Of all the major purchases you make in your life, none is more vital than buying a home. While paying off a new car can take up to six years, home ownership is a lifelong commitment. Depending on how you walk, a home mortgage can be a pair of cement shoes dragging you down into the abyss of debt.
Whether you’re a home owner who shares the burden of a mortgage with their spouse or carrying it alone, you need to make a situation that works for you. The good news is that there is a variety of tricks and services to help you save money.
These tricks work based on the cards your investment has dealt you with. How well they work will be based on your wit and skill. Needless to say, some sacrifices will need to be made.
Whether you’re looking for houses for sale in Charlotte or Raleigh, you have a mental inventory of what your dream house should be. The exterior should have no peeling paint or loose siding. Factors like these benefit the case for lowering your property taxes.
Make sure your house is up to code. Petitions to lower property taxes will be carefully reviewed by committee from reports made by an assessor. You don’t want the assessor to survey your home and find a shopping list of blemishes and code violations.
The big similarity between adjustable and fixed rate mortgages is that both present the homeowner with a lower, affordable rate. Lower rates are easier to budget into a fixed annual income. It’s no wonder why these mortgages are popular with first time homeowners.
What first time homeowners may fail to grasp is how rates can automatically adjust themselves every month. Huge rate increases happen, at least, every 45 days before the anniversary of the mortgage. Depending on how long you plan to stay on the property, a fixed rate mortgage will cut costs until it’s time to move out.
Now we come to the riskiest choice- cashing out your home equity loan. Cash-out refinances are the result of mortgages being adjusted ahead of the previous amount so the owner can take the remaining loan balance in cash. For every rise in home values, cash-out refinances are sure to follow. In the third quarter of 2006, home values rose by an index of 224 while mortgage refinances for cash-outs reached 89%.
Your potential cash bonus would come at the risk of your home. Keep in mind you are still raising the mortgage beyond the current cost. And that’s not accounting for closing costs after you’ve refinanced. On the flip side of the above statistic, the 89% of cash-outs lead to a swift drop in home value prices by the end of 2012. This swift drop wiped out the home equity of American property owners to the tune of $6.73 trillion dollars.
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