Shouldn’t buy a Texas home in 2014? Yes, shouldn’t.

We’ve been telling you the financial and personal reasons why purchasing a home in Texas this year is a very good idea. But it’s not a good idea for everyone. 

Here are the 4 reasons why you shouldn’t become a Texas homeowner this year:

1. You plan to move to another city within the next two years.Even with prices rising, you could lose money on your home purchase if you need to sell within the next two, or even three years. Selling carries costs, such as the real estate agent’s commission and a seller’s share of closing costs.

   If you’re already planning to relocate or haven’t yet decided that your current Texas city should be your permanent home, wait.

    

2. You haven’t yet saved enough money for a down payment and have no cushion to set aside for home maintenance, etc.When it comes to buying a home, the more you can put down, the better. And while some loan programs will allow you to finance some or all of your closing costs, you’re better off to have that money on hand.

   In addition, the bank will want to see that you have enough money in the bank to cover a couple months’ worth of principal, interest, taxes, and insurance.

   You may also want to buy some new furniture and/or make small improvements to your new home. You’re better off when you can pay for those things – not add them to a credit card.

   If your Texas home purchase will take your last dime, wait a bit.

3. You actually enjoy moving to a different house or apartment every few years – and you don’t mind following a landlord’s rules.If you like a change of scenery every now and then, being tied to just one home isn’t for you. Keep your options open and retain the freedom to move on when the notion strikes you.
4. You don’t want the responsibility of caring for a home or a yard.Some folks just don’t want to be responsible for anything beyond basic house cleaning. They want to leave the repairs, the maintenance, and the yard work to someone else. When they’re not at work, they want to relax, play, or perhaps take off for the week-end. They don’t want to work on household projects.

   If that describes you, then you shouldn’t own a home. At least, not now.

If none of these reasons applies to you, then now is the time to become a Texas homeowner.

The first step is mortgage loan pre-approval – so you’ll know exactly what you can spend, and so homeowners will know that you can carry through on any offer you make.

Mike Clover

Mortgage Banker

Homewood Mortgage, LLC

Toll FREE: 1-800-223-7409

O: 469-438-5587

F: 972-767-4370

NMLS# 234770

Web: www.mikeclover.com

E-mail: mike@mikeclover.com

Call for Super Service!!

We’ll be happy to provide that pre-approval. Just give us a call at 1-800-2232-7409 or apply on line at http://www.mikeclover.com.

If you’re kicking yourself for not buying a home in 2012 or 2013, don’t kick yourself again next year.

Yes, home prices have risen, and yes, interest rates have risen. However they’re both still well below their peaks. Remember that from 1979 through 1984, mortgage interest rates were over 10% – sometimes well over.  Then through the 80’s and 90’s rates bounced in a range roughly between 7% and 10.5%, only dipping down into the 5’s and 6’s after 2002.

Mortgage interest rates are still a bargain. So while it would have been fun to get in at the very bottom, 2014 is still a good time to take the plunge.

Unless you’re getting free rent, you have to pay to live somewhere. If you rent, your monthly payment will not only cover what would amount to a payment on a house, you’ll be paying for items such as a vacancy allowance, a property management fee, and a profit for the landlord.

What about home maintenance? Yes, when you rent, your landlord pays those costs. But they aren’t free to you. Every rent payment includes dollars to be set aside for repairs and maintenance.

Furthermore, as years go by you can expect your monthly rent to rise.

When you have a fixed rate mortgage loan, your payment will only increase if property tax and insurance costs rise. Even with inflation and even when your income rises, your principal and interest payment will remain fixed.

You’ll build equity. Yes, those who purchased at the top of the boom did lose money when the economy crumbled. But because banks have halted the questionable loan practices that led to the boom, we’re not likely to see that kind of buying frenzy again. If you purchase a house to live in for the next several years, your equity will grow.

You get a tax break. At today’s low interest rates, and depending upon the size of your loan, your interest payments alone might not be enough to give you a better break than the standard deduction. (For 2013 the standard deduction for a couple less than 65 years of age is $12,200.)

However, when combined with property taxes, medical expenses, employee expenses, charitable contributions, etc. making a mortgage payment rather than a rent payment can be extremely beneficial.

The first step toward home ownership is getting pre-approved for a loan, so call us today at 1-800-223-7409 or apply on line at http://www.mikeclover.com/

Our rates and fees are low – and we’ll be pleased to get you pre-approved and ready to make a winning offer.

