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105 Center Park Drive, Suite 200 *** Knoxville, TN 37922 *** Office: 865-692-8181 Cell: 865-679-9007 Toll-Free: 1-877-782-6533
Lee and Jeff are licensed to sell real estate in TN
Risk Determines Rate
Regardless of what a lender quotes on mortgage rates, the actual rate paid by a borrower is based on a number of variables. Lenders determine whether to loan money and at what rate based on the risk involved with the transaction.
Factors that increase the risk that the loan will be repaid will proportionately increase the interest rate charged to the borrower. If the risk becomes too high, the loan will not be approved.
- Loan amounts - conventional loans for more than the conforming limits set by Fannie Mae are considered jumbo loans and generally have a higher interest rate.
- FICO score - the lowest interest rate is reserved for the highest credit scores; the lower the score, the higher the rate borrower will pay.
- Occupancy - borrowers occupying a home as their principal residence are considered a better loan risk than second homes and investment properties.
- Loan purpose - purchase transactions generally have the lowest interest rate while refinancing a home is generally higher.
- Debt-to-Income ratio - a borrower's monthly liabilities divided by their gross monthly income develops a ratio that helps lenders to assess the borrower's ability to repay the mortgage.
- Loan-to-Value ratio - the lower the percentage of the loan to the appraised value of the property will generally lower the interest rate.
GREAT INVESTMENT
If you invest in a savings account, you'll make less than 1% and will have to pay income tax on the earnings. On the other hand, contribute something extra to your house payment on a regular basis and you'll essentially, earn at the mortgage interest rate which is certain to be more than you're earning in the bank.
Making additional principal contributions on your mortgage will save interest, retire debt and build equity. An extra $100 a month in the example shown will save thousands in interest and short the term of the mortgage as well.
Reducing your cost of housing is another way to improve the investment in your home. Becoming debt-free is a worthy goal that is achieved with discipline and good decisions. Suggestions like this are part of my commitment to help people be better homeowners when they buy, sell and all the years in between.
In search of an honest man
Similar to Diogenes’ search for an honest man, homeowners want someone to do quality repairs at a fair price. The task appears reasonably easy but if you’ve ever tried to locate someone to fix something, you know just how difficult it is.
Finding a list of companies from a phone book doesn’t mean they’ll be reasonable and reliable, it just means they have a phone and are willing to pay for an ad. Searching on the Internet may direct you to a website that appears to be a local company but really is a marketing company who will sell the lead to a repairman or company who will pay a referral fee.
There are consumer organizations like Angie’s list who rate repairmen and contractors but they usually require an annual membership fee to be able to access the information. There are also services like Renovation Experts or Service Magic that are registries for contractors but they may not be the most competitively priced.
Your best recommendations are going to come from friends, family and neighbors you trust who have actually used the repairmen before and would use them again. The problem here is that you might have to make multiple calls before you can find a friend who can recommend the type contractor you need.
Repairs are a normal part of selling homes and we certainly come in contact with lots of contractors. This experience leads us to understand who is reputable and reasonable as well as who to avoid. As part of our commitment to helping you be a better homeowner from the time you buy your home until you sell it, we’re more than happy to make a recommendation of good repairmen or other professionals you might need.
Give us a call…we want to help.
Safety First--app for smartphones & iPad
Deductible Is the Point
Points refer to prepaid interest on a home mortgage and can be fully deductible by the buyer in the year paid if the right conditions exist. The points must be used to buy, build or improve a taxpayer's principal residence but not all fees charged by the lender are necessarily deductible.
According to IRS Publication 936, "The term 'points' is used to describe certain charges paid, or treated as paid, by a borrower to obtain a home mortgage. Points may also be called loan origination fees, maximum loan charges, loan discount, or discount points. A borrower is treated as paying any points that a home seller pays for the borrower's mortgage."
If you purchased a home in 2011, have your tax professional evaluate your closing statement to see if there are loan fees that may be used as a deduction on your tax return regardless of whether you or the seller paid them.
