What is a Project?
The Project Management Institute (PMI) defines a project as "a temporary group activity designed to create a unique product, service, or result." A project has distinctive elements that distinguish it from ongoing work or business operations.
- A Project is a planned set of activities
- A Project has a scope
- A Project has time, cost, quality and resource constraints
Projects vs Operations
- Projects are temporary
- Developing new products or services
- Moving, adding, changing, or deleting
- Implementing a new service or solution
- Operations are ongoing
- Repetitive actions
- Maintenance
- Core business functions
What is Project Management?
Project management is the application of knowledge, skills, tools, and techniques to project activities to meet the project requirements. It is basically about people working in a team to get things done and make the unpredicted predicted.
- Addressing the various needs, concerns, and expectations of the stakeholders as the project is planned and carried out.
- Balancing the competing project constraints including, but not limited to:
- Scope,
- Quality,
- Schedule,
- Budget,
- Resources,
- Risk.
Project Management Lifecycle
The project management simple lifecycle structure includes four phases, and they can be applied to all projects. You start and plan the project, organize and prepare, carry out the work, and close the project. The Project Management Institute (PMI) originally defined the lifecycle in five phases, Initiation - Planning - Executing- Monitor & Controlling and Closing. In order to simplify the process, we will be covering the lifecycle in four phases. Each phase activities are given below and those steps are customized for University usage.
- Initiation:
- Submit your project request
- Assign a Project Manager
- Conduct a kickoff meeting
- Define team roles and responsibilities
- Sponsors' approval to proceed
- Enter project into TeamDynamix (if used for project management)
- Planning:
- Gather requirements and define scope
- Create high-level project plan
- Finalize communication plan
- Develop strategies to manage risks
- Finalize project plan with the team
- Execution:
- Hold team status meetings
- Create status reports
- Manage issues and risks
- Manage quality of deliverables
- Update your project status in TeamDynamix (if used for project management)
- Closure:
- Confirm requirements and deliverables have been completed
- Hold project close out meeting
- Complete project closing report
- Update TeamDynamix and archive project folder (if used for project management)
A number of templates are available to you for use in IT project management.
To choose a project management software, consider each provider’s cost and added fees, overall features and functionality offerings, reporting, integration capabilities, necessary features vs. feature overload, customer reviews and customer support. In this section, we walk you through how to approach this assessment.
Essential Project Management Software Features
Project management software has basic features that most projects need to be successful. However, extra or unique features make some software options better for certain teams or businesses. It’s important to do your research to understand what unique features might make your project more successful based on your team approach, type of business or type of project. Some highly utilized project management tools and features include:
- Budget planning tools: Budget planning tools allow you to upload your set budget, then track expenses and invoices to compare project costs to the planned budget. By tracking this variance, you can determine if you are running into a budgeting problem. Financial forecasting tools further help you to ensure you don’t run over budget or, worse, have to stop the project because of lack of funds.
- Resource management tools: Resource utilization tools allow you to plan, track and record where resources—such as your talent—are used in the project’s execution. In doing so, it helps to reveal gaps in availability or when certain team members are overused (risking burnout), then adjust resource allocation to prevent problems.
- Task management features: Task management features include automations (that eliminate redundant tasks from to-do lists). Examples include automating invoicing, the identification of critical project changes and managing project workflows. Other task management tools include boards (to visualize moving tasks through their stages to completion), calendars, timeline views, scheduling, task tracking and task prioritization.
- Risk management features: Common project risks include finishing over budget, with a lower-quality outcome than expected or not finishing on time. Many tools within a project management software can help you balance competing demands to finish the project as intended, including critical path charts, checklists, scheduling tools, cost breakdowns, cost variance reports and timelines.
- Reports and charts: Project management software offers digital charts for planning, tracking and readjusting your projects’ timelines, budget and quality as needed. For example, Kanban charts show tasks on a timeline board and their status. Gantt charts also give an overview of a project’s timeline complete with its phases, tasks and outputs. You can gather or feed data into these charts to update in real time.
- Mobile app: Mobile apps help teams easily track, manage and deliver project deliverables from anywhere, helping to ensure all members are always in the know no matter where they are. Real-time knowledge can help them make smart decisions that keep projects progressing as planned. Apps also offer personalized content so team members know the tasks, activities and milestones they must complete each day.
- Integrations: Integrations help to boost a project management software’s performance and cater it to your needs. Slack and Google Drive integrations, for example, allow team members to collaborate within the software on project deliverables. Stripe also allows your team to invoice clients for deliverables. Many project management software offer hundreds or even thousands of integration options.
- Client management tools: Many project management software offer various features for including your clients in the project’s execution, keeping them up to date on the project’s status and maintaining a professional relationship. Such tools include video-conferencing tools, invoicing and the ability to add clients as users to the project management software while maintaining control over what they can and cannot see.
- Collaboration tools: Many project management platforms offer tools to help project execution team members work together seamlessly, even across locations. Some come in the form of integrations, such as Slack. Others, however, are built in. Such built-in tools often include shared calendars, group chats, document sharing, chat forums and team email.
