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Metrowest Real Estate News & Views

Building Lasting Relationships Through Real Estate

By Bill Gassett | Agent in Hopkinton, MA
  • Tax Deductions When Buying a Home

    Posted Under: Home Buying, Financing, Credit Score  |  December 11, 2011 2:08 PM  |  901 views  |  No comments

    Original article source: Home buying tax deductions

    If there is anything in this world that is certain it’s the fact that everyone likes to save on their taxes when April rolls around. If you have purchased a home in the last year you are going to want to make sure that you have remembered all the allowable tax deductions.

    When taking out a mortgage to buy a home, there are certain deductions that the IRS allows that you are going to need to remember. The list below summarizes the deductions that many people forget about when buying Real Estate:

    MORTGAGE POINTS

    Points paid when taking out a mortgage are tax deductible if they are used to reduce the mortgage interest rate. In the event you don’t know, a point is 1% of the loan amount. For example on a $200,000 mortgage a point would equal $2000.00.

    Typically most people would not want to pay points on a loan unless the expectation was to be in the home for a while to recapture the cost of such points in the form of reduced payments. In order to figure out if paying points makes sense, you need to calculate the mortgage payment amount both with and without points.

    By looking at the spread between these figures you can determine how long you would need to be in the home before it would make fiscal sense. For a complete explanation see when to pay points on a mortgage. Points or origination fees paid when you buy a home or other Real Estate are generally tax deductible in full for the year that you pay them.

    It should be made clear that origination charges from the lender that constitute a “service fee” are not tax deductible. Another method you could make is to amortize the points over the term of the mortgage. This choice is usually made only when your itemized deductions are less than the standard deduction for the year you purchased the home.

    Additionally when you refinance a mortgage the points must be deducted over the term of the loan. If you deduct points over the term of the loan and sell the home or refinance it again before the loan expires, you can deduct in the year of the sale or refinancing any points that you didn’t previously deduct. Keep in mind that you will be able to get the best mortgage interest rates when you have a great FICO Credit Score.

    See how to increase a credit score to help in your efforts to get a terrific interest rate. To continue reading the full article see home buying tax deductions.

  • Short Sale vs Foreclosure Credit Score Impacts

    Posted Under: Financing, Foreclosure, Credit Score  |  October 11, 2011 12:35 PM  |  1,112 views  |  No comments

    Original article source: Credit Score short sale vs foreclosure

    Short sale vs foreclosureIt is probably safe to assume that most consumers like to work with folks they know can be trusted. In Real Estate, like some other businesses there are those that can always be counted on for delivering great advice and others that only care about their own pocket book.

    I always tell people some of the best Real Estate agents are those that don’t NEED to make a sale! It makes perfect sense because an agent that NEEDS business is far more likely to tell a buyer or seller something they want to hear rather than the truth.

    Short sales unfortunately are a specialized Real Estate transaction where information is often times bandied about with no basis of fact. Many Realtors blindly go around telling people in financial distress that a short sale is better for their financial future because their credit score will not be impacted like going through a foreclosure.

    Folks this could not be further from the truth! While there are certainly advantages of pursuing a short sale vs foreclosure, credit scoring is NOT one of them. There will be plenty of Realtors that will read this and argue with me telling me I am wrong. To continue reading see short sale vs foreclosure credit score impact.

  • Home Equity Refinancing Options

    Posted Under: Financing  |  September 19, 2011 7:12 AM  |  561 views  |  No comments

    Original article source: Massachusetts Real Estate Blog

    When looking to take money out of an existing home or other Real Estate borrowers often have a decision to make on what is the best method to do so.

    There are basically three financing options that are available to home owners. These include a cash out re-finance, home equity loan or a home equity line of credit (HELOC). Determining which of these type of loan options will work best basically comes down to what purpose the money is going to be used for.

    Unfortunately being in the Real Estate field, I often come across folks who have over extended themselves and find that they have created undue hardships . Going back ten years ago this was not so much of a problem as Real Estate markets around the country were booming and a home was an investment windfall.  Every few months the value of homes would continue to rise and did so for over a decade. Of course all good things must come to an end eventually and now we are left with property values decreasing in most areas.

    When the economy and Real Estate values are soaring it is hard not to look at a home as a giant piggy bank from which you can tap at a moments notice. When times are tough however, you may regret taking your equity for granted by pulling it out of the home.

    Below is a guide to help you determine whether borrowing against the equity in your home via a home equity line of credit (HELOC), home equity loan or a cash out refinance makes the most sense.

    To continue reading see home equity loans.
  • Credit Impact After a Short Sale and Foreclosure

    Posted Under: Home Buying, Financing, Foreclosure  |  March 21, 2011 12:07 PM  |  279 views  |  No comments
    Original article source: Massachusetts Real Estate Blog

    As a Realtor who has been heavily involved closing Massachusetts short sales over the last five years, one of the questions that I get asked quite often from home sellers is how long will it take before I will be able to buy a home again.

