13
Nov
By Mike Pfefferman
Taxes

Which Big Tax Breaks Are Available From Home Credits

There are several big tax breaks available from home credits that can help homeowners save money on their taxes. Here are some notable examples:

Mortgage Interest Deduction: This is one of the largest tax breaks for homeowners. You can deduct the interest paid on your mortgage loan, up to a certain limit, as an itemized deduction on your federal income tax return. The Tax Cuts and Jobs Act of 2017 reduced the mortgage interest deduction limit for new mortgages, but it still remains a significant tax break for many homeowners.

Property Tax Deduction: Homeowners can deduct the amount they pay in property taxes on their primary residence and any other real estate they own. The property tax deduction is an itemized deduction and can help reduce your taxable income.

Energy-Efficient Home Improvements: The Residential Energy-Efficient Property Credit allows homeowners to claim a tax credit for certain energy-efficient improvements made to their homes. This includes installing solar panels, solar-powered water heaters, wind turbines, geothermal heat pumps, and fuel cell systems. The credit is a percentage of the cost of the improvements and can provide substantial tax savings.

Home Office Deduction: If you use a part of your home regularly and exclusively for business purposes, you may be eligible for a home office deduction. This deduction allows you to deduct a portion of your home-related expenses, such as mortgage interest, property taxes, utilities, and home insurance, based on the percentage of your home used for business.

First-Time Homebuyer Credit: Although the federal first-time homebuyer credit was phased out in 2010, some states offer their own versions of this credit. These credits are designed to assist first-time homebuyers with their down payment or closing costs. Eligibility criteria and available amounts vary by state, so you should check with your state’s tax authority or a tax professional to see if you qualify.

It’s important to note that tax laws can change, and eligibility for these tax breaks may vary depending on your specific circumstances. It’s always a good idea to consult with a tax professional or refer to the latest tax guidelines to understand the most up-to-date information and determine your eligibility for these tax breaks.

12
Nov
By Mike Pfefferman
Financial Reports

What’s Ahead For Mortgage Rates This Week – November 13, 2023

The week following the FOMC rate decision meetings are typically very light, with the two most influential releases being the University of Michigan Consumer Sentiment and the weekly Job Claims reports. The more positive news is mortgage lending rates have been on the decline in the last two weeks.

Consumer Credit Reports

Consumer sentiment fell in November for the fourth month in a row due to tensions with the Middle East and there is lingering hawkishness from the Federal Reserve, which could spell continued rate hikes in the future.

The preliminary reading of the sentiment survey declined to 60.4 from 63.8 in October, the University of Michigan said Friday, making it the weakest reading since May.

Primary Mortgage Market Survey Index

  • 15-Yr FRM rates seeing a week-to-week decrease by -0.22% with the current rate at 6.81%.
  • 30-Yr FRM rates seeing a week-to-week decrease by -0.26% with the current rate at 7.5%

MND Rate Index

  • 30-Yr FHA rates increased week to week seeing a 0.20% increase for this week. Current rates at 6.91%
  • 30-Yr VA rates increased week to week seeing a 0.04% increase for this week. Current rates at 6.74%

Jobless Claims

The weekly jobless claims report from the Labor Department on Thursday also showed unemployment rolls rising to a six-month high.

Initial Claims have decreased to 217,000 compared to the expected claims of 220,000. The prior week was 220,000.

What’s Ahead

The next week will have much bigger market impacting data reports with the releases of CPI and PPI. There will also be a significant amount of the Federal Reserve members speaking throughout the week on rate policy decisions.

10
Nov
By Mike Pfefferman
0 Comments
Mortgage

How to Go From Renting to Owning a Home

Going from renting to owning a home can be a significant financial and personal milestone, but it requires careful planning and preparation. Here are some steps to take to make the transition from renting to owning:

Determine your budget: Calculate your current expenses and income to determine how much you can afford to spend on a home. Consider factors such as down payment, closing costs, monthly mortgage payments, property taxes, and homeowner’s insurance.

Save for a down payment: A down payment is typically required when purchasing a home, and the larger the down payment, the lower your monthly mortgage payments will be. Aim to save at least 20% of the home’s purchase price to avoid paying private mortgage insurance (PMI).

Check your credit score: A good credit score can help you secure a better mortgage rate, so it’s important to check your credit score and address any issues before applying for a mortgage.

Get pre-approved for a mortgage: Before starting your home search, get pre-approved for a mortgage. This will give you an idea of how much you can afford to spend on a home and will also make you a more attractive buyer to sellers.

Find a real estate agent: A good real estate agent can help you navigate the home-buying process, from finding the right property to negotiating the best deal.

Start house hunting: Once you have your budget and pre-approval in hand, start searching for your dream home. Consider factors such as location, size, amenities, and resale value.

Make an offer and close the deal: Once you’ve found the right property, make an offer, negotiate the terms of the sale, and complete the closing process.

Ultimately, the rental market is driven by supply and demand, and rent prices will fluctuate based on a variety of factors such as location, amenities, and competition. It’s always a good idea for renters to do their research and compare prices before signing a lease. If you think you are ready, remember that buying a home is a significant financial and personal decision, so it’s important to do your research and seek professional advice along the way.