- Demos and team feedback: Project management software may have all the right features but, if your team isn’t comfortable with it, it may underperform in project execution. For this reason, many software programs offer demos your team can use to test them, even allowing you to pilot them in a real project. From there, you can gather team feedback to learn the software’s appropriateness for your team and needs.
Ease of Use
Look for tools and designs that can help your organization use the software easier, despite barriers such as little knowledge of best practices or a cumbersome number of tasks that must be completed on a daily basis. Choosing the right ease-of-use features for your organization depends on many factors, including your company’s tech-savviness and size. However, some ease-of-use features commonly used by small to midsized companies are:
- Templates: Project management software templates incorporate project management best practices.
- Learning materials and opportunities: Software knowledge bases allow project managers and team members to learn how to expertly implement the software’s features based on layman’s terms definitions, videos and more. Demos are another opportunity to learn via often live interaction with software experts who know how to present its features and answer questions in layman’s terms.
- Automations: Automations make complex tasks instant and effortless by taking repetitive and often tedious tasks out of human hands. Less hands-on interaction makes the software’s involvement in project management easier to manage. Preset automation recipes make this ease-of-use feature even more intuitive.
- Mobile apps: Logistically, mobile apps make using the software easier by facilitating the gathering and dissemination of necessary information and helping team members complete tasks in a timely manner. Project field practitioners, for example, can update pertinent information on a project’s status without having to hold up the project to go back to the office to input such data.
Reporting and Analytics
Reporting within project management software presents key data in a meaningful way to help you understand the success or needed improvements in your projects. The best project management software offer dashboards that break down data in the form of graphs, tables and the like to make gleaning insights from the data instant and intuitive.
Determine the types of key performance indicators (KPIs) you may need to track and the types of needed reports to help you track them. Then, when evaluating your considered software, explore its reporting and analytics options and dashboards to determine if they have what you need.
Common reports that may be helpful in a project management software include project status, health, team availability, risk, variance and timeline reports. Common KPIs include percentage of tasks completed, return on investment (ROI), schedule variance, planned vs. real hours and the planned project value.
Next, evaluate whether the software will continue to meet your needs by exploring whether you can customize the reports or dashboards to meet needs as they arise. Customization options may include the ability to add or remove columns or create new reporting views.
Customer Reviews
Customer reviews offer real-world insights into what it is like to use your considered software and do business with its provider. Search your considered software on tech review sites such as Capterra and TrustRadius. Read the reviews of past and current users. As you do, you are likely to learn the glitches the software experiences, hidden costs not highlighted on the provider’s website and how the software compares to competitor solutions.
Customer Support
Access to quality customer support ensures that, should a glitch happen in the software, your entire project isn’t derailed. To learn more about your chosen provider’s customer support, search for it on review sites such as TrustRadius and look at the company’s plans to understand what will be available to you and when. Aim to at least ensure support will be responsive during your normal business hours and via the mediums your team is accustomed to using.
Business Size Considerations
As you look at the feature set, remember that startups have different needs in project management software than do large enterprises. For example, enterprise companies may need to manage projects with execution steps that span the globe, while startup projects are more likely to span one or two locations. Demos can help you determine what tools are useful for your organization’s size and which will unnecessarily create a steeper learning curve.
Though one software plan or tool may be best for your organization at your current size, those needs are likely to change as you grow. For example, as you grow, you may need a software or plan with greater automation capabilities to scale operations or greater file storage capacity. So, while it is important to choose a software without unnecessary features, it is equally important to choose one that will continue meeting your feature needs as they grow.
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Oil might want to consider business transformation with sustainability as core pillar of its corporate purpose
Flames from a flaring pit near a well in the Bakken Oil Field. The primary component of natural gas ... [+]
Corbis via Getty ImagesWhat is the future of Western oil majors as they battle increased scrutiny from socially activist investors, citizens, and governments? My suggestion is that they learn from the practices of Philip Morris International (PMI), the tobacco giant. PMI’s 2020 sustainability report states that “more than one billion people worldwide…and around the same number will smoke in 2025.” The report goes on to say that the addressable market of 1 billion customers worldwide has stayed constant since 2010. The World Health Organization projects this to be constant for at least another five years because nicotine is a highly addictive substance. Similarly, oil has similarly addicted customers. Despite all the promise of renewables, we have not managed yet to reduce the demand for oil.
Tobacco worldwide is dominated by five listed companies: Altria, British American Tobacco (BAT), Imperial Tobacco (IMP), Japan Tobacco (JT), and PMI. The biggest player is the state-owned China National Tobacco Corporation (CNTC). CNTC has a market share of 46% and PMI of 14%, the largest of the listed companies. Also important is Indian Tobacco Company (ITC) which is 30 percent owned by BAT. In the world of oil, akin to CNTC, state owned enterprises (SOEs) or quasi-SOEs such as Aramco of Saudi Arabia and Rosneft of Russia produce around 50% of the world’s oil. However, we have hundreds of Western oil companies in business now. My guess is that we are likely to witness consolidation in this group or purchases by private buyers, such as private equity firms. The oil SOEs are generally untouchable. Roughly 60% of PMI’s 2020 revenues are collected by the Government as excise taxes ($47 billion of $76 billion). Appropriate carbon taxes, if implemented, would also account for a large proportion of the revenue of Western oil majors in the next decade or so.
