Gunning Daily News

Q: What Should I Know about Zoning Issues and Approvals?

April 29, 2013 4:50 pm

A: Zoning regulations establish how the land can be used, either for residential, industrial, commercial, or recreational purposes, or sometimes a combination thereof. Designed to protect property owners and communities from undesirable, or inappropriate, land uses and/or construction, zoning laws can be very rigid and inflexible. On the other hand, they can protect your property value and ensure against the stationing of a mega-store right next to your home. Before you begin any remodeling job, determine how your local zoning laws might affect your project. You can visit your local zoning office, city hall, or some other local planning board to get a copy of your local ordinance and determine how you will need to seek approval for your project. Take nothing for granted; some communities even require approval to erect fences.

Choosing Your Most Sustainable Mortgage Option

April 26, 2013 5:26 pm

Your RIS Consumer Confidant recently ran across some good advice from Scott Sheldon (bayarearealestatetrends.com) who blogs about how the shrinking inventory of available housing is taking some home buyers' focus off the bottom line.

Sheldon says pre-approved buyers typically focus on purchase price, when in most cases, it’s the monthly payment over time relative to the purchase price that dictates whether or not that particular property can be identified as an opportunity.

He says consumers are beginning to place more emphasis on sustainable payment over time considering they could be paying more for the property than anticipated. And today's real estate market conditions are causing many buyers to switch mortgage loan programs during the pre-approval phase and well into after they’ve gotten they have gotten into contract.

While qualifying for the mortgage is the end result, to perform on a purchase contract, Sheldon says the appropriate loan program promoting long-term payments sustainability becomes next critically important piece of the puzzle.

In his blog, Sheldon details the following borrowing options:

  • Conventional loans represent the lowest cost combination of rate and payment over time. This type of financing represents the cream of the crop, available in the market today. 20 percent down to avoid monthly mortgage insurance, with the lowest possible payment being 3 percent is common.
  • FHA Loans/Including first-time home buyer options are typically geared towards consumers entering the real estate market for the first time. This type of financing however, is eligible for anyone and is not solely a first-time home buyer program.
  • Fannie Mae's Homepath.com program offers two main advantages, those being no appraisal requirement and no monthly mortgage insurance requirement. The cost of these two advantages comes in the form of a higher risk based pricing, an inherently higher cost loan.
  • VA Loans for military families through the US Department of Veterans Affairs guarantees loans for veterans looking to purchase real estate. The program allows for 100 percent financing and no money down and does not contain any monthly mortgage insurance.

Source: www.bayarearealestatetrends.com

Tips to Ease First Time Homebuyer Jitters

April 26, 2013 5:26 pm

Traditionally, spring marks a busy period of time for housing market activity. With the heat of summer seemingly only weeks away, BMO Harris Bank offers first-time homebuyers strategies for finding their ideal home while keeping financial priorities in check.

Buying a home can be the largest and most important financial decision one can make, so it is important to be aware of all the factors that go into making a responsible purchasing decision.

"The first step is figuring out how much you can afford to spend on homeownership, which means an honest assessment of the household balance sheet," says Kevin Christopher, Head of Mortgages Sales, BMO Harris Bank. "Once you have a clear idea of where you stand financially, you can then make a responsible decision of what you can afford, including your down payment, monthly mortgage costs and other expenses like utility costs, property insurance and taxes."

Here are tips for first timers:

Making an affordability assessment
Christopher noted that there are two rules of thumb first time homebuyers can use to determine what they can afford.

"First of all, housing costs, including mortgage payments, property insurance and taxes, should not take up more than one-third of your income. In addition to this, servicing your overall debt, including loans, utilities, credit card payments and lines of credit, should not account for more than 40 percent. If you can land safely within these parameters, then homeownership is an affordable and realistic option."

Many banks offer free online tools to help you wade through the home lending process.

Coming up with the down payment
In general, the bigger the down payment you come up with, the less interest you'll pay over the life of your mortgage. Financial institutions may offer special accounts designed to help you save for that first home. Consider opening a savings account specifically to fund your down payment. One easy way to save is to set up an automatic monthly deposit from your checking account to your savings account, allowing you to build the balance over time.

