Category Archives: Finance

Why Buy a Brand New House and Not a Pre-Loved One?

a houseOne of the questions that you might ask if you’re planning to buy a new house to live in is if you should buy a newly built one. Each option comes with its own set of perks. However, the relatively low price of a resale house might entice you more than the other, but here are some factors you might need to consider.

Modernity

When you buy new homes for sale in Kansas City, MO, you’ll be able to install modern appliances and furniture inside it easily. You will have little need for readjusting any wiring or plumbing, and whatever new appliance model you acquire can easily fit in with the rest of the house that’s brand-new.

Energy Efficiency

Most newly-built homes are fitted with the latest features that can help you save on energy and utilities. Moving into a house like this will cost you less when it comes to paying bills in the future.

Even if you pay more for a brand-new property, the large expenses are likely to stop there since you won’t be worrying about paying too much electric or water bills.

Customizability

New constructions are very much blank slates, so you are free to customize them as you wish. Choose the decor you prefer and arrange furniture and appliances to your liking. You’ll find it hard to do this with a pre-loved house.

Security

Aside from security in terms of walls, gates, and fences, you’ll also be able to need it financially speaking. It’s easier to get funding and mortgage packages for this kind of acquisition. Also, there’s usually a warranty on the structure in case accidents happen because of faulty construction.

Another advantage new homes have over resale ones is the fact that, in case you decide to let go of your house, you’ll be able to sell it faster and for a higher price. You’ll be able to move out in a shorter time, and you won’t worry too much about finances. Brand new homes are truly worth the price.

Couple having not enough money

Don’t End Up Being House Poor

Couple having not enough moneyIf you’re thinking of buying a new house, you should strive to avoid being house poor. People who are in this situation may have grand or extravagant homes, but in reality, they don’t have any other asset apart from their property. This is a result of overextended borrowing or buying too much house of what they can actually afford.

Rich and not-so-rich people can become house poor if they bought a house that is way out of their salary or budget. A rich person, for instance, could buy an enviable home, but then struggle to make mortgage payments because of living or maintaining an extremely extravagant lifestyle.

Primary Residential Mortgage Guilford and other mortgage lenders in Guildford share how you can avoid ending up house poor:

Choose a loan below your maximum pre-approved amount

After getting pre-approved and finding out the amount the lender is willing to loan, it’s best to shop for homes below the maximum amount. You may want to determine the monthly payment that works best for your budget and salary. You should also borrow a loan that lets you own a house while still being able to enjoy some luxuries in life.

Mind closing and other associated costs

Down payment and monthly loan payments are not the only expenses you need to shoulder as a homebuyer. You should also mind closing costs, which can be around 2% to 5% of the home’s purchase price. Other expenses you need to consider include private mortgage insurance (if your down payment is less than 20%), property taxes, homeowner’s insurance, maintenance, and utility bills.

Be careful when buying a house that needs renovation

If you’re thinking of buying a house that needs a lot of work, you have to remember that the cost of renovation can be bigger than what you expect. This is especially true if you don’t have any experience in this aspect and you’ll need to hire contractors to do the job. It’s best to ask yourself if you have the cash ready to do the renovation or if it’s better to buy a livable house and renovate in the future.

It’s never advisable to have all or most of your income tied on housing expenses. Be sure to do some research first and work with a reliable lender can who help you make an informed decision.

a couple looking up at a big house

The Top Three Benefits of Buying Your Own Property

a couple looking up at a big houseAside from having a career, many have the ultimate dream of owning their own home. However, there are factors involved in processing property acquisitions that can be discouraging even for stable earners. However, the perks of owning your residential unit are still something worth considering due to these reasons.

1. Flexible Payment Schemes

Nowadays more and more reals estate projects are offering amenable payment terms to customers who are interested in owning property but cannot afford upfront or the traditional payment methods. Aside from the affordable mortgage rates that feature discounts, some Utah lenders like American Loans also offer to create a customized payment scheme to suit their clients’ lifestyle better. Assess your budget and look up payment packages and methods that will work for you.

2. A Great Investment

Compared to other possible selections, buying your property is probably one of the best possible investment choices available. You can sell your home in the future and use the funds from reselling your old home to acquire a bigger property or choose to start a business with it. Play your cards right, and you can fully maximize the amount you’ve invested and earned from your property’s sale.

3. A Better Long-Term Purchase

If you have plans to have a family in the near future then having your property will be better for you in the long run. As time passes by, you will have to make some adjustments to your budget and lifestyle to accommodate these changes, and then eventually it will be harder for you to keep up with your present rental fees. Acquiring your property early on offers you a chance to eventually own your present residence, making it easier for you to survive the transitions of family life in the future. This would be quite difficult to manage with a rental.

