Breaking News!!!!

The Housing Stimulus Bill passed this summer has a provision in it that it great news for first time home buyers, a $7500 tax credit for any qualified purchase between April 8, 2008 and June 30, 2009. The credit is repayable over 15 years (making it, in effect, an interest free loan). You are eligible for for this tax credit if you have never owned a home or you have not owned a home in the past three years.  For more information call me today!  386-986-7091.

 

Buy your first home before the end of 2008.

  • Get the $7,500 tax credit on 2008 tax return
  • Get the Homestead Exemption for 2009
  • Get the Maximum Mortgage Interest Deduction in 2009.
  • Get your first home for pennies on the dollar.

The Time to call me is now!  386-986-7091

 

Click here for a list of homes for sale under $150,000

 

If you think it costs a lot of money to buy home consider what it costs not to by a home.

Did you know that costs of renting a home typically increases by 3% a year? That means that an apartment or house that rents for $1,000 a month today will rent for $1,300 a month in ten years.

But here is the scary part, if you rent that home for ten years, the total amount you would have paid for rent is $137,567! That’s money you will never see again.

Home ownership on the other hand has tax advantages over renting, and those advantages can help you save money.

Let’s consider what would happen if you purchased a home for $150,000 (plus closing costs –expenses incurred during the transaction of purchasing a home), but with no down payment! Let’s say you would finance the home with loan, at say 7% interest. Your monthly payment would be $997 per month (plus property tax and insurance). Let’s take a closer look:



Monthly Mortgage & Tax Payments

Mortgage

$997

Property Tax (Estimated for Palm Coast)

$194

Home Owner’s Insurance (Estimated)

$50

Total Monthly Payment

$1,241

Tax savings (assuming a 28% tax bracket)

Mortgage Interest deduction

$128

Deduction for property tax

$54

Total Monthly Tax Savings

$182

Total Monthly Cost after Tax Savings

$1,059



Tax advantages are not the only benefits of home ownership. Here are a few ways home ownership can help you build wealth:

First there is something called amortization. Very simply amortization is gradual payoff of your mortgage. In ten years, making only the minimum loan payment your mortgage balance would have been reduced to $128,222. The other $21,778 is called equity and it is part of your new found wealth.

Next there is appreciation. Like the stock market, housing prices do fluctuate but over the long run cost of housing typically goes up. According to the National Association of Realtors home values rise an average of 4.5 percent per year. If that holds true, in ten years your $150,000 home will be worth $232,945. That is an increase in value of $82,945!

Now lets compare the home owner to the renter ten years from now.

The renter has spent $137,567 on housing but has nothing to show for it. The homeowner has spent slightly more on a home loan, property tax and insurance. But at the same time the homeowner has also earned $104,723 in equity. The homeowner has actually created wealth simply by owning their home rather than renting! This is wealth the homeowner can use to buy a larger home, save for retirement or apply to a child’s college fund.

When is the right time to buy a home?

There are two reasons that the time to buy is now. First, there is no reason to continue helping your landlord build wealth every month you wait to buy a home is another month's rent you will never get back and another month you don't benefit from home ownership. Second, 2008 has been one of those rare years when real estate prices actually went down. Now the availability of recently foreclosed properties means homes today are more affordable than ever. But it won't last it never does. Take advantage of it while you can.

 

Did you know that there is still an option for 100% financing, even in this troubled housing market?

Its true.  It is called the USDA Rural Development Loan and all of Flagler County is qualifies for this program.  This alternative loan has been around for over 20 years, although many real estate professionals and home buyers are just now learning of its benefits for the first time. As the FHA Down Payment Assistance Program has become a program of the past, many home buyers that need to finance 100% of the purchase price of their home, to include closing costs, are scrambling to find a loan program that will allow them to buy now when prices are lower than the yahve been for close to five years.

Benefits are high for potential home buyers as they are finding home prices to be low and many distressed sellers willing to take whatever steps necesssary to sell their home. If you find yourself in this category, I'm excited to offer you a solution to your financing needs! Below you will find some of the highlights of the USDA Rural Development Loan Program.

The USDA Rural Development Loan provides a great alternative to those who have the need to finance 100% of their home price, to include closing costs AND repairs! The USDA Rural Development Loan has some exciting features that will allow you to purchase a home with no money down, no cash reserves required after closing and the option to finance some of the initial repairs (to include tile, counter tops, paint, etc) made to the home.

Buying a first home can seem intimidating, with the help of an experienced professional it doesn't have to be. When you are ready to make the best financial invest of your life, let me guide you through the process. Contact me today.