Choosing the right mortgage for you
Your mortgage needs to fit in with the rest of your financial priorities -- which could mean increased flexibility or security. Consider the following when choosing your mortgage:

  • Choose a shorter amortization period - In general, the shorter the life of the mortgage, the lower the overall interest cost. Consider choosing a 20-year amortization rather than a 30-year amortization to save you money on interest costs and help you become debt-free sooner.
  • Fixed vs. variable - Variable-rate mortgages have been a winning strategy over the long term, but fixed rate mortgages (currently at historic lows) provide cost certainty and peace of mind.
  • Stress-test your mortgage payments - Use a mortgage payment based on a higher rate to stress-test your budget; total housing costs (mortgage payments, property taxes and insurance, etc.) should not consume more than one-third of household income.

Applying for pre-approval
A pre-approval establishes the amount you can reasonably afford to borrow towards the purchase of your first home. Consider the following benefits to getting pre-approved:

  • Have a good idea of your finances - You will receive a better idea of how much you are qualified to borrow, saving time looking at homes that meet your affordability range. Your term and amortization, as well as estimated monthly payments, are provided at approval so you can use these figures when planning your overall budget.
  • Moving quickly - If you are pre-approved for a mortgage, you'll be able to move quickly to make an offer when you finally find the perfect home for you.
Source: BMO Harris Bank

3 Important Finance Lessons for Your Teen

April 26, 2013 5:26 pm

More high school students than ever will be collecting diplomas in the coming weeks, an increase attributed in part to new career-oriented schools that help students appreciate the link between learning and earning.

“After 40 years, we’re finally seeing significant improvements in high school graduation rates. The national average shot up from 72 percent in 2001 to 78 percent in 2010,” says retired business executive Cary Siegel author of “Why Didn’t They Teach Me This in School? 99 Personal Money Management Principles to Live By,”

“While it’s wonderful to offer initiatives like career-prep schools, I worry these new high school and college graduates won’t have a clue about how to manage their paychecks.”

“I wished I’d learned these things in school – I would’ve made fewer mistakes,” he says. “My main goal was to retire early enough to spend time with my kids while they were still young, and I was able to do that. It’s not because I’m rich; I’m not! It’s because I learned how to effectively manage my money.”

All high school and college grads should leave school armed with that knowledge, says the father of five teenagers ages 13 to 17.

He offers three of his favorite tips:

• Just say no to credit cards. (And don’t get one in college!) Credit card companies inundate college students with special offers. They want to hook you early on! But getting hooked on credit cards is as bad as getting hooked on drugs. The more you use them, the easier they are to use, and since you’re not required to pay off the balance each month, you can quickly spiral into debt. You pay for that debt, too. The average interest rate on student credit cards in April was 17.4 percent – which means for every dollar of debt you have, you’re charged almost 18 cents every month.

• Know what your bills are and take action when they go up. It’s amazing how many people don’t know what they’re paying their service providers each month. (If you don’t know within $5 what each monthly bill is, you’re probably overpaying on many of them.) When your cable, internet or cell phone company tells you it’s increasing its rates, call the company and ask to speak to a manager or someone in the retention department. Be polite and don’t raise your voice. Ask for detailed rationale for the increase; often, this will immediately stop the increase. If it doesn’t, stress how long you’ve been with the company and your excellent payment history.

• Spend an hour a week learning about personal finance.
Once you start, you’ll find you’re learning so much, you’ll spend more than an hour exploring. Some free resources include the internet and the library. Look for a financially savvy individual, write up a list of questions, and ask if you can interview them. You may not have to look any further for this than your own family. Just one hour a week adds up to a lot of time over a few years: 52 hours your first year, and more than 200 hours during four years of college. “I’m fairly certain that is more time than 95 percent of other college students spend on learning personal money management,” Siegel says.

Source: www.carysiegel.com

Word of the Day

April 26, 2013 5:26 pm

Mortgage. Legal document that creates a lien on property; it secures the repayment of a loan.

Q: Should I Buy a Vacation Home?

April 26, 2013 5:26 pm

A: The second home market has more ebbs and flows than the primary home market. Sales are iffy in a bad economy except, perhaps, on the high-end. That said, there is a growing trend toward the purchase of vacation homes. They are being bought for investment purposes, enjoyment, as well as retirement. In the latter instance, some people are buying with the idea of turning a vacation home into a permanent retirement haven down the road, a move that puts them ahead of the game now.

Some of the tax benefits of a second home mirror those for a primary residence. Before taking the leap, however, ask yourself if you can afford to carry two mortgages, maintain two households, and pay the extra utilities and maintenance costs. Also, learn about financing requirements and options, which can differ slightly from those on a primary residence.

