If you’re looking to buy a home, the $700 billion from the government went straight to lenders, meaning it's becoming easier to get a mortgage (at a low rate to boot). Plus, if you're a first-time buyer, there are tax credits available that could amount to $8,000, depending on the price of the home and your income level. The caveat? Lenders want candidates with a 700+ credit score.
If you already own your home, consider refinancing. If you bought your home 6 to 24 months ago or are paying a rate of 5.875 or higher, you could cut your costs by $938 per year for every $100,000 you owe. Also, you won’t have to pay income taxes on any portions of your mortgage you had forgiven through 2009, and you won’t be penalized for repaying your loan in full (read: saving money on interest) if you do so before 2012.
If you want to buy a car, you’ll need a solid credit score. The standards for loans across the board are more strict, meaning you’ll need to make sure you pay your bills on time and keep credit card balances at less than 30 percent of the max credit line.
If you have a credit card, there’s a chance your credit line will be lowered in order to avoid the risk of people overspending and being unable to make payments on time. So keep your credit card purchases to a minimum!
If you don’t have a credit card, you may have trouble getting one. Card companies aren’t making as many offers, which you might have noticed by looking in your mailbox.
If you have a savings account and your bank goes under, more of your money is insured. As part of the bailout, the FDIC insures each account holder up to $250,000 instead of the previous $100,000. So even if your bank crashes and burns, gets bought out, or merges with another bank, your cash is covered.
If you don’t have an emergency account, start building one. One of the consequences of the bailout is that companies relying on short-term loans for day-to-day expenses are going to have to cut somewhere, and that “somewhere” often starts with employees. Having emergency cash will keep you from dipping into your retirement savings.
Nestperts Brett Graff, The Home Economist and former government economist; Dara Duguay, director of Citi’s Office of Financial Education and author of three books, including The Citi Commonsense Money Guide for Real People
More Recession Resources
-- Caitlin Moscatello
See More: Buying a Car , Buying a Home , Money , Money Q&A , Saving