Web Design

I am currently using a program called Adobe Custom Suite, it includes:

• InDesign
• GoLive
• Illustrator
• Photoshop
• Image Ready

Web-pages are created based on a customers desires on layout and functionality.  Images that are not available by others are used to ensure that your web-site is unique.

Cathyspetsalon.com was created for a dog grooming business with doggie daycare services.  Colors and layout were chosen by the business owner and other details of the site were discussed and created.

Contact Danielle Rauenzahn at DRauenzahn@gmail.com to discuss your needs.

Should you get an ARM?

Should You Get An ARM? Let's look at the pros and cons to ARMS and the different options available within this category of home loan. The lender assumes the greater risk with a fixed rate mortgage because no matter how high interest rates go, the borrower's interest is locked in for 30 years. That's why fixed interest rate loans have higher interest rates. ARMs, however, put the risk squarely on the borrower. ARM qualifying rates are less than fixed-rate loans, so lenders also offer ARM borrowers more liberal qualification ratios. For instance, with a fixed-rate loan a lender might allow 28 percent of a borrower's gross monthly income for the payment of principal, interest, taxes and insurance. But with an ARM the qualifying ratio is usually higher, say 33 percent. Put these two factors together - lower initial qualifying interest rates and more liberal qualifying ratios - and you can borrow quite a bit more than you would with a fixed rate loan. So how do ARMS work? The ARM interest rate is determined by an "index" that fluctuates with economic conditions and a "margin." A typical rate cap on an annual basis is 2 percent, or 2 percent above or below the previous year's rate. An interesting ARM option is called the LIBOR (London Interbank Offering Rate) ARM. The London Interbank Offering Rate is the rate that international banks based in Europe charge each other for overnight funds. Now here's the kicker - LIBOR ARMs often have a much lower interest rate than others. The interest rate on an ARM has a lifetime cap of 13 percent, and monthly payments can't rise more than 7.5 percent annually. A LIBOR ARM may be for you if you Are looking to minimize your monthly payment. Are seeking to lower your interest rate and monthly cash flow. Want to take advantage of the equity in your house. This is a good refinance program for those who want to consolidate consumer debt such as credit cards. Any ARM is a good idea if ARM interest levels are significantly below fixed-rate interest charges You won't be staying in the house for more than five years (especially if you have a locked-in rate for the first three, five or seven years) You anticipate a higher income in the future (such as a young professional just starting out) ARMs are not a good idea if Initial rates are comparable to fixed-rate loan rates High closing costs offset the low interest rate
	Conforming vs. Non-conforming Loans Conforming loans offer terms and conditions that follow guidelines set forth by Fannie Mae and Freddie Mac. Nonconforming loans, also known as jumbos, are for borrowers whose situations do not "conform" to strict Fannie Mae/ Freddie Mac underwriting guidelines. Non-conforming loans are much easier to qualify for than conforming loans. They also close faster, have reduced or no reserve requirements, allow expanded use of loan proceeds and provide higher levels of cash out for debt consolidation. Circumstances that could prevent you from conforming financing include: Self employment; complicated tax returns; if you do not wish to disclose or document your income; high debt ratios; current or previous credit difficulties; if you want to repay federal tax liens; if you want to recoup equity from your homestead.
	Interest-Only Loans You may want an interest only loan if you: Are disciplined with money Are a risk taker Aren't taking on more than you can handle comfortably Expect your income to rise sharply in the next five years Have an irregular income (like commissioned sales) so that the lower payment is manageable during lean periods and when the money is coming in can pay down the principal Are content to let rising markets build your equity for you Are confident that home prices will continue to rise You don't if you: Have a lot of consumer debt you can't get a handle on Plan on being in your house longer than the interest-only period Are undisciplined with finances Are borrowing a small amount Plan on spending the extra cash on "discretionary" items Plan to sell or refinance before the interest-only period ends Want to lock in today's low interest rates

Mold and your Home

MAKE YOUR HOME UNFRIENDLY TO MOLD
Mold spores are present everywhere. Mold growth is most prolific in warm, damp weather, but high indoor moisture levels and poor ventilation can contribute to mold growth any time of year. To help reduce the potential for mold, provide adequate air circulation and reduce moisture levels in mold-prone areas, such as basements and storage areas.
Avoid storing items directly against walls in potentially damp areas, which restrict air circulation and trap moisture against surfaces. Also consider placing boxes and storage containers on blocks or pallets to allow for air flow.
If you’re going away for an extended period of time, remember that a closed-up house usually creates an environment where air changes occur very slowly. Any water vapor present can condense on the cooler surfaces and allow mold to grow as the temperature warms up.
Frequent air change will help control moisture levels and keep moisture and mold spores from building up. When outdoor weather is appropriate, promote air flow and air changes by using air circulating fans and/or opening the windows slightly. Dehumidifiers can help remove moisture from the air, but realize mold spores will remain. Problems may re-occur when moist conditions return.
Since prevention is always the best way to keep a home fit, the following tips can avoid the potential health and financial burdens associated with mold. For additional guidance on mold issues, visit the Canada Housing and Mortgage Corporation or the U.S. Environmental Protection Agency.
Quick Tips:
Avoid resting long-term storage directly against walls.
Place storage boxes on pallets.
Keep basement windows slightly open during mild, dry weather.
Maintain air circulation in all areas, particularly basements and storage areas.
Filter fresh air changes to help keep spores from building up.

Your Fall Checklist for Home Maintenance

Many areas have already had a taste of fall weather, and it’s not far behind for most others. Now is the time to make sure your house and heating system are ready for winter. Here is a brief checklist to guide you through some basic tasks before it is too late:
GROUNDS
Check window wells, dry wells and storm drains for debris or blockage.
Repair any driveway cracks and/or heaved or settled walkways.
Trim all trees and shrubs that are too close to the house.
Check (ideally during a rainstorm) for rainwater drainage away foundation.
Clean and put summer furnishings away.
Drain and store garden hoses.
EXTERIOR SURFACES
Check weathertightness of all exterior surfaces and components.
Check for deterioration of painted or finished areas. If too late for a full paint job, prime and touch-up bare wood surfaces.
Caulk and seal all joints in siding, around windows and doors.
Check and seal any foundation cracks.
Improve weatherstripping at exterior doors and windows as needed.
Reset storms and screens where required.
Look for any signs of insect or pest activity around the foundation and at wood components close to the ground.
ROOF (Use binoculars or hire a professional.)
Check for loose, damaged or missing roofing.
Check eave areas for signs of moisture build-up or damage.
Check the condition of chimneys.
Check flashings for signs of lifting or damage and repair as needed.
Check and clean all gutters (eavestroughs) and downspouts.
ATTIC
Check ventilation openings for nests or other blockage.
Check the position and condition of insulation for uniform coverage.
Look for any signs of excessive moisture or heat buildup.
INTERIOR ROOMS
Check all areas for signs of roof or plumbing leakage.
Have any fireplaces or wood stoves and flues checked and professionally cleaned.
Reset automatic timers for the change in daylight hours.
Check all smoke/carbon monoxide detectors. Replace batteries if over a year old.
Test Ground-Fault Circuit-Interrupters (GFCI’s) using built-in test buttons.
HEATING/COOLING SYSTEMS
Clean all elements of the cooling system.
Remove (or winterize) room air conditioners.
Follow manufacturer instructions for the maintenance of your heating system.
Change or clean heating system filters on warm air systems (now and regularly).
Check heating and cooling systems for any evidence of water leaks.
If present, clean and test the humidifier.
Have your heating system serviced annually by a qualified heating serviceperson before the heating season to keep it functioning efficiently and properly.
PLUMBING
Drain exterior water lines and open taps (in cold areas).
Insulate water lines that are subject to freezing.
Check the condition and temperature setting of the water heater. Follow the manufacturer’s recommendations for the temperature setting.
Check the plumbing system and fixtures for any evidence of water leaks or blocked drains.
Confirm proper operation of any sump pumps and free flow of the drain line.
Remember, these tips are only general guidelines. Since each situation is different, contact a professional if you have questions about a specific issue.

Septic

DO YOU KNOW WHEN TO PUMP YOUR SEPTIC?

While general recommendations for pumping out septic systems usually fall in the 1 to 3 year range, the actual required pumping schedule can vary widely based on factors such as tank size, number of occupants in a household, and whether or not there is a connected garbage disposal in use.

