Consumer Real Estate News

    • Is It Time to Sell Your Home?

      27 January 2020

      Choosing to sell your home is a big decision—one that requires the careful weighing of a variety of factors, both lifestyle and financial. To help sort things out, here are a few telling signs that now might be the time to finally put your home on the market.

      You’ve outgrown your space—really.
      Truly needing more space is about more than an overflowing closet or two. Do you have kids outgrowing shared bedrooms? An in-law moving in? A new virtual work opportunity that requires a home office? These are the life events that truly necessitate a bigger home—not the inability to curb one’s shoe-buying habit.

      Your neighborhood is booming.
      Are you smack-dab in the middle of a hot housing market? Contact your local real estate agent and check out comparable sales. If homes in your neighborhood are selling above listing price and you’ve been on the fence about selling for a while, now might be a wise time to take the leap and cash in on the opportunity.

      You’re letting things go.
      Remember when home improvement projects and landscaping chores were fun? Well, if that’s a distant memory and your grass is knee-high and the porch railing is rotting, this may be a sign that you’re ready to move on to a maintenance-free way of life. Realize that the more you let things go around the house, the more money you’ll have to invest to get it ready for market. So, honestly evaluate if it’s time for a home that offers a simpler, less work-intensive option.

      Your life has changed.
      An important life change can surpass all other reasons to sell your home. Growing or shrinking families, a new job with a new, long commute, retirement, divorce, etc., are all cause to seriously consider moving to a home that makes more sense for life as you now know it. Ultimately, a happy home is one that’s in sync with your current phase of life.

      Of course, these are just a few signs that it might be time to sell your home. Reach out to a real estate agent for more information that may help you decide.

      Published with permission from RISMedia.

    • Quick-Fix Items for Your Home to Have on Hand

      27 January 2020

      Maintaining your home requires more than your seasonal large maintenance projects. It also requires small day-to-day fixes to keep your home looking its best. Keep these handy items nearby for a quick fix whenever your home is in need.

      Extra Paint:
      Whether you opt to have paint samples or just save your current wall paint, it’s always a good idea to keep extra paint around. Scuffs, small scratches and holes can be quickly repaired or covered with a small bit of matching paint. While yes, your paint will never dry exactly the same as your first application, it will still be the perfect solution for minor issues.

      E6000 Glue:
      No mere super glue, E6000 is specifically formulated to handle your most intense gluing projects. With its praises sung by crafters and hardware stores alike, there is no doubt that this glue will come in handy. Said to be able to handle heavy materials like wood, metal and concrete. As well as an array of craft mediums, you will be grateful to have this at the ready the next time something chips or breaks and requires a hardy-but-simple fix.

      Spackle and Putty Knife:
      For obvious reasons, this is a must-have for home repairs. Don’t wait until you need it to buy it, however. It’s a small item that can be easily stored for later. Small holes from furniture, nails and other issues can be easily repaired with a little spackling compound and a little extra paint. To save time and hassle, look for a spackle with primer already in the compound.

      Everyday Tool Set:
      If you don’t already have a set of tools, there are basic items you need to have for everyday repairs. A simple toolset can be purchased at nearly any store, but will do wonders for your home the next time a small issue arises. 

      Published with permission from RISMedia.

    • What Is a Purchase Money Loan?

      27 January 2020

      A purchase money loan can refer to a mortgage provided by a bank, credit union, or mortgage company or issued or guaranteed by a government agency. Usually, however, the term refers to a loan provided by the seller.

      Seller Financing
      For homebuyers who don’t meet a mortgage lender’s requirements, obtaining financing through the seller may be an option. If the house is paid off, the seller and buyer can negotiate the terms of a purchase money loan, including the length, monthly payment, interest rate, and down payment. A security instrument is usually recorded in public records in case a dispute arises.

      A seller negotiating a purchase money loan may be more flexible than a financial institution would be. A seller may agree to an interest-only or less-than-interest loan with a balloon payment and may allow the buyer to make the down payment in installments. Since a buyer usually only seeks a purchase money loan as a last resort, the seller may charge a higher interest rate than a financial institution would or raise the purchase price. 

      Because there is no financial institution involved in the transaction, the parties can often close the deal faster than they otherwise would. Closing costs are usually lower with a purchase money loan than with a typical mortgage. 

      Sometimes a buyer uses a purchase money loan to take over the current owner’s mortgage. In that situation, the difference between the balance on the existing mortgage and the sale price is financed by the seller. The purchase money mortgage is considered a second mortgage, and the original loan must be paid off first. 

      A seller may offer a purchase money loan to attract a buyer if there are more houses for sale than buyers or if the owner needs to sell quickly. A seller may get full list price or more and may pay lower taxes if the sale is completed in installments. The seller can also benefit from monthly income and a high interest rate.

      In a land sale, the parties enter a lease-purchase agreement in which the seller gives the buyer equitable title and leases the property to the buyer. After the agreement has been fulfilled, the buyer receives the title and rental payments are credited toward the purchase price. The buyer can then obtain a loan to pay the seller.

