Brentwood TN Homes and Real Estate

"THE ONLY HISTORY THAT IS WORTH A TINKER'S DAMN IS THE HISTORY WE MAKE TODAY." Henry Ford. And making history is exactly what happened last week on several fronts...including home loan rates...so let's take a closer look.

This time of year, millions of Americans find themselves wondering how they're going to pay for all of the items on their holiday shopping lists. Perhaps you're considering charging your purchases on a credit card and then paying that card off with your tax return. But wouldn't it be nice if you had that money already? Sure, you could go to a service that gives you money now for the refund check you're expecting... but the fees involved can take a hefty chunk out of your refund.

So how can you plan ahead next time?

When you think about it, getting a refund check means that you let the IRS use your money throughout the year without paying you any interest. Wouldn't you rather have the money during the year yourself?

Here's how you do it. The IRS allows you to increase the number of dependants on your W-4 withholding form, meaning that less will be withheld for taxes from each paycheck. In the past, if you claimed greater than nine dependants, an explanation and approval may have been required. But the IRS has lifted this restriction, allowing you to voluntarily increase your dependents claimed.

This lets you have more money in each paycheck instead of "loaning" the money to the IRS and having to wait for a refund.

But don't go overboard. You should only lessen the periodic tax withholding to match the expected refund. This way you are taking your refund as you go; instead of letting the IRS hold on to it.

Believe it or not, the IRS actually makes it easy to calculate!

The IRS offers a nifty IRS Bean Counter calculator for free, which lets you see how a change in withholding will affect your paycheck.

Take advantage of this calculator today to see how changes can impact your take-home pay.

Remember, before you make any changes, you want to be sure you are balancing the amounts carefully and correctly, so it's always a good idea to check with your tax professional. If you need help or a referral, just give me a call!

Remember, as a general rule, weaker than expected economic data is good for rates, while positive data causes rates to rise.

Economic Calendar for the Week of December 22 – December 26

Getting Your Brentwood TN Home Ready for Winter ,

As winter approaches and the temperature changes it’s time to start preparing your home for winter. Beyond the usual provisions such as the sprinkler system or remedying any drafts, there is the consideration that you will be spending a lot more of your time indoors. You will want to make the inside of your home as comfortable as possible for the indoor season.

In the winter the furnace is the beating heart of your home. Check the filter, clean or replace if it’s old and dusty. Make sure it is in good working order, the middle of a freezing snowstorm is not the ideal time to find out there is something wrong with your furnace.

Make sure your carbon monoxide detectors work, if you don’t have one, get one.

Before you start closing up your home for the winter, this is a good time to give it a good cleaning. Get the small, dusty areas and scrub them well, so you can start the winter in a clean, fresh environment.

Consider the humidity. Winter air can be dry and that can not only make you uncomfortable but can wreak havoc on the wooden furniture and floors in your home. Before you buy one however, do a bit of research. Make sure it is energy efficient and relatively easy to use and fix.

You will also need to weatherproof your doors and windows, to keep the heat inside and the drafts out. Install door sweeps along all of your outside doors. Sweeps use rubber to form a tight seal with the floor and create a barrier to the outdoors. For windows there are a lot of options. You can use removable caulking, the old standard plastic cover or even heavy drapes if you don’t want to seal up the window.

Lastly, don’t forget to make the space cheerful. Use plants, candles maybe even some potpourri to keep the atmosphere pretty as well as lively.

Whether you are ready to buy or sell a home in Brentwood TN,

Call Vanessa Stalets, your Brentwood TN Homes expert!
Brentwood TN Homes for Sale

"I KNEW THE RECORD WOULD STAND UNTIL IT WAS BROKEN." Yogi Berra. And while last week's Jobs Report wasn't the worst record breaker of all time, it showed a loss of 533,000 jobs during the month of November, which represented the most job losses the US has seen in 35 years. And adding more pain to the Report were heavy downward revisions for September and October, which erased an additional 199,000 jobs. In addition, last month was only the fourth time in 58 years that our economy lost over 500,000 jobs.

So what does this mean for Bonds and home loan rates? We first have to acknowledge that we are not in a typical trading environment, where weak or negative economic reports always lead to improved pricing for home loans and vice versa. The dynamics of hedge funds de-levering - where fund managers are selling all types of securities with whatever timing they need to, in order to raise capital - have caused unprecedented volatility of late, and it is not quite clear when that will end.

The Fed has indicated that they would like to be a buyer of Mortgage Bonds, which has resulted in attractive, lower rates right now. But as stated above, the trading environment is extremely volatile, and opportunities to capitalize on lower rates that make sense should be taken advantage of. There have been recent rumors of interest rates being brought down towards 4.5% by the Treasury. This irresponsible release included no definitive plan, no indication of who might qualify, or what the restrictions would be. Like many other recent legislative "solutions", the restrictions might be very tight, with income limits set very low, and as a result, helping very few people. Remember, it may make sense for you to act now, and take advantage of current historically low rates...with the possibility of refinancing should rates decline further.

In other news to note from last week, the Bank of England and the European Central Bank both cut their key benchmark interest rates in an effort to revive their sagging economies. The reduction in rates was expected as part of a global coordinated effort, and our Fed is widely expected to cut its benchmark rate during its meeting on December 16. While a cut by the Fed often causes home loan rates to rise - because a Fed rate cut can lead to inflation, which is the arch enemy of Bonds and home loan rates - the deflationary environment we are currently in may prevent home loan rates from worsening significantly after the Fed cut.