Slight sludge buildup on bottom of a septic tank

For example, based on information supplied by Penn State University’s Cooperative Extension Service, the normal time between septic tank pump out sessions is listed below (in years).

Don’t be mislead, though – each system is different! Until a pattern is established, with no significant changes in usage, most homeowners should plan on having to pump their system every few years. If you find that your system needs pumping much more frequently than the chart indicates, it may mean your tank is undersized for the house, or material such as garbage disposal waste, or sump pump water, is being discharged into the system, increasing the solid waste or water flowing into the tank. It may also mean your system has failed or is about to fail. Consult with the pumping company or a qualified private sewage system specialist for a more detailed assessment of your system’s condition and ways to help extend the service life between pumpouts.

A question for all

I am getting ready to launch, within the next month, a website for people wanting to sell their house on their own. Having been in Real Estate previously, and study the laws and rules, I can offer advice, tell you what forms are needed, and advertise your property for you for a small fee. It costs the average home seller 5-7% of their asking price if they use a Realtor. So, if a house was listed for $225000, the commission going out to Realtors would be $11250-$15750. So in considering to sell your house on your own, a cost of $300-$600 doesn't sound like much. I would advertise your property on my website, generate and flow alot of traffic through, and give you the tools necessary to price your home properly and guide you on how to properly show your home for the most showings and responses.

I would love for people visiting this site to tell me what they think of this idea.

No Longer in Real Estate but Still Happy to Pass on Tips-What type of Realtor will work the Hardest for me?

I really am no longer in the Real Estate world, although, I have leraned quite a lot! A freind of mine asked the me the other day, what type of realtor would work hard for her. You see, her budget is small and the type of house she can afford isn't extravagant and the Realtor she currently has, hasn't called in the last 5 days. She told her they were actively looking for a house and wanted to see 4 of them as soon as possible and hasn't heard back. She believes, as do I that, the Realtor she now has, is not trying too hard for her because her commission stand to be a lot less than if this were the average sale price for a home.
Entering inot the Real Estate Market, I have found that if you want the really aggressive Realtor, you need to go for the one who is still fairly new to the game, they are out to make a name for themselves and need all the referrals they can get. They also just paid a lot of money to the different associations for dues and fees and need to make some money. Any money. Go out and get yourself a new Realtor if you need one to work hard for you!!!!!

Attic Ventilation is very Important

Attic Ventilation

The detrimental conditions caused by excessive heat or moisture build-up in attics can often be prevented by providing adequate ventilation. As a minimum, it is generally recommended that there be at least one square foot of free vent area (actual unobstructed venting) for each 300 square feet of attic floor area. Additional provisions will be required for some house styles, due to locational factors, or if there isn't a suitable vapor retarder between the 1iving areas and attic. In an existing house, actual conditions can be the determining factor. If the attic is 20 degrees or more above the outside air temperature on a warm day, or there are any odors, condensation or signs of mold growth in the attic, then additional ventilation is probably required. The ideal arrangement in most cases is to provide intake vents at eave levels and exhaust vents at the roof ridge. In fact, recent changes in construction standards dictate balanced upper and lower attic area venting. This arrangement promotes natural air convection to draw in cooler air and exhaust hot, moist air. If the house design doesn't permit such venting, a combination of gable and roof vents that provide as much crossflow as possible can be used. Most newer vents will be labeled with the ventilation area they provide; if there is no listing assume that the free vent area is no more that 50% of the total vent area due to restrictions caused by louvers and screening. It is also important to make sure that vents are not blocked by insulation or other obstructions. With cathedral or vaulted ceilings or finished attic areas, it is especially important to make sure that there is adequate venting between the roof deck and any insulation or other materials. All roof vents should be left open year round; with proper insulation levels there should not be a concern with energy loss. While it is essential to provide adequate ventilation by passive means, in some cases forced venting may be advantageous. A wind or convection driven turbine ventilator is often added for a low cost boost to air flow. Electric attic exhaust fans, however, are often more effective at replacing the hot humid attic air with cool outside air. Thermostatic controls are provided for these units; in certain situations a humidistat may also be required. Normally these fans are set to activate at about 100 degrees, but they can be preset by the homeowner to any desired temperature. If an exhaust fan is used, the HouseMaster technical staff stresses that it is important to ensure that adequate intake air provisions are provided, otherwise the unit will not operate effectively Kitchen exhaust fans, laundry rooms and dryer vents, or bathroom exhaust fans ducted into the attic can add substantial amounts of moisture. The kitchen and dryer vent should never be ducted in this manner due to the added fire risk from the grease or lint that may be present. It is advised that bathrooms with showers or elevated moisture conditions also not be vented into the attic space. Whole house fans are also used for ventilation purposes, but these are primarily used to remove excess heat build-up from the living area. Consequently, adequate exhaust provisions from the attic area must be provided or the moist house air will aggravate conditions in the attic.

You must take care of your Air Conditioner

A central air conditioning system can provide years of satisfactory cooling with relatively little maintenance. However, a seasonal start-up check and periodic maintenance is recommended.
Homeowner Checklist The amount of do-it-yourself air conditioning maintenance a homeowner can do is limited. However, there are a few steps that can help the system operate trouble-free and minimize the potential for consequential damage. Ensuring adequate airflow is perhaps the most important homeowner responsibility. Homeowners can (following manufacturer instructions):
Clean or replace the filter(s) regularly.
Keep leaves and other debris off the condensing unit.
Keep the condensing coils clean by carefully brushing and hosing them.
Keep shrubs and other plant growth that might obstruct airflow at least 18 inches away from the condenser.
Maintain insulation on ductwork in attics and other unconditioned areas.
Check the condensate drain for any sign of blockage or leakage. Water should be dripping from this drainline when the unit is running.
Keep room input and return registers clear of furniture or other obstructions.
Selecting Trained Professionals If your air conditioner needs more than the regular maintenance described here, consult a qualified air conditioning technician. A well-trained professional can provide a thorough pre-season or maintenance evaluation and servicing as needed. Insufficiently trained service technicians forsake proper diagnostic procedures and often only perform stop-gap measures to keep a unit going. Such short-sightedness can have a drastic effect on other components leading to consequential failure of the entire system. At a minimum, a technician should:
Check that the system contains the correct amount of refrigerant.
Test for refrigerant leaks.
Check for and seal duct leakage.
Clean the blower components.
Measure airflow through the evaporator coil.
Verify the correct electric control sequence.
Inspect electric terminals, clean and tighten connections.
Oil motors and check belts for tightness and wear.
Check the condensate system for backup or leakage.
Check operating temperatures and pressures.
Check the accuracy of the thermostat.

Real Estate is a really hard business. I currently work in Real Estate and have for the past year and a half. It has put me in the hole deeper than I have ever been.
First you owe memberships to your lacal and national associations that you have to pay every year or every other. Then your broker takes a percentage of every transaction, 30-50%. And you also pay nearly $500 a year to keep your Real Estate key updated. The gas you use is on your own dime and any entertaining you may have to do. This does not even mention the items your broker charges you for advertising, whether you have any listings or not, some insurance that never comes into play.
Well If You Are Considering Real Estate, Consider that it will cost you about $3000 a year. Can you afford this?.... it's a simple question?

How you keep your home will make a big difference

You might not ever be able to sell your home if you don't keep it spick and span. I have had a few horror stories of my own and heard of several more. The latest one I heard about was from a seller's agent, meaning the agent who represents the selling side. She was contacted by a couple who wanted to see the house. She made the appointment with them and verified the time with the sellers.
As they toured the home, there in the middle of the bedroom floor was a pair of dirty underwear. The prospective buyers had been impressed with the property until that moment. As soon as the "dirty deeds" were seen by these buyers, they decided to leave and make an appointment to come to the office to look for other properties.
So if you are trying to sell your home, before you leave in the morning, be sure to tidy up!