In the end, what matters is deciding to do what will suit you best. Your new acquisition can be a great place to settle down or become a future investment. Either way, it’s a win-win situation if you find the right property for you.

Broker presenting the contract to clients

Buying Real Estate: Understanding the Quitclaim Deed

Broker presenting the contract to clientsA deed is required when transferring real estate property, and one common kind of deed is called the quitclaim deed. But a quitclaim deed isn’t appropriate for all situations since it doesn’t provide sufficient security for buyers. It is, however, practical in certain situations like when transferring real estate between trusted family members.

What Exactly is a Quitclaim Deed?

To better understand how a quitclaim deed works, you need to learn how a general warranty deed works. The general warranty deed is that’s usually for certifying a title’s clean state, meaning that it guarantees that the individual who’s transferring the title to you is indeed the property’s owner and is legally entitled to transfer it to you. With this kind of deed, no one except the grantor or seller could claim ownership of the property. This deed likewise guarantees that the property has no liens or debts and provides you warranty or protection against these things.

On the other hand, you get no such warranties with a quitclaim deed since all a quitclaim deed does is transfer any of the grantor or seller’s interest in the property to you. It doesn’t guarantee that there are other owners who could claim the property as theirs. You also won’t be protected against liens or debts on the property. Do note though that a quitclaim deed doesn’t affect mortgage payments since it would only transfer the title of the property so if the property is still under a mortgage, the seller would still be liable for the payments, explains a mortgage broker from VIP Mortgage in Phoenix.

Main Takeaways

A quitclaim deed is basically a way for transferring property from the owner or grantor to another individual, usually a buyer. When a grantor issues the deed to a buyer, there’s no guarantee that the buyer would be protected against issues with the title of the property such as liens or debts.

It’s best that you only accept a quitclaim deed from family members or someone you really trust. Also, quitclaim deeds could be useful for correcting title errors or changing names indicated in the title without involving money.

Tips on Determining the Right Motorcycle Insurance Coverage

First-person view of riding a motorcycleIf you have already secured funding for your new motorcycle, you also know that you should get motorcycle insurance. But do you really need one? The answer is no, but that is if you live in Washington, Montana, New Hampshire, or Florida.

But if you live in Los Angeles or Chicago, you need motorcycle insurance. In addition, depending on the state you live in, you might also be required to have uninsured motorist coverage.

What Type of Insurance Should I Have?

As with auto insurance, the minimum coverage required is usually liability insurance. This would cover the damage that your bike has caused if you get involved in an accident, for which you are at fault. Do note though that this won’t be enough if you get sued for the accident and have to compensate the claimant. Liability insurance won’t likewise safeguard your precious motorcycle against damage from natural causes, such as hail, rain, strong winds, or theft.

Your passengers won’t be covered under standard liability insurance and some states require passenger liability insurance. Additionally, if you have a custom bike, you probably want more protection, so you would need special coverage for it. Simply put, the type of coverage you need should be a balance between potential benefits and costs, such that it would give you sufficient coverage and make financial sense as well. Bearing this in mind, talk to an insurance provider to figure out the type of coverage you need.

Tips on Getting Motorcycle Insurance Coverage You Can Afford

There are many ways to make your motorcycle insurance more affordable. For one, you could inform your provider that you keep your motorcycle inside your garage and that you have an alarm system; that is if you really do. This might result in reduced costs. In addition, you could consider attending a motorcycle safety program to communicate with your insurance provider that you’re a responsible driver, hence a low-risk client.

How to Qualify for FHA Streamline Refinance Program

refinancing mortgage contractThere are various ways to work on your mortgage rates without losing your home. The FHA streamline refinance program in Utah, for instance, is a great option for homeowners who have an existing FHA loan and want to lower their monthly payment.

However, certain qualifications need to be met. Here are the criteria for you to qualify:

You Have to be Staying in the House

One of the qualifications for refinancing is that you have to be living in the property you are refinancing. You should also own the home for at least six months before you could apply for a refinancing program.

Your Payments Should be Updated

You will not qualify for refinancing if you have two late monthly payments on your FHA home loan within the past 12 months. So before your application, check if all your payments are current and made on time.

Get an FHA-approved Letter

You need to have an FHA-approved letter to refinance your existing loan. Meanwhile, homeowners who want to switch to a different lender must ensure that the FHA approves the bank that they will choose as well.

Save Up for the Closing Costs

Another factor that you should consider is the closing costs. Keep in mind that all the closing costs must be paid up front prior to your loan approval. You may also arrange for a “no-cost” FHA streamline home loan.

Although the FHA streamline refinance program is the fastest and the easiest way to refinance your mortgage, there are still a few qualifications that need to be met. To make the process easier, you may want to consider working with qualified mortgage planners to assist you with the entire application process.