Mike Clover

Mortgage Banker

Homewood Mortgage, LLC

Toll FREE: 1-800-223-7409

O: 469-438-5587

F: 972-767-4370

NMLS# 234770

Web: www.mikeclover.com

E-mail: mike@mikeclover.com

Call for Super Service!!

Insecurity a good reason to stop renting and buy a Texas home in 2014

If you’re renting your Texas residence, you know that your home is not your own. Your rental agreement specified certain things you may not do.

For instance, you can’t paint the living room or put a nail in the wall to hang a picture. You also can’t hang a utility cabinet over the washer to hold your cleaning supplies. And why would you want to? You’d be foolish to spend money making the house nicer or more convenient, because it isn’t yours.

You can’t let your out-of-work brother move in for a few months because your lease specifies how many people will be living in the house or apartment. If you own a boat or a motorhome, you may have to pay to garage it somewhere else.

You probably can’t hang a basketball hoop or set up a trampoline or an above-ground pool. Don’t even think about wanting to build a fence.

You may or may not be permitted to own a dog or a cat – or to plant a garden in the back yard. And if you’re living in a multi-family unit, you probably have to agree to observe “quiet hours” after a certain time in the evening.

At the same time, your neighbors may not observe those rules, so you may be subjected to loud music, family fights, or children running back and forth over your head.

To make matters worse, as a tenant you have to live with insecurity. You may have a lease that says you have a right to stay for a year or even longer. But what if your landlord is behind on the payments? If “your” home is suddenly in repossession, what then?

And when your lease is up you not only have to worry about a rent increase, you have to wonder whether you’ll be permitted to stay. What if the landlord’s children need a place? Or what if he or she has sold the property and the new owner wants you out? You have no guarantee that you’ll still be living there a year when your lease is up.

The fact is, when your home isn’t really yours, you live with:

• Other people’s rules
• Insecurity.

When you own a home, you can put down roots…

When you own your home you’ll make improvements that reflect your personality and your lifestyle. As years go by you can remodel rooms to suit your own tastes. Space and zoning regulations permitting, you can even build an addition to accommodate a growing family or to provide space for an office or a hobby room.

You’ll have the option to plant a tree and watch it grow. You can build a fence and watch your children and your pets playing and growing alongside that tree. You’ll get to know the neighbors and the neighborhood – and you’ll truly belong somewhere.

The home will become truly yours, especially as you build memories within its walls.

2014 is a great time to become a Texas homeowner – for both financial and personal reasons. And… you may be pleasantly surprised to learn that you can live in a home that’s as nice or even nicer than your rental – for a smaller monthly outlay.

If you’re ready to trade the insecurity of renting for the security of Texas home ownership, give us a call at 1-800-2232-7409 or apply on line at http://www.mikeclover.com.

Related: Why do you need to contact A1 Locksmith and get more information about your home security?

We’ll be happy to get you pre-approved and ready to shop for your first home.

Mike Clover

Mortgage Banker

Homewood Mortgage, LLC

Toll FREE: 1-800-223-7409

O: 469-438-5587

F: 972-767-4370

NMLS# 234770

Web: www.mikeclover.com

E-mail: mike@mikeclover.com

Call for Super Service!!

Texas Mortgage Rates

• No Big Bank Red Tape
• 15 Day Close
• Low Rates & Fees
• Texas Owned & Operated
• 5 Star Mortgage Professional featured in Texas Monthly Magazine
• BBB A+ rating

Refinance Rates & Purchase Rates could be lower… have your clients call me to discuss.

30 yr Conventional 4.375% – 0 Discount Points – 0 Origination

15 yr Conventional 3.5% – 0 Discount Points – 0 Origination

20 yr Conventional 4.25% – 0 Discount Points – 0 Origination

10 yr Conventional 3.25% – 0 Discount Points – 0 Origination

30 yr FHA 3.75% – 0 Discount Points – 0 Origination

15 yr FHA 3.25% – 0 Discount Points – 0 Origination

30 yr USDA 4.125% – 0 Discount Points – 0 Origination

30 yr VA 3.75% – 0 Discount Points – 0 Origination

15 yr VA 3.25% – 0 Discount Points – 0 Origination

Jumbo 30 yr Fixed 4.625% – 0 Discount Points – 0 Origination

Your Locally Owned and Operated Texas Mortgage Banker……

* These rates are based on a estimated loan amount of $250,000 or above and roughly 4.434% to 5.89% APR depending on loan program. Rates are also subject to change without notice. FHA requires 3.5% down. Conventional requires 5% down. Jumbo requires 20% down up to $1Million. Jumbo APR is estimated 4.771% Some rates are based on a 740 credit score or higher. Some loans require lower LTV, call for details.