"Spring Maintenance Checklist" a checklist from Housemaster

SPRING MAINTENANCE CHECKLIST
GROUNDS
Check condition of driveways and walks.
Check window wells, dry wells and storm drains for blockage.
Check fencing conditions and gate operation.
Check retaining walls for cracks, bulges and leaning.
Check all landscaping; trim all bushes and trees.
Check all out-buildings, porches and patios.
Check for proper grading and drainage throughout property.
Check lawn sprinkler system operation.
Check all equipment in preparation of pool opening.
Check (during rainstorm) for drainage away from foundation. SIDING AND CHIMNEYS
Check all surfaces for damage or deterioration.
Check caulking at all joints.
Treat or paint worn or exposed wood components.
Check condition of masonry chimneys and vents.
Check foundation for settlement, cracks and spalling. WINDOWS AND DOORS
Check for damaged screens or broken glass.
Check weatherstripping, caulking, and window putty.
Check for frame decay or damage.
Clean and install screens. ROOFS
Check for loose, damaged or missing roofing.
Check fascia and soffit for signs of leaks/moisture build-up.
Check all flashings for fit and seals.
Check television antenna or satellite dish mounting.
Check and clean all gutters (eavestroughs) and downspouts.
Clean fungi or algae from roof surfaces. PORCH AND PATIO
Check all wooden supports and railing components.
Check flooring for wear or damage.
Apply preservative to wood decking and components.
Seal patios at foundation. INSECT INFESTATION
Check for signs of termite, ant or other insect activity.
Check for insect damage.
Arrange for treatment or repair. INTERIOR AREAS
Check attic, ceilings and walls for evidence of leaks.
Check ventilation openings for nests, or other blockage.
Check condition of all painted or finished walls and trim.
Check carpet and flooring for wear or damage.
Check condition of all stairs and railings.
Check condition and operation of all windows and doors.
Test smoke/fire alarms and carbon monoxide detectors. SLAB/FOUNDATION
Check for cracks or breaks in wall.
Check for evidence of water infiltration or dampness.
Check for decaying sills and window frames.
Check for signs of termite, ant or other insect activity
Check for changes in framing conditions.
Check crawlspace ventilation, insulation, and vapor retarders.
Test, clean and lubricate sump pump. ELECTRICAL SYSTEM
Assess power distribution for overloads issues.
Check condition of incoming service wire and supports.
Test circuit breakers and label all circuits at panel.
Test arc-fault and ground-fault circuit-interrupters (regularly).
Check circuits for over-fusing.
Check all receptacles and switches.
Check operation of vent and/or attic fans. HEATING/COOLNG SYSTEMS
Follow manufacturer instructions for HVAC systems.
Inspect and install room air conditioners.
Clean all serviceable elements of heating system.
Change or clean heating system filter (regularly).
Check venting systems for corrosion and leaks.
Clean and de-energize humidifier.
Check and lubricate attic fan. PLUMBING SYSTEM
De-winterize and check exterior faucets.
Check well and components.
Check septic tanks and systems.
Check water and waste piping for leaks.
Check hot water supply temperature.
Follow manufacturer instructions for water heater. KITCHEN/BATHROOMS
Check condition and operation of all appliances.
Clean and change range fan filters.
Check all toilet flush mechanisms.
Check and repair all leaking faucets and valves.
Caulk and grout tile at tubs and showers.
Clean aerators and showerhead.


Copyright © HMA Franchise Systems, Inc.

They Say it is a Difficult time to buy, Just Not So

They say it is a difficult time to buy a house. You'll hear it on the news, and see it in the paper. However, if your credit isn't too bad, now is a great time to buy. On the Eastern Shore of Maryland, our market is saturated with properties for sale. This gives buyers the opportunity to pick from several homes and makes it able for them to negotiate the price.
When several homes are on the market, it gives buyers purchasing power. Sellers know that they have to either have an incentive, such as closing cost help, to lure in the buyers. One seller may offer a Home Warranty, while another offers $10,000 closing cost assistance.
If you are out looking at homes to purchase, make sure to use your buying powers.
If a home is well underpriced, don't delay, it won't last long. This is another way sellers are trying to lure buyers to their home.
Look up their tax record, you can easily see what they paid for the house. This will help you decide whether to make a higher or lower offer.

Finding a HUD home

Finding a home home can be a difficult task unless you know the right person to ask. Most Realtors don't involve themselves in HUD home sales, however you can not purchase one without a Realtor. HUD says that a Realtor must handle the transaction. Usually a thousand dollar deposit is required at time of contract.
If you locate a HUD home for sale, contact your local Realtor and they should be able to locate the neccessary information to write an offer. If you are simply interested in seeing what HUD homes are available, go to www.hudhomesource.com and check it out.
Any other questions just call, 443-523-7652.
PS There are many programs, like half off for public service officers.

Now read this

Okay that same couple that my last blog was about can still get financing for 95000. So maybe things happen for the better because now there are three four bedroom house on the market in their price range. I just have to hope they haven't lost their drive to keep pursuing a home purchase.

Now here's a horror story

There is this couple and I really do love them and want to help them find a house but their lender has made it a nightmare.
They were told verbally that they were approved for one amount and when it came down to it, it was much less.
Now that they have a ratified contract on a house, the mortgage processor has been fired and his manager can no longer find him a mortgage program. He would have to reurn to looking in a much lower price range, still do-able but not as desired on his behalf.
So the moral to thye story is to affirm that you have your financing set and it is solid before going any farther.

Don't get discouraged

Sometimes looking for a house to buy can be extremely discouraging. This lovely family came to me after working with another Realtor, a friend of the family, and asked me to help them find a house. Apparantly this other Realtor was only showing them houses in neighborhoods they didn't want to live in, and in need of desperate repair.
So after getting fed up, this client calls me and says ok, I want at least a three bedroom house. I have six children. I want a decent neighborhood, and I only qualify for a mortgage amount of $115,000.
They come to the office and we find several properties to look at in good areas and condition. We write a contract on one only to have the lender now tell me that they really only qualify for $90,000.
So we start our search again. Although these houses were a little farther out, we found another they liked and wrote a contract. I call the listing agent to let her know I have an offer, but she tells me that an offer has already been accepted.
The search trudges on. Now we are running out of good homes to look at. My client asks his mother to cosign on the loan so that we can get a larger loan. Now we are back to $115000.
I found a great buy for them but we must act quickly since 2 other offers will be coming in also. It is an estate sale, so it is listed well under appraisal. So we offer a little more than asking price and now my clients are homeowners.
Don't get discouraged, you will get the house that is meant for you, all things happen for a reason. My clients ended up getting a much better buy after everything they went through.

Late Mortgage Payments Surge

Late mortgage payments surge
Regulators see big problems emerging with subprime loans, increasing credit distress with hybrid mortgages.
February 22 2007: 2:43 PM EST
WASHINGTON (Reuters) -- Late payments for residential mortgages shot up by 15.6 percent in the fourth quarter, U.S. regulators said on Thursday in a report showing record earnings by commercial banks and thrifts in 2006.
The Federal Deposit Insurance Corporation, which insures deposits at more than 8,600 banks and savings institutions, said the increase in late mortgage payments followed a 5.2 percent increase in the third quarter.
Noncurrent mortgage loans - payments that are more than 90 days late - grew by $3.1 billion in the last three months of 2006 after rising by $974 million in the third quarter, the FDIC said.
Richard Brown, FDIC's chief economist, said regulators are seeing emerging signs of distress among subprime loans, especially with hybrid mortgages that subject borrowers to higher monthly payments after introductory interest rates.
"While the degree of credit distress in these portfolios is still well below the peaks that we saw during and after the 2001 recession, it seems likely that their performance will get worse before it gets better," Brown said.
Bank regulators are considering new rules on popular loans for subprime borrowers with less-than-stellar credit that carry low introductory rates but can rise over the life of the loans.
Consumer advocates have warned that loose underwriting standards will soon have homeowners buried under mortgage debt.
Brown said that total subprime mortgages outstanding amount to about $1.3 trillion, of which $700 billion are held by private asset-backed securities issuers.
That means banks, thrifts and other mortgage lenders are holding about $500 million in subprime mortgages, Brown said.
Financial institutions insured by the FDIC held about $2.2 trillion of mortgages for single to multifamily homes at the end of 2006.
"We know for certain that more than three quarters of the mortgages held by all FDIC-insured institutions are prime loans," Brown said. "The actual percentage is certainly higher - perhaps as high as 85-90 percent."
For the fourth-quarter FDIC-insured commercial banks and savings institutions posted net income of $35.7 billion, 9.3 percent higher than the fourth quarter of 2005, but lower than $38.1 billion earned in the third quarter.
For the year, banks earned $145.7 billion, topping the 2005 total of $133.9 billion and marking the sixth straight year of record earnings, the FDIC said.
The FDIC said the industry's performance in the last three months of 2006 was stronger than the numbers indicate because restructurings at a few large institutions resulted in understated income and expense items.
"The banking industry continues to perform well," FDIC Chairman Sheila Bair said in a statement, "even as an inverted yield curve and weakening mortgage market have made the operating environment more challenging."
______________

