Mortgage rates are at record lows for both first time homeowners, as well as existing homeowners. What this means for you as a buyer however, is that your chances of securing a home loan this year could be better than ever if you have your ducks in a row and have done your financial homework.
So what will it take to get a mortgage in 2011? The same stuff it takes to get a mortgage in any other year, starting with your credit score. It isn't that you can't get a mortgage with a poor credit score, it is that your mortgage rate is going to make it impossible for you to afford to pay anything but your mortgage. And that is where current homeowners facing foreclosure found themselves at the time they purchased their homes, high interest rates because their credit score was too low to get the better rate. Higher monthly payments, resulting in less available every month for other expenses.
Credit score matters if you want the best mortgage rate. In spite of the common misconception that repeated inquiries into your credit score will not effect it, your score will fall with every inquiry. However, if you have multiple lenders making inquiries within a few weeks together, the hit will be counted as one and the drop will not be as severe.
This brings us to the next point, do the research for the best lender. You can shop around for mortgage rates and lenders, do it all within a set time frame, and get the information you need with a minimal decrease in your credit score.
While you're researching, make sure that you've already determined your borrowing budget. If you're looking for a home to buy, you should already have a budget that you adhere to, and have a savings plan in place as well. In other words, you are financially savvy enough to understand that your budget might very well be the most important determining factor in whether you will buy a home or not; can you afford it?
If you are in the market for a refinance loan, consider asking your lender to rewrite the terms of the new loan to play out over the life of the old one rather than restarting at the first year mark again. If you have already paid 10 years into your current mortgage and only have 20 to go, see if you can have the refinance loan spread over the same 20 years as well.
In the event that you do not have any savings, or are not in a position to put a down payment on your mortgage, consider a no-closing-cost refi, or applying for government assistance if you qualify. And if your loan is for less than $100,000 consider acting early in the year rather than later, when a government regulation could place you last on the list for lenders looking to make more money on bigger loans.
Make extra payments all through the year whenever you can, not just at the end of the year. You can reduce substantial time off the life of your mortgage this way just by making a few extra payments a year. Alternatively, if you are having trouble making your payments, or if you are behind on your mortgage payment, be sure to contact a HUD certified financial or mortgage counselor immediately for help and information, and to avoid the risk of foreclosure.
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Crowley & Cummings are real estate attorneys located in Dedham MA specializing in real estate closings, title examinations, complex title issues, purchase & sale agreements, condo conversions, and other related services. They service lenders and mortgage brokers, real estate agents, as well as buyers and sellers in Massachusetts, New England, and throughout the US. To learn more visit them online at www.CrowleyCummings.com.
Showing posts with label Selling a home in MA. Show all posts
Showing posts with label Selling a home in MA. Show all posts
Tuesday, January 25, 2011
Thursday, January 20, 2011
Landlord Tenant Issues With Rental Property and Taxes
Many investors took advantage of the lower prices for real estate in combination with the lower interest rates and purchased investment and rental property. Unlike in the past, the lower rates and prices promise a faster return on their investment, with equity returns sooner rather than later.
If this is your first turn as a landlord, there are some tricky tax situations that you will need to pay attention to during your first year. Even a seasoned landlord will have to keep well informed of the various tax changes from year to year.
For instance, any rental income that you receive for the year will need to be included as income. This amount will include any deposits, non-refundable deposits, first and last month's rent, and any advance rent payments. It doesn't matter when the advance payments are for, you must count them for the year you received them.
Some items that may be a little trickier are items that your tenant does to maintain the property for a discounted rental amount. You still have to claim the value of the task performed as income, and then deduct it as well as an expense. You must also claim as income any expenses paid by your tenant. If your tenant deducts the amount from their rent, you will need to claim the full rental amount, and then deduct the expense.
A less common situation is where a tenant may pay you to exercise an opt out clause in a lease. Again, this is rental income, as are lease with option to buy option payments.
Two small tax breaks are included for renting out space in your residence. You needn't disclose the rent you receive, as long as it is for less than 15 days.
These are the places that the IRS loves to catch people cutting corners, so do yourself a favor and give them no reasons to dig deeper. Consult your tax professional and your real estate attorney for advice in all legal tax and landlord tenant matters.
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Crowley & Cummings are real estate attorneys located in Dedham MA specializing in real estate closings, title examinations, complex title issues, purchase & sale agreements, condo conversions, and other related services. They service lenders and mortgage brokers, real estate agents, as well as buyers and sellers in Massachusetts, New England, and throughout the US. To learn more visit them online at www.CrowleyCummings.com.
If this is your first turn as a landlord, there are some tricky tax situations that you will need to pay attention to during your first year. Even a seasoned landlord will have to keep well informed of the various tax changes from year to year.
For instance, any rental income that you receive for the year will need to be included as income. This amount will include any deposits, non-refundable deposits, first and last month's rent, and any advance rent payments. It doesn't matter when the advance payments are for, you must count them for the year you received them.