Texas Purchase & Refinance Mortgage Rates …….

 We are from Texas, We are operated in Texas, and We are Texas Strong…..!

All Loans close on-time and within 30 Days or less.

Refinance Rates & Purchase Rates could be lower… have your clients call me to discuss.

 Rates Dropped.. Get em locked!

30 yr Conventional 4.375% – 0 Discount Points – 0 Origination

15 yr Conventional 3.5% – 0 Discount Points – 0 Origination

20 yr Conventional 4.25% – 0 Discount Points – 0 Origination

10 yr Conventional 3.125% – 0 Discount Points – 0 Origination

30 yr FHA 3.75% – 0 Discount Points – 0 Origination

15 yr FHA 3.25% – 0 Discount Points – 0 Origination

30 yr USDA 4.125% – 0 Discount Points – 0 Origination

30 yr VA 3.75% – 0 Discount Points – 0 Origination

15 yr VA 3.25% – 0 Discount Points – 0 Origination

Jumbo 30 yr Fixed 4.75% – 0 Discount Points – 0 Origination

 Your Locally Owned and Operated Texas Mortgage Banker……

* These rates are based on a estimated loan amount of $250,000 or above and roughly 4.434% to 5.89% APR depending on loan program. Rates are also subject to change without notice. FHA requires 3.5% down. Conventional requires 5% down. Jumbo requires 20% down up to $1Million. Jumbo APR is estimated 4.776% Some rates are based on a 740 credit score or higher. Some loans require lower LTV, call for details.

Mike Clover

Mortgage Banker

Homewood Mortgage, LLC

Toll FREE: 1-800-223-7409

O: 469-438-5587

F: 972-767-4370

NMLS# 234770

Web: www.mikeclover.com

Will buying a home reduce my income tax liability?

Real estate professionals dealing with the best Hilton Head real estate areas like to tell prospective buyers that owning a home will allow them to itemize deductions and thus give them a reduction in income taxes. That may be true and it may not.

Right now the standard deduction is $12,200 for married taxpayers filing jointly; $8,950 for head of household; and $6,100 for individual taxpayers. If the interest you pay, plus points, mortgage insurance, and property taxes are less than those amounts, you’ll only benefit if you have other deductions to push up the total.

Other itemized deductions that can be added to your real estate deductions on Schedule A are medical expenses in excess of either $7,500 or $10,000 (depending upon your birth date), unreimbursed employee business expenses, casualty and theft losses, and charitable donations.

What if I profited from the sale of my home last year?

As long as you lived in your home for 2 of the past 5 years, you get a break. The first $250,000 profit ($500,000 if filing jointly) is excluded from income tax liability. Profit exceeding those amounts is subject to Capital Gains tax.

Unfortunately, you aren’t allowed to take a deduction if you sold at a loss.

Will buying investment property reduce my taxes?

Investment property is addressed on a different form, and you are allowed a deduction if you have a loss.

While you do have to declare your rental income, you can offset that income with all the expenses related to owning the property. That includes points, mortgage insurance, mortgage interest, taxes (including the case of duplicate PAN card), insurance, utilities, cleaning, rental management, travel, and repairs. You are also allowed to depreciate the real property (but not the land under the house.)

Because your deductions may be limited if you earn more than $125,000 per year, it’s wise to confer with a knowledgeable tax advisor to learn the most advantageous way to take title and to set up your related accounting procedures.

What if I purchased a second home?

Interest and property tax on your second home are deductible, but again will only give you a tax break if they exceed the standard deduction when combined with other allowable deductions on Schedule A.

If you combine personal use with renting the house to others, your tax treatment will depend upon how many days you were in residence. Get tax advice in advance to avoid an expensive mistake.

We advise consulting an expert in order to take advantage of every tax break. However, in order to better understand that expert advice, we suggest reading the IRS Publication 530 (2013), Tax Information for Homeowners, published on IRS.gov.