Here is a Great Article from Housemaster

HOT WATER CONSERVATION TIPS
In modern homes, hot water is as close as the faucets in the kitchen, bathroom and laundry areas, and its availability is often taken for granted. Generally, even less thought is given to the cost of heating water because its use is constant rather than seasonal, as with a central heating or cooling system.
The temperature and amount of hot water used depends on several factors, including the number of people in a household, the number of bathrooms and whether there is a clothes washer or automatic dishwasher. Water heating may account for as much as 15 percent of your total energy bill. If your utility bills ran $2,000 last year, you may have spent $300 to heat water. You can't do without hot water, but there are several ways to conserve it so that energy requirements and costs will be less:
Wash only full loads of laundry or use appropriate water level or load size settings on your clothes washer.
Use as low a water temperature as possible for the wash cycle of your clothes washer. Use cold water for all rinse cycles. Pre-soak heavily soiled clothes before washing.
Scrape dishes before placing them in a dishwasher. If rinsing is necessary, use cold water.
Try to run your dishwasher only once a day or when fully loaded. Use the shortest cycle that will clean the dishes.
When washing dishes by hand, fill a pan with hot water for rinsing. Don't let hot water run continuously.
Install flow restrictor showerheads. These devices can reduce the amount of water flowing from the pipe from 5 gallons (19 liters) per minute to three (11 liters) while still maintaining adequate pressure.
Take quick showers instead of baths; they use up to 50 percent less hot water.
Don't let hot water run continuously when you shave. Close the drain and fill the basin with water instead.
Turn down your water heater thermostat to a minimum or vacation setting if you plan to be away from home for an extended period of time.
Repair any faucet leaks. A leaking hot-water faucet is an energy waster and should be repaired immediately.
Copyright © HMA Franchise Systems, Inc.

Borrowers seldom score by paying points

Borrowers seldom score by paying points
By Holden Lewis • Bankrate.com


Pay discount points on a mortgage, and you take a gamble. Plenty of borrowers lost that wager in recent years, according to a pair of economists.
Yan Chang and Abdullah Yavas set out to describe consumers' behavior, not to give advice about whether one should pay discount points. Even so, their research can be boiled down to this: Think hard before you pay discount points, and if you do, don't hesitate to refinance.
The studyTheir research paper, titled, "Do Borrowers Make Rational Choices on Points and Refinancing?" is a chapter of Chang's doctoral thesis at Penn State University. Chang is a senior economist at mortgage-financing giant Freddie Mac, but the study was done independently of her employer, and she speaks for herself and not on behalf of Freddie Mac. Yavas is an economist and a professor of business administration at Penn State and was her thesis adviser.
Chang and Yavas concluded that borrowers tend to pay too many points because they overestimate how long they'll keep the mortgage. Furthermore, people who pay discount points tend to wait too long to refinance.
Paying discount points is a way of reducing the mortgage's interest rate. One discount point is 1 percent of the loan amount. On a 30-year, fixed-rate mortgage, one point typically reduces the rate by one-quarter of 1 percent. By this rule of thumb, if you can borrow $200,000 at a rate of 6.25 percent with zero points, you can borrow the same amount at a rate of 6 percent by paying one point, or $2,000.
In the above situation, you save $32.33 a month by paying one point. It takes 62 months to break even -- for the accumulated monthly savings to total the $2,000 paid upfront.
8-year studyChang and Yavas looked at a sample of 3,899 mortgages that were originated between January 1996 and December 2003. About one-eighth of those borrowers paid discount points.
Of those who paid points:
•
Two-thirds had paid off the mortgage by June 2005, either because they sold the house, refinanced or defaulted on the loan. Of those people, 1.4 percent had benefited by paying points.
•
The other one-third of the points payers still had the original mortgage in June 2005, the cutoff date for the study. Of those people, 16 percent already had benefited from paying points by June 2005, and the percentage probably grew higher as time passed. That doesn't change the fact that two-thirds of the points payers made the wrong bet.
Of the seven-eighths of the borrowers who did not pay discount points, a large majority made the right call.

Down payment

Down payment
By Bankrate.com



The down payment presents the biggest obstacle to homeownership for most buyers, especially first-time buyers and those in lower income brackets. Fortunately for those people, lenders have become more willing to underwrite mortgages with small down payments.
Most mortgage lenders require a cash down payment of 5 percent, 10 percent or 20 percent of the sale price. Some lenders have zero-down mortgage programs. If you can put down more than your lender requires, say 25 percent to 30 percent, your lender may be willing to overlook past credit blemishes, approve your loan without verifying your income or both. If you come up short on the down payment, less than 20 percent of the buying price, you may have to obtain private mortgage insurance, or PMI, to protect the lender before your loan is approved.
You can often lower your mortgage payment or afford a more expensive house by putting more money down.
Lowdown on down paymentsSay you make $40,000 a year. Your maximum monthly mortgage payment (28 percent of gross income) would be $933. Assuming your total monthly debt is no more than $1,200 (36 percent of gross income), the bigger the down payment, the more expensive the house you can buy.
For instance, say the monthly mortgage payment of $933 has an interest rate of 7.5 percent. In a 30-year fixed-rate mortgage, that monthly payment covers a total principal of $133,435.45. With 10 percent down, that mortgage would cover a house worth $148,262. With 20 percent down, the house price would be $166,794.
Say you want to keep the monthly payment to $1,060. How large of a mortgage can you get? The charts below consider the key factors of interest rates, down payment amount and the length of mortgage term.

Top 7 tips for First Time Home Buyers

Top 7 Tips for First Time Homebuyers
by Eric Bramlett

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Purchasing your first home is a big step, that comes with some very serious decisions. Many homebuyers are intimidated by the process, and continue renting much longer than they should, or need to. However, if you break the homebuying process down into these simple steps, and follow these important tips, you will find the process less intimidating, and much more manageable.
1) Before You Begin, Ask Yourself One Question
Will you live in your next home for at least 3 years? If the answer is "Yes," you should probably purchase, rather than continue renting. With average appreciation, you'll break even on your closing costs after 2 years, and start making money at year three. Every year after that will put more money in your pocket! The most expensive aspect of real estate is buying & selling, so the longer you can live in the home the better. However, purchasing makes sense if you can make as little as a 36 month commitment.
2) You Don't Need a Down Payment!
It always surprises me how many people want to purchase a home, but don't because they believe that a hefty down payment is required. Zero down programs are very common, and are quickly becoming the norm, rather than the exception to the rule. Because your new home is collateral for the loan, there are many banks that will jump at the chance to loan you 100% of its value. Perfect credit isn't a requirement, either. Because real estate typically appreciates in value, it's often easier to be approved for a 100% mortgage than it is to borrow 100% for a car!
3) Get Pre-Qualified
Pre-qualification is a very important step, and the step that first time home buyers dread the most. Qualifying to buy a home is pretty easy and requires relatively little work for you. Pre-qualification is what gives you buying power and allows you to make an offer on your dream home when you've found it. More importantly, pre-qualification will let you know how much your new home will REALLY cost - in monthly payments. A $150,000 or $300,000 home doesn't mean a lot to most buyers - but $1200 per month and $2500 per month are tangibles that everyone can understand. After your lender pre-qualifies you, ask them for a "payment table" that shows you a rough estimate of TOTAL monthly payment based on purchase price. Pick your payment, and you know the price range to shop in.
4) Consult a Real Estate Professional ASAP
Many first time home buyers avoid contacting a Real Estate Agent because they dislike high pressure sales. However, Real Estate Agents have an advantage over traditional salespeople because they have access to the Multiple Listing Service, which is a database that lists roughly 99% of the homes for sale in a given market. This means that your Real Estate Agent doesn't have to sell - he/she merely presents your options. The most important qualities to look for in your Real Estate Agent are his/her knowledge of your specific market and their willingness to help. Interview a few agents and choose one that will help guide you through the process. You'll find the help & insight will be invaluable - and you'll be glad you contacted your Real Estate Agent sooner, rather than later.
5) Make a List of "Must Haves" & "Wants"
Many new home buyers mistakenly think that they will "just know" when they "walk into the one." While some buyers DO fall instantly in love with a home, this is not the norm. You'll find your search is easier, and you will be more confident in your decision, if you take a systematic approach to your search. The best way to organize your search is to make two lists: Your "must haves" and your "wants." Your "must haves" are the absolute necessities in your new home - in fact, you don't even need to view a home if it doesn't have every "must have." Great examples of your "must haves" are price, school district, size, etc... Your "wants" are the qualities that you would like for your new home to have, but it's not a necessity. Great examples of "wants" are color, flooring, kitchen appliances, surround sound, and type of exterior. By taking the time to articulate what you need and want in your new home, you will know exactly what to look for when viewing prospective homes.
6) Pick Your Favorite Neighborhoods
You can always make changes to your house, but you can never change its location. Most home buyers already have a good idea of where they would like to live because of school districts, work, or other factors. However, neighborhoods can be pretty different, even in the same area of the city. Ask your Real Estate Agent to email you a list of homes in the specific area of town you're interested in. Take a drive through the different neighborhoods on the list your Real Estate Agent sends you, and choose your favorites. Pay attention to area amenities, how well the yards & common areas are kept, and if you see a lot of "for lease" signs - which can be an indication of a heavy rental area, and lacking in "pride of ownership." After you have picked your favorite neighborhoods, and you know your "must haves" and "wants," you can literally make a list of EVERY home available that meets your criteria, and view those homes.
7) Make Your Decision!!!
Homebuyers often hesitate after they've found the right home because they're not confident about their decision, or their decision-making process. Your home is probably the largest investment of your life, and it's normal to feel butterflies in your stomach before putting your first home under contract. However, if you do your due diligence - and you have if you followed the steps above - then you will have your bases covered. If you've found a home that meets all of your "must haves," most of your "wants," is in the right neighborhood, and in your budget - it's the home for you! Don't wait and let another buyer take YOUR home!
Buying your first home can seem very intimidating, but can be extremely exciting. If you think that buying a home is right for you, it probably is. Make sure and follow these important tips and you'll know you made the right decision when you find your first home.

