New Tax Law for Deducting Home Equity Line or Loan Interest

Beginning January 1, 2018, the new tax law restricts how and when interest can be deducted on a home equity line of credit (HELOC) or second mortgage.

Before the tax law change, home equity loans and second mortgages were popular ways for homeowners to borrow money to pay for college, vacations, a new car, etc., because the interest on the loans could be deducted. Read More

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Tips for Buying a New Construction Home

New Construction homeBuying a new construction home is different than buying a pre-existing home. For one, you are buying from the builder not a previous owner. Here are some things to consider if you choose to buy new construction:

1.  Find a good real estate agent who has experience in new construction and is not affiliated with the builder. Model homes in the development are often staffed by an agent who has a relationship with the builder. Find an independent agent who has your best interest at heart. Read More

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Should I Pay for My Credit Score?

Never rely on a credit score you buy online for your mortgage planning. There are dozens of websites selling your credit score reports, but there is no guarantee that the scores you are provided are accurate or even the same scores used by your lender.

The FICO score used by most lenders ranges from 300 to 850. Lenders rely on this score to determine a borrower’s credit worthiness. Read More

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Do I Need a Home Inspection on a New Home?

Yes, you should always make a satisfactory home inspection a contingency in any offer to purchase a home, whether it is a previously owned home or brand new construction.

Buying a home is probably the biggest investment you will make in your lifetime. Unless you are a professional engineer or contractor, you should hire one to check out the home for you. Read More

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Should You Put an Escalation Clause in Your Offer?

Whether a buyer should insert an escalation clause in an offer to purchase a home depends on how hot the market is and how much the buyer wants the home. Some buyers include a clause in their offer stating they will pay $1,000 more than the highest offer the seller receives. In a very hot market with lots of buyers and not much inventory, such an escalation clause can give a buyer an edge on a home. Read More

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Do I Need 20 Percent Down to Buy a Home?

Putting down 20 percent of a home’s sales price as a down payment is the gold standard for buyers. Not only will they have an easier time qualifying for a mortgage, they will also avoid paying private mortgage insurance (PMI). Borrowers who put down less than 20 percent must pay PMI, which can add substantially to their monthly mortgage payments. Read More

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What is a No Cost Refinance?

Brownstone with lots of greeneryA ‘no cost’ refinance is one in which the lender either waives or pays all fees connected with the loan with some exceptions. The tradeoff is usually a higher interest rate which makes the loan expensive for borrowers over the long haul. If you plan to be in the home only a short time, a no cost loan makes sense. Read More

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When Can I Drop PMI?

Borrowers who had to take out private mortgage insurance (PMI) because they put down less than 20 percent when they bought their home have the right to cancel the insurance, provided they can meet the cancellation rules.

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Don’t Get Surprised by Closing Costs

home with blooming flower bushesBorrowers who say they are surprised at closing by the costs they are expected to pay have not read all the paperwork their lender has given them. New rules that went into effect in October 2015 are designed to eliminate such surprises. Under the rules, borrowers should receive an estimate of the closing costs within 3 days of their application, and the actual closing costs 3 days before closing. Read More

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