So, if you are Chevron and you could peek into a crystal ball, what does the future hold? Is there a managerial playbook for how to transform yourself and still be a relevant, thriving viable company over the coming decades? I do not mean to minimize the differences between oil and tobacco. Cheap oil has transformed lives, especially in the developing world, for the better. Without cheap oil, China and India would not have been able to lift millions out of poverty. But I am deeply concerned that 13 of the top 15 most polluted cities in the world are from India, where I am writing this from.
Many, if not most, of Western asset managers bucket tobacco and oil under the “excluded” category without fully appreciating nuances in companies within oil or tobacco. If I were the CEO of one of the large Western majors, I would study PMI’s transformation closely. In this piece, I contrast the practices of PMI with that of Chevron as a counter-example.
But before doing so, let me be clear. Putting aside the addictive pleasure people derive from smoking, cigarettes damage health and cause many deaths every year. Hence, one could argue there’s little good that can be said about the cigarette business. And while PMI is executing the major business transformation I describe below, it still sells hundreds of millions of cigarettes every year. My intention is to draw managerial lessons for oil from tobacco and provoke a deeper conversation about business transformation, as opposed to endorsing or criticizing either the tobacco or the oil business.
Prepare for a scenario where your main product is completely phased out
PMI’s competitors focus on expanding their portfolios and offering more choice to their customers. PMI, in contrast, aims to switch out of cigarettes completely, by offering both choice and better alternatives to customers via heated tobacco products branded as IQOS. It has set a target of booking more than 50 percent of its revenues coming from reduced risk products (RRPs) by 2025, thereby dramatically cannibalizing its cigarette business. Remarkably, New Zealand has banned the sale of cigarettes to anyone born after 2008. PMI is well positioned to exploit that ban. I am not suggesting that the sale of oil will ever be banned but PMI’s business transformation is worth understanding. Chevron’s 2020 sustainability report talks a lot about general trends in the oil market but has little by way of strategy for how to deal with the sunsetting of oil in the future.
View sustainability as an opportunity for innovation and publish a scorecard of business transformation metrics
Many oil majors consider sustainability as an externally imposed development that they have to deal with. Instead, disrupt the business from the inside and view sustainability as a way to differentiate yourself from the competition. This is more than empty sloganeering. PMI publishes goals and metrics related to (i) the number of adult users that have switched to IQOS; (ii) the number of markets where IQOS is sold; (iii) proportion of revenue from smoke free products (a sizeable 24%); (iv) proportion of R&D devoted to smoke-free products (99%!) apart from the traditional sustainability metrics such as (i) the number of IQOS devices recycled (84%); (ii) reduction in scope 1+2+3 emissions; (iii) supply chain practices; and (iv) not marketing to youth. The competition, by and large, continues to focus on traditional cigarettes and is likely to be not ready for an outright ban on cigarette sales that may be on the horizon, if New Zealand is an early indicator.
To transform itself, a business must conduct a holistic review and overhaul its business model to include extensive changes in the firm’s operations and value chain and the way the firm interacts with society. This is captured in PMI’s “Statement of Purpose” signed by every member of its board of directors. I do not know of any U.S. company that has done so, including all the signatories to the Business Roundtable’s “Statement of the Purpose of a Corporation” which I’ve written about before. My analysis with Aneesh Raghunandan suggests that the BRT signature is more greenwashing than substantive.
I do not get the impression that Chevron has thought seriously about sustainability as integral to its corporate purpose. Their sustainability report talks about investing $3 billion by 2028 to advance their energy-transition strategy. That number is 2.5% of $15 billion annual capex spending extrapolated to 2028 ($3/($15*8 years). Chevron seems to have targets for zero flaring by 2030. These are relatively low hanging fruit in oil and gas whereas a well-defined net zero aspiration is much harder. Chevron’s definition of net zero would only cover scope 1 and 2 emissions only, not scope 3, in any case. Moreover, Chevron’s targets seem to be anchored on emissions per barrel (intensity measure) as opposed to total emissions.
Make the Chief Sustainability Officer (CSO) report to the CFO
One of my simple litmus tests aimed at assessing whether a firm is serious about sustainability is to check who the CSO reports to. In PMI, the CSO, Jennifer Motles, reports to the CFO, Emmanuel Babeau. This enables better integration of ESG drivers into business strategy and hence mutually reinforces the link between financial performance and sustainability. It also serves to have the same high quality internal control and measurement systems for sustainability reporting as for financial reporting. Chevron has appointed a vice president of strategy and sustainability but he appears to report to the president of Chevron North America Exploration and Production.
Embed sustainability priorities in executive accountability
Viewing sustainability as central to business strategy makes it easier to integrate sustainability drivers into executive compensation goals. I have written about half-hearted or non-existent integration of ESG drivers in compensation plans earlier. PMI links executive compensation to at least two sustainability metrics: (i) revenues from business transformation related to net revenues of smoke-free products; and (ii) non-combustible product volume. Chevron’s 2020 proxy statement links executive pay to reductions of flaring and methane intensity, which are great initial steps, but the targets could become much more aggressive.