Negotiating Closing Costs

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negotiating those closing costs
How to negotiate your closing costsBy Holden Lewis • Bankrate.comShop around before choosing a mortgage lender, but don't stop there. When you receive your good faith estimate of closing costs, or GFE, the negotiation hasn't ended.The lender or mortgage broker is required to give you a GFE within three working days of accepting your loan application. The GFE comes in the form of an itemized list of estimated closing costs for everything from the lender's fees to the appraisal charge to the title insurance premium to a partial month's interest payment.The lender or broker charges some fees, and third parties charge others. The first step is to find out which are loan origination fees and which are third-party fees. Don't guess. Ask the lender or broker.The big money question"Say, 'Please explain to me what those fees are,'" says Jessica Cecere, director of the Consumer Credit Counseling Service in West Palm Beach, Fla.Simple advice, but a lot of loan applicants don't follow it.On the GFE, fees are categorized by numerical codes ranging from the 800s to the 1300s. Most of the negotiable lender-charged fees are in the 800s: application, origination, commitment, loan discount, broker, tax-related service and underwriting fees.Keys to lower closing costs:•Ask for a justification for each lender-charged fee.•If the lender charges an application fee, ask if it will be credited toward closing costs.•If the lender charges an underwriting fee as well as a processing fee, ask for details of those services. Maybe you'll find a fee that can be waived or reduced.•Recognize that some items are non-negotiable: taxes, city and county stamps, recording fees, prorated interest and reserves. On the GFE, these items are in the 1000s and the 1200s.Third-party feesFees charged by third parties are trickier to negotiate. A few third-party fees pop up in the 800s section of the GFE: those for the appraisal, credit report and inspection. The lender is supposed to pass along these charges without marking them up. Theoretically, they are negotiable and you can ask the lender to seek good deals on these three items and pass along the savings. In practice, you probably won't get a break on those services because the lender has contracted for them at a set price.You can realize some of your biggest savings by negotiating the items in the 1100s section of the GFE: title insurance, title search, title exam, attorney's fees and settlement fees. Most borrowers use a title company recommended by the real estate agent or lender. But you don't have to. You can shop for title insurance and settlement services, just as you shopped for the house and for the loan.Be prepared for resistance. Some lenders have business affiliations with title companies, and they'll pressure you to keep the title work in-house.Title insurance, settlement servicesWhere you shop for these title insurance and settlement services depends on where you live, because different places have different ways of closing real estate and mortgage transactions. In parts of the Northeast, closings are conducted in lawyers' offices. In some places, including Southern California, closings take place at escrow or mortgage companies. In much of the country, the closing takes place in the office of the agency that sells title insurance.Government regulation can limit your negotiating room. In Texas, the state sets one overall fee for title insurance, title search and settlement services, so title agencies compete on service and not price. Regulations aren't as restrictive in most other states and you could save hundreds of dollars in settlement services by shopping around."I think it's a matter of what the traffic will bear," says Bob Moulton, president of American Mortgage, a brokerage on Long Island, N.Y. He gives this tip: If you're refinancing your mortgage, and you've lived in the house less than 10 years, ask to get title insurance at a less-expensive "reissue rate."And don't forget to shop for hazard insurance -- item No. 903 on the GFE. Compare offers for homeowners insurance policies, either on your own or with the help of an insurance agent. Make sure the insurance company and settlement agent communicate with each other. You're not going to get that mortgage without proof that you have a homeowner's policy. That requirement is not negotiable.

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Lowballing in a cool housing market
Real Estate Adviser by Steve McLinden • Bankrate.com


Dear Real Estate Adviser,
In the softening real estate market, how much wiggle room is there in negotiating for a house? -- Kathi M.
I wish to purchase a home soon. My question is what is a reasonable lowball percent to offer on a house? When I ask agents, they are very vague. Is offering 10 percent below or more way off? -- May in Mizzou
How low can I go without offending the seller? -- Anthony S.

Dear Kathi, May, Anthony and many others,
As markets that were overheated as recently as early 2005 have cooled considerably, this subject has become a hot one. With a temporary overabundance of housing on the market in many parts of the country, low bidders are truly in their element for the first time in about a decade. Offers that were laughed off just 18 months ago by confident sellers are suddenly being considered. Owners who once advised their agents to ignore offers by lowballers no longer have that luxury in most markets.
But don't expect sellers to flat-out panic. Most who bought their homes recently will not let their homes go for much less than they paid for them. On the other hand, owners who have been in their homes awhile and enjoyed a big run-up in value in recent years might be more willing to listen to lower offers because they'll still profit handily on the sale.
As always, homes most likely to sell at a big discount are those in dire need of wholesale repairs, preforeclosure homes and those owned by other highly motivated people (transferring out of town, buying another home and not able to afford two mortgages, had recent death in family, investor who bought at the wrong time, etc.). To them, offers of up to 15 percent or more under market are a little more palatable.
Knowing the seller's motives always gives you much more traction with any negotiable purchase -- especially a house.
However, stingy offers on quality properties might come off as predatory and not even elicit a counteroffer. Many sellers will dig in their heels and stay put before they'll sell at giveaway prices. With a few exceptions, the underlying fundamentals of most U.S. housing markets remain strong and are still showing annual value growth, albeit a bit slower.
On average, homes sell for a little under 5 percent of asking price, and in this generally softening market, you should set your sights below this figure. As a very loose rule of thumb, based on my research and writings of the last 20 years, closing prices in a vibrant sellers' market average about 2 percent below list and average around 8 percent or 9 percent at or around the bottom (or top, depending on your perspective) of a buyers' market. Of course, much of this depends on market, location, the local economy and a home's condition. Higher-priced homes and condos are slower to move at present, so adjust accordingly. The more you research the nuances of your market, the better you'll fare.
But you have little to lose, currently, by going low. The worse that can happen is that your offer will be flatly rejected. For that reason, your best strategy might be to pinpoint several potential homes, make your low offers and see what sticks -- or at least who is willing to negotiate. In lieu of price concessions, many homeowners are offering to throw in appliances, furnishings and even such items as high-definition TVs. If you do the math, you might come out farther ahead than if you held out for an additional 1 percent or 2 percent.
A few tips: Keep silent on what your top price is and what mortgage amount you've been prequalified for. These can be used against you in the negotiation game. The amount you can borrow needn't come out until the contract phase, after you've agreed on price. And enter negotiations armed. If you can produce "comps" of similar area homes that sold at similar discounts, you have leverage. Your buyer's agent should be able to do this as part of his or her services.
Good luck to you all.

