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Save Thousands on Your Mortgage

How To Save Thousands Of Dollars In Interest On Your Mortgage

One of the most common loans you can get to buy a home is a 30-year fixed rate mortgage. If the thought of paying for your home over the course of 30-years seems daunting, here are some easy ways to shorten that term which will actually end up saving you money over the life of your loan.

Any additional payments to the principal amount (the original sum of money borrowed in a loan), helps to cut down the amount of interest that you will pay over the life of your loan and can also help to shave years off the loan as well.

When you make ‘extra’ payments toward your loan, the key is to let your lender/bank know that you want the extra funds to go toward your principal balance as they will not automatically do this for you.

You don’t have to double your mortgage payment to make a big difference either!

If you have a 30-year mortgage on a median-priced home ($250,000) with a 5% interest rate, you’ll be responsible for a $1,342.05 monthly principal and interest payment. Over the course of the loan, if you pay your exact monthly payment, you will have paid $233,133.89 in interest alone!

Paying a Little Extra Can Pay Off Big

1. Pay an additional 1/12th of your mortgage payment every month

Benefit: In the example above, adding $111.84 to your monthly mortgage payment might not seem like a lot, but each year you will have paid one extra month’s worth of payments which will shorten the term of your loan by 4 years and 8 months, all while saving you $42,000 in interest!

2. Pay an additional $50 per month towards your mortgage

Benefit: Fifty dollars might not seem like enough to make a difference on the term of your loan, but that small amount will save you over $21,000 in interest and will take over 2 years off the end of your loan. Twenty-eight years from now, you’ll be happy to pay off your loan that much sooner!

3. Make one-time lump sum payments when you can

Benefit: If you find yourself with a little extra money after a yearly bonus, a tax return, or from investment dividends, paying that money towards the principal can cut your costs. This option, however, is less predictable than the extra monthly payments.

If you have higher interest debts, like credit cards, consider using any extra funds you have to pay those debts down before applying that money towards your mortgage. Also, if you do not plan on staying in your home for more than 10 years, paying extra toward your mortgage might not make sense.

Bottom Line

If you’re wondering what strategies would work best for you to shorten the term of your loan, consult a local real estate professional who can answer your questions or connect you with someone who can.

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7 Reasons To List During The Holidays

Every year at this time there are many homeowners who decide to wait until after the holidays to list their homes for the first time, while others who already have their homes on the market decide to take them off until after the holidays.

Seven GREAT Reasons Not To Wait:

  1. Relocation buyers are out there. Many companies are still hiring throughout the holidays and need their new employees in their new positions as soon as possible.
  2. Purchasers who are looking for homes during the holidays are serious buyers and are ready to buy now.
  3. You can restrict the showings on your home to the times you want it shown. You will remain in control.
  4. Homes show better when decorated for the holidays.
  5. There is minimal competition for you as a seller right now. Inventory of homes for sale traditionally slows in the late fall, early winter.
    Listing inventory as compared to the same time last year:Housing Supply Nov 2018
  6. The desire to own a home doesn’t stop when the holidays come. Buyers who were unable to find their dream homes during the busy spring and summer months are still searching!
  7. The supply of listings increases substantially after the holidays. Also, in many parts of the country, New Construction will continue to surge and reach new heights which will lessen the demand for your house in 2019.

 Bottom Line
Waiting until after the holidays to sell your home probably doesn’t make sense.

Keeping Current Matters!

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4 Things NOT to Do When Selling

So you’ve decided to put your home on the market. Congratulations! Hopefully, you’ve brought a rockin’ REALTOR® on board to help you list your spot, and together you’ve done your due diligence on what to ask for. As you start checking things off your to-do list, it’s also important to pay mind of what not to do. Below are a handful of things to get you started.

Don’t over-improve
As you ready your home for sale, you may realize you will get a great return on your investment if you make a couple of changes. Updating the appliances or replacing that cracked cabinet in the bathroom are all great ideas. However, it’s important not to over-improve, or make improvements that are hyper-specific to your tastes. For example, not everyone wants a pimped out finished basement equipped with a wet bar and lifted stage for their rock and roll buds to jam out on. (Okay, everyone should want that.) What if your buyers are family oriented and want a basement space for their kids to play in? That rock-and-roll room may look to them like a huge project to un-do. Make any needed fixes to your space, but don’t go above and beyond—you may lose money doing so.

