Sunday, October 29, 2006
(More)tgage
American's are beginning to better understand the ways through which they can improve their financial position with their mortgage. By mapping out their short and long term plans, it becomes clear that a mortgage is an excellent tool to help fund their lives.
When buying a home people often grapple with how much money they should put down. A larger down payment will mean a lower monthly mortgage obligation. A lower down payment can afford them greater financial flexibility, if done right.
i.e. If you purchased a home for $100,000 you could put down $20,000 and take out a loan for $80,000
$479 payment each month (30 years at 6%)
If you put 0 down and took out a $100,000 loan, your payment would be
$632 payment (30 years at 6.5%)
The difference in payment would be $155 per month (much of which is tax deductible because it is mortgage interest) If you now invested that $20,000 in a mutual fund with an annual return of 10% you would actually earn $166 in income per month. Add that to the tax deduction on the additional monthly interest and you make out better with the larger loan.
In addition, you would have the $20,000 available in case you needed it for something. We all know that we can expect the unexpected, and it is nice to have the readily available funds, for the "what-ifs" in life. Unexpected triplets, loss of a job, legal issues, hole in your roof etc...If that money were tied up in your home, you would have to take out a second mortgage to tap into it. When you do that, you would incur closing costs on that money and a second lien loan would carry with it a higher interest rate.
Most people opt to make that down payment, and rely on their credit cards to fund life's curve balls. With interest rates on those cards often above 20% that is probably not the best way to go.
Just a tip...
When buying a home people often grapple with how much money they should put down. A larger down payment will mean a lower monthly mortgage obligation. A lower down payment can afford them greater financial flexibility, if done right.
i.e. If you purchased a home for $100,000 you could put down $20,000 and take out a loan for $80,000
$479 payment each month (30 years at 6%)
If you put 0 down and took out a $100,000 loan, your payment would be
$632 payment (30 years at 6.5%)
The difference in payment would be $155 per month (much of which is tax deductible because it is mortgage interest) If you now invested that $20,000 in a mutual fund with an annual return of 10% you would actually earn $166 in income per month. Add that to the tax deduction on the additional monthly interest and you make out better with the larger loan.
In addition, you would have the $20,000 available in case you needed it for something. We all know that we can expect the unexpected, and it is nice to have the readily available funds, for the "what-ifs" in life. Unexpected triplets, loss of a job, legal issues, hole in your roof etc...If that money were tied up in your home, you would have to take out a second mortgage to tap into it. When you do that, you would incur closing costs on that money and a second lien loan would carry with it a higher interest rate.
Most people opt to make that down payment, and rely on their credit cards to fund life's curve balls. With interest rates on those cards often above 20% that is probably not the best way to go.
Just a tip...
Saturday, October 14, 2006
What type of mortgage is right for me?
The only way to answer that question is to actually engage with a mortgage professional. One of our ad campaigns claims that "No two of our clients are exactly alike, neither are their mortgages." That is definitely true. Each person has a different situation, a different hook that will impact their loan. It is imperative that together you understand everything up front, before you pull the trigger on a product.
It is so important to be straightforward with a loan expert about all of your needs and your financial factors. You should never pick a product then look for the lowest bidder. Instead you should find a firm that you trust and speak with them thoroughly about your short and long term goals. Once armed with this information a good mortgage specialist, will be able to go out and find you the ideal loan. There are a lot of programs out there, and the average consumer shouldn't have to be an expert. This is where you should put your loan specialist to work for you.
If you had high cholesterol, you would first realize that you have to fix it. Then you would have to go out and figure out how to. You wouldn't just look online for the cheapest drug and buy it. You would want to engage thoroughly with a doctor (with a good reputation, that you trust) and then come up with a total plan. Some drugs work for some and not for others. In fact some drugs could have a really negative/dangerous impact on your body. Also, the Doctor might learn that you have a wildly unhealthy diet, and fixing that would also be part of the prescribed solution. In the end to fix this serious condition, you would have to take all of the necessary steps to ensure you are on the best plan. The same is true with your mortgage.
So the answer to the question of what loan is right for you, is one that can't be answered without speaking in detail first. That would be a total disservice.
It is so important to be straightforward with a loan expert about all of your needs and your financial factors. You should never pick a product then look for the lowest bidder. Instead you should find a firm that you trust and speak with them thoroughly about your short and long term goals. Once armed with this information a good mortgage specialist, will be able to go out and find you the ideal loan. There are a lot of programs out there, and the average consumer shouldn't have to be an expert. This is where you should put your loan specialist to work for you.
If you had high cholesterol, you would first realize that you have to fix it. Then you would have to go out and figure out how to. You wouldn't just look online for the cheapest drug and buy it. You would want to engage thoroughly with a doctor (with a good reputation, that you trust) and then come up with a total plan. Some drugs work for some and not for others. In fact some drugs could have a really negative/dangerous impact on your body. Also, the Doctor might learn that you have a wildly unhealthy diet, and fixing that would also be part of the prescribed solution. In the end to fix this serious condition, you would have to take all of the necessary steps to ensure you are on the best plan. The same is true with your mortgage.
So the answer to the question of what loan is right for you, is one that can't be answered without speaking in detail first. That would be a total disservice.
Sunday, October 08, 2006
Green is good
No that is not a play off of Gordon Gekko's famous quote, and in fact it has nothing to do with money. I refer to the environment and our need to do all that we can, whenever and wherever we can, to protect it. What I have learned recently is that without doing much, we can truly make a difference.