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HUD to Sell 4,000 Homes in Online Auction
From Robert Longley,Your Guide to U.S. Gov Info / Resources.FREE Newsletter. Sign Up Now!
Bidding starts Feb. 27 - View the homes now
The Department of Housing and Urban Development will sell up to 4,000 foreclosed homes via a special Internet auction on February 27-28. The unprecedented online home sale keynotes HUD's continuing commitment to increasing homeownership opportunities for American families.
The Department has used the Internet for sale of HUD homes for several years, but this auction will be different. HUD will publicize the auction in major newspapers throughout the country and use special procedures in listing the homes for sale.
Properties available through the auction will be pulled from the market for approximately three weeks prior to the auction dates. The properties can now be inspected on the HUD website. During the inspection period, prospective buyers will have an opportunity to "shop" the available listings.
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"HUD hopes this special effort will make more people aware of the opportunities that are available through our programs," said John C. Weicher, HUD Assistant Secretary for Housing-Federal Housing Commissioner. "This, in turn, will further our mission of increasing homeownership and expanding the supply of affordable housing."
To participate in the special auction, interested homebuyers will go to the HUD Auction Website where an announcement will lead the buyer to click on the state of interest. This will lead to complete information on properties available in that state.
The auction will begin on February 27 at 10 am (Eastern time) and will end on February 28 at 11:59 pm. Bid results will be announced on February 29, on the websites where the properties were listed.
All properties will be sold on an "as is" basis, without warrantee or guarantee. These properties were previously sold with FHA insurance and received by HUD as a result of foreclosure by a lender and payment of the related FHA insurance claim to the foreclosing lender.
HUD is the nation's housing agency committed to increasing homeownership, particularly among minorities; creating affordable housing opportunities for low-income Americans; and supporting the homeless, elderly, people with disabilities and people living with AIDS. The Department also promotes economic and community development as well as enforces the nation's fair housing laws. More information about HUD and its programs is available on the Internet in both English and Spanish.
[Source: Dept. of Housing and Urban Development]

Remodeling: A dozen ideas to enhance the value of your home

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Remodeling: A Dozen Ideas to Enhance the Value of Your Home
Unless you’re a stock market genius, your home is probably your biggest asset. Real estate has become a rockier road than it was a year ago, but that doesn’t mean you should stop thinking about those home improvement projects. Remodeling can be both exciting and profitable if you know which remodels add the most value to your house. Take a look at the following twelve projects which can change the feel of your home while also adding real value:
1. Minor kitchen remodel - Both men and women seem to find a bright and shiny kitchen the most appealing part of the house. The surprising news is that a minor kitchen re-do is a better deal than a complete kitchen make-over. So, if you’re feeling up to it, go ahead and get that new fridge, paint the kitchen walls and change the drawer pulls – you’re going to get the most bang for your buck by updating your kitchen first.2. Bathroom addition - Having an extra bathroom makes a house extremely attractive to larger families. Just imagine - no more fighting over bathroom time on weekday mornings.3. Major kitchen remodel - Now we’re talking about the expensive projects that probably require a professional such as updating cabinets, re-tiling and adding a granite countertop. You might also consider getting new appliances.4. Family room addition - The beauty of adding a family room is the flexibility of eventually using it for whatever best fits your needs: an extra bedroom, an office, a home theater or even a game room. Potential buyers are attracted to concepts that allow them to adjust to their families’ needs.5. Second-story addition - This remodel shares many benefits with a family room addition and even adds the same equity to your home. But, it has one special advantage: it can serve as a mother-in-law suite or a room for a teenager who suddenly needs her own space.6. Attic bedroom - Close in value to the family room and second-story additions, this project is designed exclusively as an extra bedroom but should be less expensive than building a new level or extension to the house. Since the attic already exits, this project becomes more of a redecorating proposition with maybe some attention to heating / cooling needs.7. Master suite - The complete bedroom suite for both married couples and singles is a hallmark of luxury for most Americans. Couples with children particularly love the privacy that comes with having bedroom, bath, walk-in closet and dressing area all connected and separate from the rest of the house.8. Bathroom remodel - An upgraded bathroom with new tile, tub, vanity, toilet and lighting is an extremely attractive item to potential buyers. Who doesn’t love an updated, clean bathroom?9. Siding replacement - While your family might not notice this upgrade on a daily basis, this remodel option is of huge importance when you’re ready to put your house on the market. Buyers usually won't get to the good stuff inside if your “curb appeal” doesn’t grab them.10. Deck addition - A well designed deck not only adds to the beauty of a home, but when properly displayed, also makes your home seem much larger and roomier. With the increasing popularity of outdoor living spaces, this would make a great selling point.11. Window replacement - Few things detract from the appearance of a house more than old, shabby windows. Not only do new windows add beauty, they also provide improved insulation and energy savings – an item high on most homeowner and potential buyer lists these days.12. Home office - With many people working from home these days, a home office is a great addition to a home. It’s space that you can use for professional or personal use that is separate from the rest of the house and can be a kids-free zone. It might be an upgrade that requires the least work and expense and also likely recaptures what now might be wasted space.
Are you considering a home remodel project? Keep in mind that any upgrades to your home might change the scope of your homeowners policy. Let NetQuote help you instantly connect with quality, local agents in your area who can help you make sure your policy reflects your current home – and, help save you money!

Exterior Remodeling tips for boosting home values

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Exterior Remoldeling Tips for Boosting Home Values
As the record-setting heat wave that swept much of the country subsides, Americans are venturing back outdoors to resume end-of-summer remodeling. When you make your to-do list, consider that the best improvements are the ones that add value to your home. The following are a few fix-ups that don’t require an advanced degree in carpentry, but can greatly increase the value of your home:
Look from a different angle - Snap a picture of your house. Use a digital or Polaroid camera to take several different photos of your home from various angles and exposures. It’s always enlightening to examine static images. They allow you look at details that you normally would miss, and should highlight targets for your home improvement planning.
Consider repainting - Nothing enhances the “curb appeal” of a house more than a fresh coat of paint. This project requires more patience than professional skill, so don’t be intimidated. Color selection is the part of home exterior painting that is most critical, so take the time to review the wide array of color samples provided by paint manufacturers. After all, with just the color white there are hundreds of shades. Try not to pick unusual colors for the majority of the house. Instead, look at more neutral, earthy tones such as light grays, browns or greens for most of the walls, and use brighter shades for the trim and accent touches. Warning: colors that look perfect on a sample card may need to be toned down for painting larger areas of your home. Be sure to check on a small area of the house first.
Do a little landscaping - A little landscaping goes a long way in improving your home’s curb appeal. Second to repainting, adding and maintaining new trees and shrubs is the most effective way to improve the beauty of your home. Trees are both attractive and functional providing privacy, shade and a screen to block unwanted views - creating more privacy in your home’s backyard. If you have distracting objects in your yard, such as utility boxes, shield them from sight with planter boxes or bushes.
Restore aging driveways and walkways - Pavers are the most fashionable and attractive of the possible solutions to a home’s worn, cracked or stained pathway, but they are expensive and require more skill than most homeowners possess. The alternative is to clean, repaint, or repave them. Money saving tip for cleaning your home’s driveway stain: stubborn oil or grease stains can be removed with a solution of baking soda and water. Make an absorptive paste, apply it and cover with plastic for 24 hours. Bye-bye stain.
Spruce up doors – Your home’s doors can be beautified, not replaced. Your front and back doors make a lasting impression for visitors, setting the tone for how your home’s interior is judged. Doors can be refinished and accent lighting and planter boxes will do wonderful things for drab home entranceways. If you are considering redoing your household doors, stripping and staining aren’t advisable. Instead, paint the door a traditional color, or coat the existing finish with an opaque stain. Finally, add a brass kick plate or a new, fashionable handle and lock for an extra bit of home elegance.
Maintain, maintain, maintain - Homeowners get excited over new projects and ideas but the general upkeep of a home isn’t fun and often gets neglected. When a house looks dirty, a lawn is overgrown or gutters are left hanging, a once-beautiful home takes on a tarnished appearance. This results in the de-valuing of a home that is likely worth much more. It’s easier to maintain a house on a regular basis than to take on the huge project of doing it all at once.