Word of the Day

April 26, 2013 4:24 pm

Maturity date. Date on which principal and interest on a mortgage or other loan must be paid in full.

Q: Is a Vacation Home a Solid Investment?

April 26, 2013 4:24 pm

A: Like any investment, it can be risky. Location and current market conditions are extremely important when deciding whether to buy.

Other things to consider:

Will you be able to afford repairs, maintenance, insurance, and utilities?

What about fees to pay agents who rent the property for you?

If you live several miles away from your vacation home, who will clean up between tenants and take an inventory of household items once the tenants leave?

What if you are unable to rent your second home? Can your pocketbook withstand the strain of paying the mortgage?

Helpful Tips for First-Time Pet Owners

April 26, 2013 3:24 pm

(Family Features) For years, research has shown that having a pet can be very beneficial to a person's health. In addition to warming your heart, a cute and cuddly friend can also help protect it by helping to lower your blood pressure, reduce stress, and improve your overall mood.

From online websites to local drives, the opportunity to adopt is abundant. Millions of dogs and cats are looking for their forever home. With the many joys associated with pet ownership, there are also many things to consider. Here are several tips to be mindful of regardless of whether you are a first-time or seasoned pet parent:

Visit the Vet: Get your new buddy checked out at your local veterinarian's office. While many pet adoptions include a complete medical check-up with the adoption fee, it's still important to ensure they are up-to-date on all shots and preventatives. The vet is also a valuable resource to answer any questions you may have about the proper care of your new companion.

Get to Grooming:
Many people think it's only "for the dogs," but both canines and felines need to be groomed on a regular basis. Though this task may seem uncomfortable for your pet, beginning this routine will make the task more predictable for them. Your vet can help you select the proper brush and bath supplies for your pet.

Avoid Odors and Stains:
Accidents happen so be sure that you have a plan to fight stains and odor with the proper household cleaners. For your feline friends, make sure that the litter box is easily accessible. A litter like ARM & HAMMER™ Ultra Last Clumping Cat Litter is long-lasting, with powerful odor destroyers to continuously eliminate even the worst odors and keep your home smelling fresh and clean.

Pet-Proof Your Home:
Make sure your home is a safe haven for your new furry friend, from the floor to the ceiling. Cats love to scratch and dogs love to chew. Providing them with the proper toys will not only keep them happy, but will also help protect your furniture and personal items.

Instill Good Behavior: Begin
good behavior habits from the moment you bring your pet home. Though nipping may seem adorable at first, this behavior may become a pattern that could become a big problem later. Use simple words to praise and command, setting boundaries and confirming you are the boss. For more formal training, seek your local animal trainer or enroll your pooch in an obedience class.

Source: www.UltraLastLitter.com.

How to Get More for Your Money

April 26, 2013 3:24 pm

It used to be that "middle class" meant "comfortable." Yet today, some are finding that lifestyle is slipping away as they struggle to maintain their standard of living.

Today, the best way to maintain the lifestyle you're accustomed to is to become smarter with the money you do have.

Here are a few ways you can maximize your money:

Budget for your specific needs. When every dollar counts, you can't afford to let anything slip through the cracks. That's where a budget comes in. Creating one—and actually using it—can help you take control of your money. Start by keeping a spending journal so you can see where your money's going. Next, subtract your fixed monthly costs (i.e. mortgage or rent, car payment, utilities, savings, etc.) from your monthly income. The remaining money is what you have left for variable expenses, such as groceries, entertainment, gas, etc. How you divide this money is up to you -- the only catch is you have to stay within your budget limits.

Plan ahead to avoid ATM fees. Avoiding this extra cost is as simple as planning ahead. Paying $3 here and there may not seem like a lot, but it adds up over time. For example, paying $3 at a non-bank ATM, four times a month adds up to $144 each year. That's money that could have been put away in savings or spent on other items.

Find a credit card that benefits you.
Look for one that rewards you for the money you spend.

Save money on everything. With a bit of advance planning and research, you can save money on everything from groceries and gas to haircuts and entertainment. Many of these savings can be found online and through mobile apps. Follow your favorite businesses via social media to learn about exclusive discounts and sales. Mobile apps can help you find the lowest prices on gas and other items you use every day.

Source: BMO Harris Bank