Don’t over-decorate
Over-decorating is just as bad as over-improving. You may love the look of lace and lavender, but your potential buyer may enter your home and cringe. When prepping for sale, neutralize your decorating scheme so it’s more universally palatable.

Don’t hang around
Your agent calls to let you know they will be bringing buyers by this afternoon. Great! You rally your whole family, Fluffy the dog included, to be waiting at the door with fresh baked cookies and big smiles. Right? Wrong. Buyers want to imagine themselves in your space, not be confronted by you in your space. Trust, it’s awkward for them to go about judging your home while you stand in the corner smiling like a maniac. Get out of the house, take the kids with you, and if you can’t leave for whatever reason, at least go sit in the backyard. (On the other hand, if you’re buying a home and not selling, then making it personal is the way to go, especially when writing your offer letter. Pull those heart strings!)

Don’t take things personal
Real estate is a business, but buying and selling homes is very, very emotional. However, when selling your homes, try your very best not to take things personally. When a buyer lowballs you or says they will need to replace your prized 1970s vintage shag carpet with something “more modern,” try not to raise your hackles.

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Howell Branch, New

New Office in Historic Downtown Howell, now 5 locations for Coldwell Banker Town & Country. Very excited to find the perfect downtown location for our new office. We are looking forward to seeing you at our grand opening near the end of November at 211 E Grand River Ave. Call or email us today for free market analysis on your current home and up to the minute new listing info.

The Gerardi Group are all Howell area residents ready to serve you. 855- GERARDI or SOLD@GerardIGroup.com  

#GerardiGroup #HowellHomes#ColdwellBanker

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Move or Improve – Update

Five reasons listing your home for sale this summer makes sense.

  1. Demand Is Strong The latest Buyer Traffic Report from the National Association of Realtors (NAR) shows that buyer demand remains very strong throughout the vast majority of the country. These buyers are ready, willing and able to purchase… and are in the market right now! More often than not, multiple buyers are competing with each other to buy a home. Take advantage of the buyer activity currently in the market.
  2. There Is Less Competition Now Housing inventory is currently at a 2.8-month supply, well under the 6-months needed for a normal housing market. This means, in the majority of the country, there are not enough homes for sale to satisfy the number of buyers in that market. This is good news for home prices. However, additional inventory could be coming to the market soon. There is a pent-up desire for many homeowners to move, as they were unable to sell over the last few years because of a negative equity situation. Homeowners are now seeing a return to positive equity as real estate values have increased over the last two years. Many of these homes will be coming to the market this summer. Also, builder’s confidence in the market has hit its highest mark in over 11 years. Experts are predicting that new construction of single-family homes will ramp up this summer. The choices buyers have will continue to increase. Don’t wait until all this other inventory of homes comes to market before you sell.
  3. The Process Will Be Quicker Fannie Mae anticipates an acceleration in home sales that will surpass 2007’s pace. As the market continues to strengthen, banks will be inundated with loan inquiries causing closing-time lines to lengthen. Selling now will make the process quicker & simpler. According to Ellie Mae’s latest Origination Insights Report, the time to close a loan has dropped to a new low of 42 days, after seeing a 12-month high of 48 days in January.
  4. There Will Never Be a Better Time to Move Up If you are moving up to a larger, more expensive home, consider doing it now. Prices are projected to appreciate by 4.9% over the next year, according to CoreLogic. If you are moving to a higher-priced home, it will wind up costing you more in raw dollars (both in down payment and mortgage payment) if you wait. You can also lock in your 30-year housing expense with an interest rate around 4% right now. Rates are projected to increase in the next 12 months.
  5. It’s Time to Move on with Your Life Look at the reason you decided to sell in the first place and determine whether it is worth waiting. Is money more important than being with family? Is money more important than your health? Is money more important than having the freedom to go on with your life the way you think you should?

As for buying, the interest rates have gone down again after a winter increase. Rates are hovering around 4% having been at historic lows for the past 2 years. This gives you strength in buying and provides a great scenario for selling – and for your home’s buyers. Before you invest in updates and upgrades in your current home, it would be wise to learn what your home is worth today and how the expenditures in upgrades might (or might not) increase your home’s value.  Information on whether to move or improve would be best delivered when you understand the current market better. Get a home evaluation and compare that to homes you might like that already have what you are seeking.

Only you know the answers to the questions above. You have the power to take control of the situation by putting your home on the market. Perhaps the time has come for you and your family to move on and start living the life you desire. That is what is truly important.

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