shuffm1 asked:


I am considering applying for a home equity loan. In order to get the money I need, my house would need to be assessed at a higher value than it currently is because I have very little equity in the house. However, I have made many major capital improvements, so this won’t be a problem. If the bank’s assessor assesses the property at a higher value, will my house be subject to higher property taxes? I live in NY, so the property taxes are the highest in the country, and this would be a major problem.

I have considered and researched other alternatives to a home equity loan, so I just need to find the answer to this question. I can’t seem to find it on the Internet, and I have asked two mortgage people…and they don’t even know.
OK, if my property tax is based on the value of my property…let me pose this question/example:

Say, I bought my house for $170,000 and put no money down. My house is currently assessed by the town/county at $200,000. That is what I pay property tax on. Between rising property value and tens of thousands of dollars in capital improvements, say my house can be assessed for $250,000. That would be $70,000 more than the remaining principal. Excluding any other data or costs, a 100% home equity loan would provide me with $70,000. Now, if someone came out and said my house was valued at $250,000…this wouldn’t increase my taxes? So…the town/county would not find out about this loan or the re-assessment? My tax rate here is 3.5%. I have to be 100% sure.

Anita

Rony Walker asked:


You’ve been planning to buy a home of your own for such a long time now, but getting yourself into a home loan is the last idea on your mind. And so you wait forever until you have saved enough to buy it in cash at the same time you live terribly in your drafty apartment. The reluctance to get a home mortgage is understandable. I know how frustrating it is to be asked to pay for mortgage rates that we can hardly afford. But you also need to keep in mind that with the appropriate home mortgage lender, you both may work out what the great alternatives for you are. Home loan lending fees vary. Not all of them are expensive. You merely need to learn how and where to get them.

Before you decide to scout and search for a lender, evaluate your finances first. Know your paying capability. Deduct your regular monthly costs from your consolidated monthly household earnings and you obtain the accurate amount that you can afford for your monthly loan. When you have good credit score, you will most likely qualify for the lowest mortgage fees there is. But then, when you’re in a poor credit position, you might benefit from other choices such as a no money down home loan or a secured home equity loan. Specific lenders also give home loans for women with bad credit. It’s best to learn the available preferences for you and then search for suggestion from a professional on which option would work greatly for you.

Furthermore, it is a pretty logic to have an approximation of how much you’re going to be paying each month for a certain unit by obtaining a free mortgage quote in the Internet. Gather as much loan quotes and related information as you could. Get knowledgeable on the ins and outs of home loan lending. If you’re equipped with the correct information, you’re less likely to be conned by loan sharks who are merely out to pursue you. There are several of them around, so get me a favor and be vigilant for them. Or at least be prepared must they try to place you into their trap.

Mortgage standards vary from state to state. California mortgage lenders might process a mortgage application differently from a Florida home loan lender. Thus, skim on mortgage laws on the state where you are thinking planning to purchase your house. The federal mortgage rules might be similar, but how each state perform things can vary. This would prevent confusion and conflicts along the way.

So you’ve analyzed your finances, your credit rating has been restored, or at least you’ve studied your choices, and you discover you can afford a mortgage loan. You got yourself a mortgage quote or an estimate of how much you’ll be paying monthly and you’re well learned on the prevailing interest rates. Thirty-year mortgage charges differ from a fifteen-year mortgage charge or lower. Plus, you have read up on loan laws of the certain state you have in mind as well as the kinds of mortgage loans and you know your alternatives. Thus, I guess now you are prepared to seek for a lender. Again, be firm. This is your future you’re dealing with.



HOUSTON

Kristin Abouelata – Home Loans asked:


We encourage our kids to plan for their future, but we seldom include buying a first home sooner than average as a path to building that future. Let them know buying a home is easier than they think.

Most of the people who read this column are not first time homebuyers. The fact of the matter is many of you that are first time homebuyers and reading this article are relatively mature individuals who are fighting off your commitment fears of being tied to a mortgage. But there is a huge segment of the population that could buy their first home, yet it doesn’t occur to them to do so. Who are these people? Well, it’s your 24 year old son or daughter, new to the work force, and is throwing away money on rent somewhere. Encouraging your children to buy a home when they are young is some of the soundest financial advice you can give them. Equity in a home is an easy way to grow one’s portfolio with very little investment. But the fact of the matter is it doesn’t occur to most of us to encourage the younger generation to buy early in their lives. And trust me, it rarely occurs to our kids themselves to consider buying a home in the early twenties. They are more concerned with buying a new Halo 3 for their Xbox.

Why do so many people miss the boat on this opportunity? It could be they plan to be in the area for only a short time because they will job hop to advance their career, thus viewing a mortgage as “too permanent.” I counter to simply sell the house when you move. Or maybe they expect their income to double or triple over the next three years. I say buy a home now, then upgrade to a new home; sell or rent the old house. Investing in real estate is a proven, safe and solid return on investment. And with the right combination of credit history (or a history of paying utilities, cable and your cell phone on time) and no money down, you or someone you care about can start investing in the future.

When Junior starts his new job at the company and 401(K) is available, he’s been informed by his folks, boss or peers to enroll and contribute at least a little something to it with every paycheck. Yet, he is rarely counseled quit renting that apartment for $750 a month and buy a $75,000 house. Where will he come up with the money to do it? There are multiple options for first time buyers that allow for 100% financing. Get the seller to kick in closing costs (up to 6% of sales price with some products), and one can close on a loan and bring no funds to the table. If your home value appreciates 4% in the next year, that’s a nice return on a no cash investment.

For some time, I’ve considered writing this series for first time buyers to let them know buying a home is easier than they think. But, the more I thought about it, the more I realized the advice I would offer would most likely not reach my target audience. So parents, it is up to you to supply your kids with this last little bit of advice and help to set them free to further establish their independence in this world. Clip this article out and tape it to their iPOD or the steering wheel of their car – someplace it will get noticed.

I think for most of us who have been through the experience, our first home buy was a very daunting experience. There are so many choices and unknowns – it can be overwhelming. In this series, I will try to break it down the process into small logical steps and make it easier understand the steps involved in financing your first home. Where do you start? That is perhaps the easiest part. Our newly established worker should first make a list of all his or her debt obligations such as student loans (unless deferred), car payments, credit card debt, etc. Hopefully at this age, this will be a small list. Then add what you think amount you could afford for a mortgage. Take that amount and divide it by your gross monthly income. If you come in at 43% or less, you’re in business. If you have something in your savings or checking – great. If not, don’t let it deter you. You have options.

Contact a mortgage specialist to drill out the details and find a good realtor who knows your market for housing you can afford. What next? Get ready to tell your landlord “Adios!.”



CARLOS