Some items that may be a little trickier are items that your tenant does to maintain the property for a discounted rental amount. You still have to claim the value of the task performed as income, and then deduct it as well as an expense. You must also claim as income any expenses paid by your tenant. If your tenant deducts the amount from their rent, you will need to claim the full rental amount, and then deduct the expense.
A less common situation is where a tenant may pay you to exercise an opt out clause in a lease. Again, this is rental income, as are lease with option to buy option payments.
Two small tax breaks are included for renting out space in your residence. You needn't disclose the rent you receive, as long as it is for less than 15 days.
These are the places that the IRS loves to catch people cutting corners, so do yourself a favor and give them no reasons to dig deeper. Consult your tax professional and your real estate attorney for advice in all legal tax and landlord tenant matters.
------------------------------------------
Crowley & Cummings are real estate attorneys located in Dedham MA specializing in real estate closings, title examinations, complex title issues, purchase & sale agreements, condo conversions, and other related services. They service lenders and mortgage brokers, real estate agents, as well as buyers and sellers in Massachusetts, New England, and throughout the US. To learn more visit them online at www.CrowleyCummings.com.
Wednesday, December 1, 2010
Renting Your Property After Buying a New Home
Your house is appreciating, in a very nice neighborhood, desirable, and easily rented for more than what you owe per month on your mortgage. You find a new home in an even better neighborhood, for less than you currently owe on your main residence.
The problem is, you will need to refinance your existing home to remove the equity and use it as a down-payment on the home you would like to buy. The second problem is, that no lender will give you a refinance loan, unless you are going to live in the home you are refinancing.
The only way around this issue is to get the refinance loan with the plan to live in your home at present. Once you've refinanced, change your mind and purchase the second home with the money from the refinance loan, rent out your house, and move into the new purchase. Some folks would call that dishonest, however, in the land of real estate and financing, it's simply referred to as a wise financial decision.
The old story about buying the house next door and then dumping yours works too, if you can manage to buy the house next door for a song, and you don't mind trashing your credit when you mail your keys back to your lender on the old property.
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Crowley & Cummings are real estate attorneys located in Dedham MA specializing in real estate closings, title examinations, complex title issues, purchase & sale agreements, condo conversions, and other related services. They service lenders and mortgage brokers, real estate agents, as well as buyers and sellers in Massachusetts, New England, and throughout the US. To learn more visit them online at www.CrowleyCummings.com.
The problem is, you will need to refinance your existing home to remove the equity and use it as a down-payment on the home you would like to buy. The second problem is, that no lender will give you a refinance loan, unless you are going to live in the home you are refinancing.
The only way around this issue is to get the refinance loan with the plan to live in your home at present. Once you've refinanced, change your mind and purchase the second home with the money from the refinance loan, rent out your house, and move into the new purchase. Some folks would call that dishonest, however, in the land of real estate and financing, it's simply referred to as a wise financial decision.
The old story about buying the house next door and then dumping yours works too, if you can manage to buy the house next door for a song, and you don't mind trashing your credit when you mail your keys back to your lender on the old property.
------------------------------------------
Crowley & Cummings are real estate attorneys located in Dedham MA specializing in real estate closings, title examinations, complex title issues, purchase & sale agreements, condo conversions, and other related services. They service lenders and mortgage brokers, real estate agents, as well as buyers and sellers in Massachusetts, New England, and throughout the US. To learn more visit them online at www.CrowleyCummings.com.
Wednesday, September 22, 2010
What About the Seller?
Crowley & Cummings LLC MA Real Estate Attorneys Checklist for Sellers of Real Estate
With all the emphasis on buyers, First time buyers, second home buyers, a seller could get lost in the shuffle. This handy checklist of items to remember (it’s your closing too after all), will help keep you from feeling alone while the spotlight is on the buyer.
Up to 4 Weeks Before Closing
Remind your broker to have your home fire inspection done; the closing cannot move forward without this report from the local fire department. You will receive a Certificate of Compliance. Make a note of the date the department was contacted, the date of your inspection and the date the certificate was obtained.
Up to Two Weeks Before Closing
Notify your utility companies so that you can get your final readings. Make a note with the name, phone number, and the name of the person you spoke to and on what date so that you will have the information should you need it to call again and remind them a week later. For oil heat you need to obtain proof of how many gallons are left in the tank from your oil company, unless you have made another agreement with the buyer. Your broker will be able to explain the entire process to you in detail. Make a note of the date for anything you do, and anyone you speak with regarding the details of the closing and the tasks leading up to it.
Contact the post office or visit a branch and obtain a Change of Address package. Make sure that you have sent your new address information to everyone and have changed it with the post office. This will allow them to forward any mail from anyone that you might have forgotten to notify personally. Make a note of the date and a list of to whom you send notices.
Fill out a change of address form with the Registry of Motor Vehicles for your car, and get a sticker for your license.
Last Minute to Up to One Week Before Closing
Write down contact information and include the name and telephone number of your Crowley & Cummings Attorney, the name and phone number of your broker, the address for the home or business you are selling, and the address for where the closing will be held.
Either you or your broker will need to contact the water and sewer departments for final readings at least 5 days before your closing.