Refinancing a principal residence or purchasing an investment or income property require that points must be deducted ratably over the term of the mortgage rather than deducting them fully in the year paid. Borrowers in these situations should consider the benefits of lower interest rates from paying point to higher interest rates without points.
This article is meant to provide information that can be discussed with your tax professional about your specific situation and is not to be considered tax advice.
"This year, I am going to . . .."
Every year, it seems like the same things are on the list but this could be the year you really do invest in a rental home.
Rents are climbing, home prices are cheap and mortgage rates are low for even non-owner occupied properties. A $125,000 home with 20% down payment can easily have a $300 to $500 monthly cash flow after paying all of the expenses.
There are lots of investment strategies that work but one that is easy to understand and execute is to stay with below average price range homes in predominantly owner-occupied neighborhoods. These properties will appeal to the broadest range of tenants while you hold them and buyers when you're ready to sell.
Single family homes offer an opportunity to borrow high loan-to-value mortgages at fixed rates for long terms on appreciating assess with tax advantages and reasonable control
This is the year to make some real progress on your resolutions.
Choose Your Deduction
One third of all U.S. households, 75% of households with more than $75,000 income and most homeowners itemize their deduction on their federal income tax returns. It makes sense because the interest paid on their mortgage and their property taxes probably exceeds the allowable standard deduction.
However, with interest rates as low as they have been in the last two years and the price of homes having come down considerably, it is possible that the standard deduction may be the better choice.
Each year, the taxpayer can compare the total of the itemized deductions to the standard deduction to select which method will result in the most benefits. The 2011 standard deduction is $11,600 for married couple filing jointly and $5,800 for single filers.
The Housing and Economic Recovery Act of 2008 allows homeowners to take the standard deduction and the lesser of their actual property taxes of $1,000 if filing their return married jointly. For more information, see Schedule L found on www.IRS.govand consult your tax advisor.
The "Right Size" Home
Work hard, buy a home, start a family and continue to upgrade your home until everyone has enough room. This has been the blueprint for lots of homeowners for the last fifty years but there is certainly a shift in thinking that could change all of that.
Interestingly, Americans live in much larger homes than most people in other countries throughout the world. The U.S. Census reported in 2006 that the average single family home completed had 2,469 square feet which was 769 feet more than in 1976.
Once the children are grown and have moved out, homeowners are finding they have too much room. Even if their home is paid for, they have higher property taxes, insurance, utilities and maintenance on the larger home than they'd have if they were living in the "right size" home.
Some homeowners state thaty they're keeping their larger home because it has luxury features that smaller homes don't have. There's a movement that seems to have started in the United States to find the "right size" home with the amenities and convenience that homeowners want.
This philosophy has been expressed by Sarah Susanka in her book Creating the Not So Big House. It proposes a house that "values quality over quantity with an emphasis on comfort and beauty, a high level of detail, and a floor plan designed for today's informal lifestyle."
Last Minute Gifts Without Shopping
What do they want? What do they need? Will it fit? Do they already have one? These are the common thoughts running through our minds when trying to find the perfect gift.
The gift of really listening with no interrupting, no daydreaming and no planning your response is exactly what people want when they have something important to say.
The gift of affection with appropriate hugs, kisses and pats on the back can demonstrate your love for family and friends better than words.
The gift of laughter by sharing cartoons and funny stories will say "I love to laugh with you."
The gift of a simple written note shows sincerity and real heartfelt sentiment that may be remembered for a lifetime and could even change a life.
The gift of a sincere compliment supports a person's need to be accepted and appreciated. "You look great in that color", "That was outstanding" or "I really enjoyed that" can make someone's day.
The gift of random kindness or good deeds like holding a door or allowing someone to move ahead of you in a checkout lane shows respect for others.
Your smile, however, may be your most rewarding gift. Invariably, the person receiving the smile will in turn, smile back. The gift you gave will now be given back to you. It will be the right size and you can always use one more.
There's No Place Like Home
You don't have to be Dorothy in the Wizard of Oz to feel like there's no place like home.
Home is a place to call your own. It's a place to raise your family and share with your friends. It's a place to create memories. A home is a place to feel safe and secure.