I recently took a flight from Las Vegas to NY, and had a revelation. In between the post LV, drooling pass-out and defeating the guy in seat 26C in trivia ( Awesome new feature on Delta flights where you can compete in trivia knowledge for free against your co-passengers) I came across the movie "An Inconvenient Truth" that really grabbed me. For those that don't know the film, it is basically Al Gore's position piece through which he tries to hammer home the dangerous trajectory we are on regarding our planets well being. The real data that proves that the biggest threat to us, is in fact us. The good thing though is that we have the ability to start righting the ship, now!
Each of us can make a difference and the best place to start is where we live. Little things such as improving the insulation in your home, or changing your air conditioner filters more often, allow your house to not have to work so hard. Also, if we could leave our thermostats just 2 degrees cooler in the winter, and/or 2 degrees warmer in the summer we could vastly reduce the Carbon Dioxide emissions from our homes.
Another easy change is removing the common incandescent light bulbs we currently use and replacing them with fluorescent light bulbs. These are way more energy efficient and they actually last much longer. Takes away the hassle of replacing them so often! You can buy these bulbs at http://www.energyfederation.org/consumer/default.php/cPath/25_44
Point is, there are little things we can do that will protect our planet for us, and more importantly for the next generation(s) Most people feel that the careless things they do are so miniscule, that it cannot impact the big picture. Unfortunately when you add all of those people together, it truly sets us all back. So when buying your first home, or "cashing out" money through a refinance, you might consider putting some money back into your home to ensure that it is enviro-friendly. It is more important than ever before. For a list of the many things you can do visit
http://www.climatecrisis.net/takeaction/whatyoucando/
If we like this planet we live in, and plan on sticking around for awhile ( I know I sure do) we better all start saying it and actually living it...Green is good!
I recently took a flight from Las Vegas to NY, and had a revelation. In between the post LV, drooling pass-out and defeating the guy in seat 26C in trivia ( Awesome new feature on Delta flights where you can compete in trivia knowledge for free against your co-passengers) I came across the movie "An Inconvenient Truth" that really grabbed me. For those that don't know the film, it is basically Al Gore's position piece through which he tries to hammer home the dangerous trajectory we are on regarding our planets well being. The real data that proves that the biggest threat to us, is in fact us. The good thing though is that we have the ability to start righting the ship, now!
Each of us can make a difference and the best place to start is where we live. Little things such as improving the insulation in your home, or changing your air conditioner filters more often, allow your house to not have to work so hard. Also, if we could leave our thermostats just 2 degrees cooler in the winter, and/or 2 degrees warmer in the summer we could vastly reduce the Carbon Dioxide emissions from our homes.
Another easy change is removing the common incandescent light bulbs we currently use and replacing them with fluorescent light bulbs. These are way more energy efficient and they actually last much longer. Takes away the hassle of replacing them so often! You can buy these bulbs at http://www.energyfederation.org/consumer/default.php/cPath/25_44
Point is, there are little things we can do that will protect our planet for us, and more importantly for the next generation(s) Most people feel that the careless things they do are so miniscule, that it cannot impact the big picture. Unfortunately when you add all of those people together, it truly sets us all back. So when buying your first home, or "cashing out" money through a refinance, you might consider putting some money back into your home to ensure that it is enviro-friendly. It is more important than ever before. For a list of the many things you can do visit
http://www.climatecrisis.net/takeaction/whatyoucando/
If we like this planet we live in, and plan on sticking around for awhile ( I know I sure do) we better all start saying it and actually living it...Green is good!
Wednesday, October 04, 2006
Brand..New Thinking...
What is in a brand? It represents not only who the company is, but more importantly what it's promise is to it's clients. A strong brand is one that delivers on that promise through it's daily efforts and engagements. A brand is comprised of many components, and the combination translates into user experience. Is it good/bad/indifferent?
Most companies, especially in the banking world are scared to stand out. They have a fear of looking "silly" in the eyes of consumers and tend to keep it bland. We choose to stand out because we feel that we honestly offer a clearly different and better user experience in the mortgage industry. It is rarely found, and nobody does it quite like us. People want to be spoken to, not spoken at. They want to engage in a conversation that is about them, and not about the person selling to them.
Why would a mortgage company care about a brand? Because we help people manage their largest asset, their home. It is a high stakes financial decision, and one that should be taken seriously. There are so few firms out there, looking to roll up their sleeves and truly help people make decisions that are good for them. That is our daily/weekly/monthly/life commitment to our clients. How could you offer anything less?
So we relish in our "differentness" because we think that is precisely what our clients want and more importantly deserve....
Most companies, especially in the banking world are scared to stand out. They have a fear of looking "silly" in the eyes of consumers and tend to keep it bland. We choose to stand out because we feel that we honestly offer a clearly different and better user experience in the mortgage industry. It is rarely found, and nobody does it quite like us. People want to be spoken to, not spoken at. They want to engage in a conversation that is about them, and not about the person selling to them.
Why would a mortgage company care about a brand? Because we help people manage their largest asset, their home. It is a high stakes financial decision, and one that should be taken seriously. There are so few firms out there, looking to roll up their sleeves and truly help people make decisions that are good for them. That is our daily/weekly/monthly/life commitment to our clients. How could you offer anything less?
So we relish in our "differentness" because we think that is precisely what our clients want and more importantly deserve....