An Overview of the Kinds of 1031 Tax Exchanges

Man reviewing documentsBuying and selling property is among the most lucrative ventures nowadays. There are, however, various taxes involved in property transactions, which might not be so convenient for you. But Section 1031 of the United States IRS code allows you to defer the taxes from property transactions.

It is prudent to consult the best among the many 1031 exchange companies in Utah to get the ideal one for your situation. Here are some of the available 1031 tax services.

Simultaneous Exchange

This is the original type of 1031 transactions. In this tax service, your original property is sold and the replacement one bought at the same point in time and using one escrow office. A simultaneous exchange is tough to navigate, and hence just one player in a property transaction is involved in the trade.

Delayed Exchange

In delayed exchange, real estate is sold then a replacement one is bought within 180 days. The replacement property should be recognized within 45 calendar days of the sale of the original one. A delayed exchange is the most popular because of the window period between selling and buying replacement property.

Reverse Exchange

In this 1031 tax exchange, replacement property is bought before the sale of your original property. If you must close the deal of your replacement property yet you haven’t found a buyer of your original one, a reverse exchange is an ideal option. However, this tax exchange will not allow you to own your old and new properties at the same time, and so complications may arise regarding your deed transfer.

From the above tax exchange types, you will appreciate that there is one to suit virtually every need. Section 1031, however, only applies to transactions involving commercial and investment properties. With a good 1031 exchange company, you will know the best way to structure your properties to benefit from this profitable service.

FHA loan form

The Most Common Types of FHA Loans

FHA loan formThe Federal Housing Authority established the FHA loan program upon its formation in 1934. The purpose of the FHA loan program is to help Americans get housing loans.  The FHA does not lend out money itself. It only promises lenders that if the owner of a loan it backed does not pay, the FHA would cover it.

The benefit to the mortgage owner is the low down payment. If you are eligible for the FHA loan program, you only have to pay 3.5% as a down payment. To make the program more accessible to more people, the FHA supports different types of home loans. Below are some of the most common ones.

Fixed rate

A fixed rate mortgage is a conventional type of loan. The interest rate is the same throughout the loan term, which can be as long as 30 years. The only things that will change the monthly payment are the amount of the property taxes and insurance premiums.  It is the most common type of loan people apply for through the FHA loan program.

Adjustable rate

An adjustable rate mortgage is also a conventional loan. However, the interest rate can change over the term of the loan. You might get a fixed interest rate for the first few years, after which the interest rates will follow market changes.

Reverse mortgages

People over 62 years old that own their primary residence can apply for reverse mortgage loans. They can use the equity on their homes to get money from a lender to spend on whatever they want. The loan principal and interest rate become due when the property owner dies or sells the property.

Gradated payment

This type of loan is for people with good prospects but limited incomes. A new college graduate or professional just starting out is a good candidate for this loan. Also known as a Section 245(a) loan, the monthly payments are smaller than normal in the early part of the loan term. This gradually goes up over time when the mortgage owner can presumably afford to pay more.

Many more types of loans are available under the FHA loan program. These are just the most common ones. If you qualify for and want to apply for an FHA-backed loan, it’s likely you’ll find one to fit your circumstances.

3 Common Reasons People Take Out Cash Loans

a man handing over dollar billsMany people apply for loans to cover some unexpected but highly urgent bills. And while the reasons vary, it’s still good to know that you can count on these loans to get you through your financial responsibilities. If you haven’t taken out a loan yet, these situations are examples of when cash loans in Provo will be helpful.

You need to pay off your credit card debt

Based on recent figures, the average credit card debt per card is $1,154. When you’ve already reached your credit limit and you need to pay off past debts, you can apply for personal loans. For many people, it is important to keep their credit score stable because a poor one can have several consequences, which may affect not only their borrowing capacity but also their chances of getting future loans.

You need a buffer for your childbirth or child-rearing budget

Babies are precious. And expensive. While you can save up for the baby’s future needs such as diapers and milk, the biggest bulk of all baby-related expenses are the hospital bills during childbirth. Of course, you have nine months to prepare for the day, but if you became a candidate for a Cesarean section at the last minute or needed to have an emergency operation, a loan will be your rescue option.

Holidays are expensive, too

You’re making a list and checking it twice, because you need to find which items will cost you much this time. Holidays such as Thanksgiving and Christmas are expensive and sometimes, with all the festivities happening, you need some extra cash for spending.

Borrow Wisely

There are many types of cash loans you can apply for. Just make sure that you borrow within the range you’re comfortable with and that you have a debt-free plan in action. Lastly, personal loans are great for unexpected expenses so make sure you spend it wisely, so you don’t end up developing a borrower’s habit.