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21 Monday Sep 2015
Posted in Helpful Information
Tag Archives: home ownership
Homeowner’s Insurance Tips!
16 Monday Feb 2015
Posted in News you can USE!
Save on Homeowner’s Insurance
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Insurance is a way to hedge the risk of a possible loss on an asset that a person or entity cannot afford. The cost of the coverage is determined by risk and exposure to the insurer and reflected in the premium.
Another way to say it is: don’t buy insurance when you can afford the loss. If you have a mortgage on your home, you must have insurance. It is probably prudent for most people to have property insurance but certain coverage might be avoided because you can afford the loss if you were to have an occurrence.
- Call your current agent and review your insurance coverage. Ask if there are any available discounts whether your property qualifies for now or after certain improvements are made. Monitored alarm systems, dead bolts, smoke detectors, updated electrical, certain types and ages of roofs among other things may be eligible for individual discounts.
- Compare the newly revised coverage and premium with other reputable agencies and insurers. Shopping can be time consuming but experts agree that the exercise can be valuable and should be considered every few years.
- Deductibles are an easy way to affect the premium based on the initial amount of loss that the insured wants to assume. The higher the deductible, the lower the premium. Determine the amount of risk you want to assume and select an appropriate deductible.
- Consider bundling your home and auto policies for possible discounts and leverage for better service.
- Don’t become a co-insurer. Most policies stipulate that a building must be insured for at least a certain percentage, usually 80% of its insured value to be able to collect the full amount of a partial loss. Insured value is not always the same as market value. The land is not considered in the value but replacement cost of the dwelling is.
It isn’t possible to purchase insurance after a loss; it must be purchased before a loss is incurred. Premiums are based on careful analysis of insurer’s loss and overhead expense plus a profit. As a homeowner and an insured, it would be equally wise to analyze coverage, claim service, your risk tolerance and the premium you’ll pay for that coverage.
Homeowner Tax Benefits
29 Monday Dec 2014
Posted in News you can USE!
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There are many reasons for wanting to have a home of your own like a place to raise your family, share with friends and feel safe and secure. While investment opportunities rank high for most people based on the fact that homeowners’ net worth is over forty times higher than that of renters, so do the tax benefits that reduce tax liability.
- Taxpayers who have owned and used a home for at least two out of the last five years, can exclude a maximum of $250,000 of gain as a single taxpayer and up to $500,000 of gain for married taxpayers filing jointly.
- If the gain on a principal residence exceeds the allowed exclusion, the balance is taxed at the lower long-term capital gains rate rather than the marginal tax rate of the homeowner.
- Homeowners can deduct the interest paid on up to $1,000,000 of acquisition debt used to buy, build or improve their first or second home. They may also deduct the interest on up to $100,000 over acquisition debt that is a recorded lien on their first or second home.
- IRS will allow taxpayers to decide each year whether to take the higher of the itemized deductions or the standard deduction.
- Points paid on new loans for home purchases are considered interest and can be deducted in the year paid. On the other hand, points paid for refinancing a home must be amortized over the life of the mortgage.
For more information, talk to your tax professional and see IRS publication 523 and IRS Publication 936.
Verify with Your Lender
24 Monday Nov 2014
Posted in News you can USE!
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 return?”
Qualifying for a Mortgage
29 Thursday May 2014
Posted in News you can USE!
The 4 Cs of Qualifying for a Mortgage
Homeownership | May 7, 2014
Thinking about buying a home but not sure whether you qualify for a mortgage? Consider the following facts.
What Do Lenders Look For?
Freddie Mac buys mortgages that meet our requirements from lenders – we don’t make the loans. The lenders decide the standards they ultimately apply in making loans.
When deciding whether to make a loan, lenders evaluate the four Cs:
- Capacity to pay back the loan. Lenders look at your income, employment history, savings, and monthly debt payments, such as credit card charges and other financial obligations, to make sure that you have the means to take on a mortgage comfortably.
- Capital. Lenders consider your readily available money and savings plus investments, properties, and other assets that you could sell fairly quickly for cash. Having these reserves proves that you can manage your money and have funds, in addition to your income, to pay the mortgage.
- Collateral. Lenders take into account the value of the property and other possessions that you’re pledging as security against the loan.
- Credit. Lenders check your credit score and history to assess your record of paying bills and other debts on time. (Even if you don’t plan to buy a home now, it’s always a good idea to build and maintain strong credit. Landlords often check it to make sure that you can pay the rent. It’s also important if you want to apply for a mortgage or other credit line in the future, such as a student loan, car loan, or credit card.)
Want to Know More?
Visit About Homeownership for information, resources, and tools to help you gauge your options and understand what’s involved in looking for, buying, and maintaining your own home.
Learn the truth about some homeownership myths that also might be keeping you out of the market.
http://www.freddiemac.com/blog/homeownership/20140507_4Cs_qualifying_mortgage.html
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