Tag: closingcost

[CAUTION: Before you start making that extra payment, you’ll want to make sure it’s allowed. Some lenders either don’t facilitate the process or don’t credit the payment more than one time per month. Many lenders decide to hold partial payments in an account until the rest of it is received.]

Should you be refinancing right now with sub-3% rates? Probably. But are there other ways to save on your mortgage that you might not know about? Definitely. A little-known mortgage payment trick could save you thousands over the life of your loan. 

So what’s the big secret? Paying your mortgage twice per month. 

We know what you’re thinking: “How does paying double save me money?” Let us explain. Paying twice per month doesn’t mean making the entire monthly payment twice. It means paying half of the total every two weeks. 

“The practice is called bi-weekly mortgage payments, a strategy where mortgage loan customers pay their mortgage loan every two weeks, instead of once a month,” said Experian. “The idea is to chop down your mortgage payment more quickly, and in the process, lower the amount of interest you pay on your mortgage overall.”

So how does paying every two weeks cut down on your total amount and save you big time? When you pay monthly, you make 12 payments per year. Pay every two weeks, and you actually end up making 13 full payments. And that one extra payment is directed toward the loan’s principal. 

“Since the homeowner is reducing the amount of the loan balance quicker, they are also reducing the amount of interest charged over the life of the loan,” said MortgageCalculator.org.

What to ask your lender

Before you start making that extra payment, you’ll want to make sure it’s allowed. Some lenders either don’t facilitate the process or don’t credit the payment more than one time per month. “Many lenders decide to hold partial payments in an account until the rest of it is received,” said MortgageCalculator.org.

Other companies may allow bi-weekly payments but charge a fee. “Rarely, some lenders will charge you to make biweekly payments, since it’s essentially twice as much work for them to process,” said Magnify Money. “If your lender does this, it may be better to stick with your normal monthly payment plan. If you want to make biweekly payments, you can still do so manually for free by setting aside a portion of your paycheck on your own, paying your normal monthly payment, and then submitting an extra payment once per year.”

How much can you save?

This scenario illustrates the type of long-term savings that make bi-weekly payments attractive. “Say you have a 30-year fixed-rate mortgage for $250,000 with a 4 percent interest rate. Your monthly payment would be about $1,194, and the total interest paid over the life of the loan would be $179,673,” said Bankrate. “In the same scenario, using a biweekly mortgage calculator, your total interest paid over the life of the loan on a biweekly plan is $150,450.40. That means you’d save more than $29,000, and pay off your loan in 25 years instead of 30.

Another alternative

If making a payment every two weeks isn’t feasible, consider a lump sum payment once a year. Maybe you get a Christmas bonus, a merit bonus, or a tax refund. Using this windfall and allocating the equivalent of one mortgage payment would make a huge dent in your principal. “By paying one extra payment of $1,285.33 each year” on a “25-year loan of $250,000 with interest at 3.75%…the loan amortization schedule with extra payments shows that you would repay the loan 2 years and 11 months earlier and save $17,381.35 in interest,” said Interest.com.

Message me if your thinking about buying or selling a Fort Collins or Loveland home at m.me/EdPowersRealEstate

Ed Powers Real Estate 970-690-3113 ed@EdPowersRealEstate.com www.EdPowersRealEstate.com

The country was rocked by the murder of George Floyd on May 26, and protests have been erupting all over the world ever since. In the aftermath of Floyd’s death, many companies have spoken out to decry racism and commit their dollars—and their activism—to equality. 
      In that vein, we’re posting a list of companies who have been outspoken in their support of racial equality. For the purpose of this article, we’re focusing on those that are in some way related to buying or selling a home, renovating, decorating, and even celebrating a purchase or home-related milestone. But you can track corporate donations and see a growing list of companies across nearly every type of industry who have taken a stand here.
      This is not meant to be a comprehensive list, and we invite you to add anyone we missed in the comments.
Look to your lender Choosing between financial institutions for a purchase or refi? “Bank of America pledged $1 billion over four years to help communities across the country address economic and racial inequality and said the commitment
CONTINUED >>>

Mortgage Rates 
U.S. averages as of July 2020:
30 yr. fixed: 3.13%
15 yr. fixed: 2.59%
5/1 yr. adj: 3.08%

Freddie Mac’s results of its Primary Mortgage Market Survey® shows that “After the Great Recession, it took more than ten years for purchase demand to rebound to pre-recession levels, but in this crisis, it took less than ten weeks. The rebound in purchase demand partly reflects deferred sales as well as continued interest from prospective buyers looking to take advantage of the low mortgage rate environment.”

