Since 1996

This is the customer that shops primarily on price. The cheaper, the better – regardless of quality. Oftentimes, you get what you pay for. Although there is some good value to be had with this approach. The cheapskate represents the overwhelming majority of consumers. Some fall into this category based on affordability, while others fall in this category in emergencies. They simply don’t need the expensive or larger size because they may be on vacation and just need something to get them by for that temporary time period.

About 45% of consumers are in this category.

 

 

This is a person willing to spend but is willing to wait for the store to have their sales, discounts, rebates, reward points, and buy one get one free. This consumer will often patiently wait and save 25%, 35%, or even 50% then they will rake up on all of their desired items. The best months to buy a new car are in the last quarter of the year. October, November and December.

The auto manufacturers’ stop producing the current year cars on September 15th and begin production for next year’s models. The excess inventory must go to make room for the new models and prepare for the upcoming holiday season. Note: If you are lucky, some great bargains are to be had during clearance sales pertaining to clothing, electronics, food, etc. 

About 15% of consumers are in this category.

 

This is the consumer that has a great idea of what they want and they look at the purchase for the short, mid, and long term. Buyers’ remorse is forbidden because they are willing to spend whatever it takes to get the desired results. The key is desired results. The purchase of a nice car, nice clothing, moving into that great neighborhood, great schools, etc.

About 25% of consumers are in this category.

 

This is the person who has inside knowledge of an industry, knows what the prices should be, and recognizes when both the product and the service are priced right. They will do their homework, ask critical questions, shop around, etc.

About 3% of consumers are in this category.

A master negotiator is someone who recognizes the entire situation, knows when something is overpriced and will challenge it. The great negotiators have leverage! Weak negotiators have absolutely no leverage but will continue to talk and waste time. Good negotiations have some give and take. When there is only one side with leverage or unequal leverage, there are no negotiations.

About 2% of consumers are in this category.

 

This is the person who wants to be the first or only person in an elite group. They are the first to see the new movie, buy next year’s model car, travel to a desirable destination, get married, and have children. Sometimes, they are secretly or openly competing with family, friends, co-workers, keeping up with the Joneses, etc.

About 10% of consumers are in this category.

 

Down payment is the amount of money that you put into the house, you may be unable and/or unwilling to buy the house outright so you may put a percentage down as a payment. If you make a 20% down payment, now you own 20% of the home and you are financing and/or paying for the remaining 80% over a specified period of time. Most people finance or mortgage property for 15 or 30 years. The greater the down payment the greater the ownership percentage of equity that you have in the property. Equity is the percentage and/or dollar value that you have in the home. Every time you make a payment, your payment is allocated where a certain percentage goes for the mortgage interest and a percentage goes on the principal (equity).

Debt-to-income ratio is the percentage of what the house and overall debts total up every month. Ideally, it’s 28% of your gross income if you have wages or w-2’s, but if you have freelance or self-employment income, it is your net income. Your overall debts including the prospective house should be 36% to 43%. This means that no more than 43% of your total qualified income should not go toward debts. Everyone lives life in different ways. If no more than 43% of your income goes to debts, then, you will be able to handle life as it comes and the threat of foreclosure is greatly reduced.

The 28% of the house includes the mortgage, interest, property taxes, homeowners insurance, and the optional homeowner’s association fees. If these items add up to less than 28% of your income, then, you proceed to step two. If you have outstanding debts such as student loans, alimony, child support, mortgage, car note, etc., these add to your debt-to-income ratio. If these debts are scheduled to end in less than two years or 24 months, then, they don’t count against the debt-to-income ratio.

Credit score represents your ability to repay the loan. A good credit score is a score of approximately 620. A credit score that is below 620 may produce a higher interest rate. Conversely, a credit score that is considered A-plus may put you in a stronger negotiating position to get a slightly better interest rate. 

The 5 factors that your credit score is based on are: (1) Your payment history, this makes up 35% of your credit score. (2) The amount that you owe, this makes up 30% of your credit score. (3) The length of credit history, this makes up 15% of your credit score. (4) New credit, this makes up 10% of your credit score and (5) The credit mix, makes up 10% of your credit score. 

Credit and Character goes together, the prisons are filled with people with no credit and/or bad credit. No credit because they may have gone to prison at such a young age, before they understood it. How someone handles their money is a direct indicator of character, if they can’t handle their own money, guess what they will do with somebody else’s money. 

Don’t trust them!

Whether it’s dating, marriage, friendship, family, gambling, etc. 95% of the time these words will come to pass and be made true.