      Other Types of Purchase Money Loans
      A conventional purchase money loan can be issued by a bank or mortgage lender. A lender may loan up to 20 percent of the sale price as a second mortgage to cover a shortfall if the amount approved for a first mortgage isn’t enough to buy a desired house. The Federal Housing Administration and Veterans Affairs Administration offer government-backed purchase money loans.

      Many Ways to Buy a Home
      You have numerous options to achieve your dream of homeownership. If things haven’t worked out with a conventional lender or government agency, financing a home purchase through the seller may be an avenue worth exploring.

      Published with permission from RISMedia.

    • How Starting a 529 College Savings Plan Early Helps

      24 January 2020

      Even if your children are just a few years away from starting college, it’s not too late to start a college savings account. But it’s never too early to start one, either. 

      Saving for college is something parents may not think about, or act on, until their child is 7 years old or so. That’s better than starting when children reach high school, but a college fund can also be started at birth or earlier. 

      Money in 529 plan accounts—named from a section of the federal tax code—grows tax free and is tax free when withdrawn and spent on eligible expenses like tuition, fees, housing, meal plans, books and equipment. It can pay for private school from elementary school onward.

      Here’s how saving early can add up. Suppose you start saving right after a child is born, investing a $2,000 lump sum to start and continuing with monthly $300 contributions until age 18. By the time the child enters college, the account grows to $130,077, assuming an average annual return of 6.21 percent, according to research by RBC Wealth Management. 

      By delaying the same savings method until the child turns 6, the account grows to $73,026, or about 44 percent less. If parents didn’t start saving until the child turned 12, the total value would reach $33,284. 

      Not only is less money invested if saving starts later, but there’s less interest to compound. Also, the most popular investment options for 529 plans automatically shift funds from stocks to bonds as the child ages, typically creating less risk and lower returns. Opening an account later, such as at age 7, means that you’re missing out on potential gains from early, more aggressive investments. 

      A model that Morningstar based on average allocations for stocks and bonds in age-based portfolios found that with a $50,000 investment divided into equal monthly installments, someone who began saving when a child was 7 could expect a median balance of almost $81,000 by age 18. 

      Starting a year earlier at age 6, the median balance would be almost $4,000 higher. If opened at birth, the account would be $30,000 higher.

      Contributing to a college savings plan late, such as when a child is in high school, can be leveraged for long-term gain by using it if the child pursues a graduate degree years later.

      But forget about the above figures for a moment. Whenever you start saving for your children’s college fund, show them the balance  each month as an incentive for both of you to save more.

      Published with permission from RISMedia.

    • IRS Audit Red Flags Retirees Should Watch Out For

      24 January 2020

      Only about 1 percent of Americans are audited in a given year, and most of those are weighted toward people with high incomes. Still, it’s something you don’t want to take a chance on. 

      Retired taxpayers should be aware of some red flags that could lead to an IRS audit. And we’re talking about more than a few math errors, which may draw an IRS inquiry on their own, but are unlikely to result in a complete exam of their tax returns.

      Here are some red flags worth knowing: 

      Not Reporting ll Taxable Income
      This is an error that the IRS computers will easily find because they get copies of all the 1099s and W-2s that show what you were paid. They also get 1099-R form copies reporting payouts from retirement plans, 401(k)s and IRAs, as well as 1099-SSA forms reporting Social Security benefits. 

      So failing to report taxable income from wages, dividends, pensions, IRA distributions, Social Security benefits and other income sources is a red flag by itself because the government already has those documents from the reporting agencies and will check if they match your tax return.

      High Income
      The more income you have, the higher the chance that you’ll be audited. It’s a fact of how the IRS works. Audits on taxpayers earning $200,000 or more are almost 3 percent of returns, and for those earning $1 million or more, it doubles to about 6 percent. 

      There’s nothing wrong with being audited if you’re accurately reporting your income and earn $1 million or more per year. But if there are mistakes on your return, expect the IRS to seek to get them fixed. 

      Large Deductions
      If your tax deductions or charitable deductions are higher than the average, there’s a higher chance you’ll be audited. If you have the proper documentation for your deduction, then claim it. 

      Retirees may have given more to charity than others, so if you make noncash donations over $500, be sure to file Form 8283, or you could be shooting up a red flare to the IRS. 

      Not Taking Minimum Distributions
      There are laws for the required annual minimum distributions from retirement plans, and not taking them as a retiree is a red flag the IRS will likely see. 

      You generally have to start taking withdrawals by age 70-1/2, though Roth IRAs don’t require withdrawals until after the owner has died. People who don’t take out the proper amount can be hit with a 50 percent penalty of the shortfall. If you retire early and take payouts before age 59-1/2, be sure you qualify for an exception, or you’ll face a 10 percent penalty on the early distributions. One exception is using an IRA to pay your medical insurance premium after a job loss.

      Published with permission from RISMedia.