Have your homeowner’s insurance set to cancel the day after your closing, and remember to notify your insurance agent(s) with your new address for automotive insurance as well. Make a note of the date of every conversation, and the name of anyone with whom you speak.
Make sure that your moving arrangements have been made to allow you plenty of time to vacate the premises some time prior to the closing. In most cases, the property must be delivered ‘free and clear’ of any debris or occupants/tenants. And unless you have made other arrangements, the property should be swept clean leaving no trace of occupancy. Make a note of the date you contacted the moving company as well as the name and address of the company, and the moving date you have arranged.
Remind your attorney at Crowley & Cummings to have the new deed prepared. If you are not planning to attend the closing, this would also be a good time to have a power of attorney prepared so that you can go in and execute both that and the deed at the same time. Provide your attorney with instructions in writing as to how you would like the funds from the sale deposited. Date all of your interactions.
If you are planning to attend the closing, you will need to bring two forms of identification, one a license or valid legal ID, the Certificate of Compliance from the Fire Department (your broker should be available to help you with this), any keys to the property and any buildings thereon, a few blank checks in the event that there are last minute adjustments that need to be accounted for. If you are not going to attend the closing, bring these items with you when you execute the power of attorney and deed, or drop them off on the day of the closing.
If you are selling or buying a home in Massachusetts and need a closing attorney or mortgage financing, contact the real estate law office of Crowley & Cummings and have everything taken care of in one place.
------------------------------------------
Crowley & Cummings are real estate attorneys located in Dedham MA specializing in real estate closings, title examinations, complex title issues, purchase & sale agreements, condo conversions, and other related services. They service lenders and mortgage brokers, real estate agents, as well as buyers and sellers in Massachusetts, New England, and throughout the US. To learn more visit them online at www.CrowleyCummings.com.
With all the emphasis on buyers, First time buyers, second home buyers, a seller could get lost in the shuffle. This handy checklist of items to remember (it’s your closing too after all), will help keep you from feeling alone while the spotlight is on the buyer.
Up to 4 Weeks Before Closing
Remind your broker to have your home fire inspection done; the closing cannot move forward without this report from the local fire department. You will receive a Certificate of Compliance. Make a note of the date the department was contacted, the date of your inspection and the date the certificate was obtained.
Up to Two Weeks Before Closing
Notify your utility companies so that you can get your final readings. Make a note with the name, phone number, and the name of the person you spoke to and on what date so that you will have the information should you need it to call again and remind them a week later. For oil heat you need to obtain proof of how many gallons are left in the tank from your oil company, unless you have made another agreement with the buyer. Your broker will be able to explain the entire process to you in detail. Make a note of the date for anything you do, and anyone you speak with regarding the details of the closing and the tasks leading up to it.
Contact the post office or visit a branch and obtain a Change of Address package. Make sure that you have sent your new address information to everyone and have changed it with the post office. This will allow them to forward any mail from anyone that you might have forgotten to notify personally. Make a note of the date and a list of to whom you send notices.
Fill out a change of address form with the Registry of Motor Vehicles for your car, and get a sticker for your license.
Last Minute to Up to One Week Before Closing
Write down contact information and include the name and telephone number of your Crowley & Cummings Attorney, the name and phone number of your broker, the address for the home or business you are selling, and the address for where the closing will be held.
Either you or your broker will need to contact the water and sewer departments for final readings at least 5 days before your closing.
Have your homeowner’s insurance set to cancel the day after your closing, and remember to notify your insurance agent(s) with your new address for automotive insurance as well. Make a note of the date of every conversation, and the name of anyone with whom you speak.
Make sure that your moving arrangements have been made to allow you plenty of time to vacate the premises some time prior to the closing. In most cases, the property must be delivered ‘free and clear’ of any debris or occupants/tenants. And unless you have made other arrangements, the property should be swept clean leaving no trace of occupancy. Make a note of the date you contacted the moving company as well as the name and address of the company, and the moving date you have arranged.
Remind your attorney at Crowley & Cummings to have the new deed prepared. If you are not planning to attend the closing, this would also be a good time to have a power of attorney prepared so that you can go in and execute both that and the deed at the same time. Provide your attorney with instructions in writing as to how you would like the funds from the sale deposited. Date all of your interactions.
If you are planning to attend the closing, you will need to bring two forms of identification, one a license or valid legal ID, the Certificate of Compliance from the Fire Department (your broker should be available to help you with this), any keys to the property and any buildings thereon, a few blank checks in the event that there are last minute adjustments that need to be accounted for. If you are not going to attend the closing, bring these items with you when you execute the power of attorney and deed, or drop them off on the day of the closing.
If you are selling or buying a home in Massachusetts and need a closing attorney or mortgage financing, contact the real estate law office of Crowley & Cummings and have everything taken care of in one place.
------------------------------------------
Crowley & Cummings are real estate attorneys located in Dedham MA specializing in real estate closings, title examinations, complex title issues, purchase & sale agreements, condo conversions, and other related services. They service lenders and mortgage brokers, real estate agents, as well as buyers and sellers in Massachusetts, New England, and throughout the US. To learn more visit them online at www.CrowleyCummings.com.
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