Mike Clover

Mortgage Banker

Homewood Mortgage, LLC

Toll FREE: 1-800-223-7409

O: 469-438-5587

F: 972-767-4370

NMLS# 234770

Web: www.mikeclover.com

Texas Purchase & Refinance Mortgage Rates …….

 We are from Texas, We are operated in Texas, and We are Texas Strong…..!

All Loans close on-time and within 30 Days or less.

Refinance Rates & Purchase Rates could be lower… have your clients call me to discuss.

 Happy Friday!

30 yr Conventional 4.5% – 0 Discount Points – 0 Origination

15 yr Conventional 3.5% – 0 Discount Points – 0 Origination

20 yr Conventional 4.375% – 0 Discount Points – 0 Origination

10 yr Conventional 3.375% – 0 Discount Points – 0 Origination

30 yr FHA 4.0% – 0 Discount Points – 0 Origination

15 yr FHA 3.25% – 0 Discount Points – 0 Origination

30 yr USDA 4.25% – 0 Discount Points – 0 Origination

30 yr VA 3.875% – 0 Discount Points – 0 Origination

15 yr VA 3.375% – 0 Discount Points – 0 Origination

Jumbo 30 yr Fixed 4.875% – 0 Discount Points – 0 Origination

 Your Locally Owned and Operated Texas Mortgage Banker……

 * These rates are based on a estimated loan amount of $250,000 or above and roughly 4.551% to 5.89% APR depending on loan program. Rates are also subject to change without notice. FHA requires 3.5% down. Conventional requires 5% down. Jumbo requires 20% down up to $1Million. Jumbo APR is estimated 4.89% Some rates are based on a 740 credit score or higher. Some loans require lower LTV, call for details.

Mike Clover

Mortgage Banker

Homewood Mortgage, LLC

Toll FREE: 1-800-223-7409

O: 469-438-5587

F: 972-767-4370

NMLS# 234770

Web: www.mikeclover.com

Sometimes real estate and mortgage professionals forget that consumers don’t know the meaning of the terms and acronyms they use on a daily basis. And sometimes consumers are too shy to speak up and say “What does that mean?”

If you’re confused and not asking, here are a few of the most common terms and acronyms you’ll run across during your home buying adventure.

GFE – Good Faith Estimate.

This is a document your lender must supply to give you an idea of what you’ll be paying in closing costs. Use it to compare costs and fees between lenders and loan programs.

One section of the GFE deals with lender fees, title insurance, appraisal and inspection fees, courier fees, etc. These fees can vary from lender to lender, so deserve special attention. The document is labeled “good faith” because some of these fees can’t be precisely determined until you’re into the loan process. However, they should be very close.

The other section is Prepaids. The prepaids include interest, homeowners insurance, property taxes, and mortgage insurance that must be paid or deposited into an escrow account prior to closing.

LTV – Loan to Value

The amount of your loan as a percentage of either the appraised value or the selling price – whichever is less.

DTI – Debt to income ratio

This is the percentage ratio that compares your monthly obligations (including your new mortgage payment) to your monthly income.  Other obligations included are credit card payments, school loans, car loans, retail accounts, child support payments, and payments on other real estate you own.

The percentage you’re allowed will depend upon the kind of loan you’re getting – so talk with your lender before shopping for a new home.

Verifications

As the name suggests, these are documents designed to verify all the information you’ve given your lender during the application process. Much of the information can be verified in other ways, but when needed, these forms are sent directly from your broker to the entity who will issue the verification. This could be your bank, your employer, your landlord, etc.

VOD is verification of deposit.

VOL is verification of loan.

VOR and VOM are verifications of rent or mortgage payments.
VOE is verification of employment.

Ready to get started? Call us.

Here at Homewood Mortgage, the Mike Clover Group, we’re always willing to get you pre-approved before you shop. With a pre-approval in hand you’ll never be disappointed by setting your sights on a house that’s out of your reach – and home sellers will give your offers prime consideration because they’ll know you can close.

So if you’re thinking of becoming a Texas homeowner, call us at 1-800-223-7409 or apply on line at http://www.mikeclover.com/

Mike Clover

Mortgage Banker

Homewood Mortgage, LLC

Toll FREE: 1-800-223-7409

O: 469-438-5587

F: 972-767-4370

NMLS# 234770

Web: www.mikeclover.com

Texas Purchase & Refinance Mortgage Rates …….