Cultivate a culture that welcomes not rebuffs challenge
The CEO of PMI, Jacek Olczak, states “I cordially invite you to question, to challenge, and above all to engage with us as we remain focused on making our company one that is centered on sustainability and a higher purpose.” I have not seen or heard of such a culture among the oil majors, except perhaps a bit for Exxon after the Engine no.1 initiative.
Gather and publish data on the whole value chain
PMI’s business transformation is based on an in-depth understanding of the global tobacco and nicotine value chain. Seventy thousand data points on this chain are published in their Tobacco and Nicotine database and covers information on number of farms, volume of cigarettes manufactured, and government revenues from excise for over nine years. I have never seen anything similar in the world of oil and gas.
Make multi-stakeholder engagement the norm
Business transformation depends on the cooperation of stakeholders- from supply chain to regulators, consumers, employees, investors and the finance community, and civil society. In each case, explain why you engage, how you engage and what are the key issues that are discussed. PMI does this well, but I have not seen something similar in oil and gas.
Don’t shy away from negative externalities imposed by the firm
Most oil majors barely engage with “single materiality” issues or sustainability factors that are important for enterprise value creation for investors. “Double materiality” refers to risks and opportunities material from a financial and non-financial perspective especially, negative and positive externalities created by the firm for which the market does not hold the company accountable. PMI advocates for adding “P” (the impact of the product) to ESG, an aspect that ESG ratings ignore. I have written about this in the case of Cola Cola. PMI, perhaps on account of Big Tobacco’s long history with regulators and lawsuits, has been far more pro-active in dealing with health related problems created by the burning of tobacco when smoking a cigarette. Oil and gas could do far more.
In sum, if sustainability is truly imbedded in corporate purpose, strategy and implementation is better integrated with all aspects of business. If sustainability is viewed as a value imposed by activist investors or outsiders, as seen by most of the oil and gas industry, a company’s ESG efforts will always come across as disjointed and sometimes aimed at spin or even greenwashing. The oil and gas majors would do well to understand how PMI has been transforming itself over the last decade or so.
As a business school professor, I am always drawn to managerial lessons one can glean from companies that have battled a similar crisis before. Tobacco, to some extent, has been there and done that. Oil would do well to learn from Tobacco.
Updated
How to use this mortgage calculator
The Ascent's mortgage affordability calculator with PMI, interest, and property taxes helps you understand how much a home loan will cost. It also makes it easy to compare loan options. To use the calculator, plug in:
- Your desired home price
- The amount of your down payment
- The interest rate on the loan you're considering
- The type of mortgage (the loan term)
You can also add the cost of home insurance, property taxes, and homeowners association (HOA) fees, if you know them. This can give you a more accurate estimate and help you with your home search.
Mortgage calculator formulas
A good mortgage payment calculator takes into account all the monthly costs that go into a mortgage payment. These costs are added together to estimate your total monthly payments as well as the interest you'll pay over time.
Here's how a mortgage rate calculator determines your payment amount.
1. The calculator determines how much you're borrowing
This is the total home price, minus any down payment. Enter the price of the home you're interested in, as well as how much you're using as a down payment. If you are buying a $400,000 home and making a $40,000 down payment, the calculator subtracts $40,000 from $400,000 to determine that you are borrowing $360,000.
2. It calculates your principal and interest payments
A mortgage payment can be broken down into four parts: Principal, interest, taxes, and insurance.
This calculator immediately figures out how much your principal and interest will run each month, based on a specific interest rate. A loan with a longer term typically has a higher interest rate, but the principal payment isn't as high each month as with the payment for a shorter-term loan, since you have longer to pay off the principal.
For example, if you borrowed $360,000 on a 30-year loan at 7.5%, your principal and interest payment would be $2,517. If you borrowed the same amount through a 15-year loan at 6.8%, your principal and interest payment would be $3,196.
3. It adds in property taxes, home insurance, HOA fees, and any mortgage insurance costs
If you're taking out a mortgage, the monthly payment consists of more than just principal and interest. You're also responsible for paying property taxes and homeowners insurance, both of which are added into your monthly payment. Some homeowners also pay a homeowners association (HOA) fee.
A mortgage affordability calculator can estimate these inputs based on the typical costs for a home in your price range, or you can provide exact details to get a more accurate estimate. For example, if your home insurance is $1,200 per year, your property taxes are $3,000 annually, and your HOA fees are $500 per year, this adds around $392 to your monthly payment.
If you've made less than a 20% down payment, private mortgage insurance (PMI) must also be included, which typically costs between 0.5% and 1.0% of your loan amount annually. For instance, if you're borrowing $360,000, you might pay between $1,800 and $3,600 for mortgage insurance.
Principal, interest, property taxes, HOA costs, home insurance fees, and PMI are added together, resulting in your total monthly payment. If you opted for the 30-year loan mentioned above, this would mean adding up:
- $2,517 for principal and interest
- $634 for property taxes, insurance, and HOA costs
- $233 for mortgage insurance
The calculator would show your total monthly mortgage payment at $3,384.