Inspect all of your decorations and electrical lighting before using them. While you're enjoying the holidays this year, it's important to pay attention to some of the things that may affect your safety.
- Extension cords should not be placed under the carpet or rugs or bundled together which could cause overheating.
- Limit three standard size sets of lights to a single extension cord.
- Consider using portable or permanent ground fault circuit interrupters with all lighting to avoid possible shocks.
- Turn off holiday lights when you leave the home or got to bed.
- Avoid using candles near trees or wreaths.
- Do not allow natural trees to dry out during the time they're displayed to potential fire hazard.
- Make certain that all trees are on a firm, steady base to avoid tipping over.
- Don't burn wrapping paper in fireplaces.
- Small children are particularly susceptible to accidents and should be protected from potential harm.
Bio Link
“No house too big or too small . . . no problem too large . . . together we'll succeed!” PERSONAL: I’m a transplant to Knoxville from Wisconsin. I moved here over 29 years ago, and feel like a native. I can readily empathize with relocating buyers and sellers and know what is needed to smooth the transition for you. No matter the price range, no matter the issues encountered during your real estate transaction, you will receive unrelenting service! I graduated from the University of Wisconsin with a degree in French and Spanish. Current hobbies of mine include spending time with thefamily, reading, and traveling. INDUSTRY INVOLVEMENT: I have participated for the last 10 years in the governance of the Knoxville Area Association of REALTORS® including serving as the 2008 President of the then 4000+ member Board. I have served on the Tennessee Association of REALTORS® Board of Directors since 2001 and on the National Association of REALTORS® Board of Directors in 2008. I was the 2006 President of the Tennessee State Women’s Council of REALTORS® and the 2009 President of the State of Tennessee International Council. COMMUNITY INVOLVEMENT: Civic involvementincludes membership in the Rotary Club of Farragut, American Cancer Society Health Leadership Initiative Council, charter membership in the Fort Loudon Lake Association, and past service on the Farragut West Knoxville Chamber of Commerce, where I was the recipient of the 2002 Chamber’s Joan McIntee Diplomat of the Year award. I was also chosen by the Tennessee Housing Development Authority to serve on their REALTOR Advisory Board for the State of Tennessee in 2009. I am a certified trainer through the Tennessee Association of REALTORS® and the Tennessee Real Estate Commission for the CORE course, and I have done training at the Knoxville Area Association of REALTORS® and at individual real estate offices affiliated with our Association. My main focus remains, however, on my clients and customers. They deserve and receive million dollar treatment, no matter what the price of the property! Service beyond your expectation is my goal—because I expect it! * * * * AWARDS & RECOGNITION * Awarded the 2009 REALTOR® of the Year, Knoxville Area Association of REALTORS® and the *2009 REALTOR® Member of the Year Award, Tennessee Women’s Council of REALTORS® *Lifetime Hall of Fame Award, Knoxville Area Association of REALTORS® CERTIFICATIONS & DESIGNATIONS *Accredited Buyer Representative (ABR) *Accredited Home Staging Specialist (AHS) *At Home With Diversity (AHWD) *Certified International Property Specialist (CIPS) *Certified Negotiations Expert (CNE) Certified *Residential Broker (CRB) *Certified Residential Specialist (CRS) *Certification for Internet Professionalism (e-PRO®) *Graduate, REALTOR® Institute (GRI) *Performance Management Network (PMN) *Real Estate Collaborative Specialist-Divorce (RCS-D™) *Real Estate Cyberspace Specialist(RECS) *Seniors Real Estate Specialist (SRES) SPECIALIZATION: I specialize in representing Buyers and Sellers in the purchase and sale of single-family residences and income property within Anderson, Blount, Knox, Loudon and Roane Counties in East Tennessee, including among others, the cities of Knoxville, Alcoa, Maryville, Farragut, Lenoir City, Loudon, Oak Ridge, Kingston, Seymour and Clinton. I keep up to date on transactions and local market conditions in these areas. Call me, and make your next move a "MOVING EXPERIENCE!"
