If you have a vacation home that you had hoped to retire to some day but have since changed your mind, don’t jump to sell it…consider renting it out instead.
For many, it seemed like a great idea to buy that vacation condo 20 years ago. The plan was to vacation there as often as possible, then some day sell your primary residence and retire there for your Golden Years. But lifestyle changes or financial situations might now be causing you to consider selling it instead.
However, as a member of the Top 5 in Real Estate Network®, I have seen many a client successfully rent a retirement home instead of selling it. Author Christine Karpinski, director of Owner Community for HomeAway.com (HomeAway.com), offers some good reasons to consider renting your second home:
1. Circumstances have changed. Maybe grandchildren have arrived on the scene and you can't bear the thought of moving hundreds of miles away from them. Or your parents are in poor health and need you nearby.
2. You've suddenly realized there's no place like home and you've simply changed your mind. You've decided you like being near your friends and you don't want to leave your church or synagogue. Renting your second home out during the time you are not staying there makes it financially feasible to keep both homes.
3. You've decided to "retire" from retirement. These days, it’s not unusual for people to test-drive retirement and find that it's just not for them. Work can provide many rich rewards—structure, social interaction, mental stimulation, a sense of purpose, and so forth—that people keenly miss when they retire. And, let's be honest—sometimes people simply can't afford to retire.
4. Your fixed income hasn't kept up with your lifestyle. Even when you're happy to give up the daily grind of your job, losing the paycheck that comes with it can be pretty painful. Factor in inflation, rising taxes, and unexpected "new" expenses, and you may find that what seemed like a manageable cost of living five years ago doesn't seem that way anymore. Your second home, even if it's paid for, may start looking like a liability due to property taxes, homeowner's association dues, and maintenance costs. Not if you rent it out, says Karpinski. Then it becomes a source of new income.
So don’t give up and seek to unload your second home just yet! There are still many ways to make this investment pay off. For more information on renting or buying a second, potential retirement home, please e-mail me. And please forward this email to any friends and family who could benefit from these insights.
Friday, July 16, 2010
Thursday, July 8, 2010
Why You Should Buy a Home Now…Even after the Tax Credit
In my honest opinion and as a Member of the Top 5 in Real Estate Network®, I have seen many real estate markets come and go, and I know for a fact that the many outstanding opportunities that exist for home buyers today will not be around forever.
While much press coverage has been given to the recent first-time and move-up buyer tax credit, there are many time-sensitive factors that make the current climate an exceptional time to buy a home…even without the tax credit.
Besides mortgage interest rates that have been hovering at near-record lows, homes in many markets have become more affordable. Prices have moderated from the highs of the housing boom that occurred in most of the country, especially in major markets where they had increased significantly.
According to the National Association of Home Builders (NAHB), new construction homes are an especially wise investment for home buyers. New homes are generally built to be much more energy efficient than homes constructed a generation ago, making them more affordable to operate. Plus, new homes often incorporate open floorplans, flexible spaces, improved safety features and low-maintenance materials—making them well-suited for today’s modern families.
So, if you’re thinking about buying a home, please don’t count on interest rates or prices staying at current levels—I’ve seen them change unpredictably and quickly! Mortgage rates are sensitive to market conditions, and even a slight increase can push monthly payments beyond a family’s budget. As the country recovers from the recession and people stabilize their financial situations, NAHB economists expect that home prices will begin to increase by 2011.
For further advice on buying a home or market conditions, feel free to e-mail me anytime. And be sure to pass this information on to friends and family who might also be considering a real estate purchase.
While much press coverage has been given to the recent first-time and move-up buyer tax credit, there are many time-sensitive factors that make the current climate an exceptional time to buy a home…even without the tax credit.
Besides mortgage interest rates that have been hovering at near-record lows, homes in many markets have become more affordable. Prices have moderated from the highs of the housing boom that occurred in most of the country, especially in major markets where they had increased significantly.
According to the National Association of Home Builders (NAHB), new construction homes are an especially wise investment for home buyers. New homes are generally built to be much more energy efficient than homes constructed a generation ago, making them more affordable to operate. Plus, new homes often incorporate open floorplans, flexible spaces, improved safety features and low-maintenance materials—making them well-suited for today’s modern families.
So, if you’re thinking about buying a home, please don’t count on interest rates or prices staying at current levels—I’ve seen them change unpredictably and quickly! Mortgage rates are sensitive to market conditions, and even a slight increase can push monthly payments beyond a family’s budget. As the country recovers from the recession and people stabilize their financial situations, NAHB economists expect that home prices will begin to increase by 2011.
For further advice on buying a home or market conditions, feel free to e-mail me anytime. And be sure to pass this information on to friends and family who might also be considering a real estate purchase.