Elements of a house loan calculator
It's important to understand all the inputs of a home loan repayment calculator to determine your monthly and total costs.
Home price
This is the amount you are paying for the home. If you've made an offer to buy a house for $400,000, the home price would be $400,000.
Down payment
The down payment is the amount of money you put down on the property at closing. Ideally, this will be at least 20% of the home's purchase price because you can qualify for a more affordable loan and get a broader choice of lenders. Lenders do let you put down much less in some cases -- as low as 3%, or even $0 with certain loans (such as VA loans).
Your down payment is determined by the amount of cash you have available to put toward the home. If you have $40,000 available for this use, you'd be putting 10% down on your $400,000 loan.
The down payment is subtracted from the home's purchase price to determine the amount of money you borrow from your mortgage lender.
Interest
Interest is the rate you pay to borrow. Your interest rate is based on national averages and economic conditions, as well as individual financial credentials such as your credit score and your debt relative to your income. Your mortgage loan type and choice of lender also factor into your interest rate.
The higher the interest rate, the more financing charges you pay your lender over time. A higher rate also leads to larger monthly payments.
Often, in addition to your interest rate, you'll see something called "annual percentage rate," or mortgage APR. A mortgage APR is the yearly cost of borrowing money. It includes your interest rate, but also fees your lender may charge, all rolled into one rate.
Private mortgage insurance (PMI)
Mortgage lenders require you to have private mortgage insurance (PMI) when your down payment is less than 20% of your home's value. The amount you pay depends on how much you borrow, but its annual premium is typically between 0.5% and 1.0% of your home loan.
Mortgage type
There are several kinds of mortgages, including 30-year, 20-year, and 15-year loans. Your loan type affects monthly payments and total costs.
A loan with a longer payoff time typically has a higher interest rate. Since you pay more in financing charges and pay interest for longer, it's more expensive than a loan with a shorter payoff period. However, the monthly payments are lower than a shorter-term loan. Because you aren't making as many payments, loans with shorter payoff times have higher monthly payments -- despite the lower rate and lower total costs.
Insurance
Homeowners insurance is required by lenders. Lenders require this because the home serves as collateral for the loan. The cost to insure a property is based on many factors, including its value, the type of insurance, and the level of risk. For example, homes in an area prone to earthquakes typically cost more to insure. The same is true of homes in areas prone to mudslides or on floodplains.
It's a good idea to compare insurance quotes from several carriers to find the most affordable coverage. Rates can vary dramatically, particularly after you factor in the variety of discounts offered by insurers.
Lenders typically collect monthly payments (as part of your overall mortgage payment) for home insurance and keep the money in an escrow account. For example, if your insurance is $1,200 per year, your insurer adds $100 onto your mortgage payment. The money is kept in a special account, then your insurance bill is sent to your lender, which pays it out of that account annually.
Property tax
Property tax is paid to local and state governments. The amount of property tax depends where you live. It's usually expressed as a percentage of your home's value. Property tax payments are also collected by your lender as part of your monthly mortgage payments and put into escrow until your lender pays your property tax bill once per year.
HOA fees
If your home is part of a homeowners association, then HOA fees are factored into monthly housing costs as well. HOAs collect dues to maintain common areas and provide other services.
While paying funds into escrow raises the total due each month, it removes the headache of trying to come up with the money to pay insurance, taxes, and HOA fees when those bills come due.
Why would someone need a mortgage calculator with PMI, interest, and taxes?
Our simple mortgage calculator can help you make informed decisions about your loan, including:
- Comparing loan scenarios: Before applying with a mortgage lender, see how decisions such as borrowing more or making a smaller down payment affect your cost. Compare scenarios by changing the input amounts using a hypothetical mortgage calculator.
- Comparing loan types: Change the loan term to see how a shorter or longer payoff time affects loan costs.
- Determining what you can afford: Use the calculator to see the cost of different loan amounts to see if they fit in your budget.
If you get quotes from several mortgage or refinance lenders, you can also use our mortgage affordability calculator above to view the true cost of each loan.
How to interpret the results of the mortgage calculator
The results of a mortgage repayment calculator can help you determine how much a particular loan will cost each month. Using the calculator, you can compare loan types and determine, for instance, if you prefer a 15-year or 30-year loan, based on total costs and monthly payments.
You can also make sure the mortgage payments fit into your budget. If your total payment would be $3,384 with all costs added in, you can assess whether this is a comfortable amount to pay.
Generally, a mortgage payment should never exceed 28% of your monthly take-home pay. Let's say you bring home $6,000 per month -- 28% of $6,000 is $1,680. That means that your mortgage payments, including principal, interest, taxes, insurance, and HOA should not be more than $1,680.
What to do after using the mortgage calculator
After using the mortgage loan calculator, you're ready to make informed choices about home buying. Consider taking these next steps.
Get qualified for a loan
Work on improving your financial credentials to increase the odds you can qualify for a mortgage loan at a competitive rate. This could mean paying down debt or improving your credit score.
Choose a loan type
You can use a simple mortgage interest calculator to decide if you want a 30-, 20-, or 15-year loan based on the monthly payments and total loan costs for each loan type.