All Loans close on-time and within 30 Days or less. Average loan is closing currently within 15 days.

Refinance Rates & Purchase Rates could be lower… have your clients call me to discuss.

30 yr Conventional 4.375% – 0 Discount Points – 0 Origination

15 yr Conventional 3.375% – 0 Discount Points – 0 Origination

20 yr Conventional 4.125% – 0 Discount Points – 0 Origination

10 yr Conventional 3.125% – 0 Discount Points – 0 Origination

30 yr FHA 3.75% – 0 Discount Points – 0 Origination

15 yr FHA 3.25% – 0 Discount Points – 0 Origination

30 yr USDA 4.125% – 0 Discount Points – 0 Origination

30 yr VA 3.75% – 0 Discount Points – 0 Origination

15 yr VA 3.25% – 0 Discount Points – 0 Origination

Jumbo 30 yr Fixed 4.75% – 0 Discount Points – 0 Origination

Your Locally Owned and Operated Texas Mortgage Banker……

* These rates are based on a estimated loan amount of $250,000 or above and roughly 4.434% to 5.89% APR depending on loan program. Rates are also subject to change without notice. FHA requires 3.5% down. Conventional requires 5% down. Jumbo requires 20% down up to $1Million. Jumbo APR is estimated 4.765% Some rates are based on a 740 credit score or higher. Some loans require lower LTV, call for details.

Mike Clover

Mortgage Banker

Homewood Mortgage, LLC

Toll FREE: 1-800-223-7409

O: 469-438-5587

F: 972-767-4370

NMLS# 234770

Web: www.mikeclover.com

E-mail: mike@mikeclover.com

Is your heart set on becoming a homeowner in 2014? If so, make it easier by embracing these 5 resolutions:

1. Increase Your Credit Score

The better your credit score, the lower your mortgage interest rate, so do all in your power to raise those numbers.

Begin by getting a copy of your credit report. Check it carefully for any errors, and if you find them, dispute them. If you have some old debts that you could pay off with a bit of effort, do it. But don’t close any credit card accounts. Keep them open by using the cards occasionally, then paying the bill in full each month.

Meanwhile – don’t charge more, and absolutely don’t even shop for big ticket items that will trigger a check on your credit. Don’t give your Social Security number to anyone.

2. Save Up for that Down Payment

While low-down-payment loans are once again available, you’ll typically need a 20 to 25 percent down payment to avoid mortgage insurance and qualify for the best mortgage rates. So start cutting expenses and putting money aside for that down payment.

Most of us have at least a few expenses that will cut $5, $10, $20 or more from our daily expenditures. For instance, you could eliminate that cup of espresso on the way to work, or bring lunch from home.

3. Get Pre-Approved

Becoming pre-approved for your mortgage loan is important for two reasons:

First, you’ll know just how much home you can afford, based on your down payment funds and your current debt and income ratios.

Second, once you’ve found the home, the sellers will look favorably on your offer because they’ll have the assurance that you actually can get a loan and close on the purchase.

Come see us at Homewood Mortgage, or begin the process here on line. We’ll be pleased to get you pre-approved and to answer any questions you have about the loan process.

4. Begin the Search Well in Advance of the Purchase

Begin long before you’re ready to make the purchase – by researching neighborhoods to decide where you want to live. Think about the places you go every day and focus on neighborhoods that will give you the shortest commute time. But don’t stop there – drive around and see if the neighborhoods offer other amenities that are important to you – such as a park, a convenience store, a nearby mall, etc.

If you have children, research the schools and learn which neighborhoods you must choose from in order to have your children in the school you favor.

Then start reading the ads for homes in your chosen neighborhoods. You’ll learn whether one neighborhood is more expensive than another, and what you can expect to pay for a home that meets your needs for size and amenities.

5. Choose a Top Real Estate Agent

Take the time to find a real estate agent who will really work for you. Get references, go to their websites and blogs, read their testimonials, and then have at least one real conversation before signing a buyer agency agreement. Type “real estate agent” and the name of your town into a search and you’ll soon learn which agents know most about your community.

When you’re well prepared, your home purchase can be an exciting, pleasurable adventure. So be prepared!

Mike Clover
Mortagage Banker
Homewood Mortgage,LLC
18070 Dallas Parkway
Ste. 304
Dallas, TX 75287
NMLS#234770
www.mikeclover.com