30 Sep 07 Little Things Add Up…

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Traditionally, as home buyers, after we found the new home of our dreams, we spend hours and even days searching for the best home loan with low interest rates and low closing costs. We fight for the lowest possible monthly payment and most of the time don’t think twice about our total cost of interest or if we can pay off our home loan a little sooner. For most of us, after we sign our closing documents, we forget about it, and go through life paying the minimum payments.

Little things add up when paying down your home loan. The most popular loan program most homeowners do take advantage of is bi-weekly mortgage payments. This approach is a great way to pay down your loan faster and save money on interest payments. It basically adds up to an extra payment a year and makes a huge long and short term difference on the interest you pay. Lenders usually charge a set up fee but this is offset with the eventual savings. If you didn’t have the option to take advantage of this approach, or opted out of it, you may want to contact you lender to see what you can do to set up a bi-weekly payment option. If you are unable to make bi-weekly payments you can always pay a little more on each payment or make a large lump sum payment each year. By paying your principle down faster, you will save thousands of dollars during the life of your loan. Recently, several programs have developed that can help you pay your mortgage off in as little as 15 years.

Like everything else in life, it’s the small things that matter, and your efforts to pay your principal down now can put you in a great place in the near future. Before agreeing on a loan, ask your lender what you can do to pay your loan off faster and save money on interest. Many lenders have great programs and useful information. Taking the time to learn a little more about paying your principle down faster can significantly reduce the interest costs of your real estate investment.

Are there any loan programs you recommend?

Tags: home buyers, home loan, Homes for Sale, interest payments, lenders, mortgage, new homes

28 Sep 07 Create a US real estate subsidy program? Maybe…

Should the real estate industry receive more support from our government? Earlier today it crossed my mind that farmers (and not just the family farmers) have been receiving tax cuts, subsidized loans and insurance, money and a lot more annually from our government. Figuring out if this is good policy is another subject, but should the real estate industry get similar assistance? I could argue that events in our nation’s real estate industry influence several other industries across the country and that the real estate industries health is directly related to the health of our national economy. I could be way off here, but I think the amount of real estate related jobs nationwide compares to the amount of farm jobs nationwide. And isn’t owning a new home important to the financial well being of most Americans? Let’s say the government did subsidize the real estate industry would the car industry be next? Is it a good idea to offer assistance to any industry? Just a thought

Jayson

Tags: economy, insurance, new homes, Real Estate, subsidized loan, subsidy program

28 Sep 07 Recent Rate Cut - Will it be enough?

As you know, the Federal Reserve recently implemented a ½ point rate cut in an effort to stimulate our slowing economy. The fed mentioned that a major factor in our weakening economy is the real estate slowdown and the domino effect that this slowdown is having on related industries. The rate cut is expected to boost consumer confidence, consumer spending and decrease credit related monthly payments for many Americans, but will it be enough to stimulate new home sales? Will the rate cut have a significant effect on our nation’s real estate market? How much will it affect the Arizona real estate market?

The rate cut will most likely increase home sales some, but I’m not convinced that rising interest rates are the only reason why many people are not buying. Aren’t several people canceling? Aren’t many waiting to “know” when things can’t get worse?

In addition to rate cuts, I think the Fed should somehow reward responsible creative lending practices with lower borrowing rates. Regardless, the national attention and recent actions by the Fed give me hope that, in time, our nation’s real estate market will once again be robust. After all, it is the best time to buy! Any thoughts on what else we can do?

Tags: borrowing rates, federal rate cut, federal reserve board, home sales, interest rate cut, Real Estate, real estate market