    The answer to this question does not have any clear cut and dry answer. There are quite a few variables involved when trying to figure out when someone will be able to purchase a home after a foreclosure or short sale.

    Going through either a short sale or a foreclosure has the potential to seriously impact ones credit.  Government entities Fannie Mae, Freddie Mac and FHA do not directly loan money to individuals but are the governing body that work with lenders to guarantee loans and free up money to provide mortgages.

    Banks typically have the authority to lend to whoever they want but will generally follow the guidelines set forth by these entities. There are some lenders of course that will take greater risks with some borrowers than others.

    Below are the general guidelines that FHA, Fannie Mae and Freddie Mac follow when considering a loan after a short sale or foreclosure:

    See Buying a home after short sale or foreclosure for a complete understanding of how your credit will be impacted as well as the time period before a borrower will be able to get financing to purchase another home.

  • Home Finance Tips to Increase a Credit Score

    Posted Under: Home Buying, Financing, Credit Score  |  March 7, 2011 10:02 AM  |  885 views  |  No comments

    Original article source: Massachusetts Real Estate Blog

    Credit scores can have a dramatic effect on a borrowers ability to get the best rates for many types of financing including a home mortgage and a car loan.

    If your credit score does not meet minimum standards you may not even have the ability to get a home mortgage period!

    There are a number of factors that the credit bureaus use to calculate your credit score. One of the most important factors they use is your past payment history which generally accounts for 35% of your credit score. In the mortgage article how to improve a credit score, all the various ways you can achieve and maintain a great credit score are discussed. If you pay attention to these credit scoring factors you will be well on your way to achieving an exceptional credit score.

    When it comes to your home there are ways to improve a credit score with specific home finance tips.

    Pay Your Mortgage On Time

    It goes without saying that paying your bills on time is a must if you want to have excellent credit. Above all else you want to make absolutely certain you pay your home mortgage when it is due. As mentioned above, past credit history is a critical factor on how you be viewed by a lender when applying for financing.

    There is nothing that will hit your credit harder than a missed mortgage payment. Credit scoring agencies will look at a missed mortgage payment in a far more negative light than a missed car or credit card payment. If at all possible you should always consider making your mortgage payment before other bill that are due.

    To continue reading and see the rest of the financial tips view increasing a credit score.

  • Fannie Mae Increasing Loan Costs to Borrowers

    Posted Under: Home Buying, Home Selling, Financing  |  January 30, 2011 9:16 AM  |  540 views  |  No comments
    Original article source: Massachusetts Real Estate News

    Guest blogger Michael Dunsky from Guaranteed Rate is back again to take a look at the recent announcement by Fannie Mae that a borrowers costs and/or interest rate will be rising in the near future.

    Michael comes to the Massachusetts Real Estate blog on occasion because of his extensive knowledge on what is going on in the world of finance and mortgages.


    More Bad News For Borrowers With Fannie Mae Backed Loans

    Fannie Mae’s recent announcement indicates that on April 1, 2011 they are implementing a higher interest rate to borrowers even if they have a perfect credit score. This change is being implemented for any loan term over 15 years. Freddie Mac will also make fee structure changes as of March 1st.

    They call this a Loan Level Price Adjustment (LLPA) and this means that borrowers are going to be charged more in the form of cost or higher interest rate based on a combination of how much down payment or the amount of equity in their home if they are refinancing, as well as their credit score.

    To continue reading see Fannie Mae Mortgage Interest Rates Rising.

  • The Benefits of a 203k Rehabilitation Loan

    Posted Under: Home Buying, Home Selling, Financing  |  December 13, 2010 7:40 AM  |  569 views  |  No comments
    Original Article Source: Massachusetts Real Estate Blog

    Guest blogger Michael Dunsky from Guaranteed Rate Mortgage is back to take to help review a popular mortgage program known as the 203k rehabilitation loan.

    The landscape of the housing market all over the country has changed drastically over the last few years. Foreclosures and short sales have become the norm not the exception. Many of these distressed properties that have been entering the market are not in the best of shape.

    Some of them need a major overhaul! They have however, created opportunities for buyers who are looking to invest the time and effort to fix them up either to turn around and resell them or to live in as a permanent residence.


    As such, the 203K rehabilitation loan is a terrific mortgage vehicle for those buyers who would like to invest in repairs and improvements in a property. The Federal Housing Administration (FHA) which is a part of the Department of Housing and Urban Development (HUD) is the party in charge of administering various single family mortgage insurance programs.

    The 203K is the primary program for the repair and rehabilitation for single family properties. To continue reading see 203k Rehab Loan.

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