Monthly Archives: February 2013

Refinancing

We’re constantly bombarded by lenders to refinance our mortgage under a variety of programs. The volume of offers can almost make you numb to the rational consideration.

There are common rules of thumbs that homeowners and agents use such as not refinancing more often than every two years or there must be at least 2% savings from your previous mortgage rate may not always be accurate.

The reality is that if you can refinance for a lower rate and you’ll be in the home long enough to recapture the cost of refinancing, it should be considered. The costs of previous refinancing that haven’t been recaptured by monthly savings may need to be added to the costs of the new refinance.

Take a look at the chart that shows the average rates according to Freddie Mac for 2012. They are lower today than they were in January of 2012 and for the ten years before that.

Refinancing may save you a substantial amount of money, especially if you’re going to be in your home for a long time. It is definitely worth investigating. To get a quick idea of what your savings could be, use this refinancing calculator.

Vacation checklist for your home

The last thing you want to do while you’re on a trip is to worry about someone burglarizing your home. Use this checklist to add some peace of mind to your travel plans.

•Ask a trusted friend – to pick up your mail and newspaper and keep the yard free of trash and advertisements.
•Stop your mail but maybe not your newspaper – you can easily handle this online by going to the US Postal Service’s Hold Mail Service. A recent story implicated an employee from a major newspaper who was passing customer hold requests to burglars.
•Don’t post about your trip on Facebook and Twitter until you return – some burglars actually look for this type of announcement to schedule their activities.
•Do notify police and/or neighborhood watch – especially if you’re going to be gone for more than just a few days. Let your monitoring service know when you’ll be gone and if someone will be checking on your home for you.
•Light timers make it look like someone is home – use several set for different times to better simulate someone at home.
•Do unplug certain appliances – TVs, computers, toaster ovens that use electricity even when they’re off and to protect them from power surges.
•Don’t hide a key – burglars know exactly where to look for your key and it only takes them a moment to check under the mat, above the door, in the flower pot or in a fake rock.

These easy-to-handle suggestions may protect your belongings while you’re gone while adding a level of serenity to your trip.

Renting vs. owning

How much evidence is needed to make a decision to get out of the rent race and become a homeowner?

Compare your rent with a mortgage payment on a similar size property. If you want a larger home than your current one, use the rent that property would require instead of what you’re currently paying. If it’s considerably cheaper, you may not need any further encouragement.

By the time you consider the principal reduction, appreciation and tax savings, your monthly cost of housing could be much less than the rent you’re paying.

The principal reduction included in each payment is like a forced savings account that increases as your mortgage balance decreases. Your equity in the property will also grow due to appreciation. The equity is part of your net worth and an investment in your family’s future.

The income tax savings can be an additional financial consideration if the combined interest and property taxes exceed the allowable standard deduction.

Trends are showing that both tenants and homeowners are staying in their homes longer. It’s been said that whether you rent or own, you’re paying for the home. Do you really want to buy the home for your landlord?