Housing/Mortgages
Archived Posts from this Category
How Much Does Private Mortgage Insurance (PMI) Cost?
Posted by miller on 17 Mar 2008 | Tagged as: Housing/Mortgages
If you are financing more than 80% of the value of a home, lenders require extra risk protection against the possibility of you defaulting. Usually this comes in the form of private mortgage insurance (PMI). Simply stated, PMI is a premium you must pay each month until you are financing less than 80% of the home’s value. I’ve run a few posts recently about PMI (a loan primer and tax deductibility), and this post will focus on how the lender determines how much your PMI will be. Continue Reading »
I Bought a House!
Posted by miller on 16 Mar 2008 | Tagged as: Housing/Mortgages
If you wondered if I had crawled under a rock for the last couple weeks, then you were right! I’ve mentioned over the last month or so that I have been looking for a house to buy. And, my girl friend and I signed for one last week! Continue Reading »
Is Private Mortgage Insurance (PMI) Tax Deductible?
Posted by miller on 27 Feb 2008 | Tagged as: Housing/Mortgages
If you have a mortgage for more than 80% of the worth of your home then you probably already know what private mortgage insurance (PMI) is. In fact, if you opted for a borrower paid PMI loan, you have to pay it every month. Hopefully you also know that under many circumstances PMI is tax deductible, just like mortgage interest and property taxes. Continue Reading »
Borrower Paid PMI, Lender Paid PMI, & Piggyback Loans (Oh My!)
Posted by miller on 18 Feb 2008 | Tagged as: Housing/Mortgages
As part of my housing search, I have been bombarded with financing options. And just as soon as I decided I wanted a 30 year fixed mortgage, I was bombarded with yet another set of options: borrower paid PMI, lender paid PMI, or piggyback loan. Despite being independent of the down payment, these options could potentially change my monthly payments by hundreds of dollars a month, and total money paid (in the end) by tens of thousands! So what are the in’s and out’s of each? Continue Reading »
Finding Money for a Down Payment on a House
Posted by miller on 14 Feb 2008 | Tagged as: Housing/Mortgages
Being a prospective home buyer, one of the first questions that crossed my mind was how to come up with a down payment. In the post housing bubble age of the Credit Crunch, it is extremely hard to get full financing or other exotic loans. Down payments are, once again, important. The old convention says you need 20% down. Well, how in the world I am going to find 20%? Remember, houses have become harder to buy historically — especially for the younger crowd. Here are some ideas… Continue Reading »
Price to Rent Ratios Can Be a Bad Indicator of Housing Markets
Posted by miller on 07 Feb 2008 | Tagged as: Housing/Mortgages
How many articles have you read over the last six months that use the price to rent ratio (P/R ratio) to establish exactly how over priced the current housing market is? While I am firm believer that housing is currently over priced, I personally have found the predictions of expected drops to be fairly extreme. The predictions are based off price to rent ratios, which (as the claim goes) historically revert to the mean. But I think these articles miss one very important point — cities change! Continue Reading »
When Fed Rates Go Down, Mortgage Rates can (and did!) Go Up!
Posted by miller on 04 Feb 2008 | Tagged as: Housing/Mortgages, Investing, Personal Finance
Conventional wisdom says that when the Feds cut rates, mortgages rates go down. However, it is also possible for mortgage rates to in fact increase! This is exactly what happened last week when the Feds provided a second significant rate cut in as many weeks. Why does this make sense? We must separate the long term and short term effects of rate cuts. Continue Reading »
Lending Tree. When Banks Compete, You Win. But When They Don’t… Do You Lose???
Posted by miller on 30 Jan 2008 | Tagged as: Housing/Mortgages
One of my goals for the week was to get pre-qualified (pre-approved, pre-authorized) for a mortgage. I’ve read this is the bargaining chip you use to get realtors to take you seriously. Following the review and advise of my friend Jim, I decided to give Lending Tree a shot. When he used Lending Tree a few years back, he got a friendly phone call within hours and numerous hours soon to follow. Unfortunately, I cannot say the same happened for me. Yet I know I have excellent credit, plenty of income, and a reasonable down payment. So what happened? Continue Reading »
Housing Bubble Casualty — a Flipper Caught in the Crossfire!
Posted by miller on 29 Jan 2008 | Tagged as: Housing/Mortgages
I went and checked out some open houses this last Sunday to try to get some perspective on the Baltimore housing market. I explored my current neighborhood — a place called Locust Point (where Fort McHenry is… you know, War of 1812… France Scott Key… Star Spangled Banner??? No? Well, me neither before I moved here!). Anyway, like much of the country, Baltimore’s housing jumped leaps and bounds over the last five years. Some of that is correcting itself as prices drop and inventory increases. Here’s an example of a place where the owner is getting caught in the cross fire. Continue Reading »
Planning for House Hunting
Posted by miller on 27 Jan 2008 | Tagged as: Housing/Mortgages
As I mentioned a few posts ago, one of my “goals” of 2008 is to seriously consider and explore buying a house. This doesn’t necessarily mean purchase a place, though that would be ideal. There are a lot of reasons why I think buying soon would be good, but there are other reasons why I think it’s not good. Here I’ll talk about my “pre-buy” plan of attack — research-oriented steps that should set me up right for eventually buying a home. Continue Reading »