Compare rate quotes
Apply with several lenders to get preliminary rate quotes. You can input the interest rates and terms each lender offers into the calculator to see which lender offers the best loan.
Obtain pre-approval
After narrowing your options to one lender, submit your financial information to complete the pre-approval process. Lenders will assess your details and tell you how much you can borrow, at what rate. You'll lock in your loan rate during this process.
While you aren't 100% guaranteed to get the loan you're pre-approved for, you should get final approval under the agreed-upon terms as long as nothing changes financially, and the home you're buying is approved by the lender.
Complete your purchase
After getting pre-approved, you can make an offer on a home. When that offer is accepted, you'll go through the appraisal and inspection process. Once the home checks out and your lender reviews your financial credentials again, you close on your home loan.
Frequently asked questions about mortgages
How do I qualify for a mortgage?
To qualify for a mortgage or refinance, shop around with several lenders. When you find the best rates and terms, make sure you meet the lender's requirements for income, debt, and credit score.
You'll then provide information on your finances, so gather documents such as pay stubs and bank statements. Once you've found the right loan and have your paperwork ready, submit an application. For more information, or if you're ready to go, use our form to guide you through the process and get a mortgage pre-approval.
Can I get a mortgage with no credit?
Yes, although it won't be as simple as landing a loan with a strong credit history. Most lenders look at your credit report and score when determining if you qualify for a home loan. However, some lenders work with borrowers who don't have a credit history. They can review other documentation, such as utility statements, showing you have a history of making on-time payments.
Shop around for a lender that does manual underwriting and prepare financial documentation such as bank statements. Find out more in this guide to how to buy a house with no credit.
What does a mortgage payment include?
Your monthly mortgage payment includes:
- Principal: This is the amount you pay toward the loan balance each month.
- Interest: This is the cost you pay for borrowing. It's determined by how much you borrow and your interest rate.
- Taxes: Most lenders collect a payment toward your property taxes each month. This money is put into an escrow account. That's a special account earmarked for such expenses. The lender pays the property tax bill out of the escrow account.
- Insurance: Lenders also collect a monthly payment toward homeowners insurance. This is also put into escrow. Lenders then pay your insurance bill to protect the collateral (the house).
A simple mortgage calculator with taxes and PMI can tally these up and give you a hypothetical mortgage payment. You could also use a mortgage amortization calculator or amortization schedule to give you a sense of how much interest you'll pay over time.
What mortgage type should I choose?
The type of mortgage you should choose depends on many factors, including your credit history, your down payment amount, the type of house you're buying, and your goals for your loan. For example, you may wish to choose a:
- Conventional mortgage (one not guaranteed by the government) to avoid upfront fees.
- A government-guaranteed mortgage (such as an FHA, USDA, or VA loan) if you have poor credit or a low down payment.
- A 30-year fixed-rate loan if you want predictable payments and don't mind paying more interest over time in exchange for a smaller monthly payment.
- A 15-year fixed-rate loan if you want predictable payments and want to pay the least amount of interest over time, despite having higher monthly mortgage payments.
These are just a few examples of different home loans. Research all the mortgage types before you decide. For example, if you're purchasing a fixer-upper and want to borrow enough money to cover both the home and the cost of upgrades and repairs, look into a conventional, FHA, or USDA rehab loan.
What can I expect in the home-buying process?
To begin the process of buying a home, set a budget to ensure you're prepared to qualify for a home loan and pay a mortgage. Prepare the financial documents that mortgage lenders will want to review. Get quotes from several lenders, and pursue mortgage pre-approval from the one offering the best terms.
You may want to hire a real estate agent to help you shop for properties. When you find a home that fits your budget and criteria, make an offer, including any contingencies or conditions that must be met, such as a satisfactory inspection. Complete the formal loan approval process for the mortgage loan that best fits your needs, and close on your transaction.
This home buyer checklist provides more insight into each of these steps, so check it out before you shop for a property.
How much should you save for a down payment?
Ideally, you will make a down payment equal to 20% of the value of the property. So if you're buying a $400,000 home, save $80,000.
However, many people don't save this much for a down payment. You could qualify for a conventional loan (not backed by the government) with as little as 3% down. Some government-backed loans don't require a down payment at all. But if you don't make a down payment or make a small one, expect to pay mortgage insurance or other upfront fees.
Whether you plan to save 20% or not, look into how to save for a down payment.
What documents do you need to apply for a mortgage?
To apply for a mortgage, you need:
- Proof of income, such as tax returns, pay stubs, W-2s, or 1099 tax forms
- Proof of assets, such as bank statements and investment account statements
- A gift letter if someone is providing you with gift money for a down payment
- A history of mortgage or rent payments, such as information from your landlord
- Identification, such as a Social Security card or government-issued ID
Lenders may also request additional information, so read more details in our full guide to what documents are required for home loans.
What expenses of homeownership do I need to prepare for?