Sunday, July 4, 2010
Do You Know What Impacts Your Credit Score? Take This Quiz and Find Out
According to credit experts, 42% of U.S. consumers have credit scores between 550 and 699. As a result, these consumers typically don’t qualify for preferred interest rates and, depending on their overall credit profile, they may not even qualify for certain loans and credit cards.
As a member of the Top 5 in Real Estate Network®, I have worked with many clients throughout my years in the business and have seen first-hand how credit scores can wreak havoc on securing a favorable mortgage. Most clients I work with don’t have a clear picture of what impacts their credit profile and, more importantly, don’t know what steps they can take to help improve it. I find this short quiz, from credit consultants ApprovalGuard.com, to be immensely helpful when it comes to understanding how your credit profile works. Take a few minutes to see if your credit knowledge is up to par.
1. To have the best credit-profile impact, what is the maximum amount of your monthly credit line that should be used?
a) 70%
b) 30%
c) 50%
2. What is the number-one contributing factor to a good credit score?
a) Length of credit history
b) Amounts you owe
c) Payment history
3. If you pay 2% each month on your credit card (typical minimum payment), when will you pay off a $3,000 balance at 10% interest?
a) 18 years
b) 6 years
c) 3 years
4. After paying off a high-interest credit card, you should:
a) Continue using it occasionally
b) Close the account
c) Use the full amount of available credit every month
5. Applying for credit cards in order to just receive a free sign-up gift (t-shirts, mugs, etc.) has no impact on my credit profile?
True or False
6. Rewards points on credit cards are a good deal when:
a) I get cash back
b) I get free airline tickets
c) I carry no balance each month
7. To have a credit score, I must have at least one creditor reporting activity on my credit report for:
a) 12 months
b) 8 months
c) 6 months
8. Credit bureaus that manage your personal credit report data and credit scores are a:
a) Government entity
b) Non-profit agency
c) Regular business corporation
9. Banks and credit card companies think you are creditworthy by how many credit offers you receive by mail?
True or False
10. Credit scores are used by lenders mainly to:
a) Tell how I compare to other consumers
b) Tell if I make my payments on time
c) Predict the likeliness that I will repay my loan on time
Answers: 1 – c, 2 – c, 3 – a, 4 – a, 5 – False, 6 – c, 7 – c, 8 – c, 9 – False, 10 – c
If you find you answered more than half of these questions wrong, you’re not alone, says ApprovalGuard, whose surveys reveal that the majority of consumers do not know the answers to these and similar types of questions. The good news is it’s not too late. With a good understanding and proper guidance of how credit works, consumers can learn how to effectively manage their personal credit profile. For more information, please e-mail me, and please feel free to forward this quiz to others.
As a member of the Top 5 in Real Estate Network®, I have worked with many clients throughout my years in the business and have seen first-hand how credit scores can wreak havoc on securing a favorable mortgage. Most clients I work with don’t have a clear picture of what impacts their credit profile and, more importantly, don’t know what steps they can take to help improve it. I find this short quiz, from credit consultants ApprovalGuard.com, to be immensely helpful when it comes to understanding how your credit profile works. Take a few minutes to see if your credit knowledge is up to par.
1. To have the best credit-profile impact, what is the maximum amount of your monthly credit line that should be used?
a) 70%
b) 30%
c) 50%
2. What is the number-one contributing factor to a good credit score?
a) Length of credit history
b) Amounts you owe
c) Payment history
3. If you pay 2% each month on your credit card (typical minimum payment), when will you pay off a $3,000 balance at 10% interest?
a) 18 years
b) 6 years
c) 3 years
4. After paying off a high-interest credit card, you should:
a) Continue using it occasionally
b) Close the account
c) Use the full amount of available credit every month
5. Applying for credit cards in order to just receive a free sign-up gift (t-shirts, mugs, etc.) has no impact on my credit profile?
True or False
6. Rewards points on credit cards are a good deal when:
a) I get cash back
b) I get free airline tickets
c) I carry no balance each month
7. To have a credit score, I must have at least one creditor reporting activity on my credit report for:
a) 12 months
b) 8 months
c) 6 months
8. Credit bureaus that manage your personal credit report data and credit scores are a:
a) Government entity
b) Non-profit agency
c) Regular business corporation
9. Banks and credit card companies think you are creditworthy by how many credit offers you receive by mail?
True or False
10. Credit scores are used by lenders mainly to:
a) Tell how I compare to other consumers
b) Tell if I make my payments on time
c) Predict the likeliness that I will repay my loan on time
Answers: 1 – c, 2 – c, 3 – a, 4 – a, 5 – False, 6 – c, 7 – c, 8 – c, 9 – False, 10 – c
If you find you answered more than half of these questions wrong, you’re not alone, says ApprovalGuard, whose surveys reveal that the majority of consumers do not know the answers to these and similar types of questions. The good news is it’s not too late. With a good understanding and proper guidance of how credit works, consumers can learn how to effectively manage their personal credit profile. For more information, please e-mail me, and please feel free to forward this quiz to others.
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