• 30-year fixed-rate mortgage (FRM) averaged 3.13 percent with an average 0.8 points for the week ending June 25, 2020, down from last month when it averaged 3.15 percent. A year ago, at this time, the 30-year FRM averaged 3.73 percent.

• 15-year FRM this week averaged 2.59 percent with an average 0.8 points, down from last month when it also averaged 2.62 percent. A year ago, at this time, the 15-year FRM averaged 3.16 percent.

• 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.08 percent this week with an average 0.5 points, down from last month when it averaged 3.13 percent. A year ago, at this time, the 5-year ARM averaged 3.39 percent.

Better family gathering space. More comfortable bedroom space. Peaceful and private outdoor space. If those items tick your preferred “quarantine home” boxes, we get it. Perhaps it is time to buy or sell your Fort Collins or Loveland home.

The truth is that being stuck at home—in a home you don’t necessarily love—stinks. So, we don’t blame you if, while you’ve been sheltering, you’ve been dreaming of what you would change and where you would move given the choice. 

The good news is that this pandemic is already having an impact on how builders operate, and the very things that are frustrating you about your existing home will likely drive changes to design and architecture in the future.

“While the coronavirus still rages on, it’s hard to predict what post-pandemic abodes might look like,” said Barrons. “Yet, developers around the U.S. are already rethinking projects, anticipating residents’ needs and preferences that Covid-19 would spur. In doing so, they are re-evaluating current in-unit aesthetics and in-demand amenities. 

That means a “new consumer” might have “different priorities from now on regarding health, technology and socialization,” Marcelo Kingston managing director of Multiplan, the developer behind 57 Ocean in Miami Beach, told them. 

Home size

Homes had been trending smaller. But that may be over. With uncertainty about the future around spending more time in the home, which likely includes some form of work-from-home scenario, homeowners are likely looking for more space. Expect homes to grow in size accordingly.

A greater dependence on the home office

“More attention will be given to the arrangement of the workplace at home,” said Dezeen. “Spatial organization will change, with the place to work at home no longer a desk with a parody of an office chair and a lamp, slotted somewhere in the corner of the living room or under the stairs. Now it will be a completely separate room with large windows, blackout curtains and comfortable furniture. It will be technically equipped and sound-insulated.”

An increased emphasis on “health and hygiene”

This covers a wide variety of amenities.

“Joel Sanders of JSA Architects predicts that the pandemic, “like 9/11, will have an enormous impact on public space because of social distancing and fear of contamination,” said Dwell. “He foresees these concerns finding their way into the home, impacting space in more subtle ways, like the distancing of furniture arrangements and domestic footprints shifting to include “safe” rooms to isolate contagious occupants.

In addition, architects and designers foresee “a compartmentalization of spaces including entries, foyers, and mudrooms, incorporating sanitation stations to wash, disinfect, and remove contaminated clothing. This attention to sanitation, however, won’t necessarily give rise to sterile-looking environments. According to Bryan Young, principal of Young Projects, “Fundamental qualities of wellness are even more meaningful for adapting to a post-coronavirus environment, incorporating natural light, natural ventilation, connection to green spaces and landscape.”

This type of design will bleed into technology, as well. “We already have much of the technology we need to replace human contact with smart sensors,” said Stambol. “And in a post-pandemic world, nobody wants to touch anything unnecessarily. So, the low-hanging-fruit of design upgrades will be the first to change. Think of more touchless faucets and sensor-operated doors. Every doorknob, light switch, thermostat, and the high-traffic button will be swept away, replaced by motion activation or voice command. And every previous objection based on cost can be easily countered with memories of a global economic catastrophe.”  

Smart technology

This is already one of the most pervasive trends in home design, but “Manufacturers of smart home systems will go one step further,” said Dezeen. “Their programs will not only control the temperature of the air in the house, but also its quality and, if necessary, they will automatically clean it. Air from the outside will of course be filtered.”

Message me if your thinking about buying or selling a Fort Collins or Loveland home at m.me/EdPowersRealEstate

Ed Powers Real Estate 970-690-3113 ed@EdPowersRealEstate.com www.EdPowersRealEstate.com