Expenses of homeownership to prepare for include:
- Your mortgage payment
- Property taxes, which are often added to your mortgage payment (your lender puts the money into a special escrow account, then pays your local government)
- Homeowners insurance, which is also often added to your mortgage payment and paid by your lender. Check out our guide to determine how much homeowners insurance you may need
- Mortgage insurance, which protects the lender from potential losses if you make a down payment below 20% of your home's value
- Utilities, including electricity, gas, water, cable, and internet
- HOA dues, if you live in a neighborhood or building with a homeowners association
- Home maintenance and repairs, so that you aren't caught off guard by unexpected expenses
You can learn more about all these costs in our guide to homeownership expenses.
What's the difference between a 15- and a 30-year mortgage?
With a 15-year loan, you make payments for just 15 years, as opposed to 30. The monthly amount you owe is higher on a 15-year loan than a 30-year loan because you make fewer payments. The interest rate is usually lower on a 15-year loan. And total interest costs are lower, because you pay interest for less time.
Carefully consider the pros and cons of a 15- vs. 30-year mortgage when you decide which is right for you. Additionally, you can explore 20- vs. 30-year mortgages.
The "sweet spot" is the loan term that allows you to pay the mortgage off as quickly as possible without cutting your budget short each month.
What tips would you give first-time home buyers?
Some of the best tips for first-time home buyers include:
- Begin to save early for a down payment.
- Take steps to Improve your credit score.
- Set a budget before shopping for a home.
- Shop around for the most favorable mortgage interest rate and loan terms.
- Get pre-approved before making an offer on a home.
- Hire a real estate agent with solid credentials you feel comfortable with.
- Research properties carefully, considering factors such as zoning laws and school districts. Even if you don't have children in school, homes in good school districts tend to fetch a higher resale price.
- Make an offer that protects your interest, including contingencies such as an inspection to check for major issues.
- Save up for closing costs.
For more information, look at our first-time home buyer tips.
Why does my debt-to-income ratio matter when applying for a mortgage?
Lenders consider your debt-to-income ratio when you apply for a mortgage because they want to know you can afford mortgage payments. They look at your:
- Front-end ratio, which compares your monthly mortgage payments to your income. This is where the "no more than 28%" rule of thumb comes into play.
- Back-end ratio, which compares mortgage payments and other debts to your income.
If either ratio is too high, a lender won't approve your loan. For more information about lender requirements, read up on debt-to-income ratio and why it matters.
How does my credit score affect mortgage rates?
A higher credit score can result in a lower mortgage rate, since lenders view you as a low-risk borrower. A lower mortgage rate means lower monthly payments and less total interest paid over time.
A credit score on the low end can make it difficult to get approved for a loan. And lenders that do approve a mortgage will charge a higher rate. That's because credit problems suggest a greater chance a borrower will default on a loan.
Find out more about this by looking into how credit scores affect mortgage rates.
If you want to uncover more about the best mortgage lenders for low rates and fees, our experts have created a shortlist of the top mortgage companies. Some of our experts have even used these lenders themselves to cut their costs.
SEATTLE, WA — The PMI23 Manufacturing Success Conference, to be held Oct. 23-26 at the Lotte Hotel in this stunning city on Puget Sound, will explore how the industry can contribute to solving water-related challenges occurring worldwide.
PMI23 keynote speaker, Moogega Cooper, will explore this potential in her address titled “Limitless.” A true guardian of the galaxy as the leader of NASA’s Jet Propulsion Laboratory’s Planetary Protection Group, “Dr. Moo” will challenge PMI23 attendees to pursue their dreams and reach their true personal potential.
PMI Women’s Breakfast featuring Andrea Quinn
A new addition to the conference this year will be the Women's Breakfast, with featured speaker Andrea Quinn. After Quinn was taken out of work one day on a stretcher, she decided to profoundly change her life. Brought to the brink by overworking and by trying to meet unrealistic expectations, she became a life coach to help women achieve an empowering work/life balance. Quinn’s remarks during the PMI Women’s Breakfast: “Essential Empowerment Curriculum for Women” will serve as a guide to achieving respect and career success while remaining true to personal values.
After the breakfast, Quinn will deliver the “Tools to Reinvent Yourself in the New World of Business” keynote to all attendees. Her address will provide advice on how to navigate a changing business landscape by implementing personal development and self-accountability. She will facilitate discussions about how to accept and be open to change, how to make empowering personal and professional choices, and how to build community.
Early birds will reap the benefits of PMI23
Starting on the morning of the first day of PMI23, the PMI Inspiring Leaders Program will cultivate the creative, leadership and team-building skills of those who arrive a little early to PMI23. Working closely with a group of plumbing manufacturing professionals in a setting that inspires—Seattle’s Museum of Flight—program facilitator Nicole Bianchi will explore how to be intentional as leaders and clear on leadership philosophy and how to set expectations, build relationships that are clear and kind, and have conversations that matter.
Her goal will be to help participants build working relationships of accountability and engagement that increase productivity and results. This exciting pre-conference program on Oct. 23 is open to all employees of PMI member companies, no matter their position or experience level.
Expert presenters cover the gamut of industry issues
Expert presenters will deliver crucial insights during an extraordinary program designed to fuel professional development. subjects to be addressed: artificial intelligence, extended producer responsibility, green building, international perspectives, legislative and regulatory developments, the manufacturing economy, market outlook, PFAS, the skilled labor gap, sustainability, trade, water management, WaterSense and more. In addition, PMI’s 2024 leaders and 2023 award winners will be introduced during PMI’s 69th Annual Meeting of the Membership on Oct. 25.