Bonds and home loan rates tested their best levels of 2008 throughout last week, but could not improve beyond them. As a result, Bonds and home loan rates ended the week slightly worse than where they began...even in the midst of rumors of rates declining as mentioned above.

GAS PRICES SURE HIT A RECORD EARLIER THIS YEAR, BUT NOW THAT THEY HAVE IMPROVED, THE IRS HAS ISSUED NEW MILEAGE RATES FOR 2009. SEE THIS WEEK'S MORTGAGE MARKET VIEW FOR ALL THE DETAILS!

We will likely see another volatile Friday this week, with the release of several important reports at 8:30am ET. First we have the Producer Price Index, which measures inflation at the wholesale level. Given the recent whispers of deflation, this will be an important report to watch. Consumer Sentiment will also be released…but given the state of the economy, the results likely won’t be much of a surprise.

In addition, we’ll get a read on consumer spending patterns with November’s Retail Sales Report. This Report is a measure of the total receipts of retail stores from samples representing all sizes and kinds of business in retail trade throughout the nation. Black Friday kicked off the holiday shopping season last week and the National Retail Federation amazingly estimated that shoppers spent 7.2% more than last year…but this is likely a result of the deep discounting seen by retailers, and it could well be that many shoppers who normally wait until December to get started on holiday purchases went out early to take advantage of the sales. Don’t be surprised if this is a horrible report, as not only have the holiday shopping lists become shorter, but the amount spent for each individual has likely been reduced. In any event, it will be important to see what the report reveals, as a lousy report should be friendly towards home loan rates.

Remember, as Bond prices move higher, home loan rates move lower. And as you can see in the chart below, Bonds have stalled out in their improving direction for the time being, after making some great gains over the last month. Home loan rates currently stand at historic lows.

I will keep you updated as things progress, but give me a call to talk about the current historically low rates, and how this opportunity might benefit you.

Chart: Fannie Mae 5.5% Mortgage Bond (Friday Dec 05, 2008)

IRS RELEASES NEW MILEAGE RATES

If you drive a car, truck or van for work, the Internal Revenue Service (IRS) has announced news that impacts you. That's because the IRS has released the new standard mileage rates for 2009. The rates will be used to calculate deductible costs for driving an automobile for business, charitable, medical and moving purposes. The new mileage rates for business, medical and moving purposes will be slightly lower than the rates for the second half of 2008, which were raised in the middle of last year due to spiking gas prices. The rate for charitable driving, however, is set by law and will remain unchanged from 2008.

Beginning January 1, 2009, the standard mileage rates for 2009 are as follows:

• Businesses = 55 cents per mile driven
• Medical or moving = 24 cents per mile driven
• Charitable organizations = 14 cents per mile driven

Overall, these rates reflect the higher transportation costs compared to a year ago. However, the rates are slightly lower than the second half of 2008 to factor in the recent drop in gasoline prices. While gasoline is a significant factor in the mileage rate, other fixed and variable costs, such as depreciation, also enter the calculation.

But before you calculate your deduction, make sure you qualify. The IRS reminds taxpayers that they cannot use the business standard mileage rate for a vehicle after using any depreciation method under the Modified Accelerated Cost Recovery System (MACRS) or after claiming a Section 179 deduction for that vehicle. In addition, the business standard mileage rate cannot be used for any vehicle used for hire or for more than four vehicles used simultaneously.

Remember, you don't have to use the standard rate! Although the IRS provides the standard mileage rate for ease and convenience, you're not required to use it. If you choose, you have the option of calculating the actual costs of using your vehicle instead of using the standard mileage rates. So keep that in mind as you calculate your automobile usage for business, medical, moving, or charity driving in 2009!

Remember, as a general rule, weaker than expected economic data is good for rates, while positive data causes rates to rise.

Economic Calendar for the Week of December 08 – December 12

Economic Indicator

Release Date Time

Consensus Estimate

Analysis

Construction Spending

Monday, Dec. 1, 2008

Down 0.9%

Low importance. An indication of economic strength. Weakness may lead to lower rates.

ISM Index

Monday, Dec. 1, 2008

38.00

Important. A measure of manufacturer sentiment. Weakness may lead to lower mortgage rates.

ADP Employment

Wednesday, Dec. 3, 2008

Jobs -173k

Important. A measure of employment. Weakness in payrolls may bring lower rates.

Revised Q3 Productivity

Wednesday, Dec. 3, 2008

up 0.9%

Important. A measure of output per hour. Improvement may lead to lower mortgage rates.

Fed "Beige Book"

Wednesday, Dec. 3, 2008

None

Important. This Fed report details current economic conditions across the US. Signs of weakness may lead to lower rates.

Factory Orders

Thursday, Dec. 4, 2008

Down 2.7%

Important. A measure of manufacturing sector strength. Weakness may lead to lower rates.

Employment

Friday, Dec. 5, 2008

Jobs -300k, Unemp @ 6.8%

Very important. An increase in unemployment or a large decrease in payrolls may bring lower rates.

Consumer Credit

Friday, Dec. 5, 2008

2.7B

Low importance. A significantly larger than expected increase may lead to lower mortgage interest rates.