This was the fourth week that rates have dropped

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Most interest rates were down again during the week ended August 17 and 18, but the changes were not nearly as aggressive as immediately after the Federal Reserve Board's decision to pause in its long term pattern of quarter-point rate increases.
This was the fourth week in a row that rates have dropped and the long term fixed rate products are down at least 20 basis points over that period. Frank Nothaft, Freddie Mac vice president and chief economist commented "This week's news that July housing starts fell 2.5 percent added conviction to Fed Fund futures traders who are currently pricing contracts to suggest the chances of another rate increase from the central bank this year are about fifty-fifty. As a result, 30-year fixed-rate mortgages are down for the fourth straight week and are the lowest they've been since mid-April. Meanwhile, ARM rates have gone down less. All of which could help persuade homeowners with ARMs on the verge of resetting to make the decision to lock into a fixed-rate mortgage now rather than take a chance of a higher rate on the adjustment date."
This was the fourth week in a row that rates have dropped and the long term fixed rate products are down at least 20 basis points over that period.
Frank Nothaft, Freddie Mac vice president and chief economist commented "This week's news that July housing starts fell 2.5 percent added conviction to Fed Fund futures traders who are currently pricing contracts to suggest the chances of another rate increase from the central bank this year are about fifty-fifty."
"As a result, 30-year fixed-rate mortgages are down for the fourth straight week and are the lowest they've been since mid-April. Meanwhile, ARM rates have gone down less. All of which could help persuade homeowners with ARMs on the verge of resetting to make the decision to lock into a fixed- rate mortgage now rather than take a chance of a higher rate on the adjustment date."

First-Time Homebuyers guide to taxes

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First-time home buyers' guide to taxes
By Kay Bell • Bankrate.com


There's nothing quite like purchasing your first home. You're on your own. You have a substantial financial investment.
And you now have some different tax considerations.
You're probably well-aware that homeownership affords you several new ways to save on the annual Internal Revenue Service bill.
"Homeownership is one of the best tax benefits that the federal government gives out," says attorney Robin Gronsky, principal of Gronsky Law Offices in Ridgewood, N.J. "People count on it. It's how they calculate their out-of-pocket costs in owning versus renting."
What you're probably less sure of is exactly how to go about taking advantage of all your new house-related tax breaks.
Many first-time homeowners will definitely enter new tax-filing territory with the very first return they file after moving into their new abode. For other new owners, the filing changes might take a little longer to show up.
But all will need to know some basic tax rules that could make their homes a great tax -- as well as an actual -- shelter.
Guide to first-home taxes
You survived the house search and the bidding process. Getting the mortgage on your new home was a piece of cake. But now you've got to file your tax return for the first time since you moved into your first home. Relax. You'll probably find that as a new homeowner, you'll save on your taxes. But there are some specific things you need to pay attention to so that you get every available tax break.

10 tax tips for home buyers
1.
Welcome to Schedule A
2.
Making the most of mortgage interest
3.
Hang onto your HUD-1
4.
Points pay off at tax time
5.
The tax-deduction value of property taxes
6.
Timing is everything
7.
Other deductions, thanks to your home
8.
What's not deductible
9.
Not federal, but tax-related
10.
Planning ahead
Welcome to Schedule AAs a homeowner, regardless of whether you're a first-timer or have owned many residences, you probably immediately think "deductions" when it comes to tax time. That's because you now have the chance to claim several expenses you didn't face as a renter.
The big-three home-related deductions are mortgage interest, any points connected with the loan and property taxes. To claim these, you'll have to itemize.
This deduction method, which requires filing the long Form 1040 and detailing your various deductible expenses on Schedule A, is often a new experience for first-time homeowners.
However, before you rush off to download this new tax paperwork, take a few minutes to evaluate your overall filing circumstances. While many homeowners do benefit by itemizing, that's not the case in every situation.
You want to make sure that the deduction method you choose is the one that gives you the larger deduction amount. If you find that the standard deduction, which on 2005 taxes is $5,000 for single taxpayers and $10,000 for married couples filing a joint return, is greater than the total of your itemized expenses, then by all means take the standard deduction.
Don't worry, you're not stuck using that method forever. You can alternate between the two deduction options every year or you can itemize for several years, claim the standard amount for a few more and then return to itemizing.
The key is to always pick the deduction method that will give you the most tax savings for each filing year.

5 homeownership tax myths

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5 homeownership tax myths
By Kay Bell • Bankrate.com


Owning a home tops the dream list for most Americans, and for plenty of good reasons. It's a shelter for your family, a gathering place for your friends and a good long-term investment.
Tax breaks are also frequently cited as motivation for moving from renting to owning, and there are many ways a home can cut your tax bill.
But, as is often the case with the U.S. tax code, homeownership tax benefits are not always clear-cut. That frequently leads to some bad information floating around.
While myths, half-truths and misconceptions may abound, we've narrowed it down to five that, if you buy into them, could cost you.
Half-truths, misconceptions and just plain hogwash
1.Mortgage interest will reduce my tax bill.
2.All costs related to my home are deductible.
3.I must use home profits to buy a new home.
4.Putting my children on the deed is tax-smart.
5.If I take a loss on a sale, I can write it off.

1. My mortgage interest will reduce my tax bill. This is true for the majority of homeowners, but not for all. And this tax break won't work forever.
To take tax advantage of your home loan's interest, you must itemize and come up with a total that exceeds your standard amount. On 2006 tax returns, the standard deductions will be $5,150 for single taxpayers, $7,550 for head of household filers and $10,300 for married couples who file jointly. These amounts increase a bit each year to account for inflation.
"Given home prices these days, most owners are itemizing," says Mark Luscombe, principal tax analyst with CCH Inc. of Riverwoods, Ill. By the time they count mortgage interest, property taxes and other nonhome deductions, such as state taxes and charitable gifts, their itemized totals easily surpass their allowable standard deductions.
But most is not all.
Taxpayers who buy a home late in the year, for instance, might find the standard deduction is more beneficial, at least initially, says Kathy Tollaksen, a CPA at Sikich LLP in Aurora, Ill. In these cases, where you make only a few payments in a tax year, depending on your loan you might not pay much interest, at least not enough to exceed standard amounts.
Timing also could reduce or eliminate other home-related tax breaks.
"Quite a few states have real estate taxes that are calculated in arrears. That is, they have already been paid or mostly paid (by the seller) by the time you buy," says Tollaksen. "In the first year, you're seeing taxes that are someone else's responsibility so you're not getting the full tax value of your real estate taxes."
The benefit of mortgage interest also could be a myth if you've lived in your home for a long time. In this case, you likely are paying more toward your loan's principal instead of interest. So homeowners at the end of a loan term don't get much, if any, from this tax break.

17 ways to save on energy

17 ways to save on energy
By Bankrate.com


Get a home energy audit every couple of years with your power company to find ways to cut costs.
Check with your utility company for rebates whenever you install energy-saving equipment.

Add more energy-efficient insulation to your attic, with the appropriate R-value, or resistance to heat flow, for your climate and the type of heating in your house..
Turn down your home thermostat two degrees and save 24 kilowatt hours a month. It might not sound like much, but it adds up.
Buy a programmable thermostat, especially if your home is vacant most of the day. Set it to turn on a half hour before anyone arrives home.
Adjust your thermostat to a comfortable temperature and wait. Turning your thermostat up or down dramatically wastes energy and increases your heating costs.
Lower your hot water thermostat 10 degrees, but no lower than 120 degrees. You'll still get all the hot water you need and save 25 kilowatt hours a month.
Fix leaky faucets -- one drip a second is 20 kilowatts a month.
Invest in weather-stripping kits if you've got drafty doors.
Trade your standard candescent bulbs for compact fluorescent bulbs. They are more energy-efficient, last for years instead of months, consume little power and generate little heat.
Turn off your computer when not in use, or use the energy-saving "sleep" mode.
Seal energy leaks. Caulk over cracks and small holes around windows and exterior walls. Look carefully around plumbing pipes, telephone wires, dryer vents, sink and bathtub drains and under countertops.
Participate in your power company's special energy-saving program. Some programs shut down electric appliances for short bursts of time during peak hours. You hardly notice the difference -- except in your bill.
Buy major appliances that sport the "Energy Star" sticker. That shows the appliance meets or exceeds standards set by the U.S. Department of Energy and the Environmental Protection Agency.
Consider a front-loading washing machine. They use 50 percent less energy and one-third less water. Plus, they remove far more water in the rinse cycle, and that translates into big savings in dryer time.
When building a home or replacing a roof, select a roof based more on energy efficiency than on how it looks. Light-colored roofs, such as white, galvanized metal or cement tile, do the best job of reflecting the sun, and cool quickly at night.
Landscaping with the right mix of trees and shrubs can lower your energy bills by blocking winter winds or the summer sun.

