and everyday debit card transactions?

If you also want us to authorize and pay overdrafts on ATM and everyday debit card transactions after your account has been open for 30 days, you may opt in.

You have an ongoing right to change this consent at any time. If your overdraft privilege has been revoked for any reason, the opt-in or opt-out selection may not apply. Please contact your nearest office for more information.

Alternate ways to Opt In/Out or make changes:

By Phone. Our Customer Care Representatives can be reached at 815-936-7600.
By Mail. Peoples Bank of Kankakee County, 333 E. Court Street, Kankakee, IL 60901
In Person. Please visit your local office and ask a representative to help you decide which plan is best for you.