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Showing posts from November, 2014

Verify with Your Lender

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If you have a mortgage with an escrow account to pay your property taxes and insurance, you expect the company servicing your loan to pay this year’s taxes this year so that you can deduct them on your 2014 income tax return.  After all, your monthly payment includes 1/12 the annual amount so there will be money available for them to be paid on time.IRS requires that expenses must actually be paid in the year that a deduction is to be taken. The predicament occurs when you’ve made your payments but the mortgage company didn’t pay the taxing authority in the tax year they were due.  If they paid your 2014 taxes in January of 2015, they wouldn’t be deductible for you until you file your 2015 income tax return. Verify with your lender after you make the December payment that they did indeed pay your property taxes.  The question for your lender’s customer service is: "Have you or will you pay the 2014 property taxes this year so I’m eligible to deduct them on my 2014 income tax r…

Consider an Adjustable Rate

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With fixed rate mortgages as low as they are, most purchasers or owners wanting to refinance might not even consider an adjustable rate loan.The determining factor should be how long the person plans to be in the home and which mortgage will provide the cheapest cost of housing.For instance, if you compare a $300,000, 30 year term mortgage with a 4.125% rate on the fixed and a 3.25% on the 5/1 adjustable, the breakeven point would be almost seven years assuming the rates adjusted the maximum that they could in each year.Therefore, if a person is going to stay in the house less than 7 years, the ARM would provide the cheapest cost of housing.  This example shows that at the end of five years, the ARM would generate almost $13,000 savings over the fixed-rate.  On the other hand, this could be a good time for homeowners with an existing adjustable rate mortgage to consider refinancing into a fixed-rate mortgage.The longer that they intend to stay in their home, the more advantageous it m…

Realize Tax Savings Sooner

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A homeowner’s tax saving benefit is generally realized when they file their federal income tax return after the money has been spent for the interest and property taxes.  Some people look forward to the refund as a means of forced savings but some people need to realize the savings during the year.It is possible to adjust the deductions being withheld from the homeowner’s salary so they realize the benefit of the savings prior to filing their tax returns in the form of more money in their pay checks.  Employees would talk to their employers about increasing their deductions stated on their W-4 form. By increasing the exemptions or deductions, less is taken out of the check and the employee will receive more in each pay check.  If a person over-estimates their exemptions and therefore, underpays their income tax, they might incur interest and would have additional tax to pay when they filed their tax return.

Buyers considering this strategy should seek tax advice and discuss it wi…

Talking Points with an Agent

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A list of talking points can be very valuable to guide the conversation with an agent that will lead to a decision to have him or her represent you in the sale of your home.  If you haven’t been through the process before or it has been a while, the answers to these questions can reveal things about the experience and where-with-all of your candidate.Even if you only intend to interview one agent and maybe they are a trusted friend, it is appropriate to understand how different issues will be handled.  Professionals should not feel challenged to discuss these important concerns. 1. Tell me about your experience and training. 2. Do you work real estate full-time? 3. Are you a REALTOR® and a member of MLS? 4. What is the average price of the homes you have sold and how many did you sell last year? 5. Which neighborhoods do you primarily work? 6. How many homes have you sold in my neighborhood? 7. What is your list price to sales price ratio? 8. How many buyers and sellers are …