Questions about Homeowners policy

1. Can I drop my homeowners policy? If you have a mortgage, the answer is probably "no." Because you have a lien on the property, most home loans require you to have coverage that the lender finds suitable. If the policy lapses, you can be in mortgage default. If you are having trouble finding an insurer or paying the premiums, call your lender to see if it can offer suggestions and/or work with you to solve the problem.
2. Can I afford to regularly put money into an account to cover any storm damages? This is a necessity if you're going to drop your insurance coverage. Without the emergency self-insurance account, you'll either be stuck not making repairs, borrowing money to make them or putting them on credit cards, which could create additional problems.
3. How large should my self-insurance account be? Sit down and do a worst-case scenario in the event of a natural disaster. Consider what it will cost to repair or replace your home or major parts of it, such as your roof or walls that are more exposed to potential damage.
Then there are your belongings: furniture, clothing, food, exterior buildings, landscaping, and potential costs of debris removal or demolishing partially standing structures that need to come down for safety reasons.

Homeowner's Insurance Don't go bare

Homeowners insurance: Don't go bare
By Kay Bell • Bankrate.com


Homeowners all across the United States are doing double takes as they look at their annual insurance policy renewal statements.
A spate of natural disasters, accompanying insurance claims and subsequent premium increases has pushed some homeowners to the breaking point. Out of both personal and financial frustration, some are considering dropping their coverage.
In the insurance industry, it's known as "going bare." And while it might be tempting if you're looking at a policy price that's tripled or quadrupled in the last year, it's not a decision to be made rashly.
"Two types of people might qualify to go without coverage," says George Yates of Dayton Ritz & Osborne, an insurance agency based in East Hampton, N.Y. "The independently wealthy, with an asset so small to them that it wouldn't matter if they lost it, or someone who just can't afford insurance.
"In either case, it's not particularly good risk management."
But sometimes, a homeowner's day-to-day financial management issues are more pressing.
In Florida, for example, homeowners are finding their premiums have skyrocketed. Add to that deductibles that look like they won't be met unless the structure is destroyed. Plus, many insurers have either gone out of business or decided to stop writing policies, limiting customers' comparison-shopping options.
In the end, many homeowners find themselves in the unhappy position of choosing between high premiums or exorbitant premiums. Or no premiums.

Annual Percentage Rate

The cost of credit on yearly basis, expressed as a percentage. Required to be disclosed by the lender under the federal Truth in Lending Act, Regulation Z. Includes up front costs paid to obtain the loan, and is therefor, usually a higher amount then the interest rate stipulated in the mortgage note. Does not include title insurance, appraisal, and credit report.

Amortization

Amortization is payment of debt in regular, periodic payments of principal and interest.

Aggregate Adjustment

The adjustment made as a credit to the borrower at closing to avoid an overage in the borrower's escrow account.

Adjustment Interval

For an adjustable rate mortgage, the time between changes in the interest rate charged. The most common adjustment intervals are one, three, or five years.

Adjustable Rate Mortgage (ARM)

A mortgage in which the interest rate is adjusted periodically based on an index. Also called a variable rate mortgage.

Acre

An acre is a measure of land equal to 43,560 square feet.

Acknowledgement

An acknowledgement is a formal declaration before a public official (typically a Notary Public) certifying that one has signed a document. Required before recording real estate legal documents, such as deeds of trust.

Abstract of Title

An abstract of Titleis a historical summary of all the recorded transactions that affect the title to the property. An attorney or a title company will review an abstract of title to determine if there are any problems affecting the property. All problems must be cleared before the buyer can be issued a clear and insurable title.

DPOL.com

dpol.com is where you can view current property listings for sale in the Delmarva area. Check it out, you can put in price desired, bedrooms wanted, and so on and it will show you everything available that fits into your criteria.

Low-Rate Mortgage & Home Equity Loans


Choosing the right lender is crucial. They will be with you for the life of your loan, 30-40 years. With E-loan you can apply over the internet and track your progress.

Bank Accounts

It is important to maintain a bank account in good standing. Keeping your account with a positive balance is a good way to build your credit standing.
If you do not have a bank account you should definately obtain one. Look for one that gives you a good percentage rate so that the money you are saving can grow more rapidly. Anything that can help your money grow is a good thing.
One thing mortgage lenders like to see is that you have been able to have saved some money. Try making some amount of deposit monthly to grow your balance.
Money is not always needed for a down payment, but there are almost always closing costs, unless the seller has agreed to pay them.

There are Programs for the Credit challenged

Compare what different lenders have to offer. There are many different loan programs out there. Almost one for every individual. Even people with less than perfect credit scores can obtain a mortgage loan. Your loan will be based on your credit score.
For the people with less than perfect credit, lenders like to see that you have been paying your bills on time for at least the last six months. They also would like to see close to three lines of open credit, such as credit cards and major department store cards. One other thing to keep in mind is that now is not the time to make any large purchases, like a vehicle. This would create a new loan on your credit with no payment history. If you have recently purchased a vehicle, you will want to ake timely payments for the next six months to help your credit score.

Getting More Interested Buyers

Sometimes a yard can make all the difference. It's hard to say how many more homes buyers would have an interest in seeing if the yard was more appeallng. Usually, if a buyer hasn't spotted your home from riding around, they have found it on the internet. Sites like dpol.com are a common site people view properties for sale. "A picture says a thousand words" visitors of this site can view properties for sale by simply logging on and starting a search. If your home isn't appealling from the outside, it's unlikely buyers will wish to visit your property. If noone visits, noone buys.
Try some simple landscaping to the yard. Plant shubbery and flowers. Brighten your yard and brighten your opportunity of a sale.

A skilled Mortgage Lender can help

A Skilled Mortgage Lender Can Help

It’s a very simple equation. The higher your credit score, the better interest rate you will receive as a borrower. The reasoning behind the equation is equally simple –your interest rate not only reflects current market conditions but also your estimated ability to pay back the loan. To a lender, the latter is worth its weight in gold.
Components of a Credit Score Generally speaking, your credit score is based upon the following criteria in order of importance:
Payment history (this is where delinquencies will hurt you).
Responsibility regarding credit usage (how maxed out are your accounts).
Credit age (how long have you had your credit accounts).
Number of credit inquiry requests.
Credit diversity.
These quantifiable aspects, once accumulated, typically result in a number between 450 and 850. The bottom line is the higher number, the more likely you are to pay back the loan. A Closer Look at the Players Involved. There are three separate credit bureaus that keep track of your score, Experian, Trans Union and Equifax. If you’ve heard your score referred to as a “FICO” score it’s because all three bureaus use software developed by Fair Isaac Corporation. FICO is an acronym taken from that name. It’s important to know most lenders look at all three scores when making a decision on your loan, since scores can and often do vary. While FICO is the industry standard, the three major credit bureaus recently released their own scoring model called Vantage Score. The new system is actively being marketed to lenders, and the bureaus claim that it will produce more uniform results. In addition, the scoring system is arranged similarly to the grades given out in school, making it easier for everyone to understand. Time will tell whether this system will impact the use of the FICO system. What a Credit Score Means... A borrower with an outstanding credit score will get what is called an A-paper loan. This borrower is rewarded with a lower interest rate because of their proven track record. Consumers with less-than-perfect credit receive loans labeled A-minus, B-paper, C-paper or D-paper. These loans are known as “sub-prime” and come with a higher interest rate. On a monthly basis, this translates into more money out of the borrower’s pocket."


Improving Your Score

Now that we’ve explored the nuts and bolts of credit scoring, let’s examine how you can improve your score. For starters, it’s a good idea to consult with a qualified mortgage professional that can provide examples of reasonable credit usage, discuss options for paying off existing debt and advise you regarding whether limiting or expanding your credit is most beneficial. A mortgage consultant can also assist you with identifying negative items or potential errors on your credit report. It’s important to deal with such issues as soon as possible. In addition, if you need credit counseling, a mortgage professional can help you obtain it. Here are some additional tips to keep in mind:

1)Pay your bills in a timely manner – Paying bills on time for one month can raise your credit score as much as 20 points.

2)Control the balances on your credit cards. Maxing out credit cards can lower your score as much as 70 points.

3)Don’t open new lines of credit you don’t need. New accounts lower your average account age which, in turn, may lower your score as much as 10 points.
4)Increasing high credit limit on current accounts – Often you can increase your line of credit to the point where you balance is less than 50%, this generally has a positive impact on your scores as the credit bureau’s systems pick this ratio up as a conservative use of spending.