See the entire PMI23 schedule by visiting www.safeplumbing.org/events/calendar/event/scheduled-activities/pmi23-manufacturing-success-conference. Register at www.safeplumbing.org/events/calendar/event/pmi23-manufacturing-success-conference.
To learn more about Plumbing Manufacturers International, visit safeplumbing.org.
(RTTNews) - The manufacturing sector in Vietnam continued to contract in July, albeit at a slower rate, the latest survey from S&P Global revealed on Tuesday with a manufacturing PMI score of 48.7.
That's up from 46.2 in June, although it remains beneath the boom-or-bust line of 50 that separates expansion from contraction.
The trend in the headline index was matched by a number of the survey's sub-indices in July, with rates of contraction in output, new orders and employment the weakest in the respective sequences of reduction which stretch back to March in all cases.
In particular, new orders decreased only marginally in July amid some signs of demand stabilizing. That said, manufacturers signaled that demand remained subdued overall, particularly in export markets.
U.S. stocks traded higher midway through trading, with the S&P 500 gaining around 0.5% on Monday.
The Dow traded up 0.59% to 35,434.26 while the NASDAQ rose 0.25% to 14,067.65. The S&P 500, also rose, gaining, 0.51% to 4,559.39.
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Leading and Lagging Sectors
- Energy shares climbed by 2% on Monday.
- In trading on Monday, health care shares fell by 0.2%.
Top Headline
The S&P Global composite PMI fell to 52.0 in July from 53.2 the prior month.
Equities Trading UP
- Tupperware Brands Corporation (NYSE:TUP) shares shot up 66% to $1.4912 on above-average volume amid retail investor interest.
- Shares of AMC Entertainment Holdings, Inc. (NYSE:AMC) got a boost, shooting 28% to $5.61 after a Delaware judge denied the company from converting its AMC preferred equity units into common stock.
- Applied Digital Corporation (NASDAQ:APLD) shares were also up, gaining 17% to $9.00 after the company reported better-than-expected fourth-quarter adjusted EPS results and issued FY24 revenue guidance above estimates.
Equities Trading DOWN
- AppHarvest, Inc. (NASDAQ:APPH) shares dropped 70% to $0.1001. AppHarvest announced Chapter 11 filing to support a financial and operational transition.
- Shares of Kodiak Sciences Inc. (NASDAQ:KOD) were down 50% to $3.61 after the company released topline results from three Phase 3 studies of tarcocimab tedromer for neovascular age-related macular degeneration and diabetic macular edema.
- 22nd Century Group, Inc. (NYSE:XXII) was down, falling 38% to $2.9999. 22nd Century named interim CEO and implemented a $15 million cost reduction initiative.
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Commodities
In commodity news, oil traded up 2.5% to $78.97 while gold traded down 0.3% at $1,961.20.
Silver traded down 1.1% to $24.585 on Monday while copper rose 1.1% to $3.8585.
Euro zone
European shares were mixed today. The eurozone’s STOXX 600 rose 0.1%, London’s FTSE 100 rose 0.2% while Spain’s IBEX 35 Index fell 0.3% The German DAX rose 0.1% French CAC 40 fell 0.1% and Italy’s FTSE MIB Index rose 0.2%.
The HCOB Eurozone manufacturing PMI declined to 42.7 in July from 43.4 in the prior month, while composite PMI slipped to 48.9 in July from 49.9 in the prior month.
The HCOB France composite PMI declined to 46.6 in July from 47.2 in June, while German composite PMI slipped to 48.3 in July from 50.6 in the prior month. Spain's producer prices fell 8.1% year-over-year in June. Excluding energy, the producer price inflation eased to 2.2% in June from 2.9% in May.
Asia Pacific Markets
Asian markets closed mostly lower on Monday, with Japan’s Nikkei 225 falling 0.57%, China’s Shanghai Composite Index falling 0.06% and Hong Kong’s Hang Seng Index gaining 0.78%. India’s S&P BSE Sensex, meanwhile, fell 1.3%.
The au Jibun Bank Flash Japan services PMI fell to 53.9 in July compared to a final reading of 54.0 in the previous month, while manufacturing PMI declined to 49.4 in July from a final level of 49.8 in May. The Judo Bank Flash Australian composite PMI slipped to 48.3 in July from 50.1 in the prior month.
Economics
- The S&P Global services PMI fell to 52.4 in July from 54.4 the prior month.
- The S&P Global manufacturing PMI rose to 49 in July from a six-month low level of 46.3 in June.
- The Chicago Fed National Activity Index fell to -0.32 in June versus a revised -0.28 in May.
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COVID-19 Update
The U.S. has the highest number of coronavirus cases and deaths in the world, reporting a total of 107,455,000 cases with around 1,169,350 deaths. India confirmed a total of at least 44,995,050 cases and 531,910 deaths, while France reported over 40,138,560 COVID-19 cases with 167,640 deaths. In total, there were at least 691,827,450 cases of COVID-19 worldwide with more than 6,902,170 deaths.
