Gray divorce: Getting a divorce after 50
A common problem
Divorce among baby boomers is, well, booming. According to a study out of Bowling Green State University, in 2008, a quarter of all divorces in the U.S. involved people aged 50-plus, up from one-tenth in 1990.
At that age, there’s a lot at stake. It’s not just about divvying up assets. Particularly for the lesser earner, it’s important to secure the future.
“Almost nobody gets married anticipating divorce,” says Bruce Christensen, a family law attorney with the law firm Richman Greer in Miami. “What may be obvious to everyone else comes as a surprise. But those over 50 are dealing with a whole different mindset. So it does present additional challenges.”
“The first thing you need is a crash course in financial planning, especially if you are not the spouse who handles the finances,” says John Hauserman, a Certified Financial Planner professional in Marriottsville, Md. whose book “RetirementQuest” focuses on financial planning for the 50-plus.
Then, he says, close joint accounts, change the beneficiary on all accounts — “and you might want to start monitoring your credit for unauthorized activity.”
“It’s very important for both parties to have a team of qualified professionals,” says Rita Cheng, a Chartered Retirement Planning Counselor with Ameriprise Financial in Bethesda, Md. She suggests an attorney, financial planner, tax adviser and possibly a business evaluation specialist — because, for example, “a self-employed consultant’s income may appear to be lower than it is.”
Who gets what?
Absent a prenup, Christensen says, marital assets include everything acquired during the marriage, regardless of how it is titled, though laws vary slightly from state to state. In most states, exceptions include “anything brought into the marriage or obtained by gift or inheritance — but with investment accounts, if you buy and sell during the marriage, they become intermingled.”
While the furniture may not be worth much, he adds, “Art and collectibles — wine collections, for example — are a different story. It’s a good idea to hire an appraiser.”
Splitting everything 50-50 may sound like the simplest solution, but it’s probably not an equitable one, Cheng warns.
“Fair is not the same as equal,” she says. “You don’t want to be in a situation where you can find yourself destitute.”
Hauserman recommends making these decisions in the broadest possible context. For example, both partners may be emotionally attached to the marital home, but should consider that they may need to sell it anyway.
With so many mortgages upside down these days, Christensen points out, after a sale the bank will want the difference between what you owe on the mortgage and the selling price, unless it’s a short sale. “So it becomes a logistics problem.”
Pensions and retirement funds
One spouse’s individual retirement account or 401(k), Cheng says, can be split equally or unequally via a qualified domestic relations order, or QDRO.
“Some companies permit the plan account to be divided so that the ex-spouse can also maintain an account with the company,” she says. “Otherwise, the defined contribution plan can be transferred to an IRA for the ex-spouse without triggering negative tax implications. “
Public employee pension plans may have different rules, Cheng says. Be sure to ask whether it will allow a QDRO, pay it in a lump sum or allow the nonemployee spouse to receive benefits prior to the employee spouse.
The lesser earner of a divorcing couple is entitled to Social Security retirement benefits based on the higher earner’s work record, as long as the marriage lasted at least 10 years. The lesser-earning spouse must be at least age 62 to begin collecting benefits. Even if the higher-earning spouse qualifies for benefits but has not applied for them, a lesser-earning ex-spouse can collect based on the other’s earnings if the couple has been divorced for at least two years.
In fact, if the higher-earning spouse should remarry, the new wife can also draw benefits based on his record without it affecting his Social Security benefits at all. “A lot of people don’t know that if they are divorced and their ex is remarried,” Cheng says, “that does not mean the new wife can’t get Social Security based on his income as well as the former (wife).”
“Alimony is the toughest issue to face,” Christensen says. “Permanent alimony is rarely actually permanent. It lasts only until either spouse dies or the spouse receiving the alimony remarries. There’s also a statute in effect in some states that if someone is living with someone else in a supportive relationship or sharing expenses, that can also be taken into account.”
In some states, he says, if the marriage lasted 10 years or fewer, there may be a time limit on how long an ex-spouse can receive alimony.
When a supporting spouse remarries, “he may deliberately reduce his income today so the surviving new wife will get more,” says Linda S. Gross, a certified family law specialist in Santa Monica, Calif. But in some states, she says, that won’t wash; alimony can be based on the total income the supporting spouse has access to — including investment income — not just the total he or she chooses to withdraw.
More controversy can ensue when the supporting spouse retires, says Christensen. “It’s ‘I still need alimony’ versus ‘I am living off my retirement and you are getting your share of my retirement fund,'” he says. “But the money in that fund earned after the divorce is not included, so should the spouse who has the greater benefit have to pay more to the ex-spouse?”
A more secure guarantee of support, Gross says, is a life insurance policy. “If the parties purchased life insurance during marriage, even if it is a term policy, it may be given to the supported spouse,” she says, “so that if the supporting spouse dies, the supported spouse gets an insurance payout.”
However, she adds, many people are not comfortable with their ex having a life insurance policy on them after divorce.
If life insurance was not purchased during marriage, Gross says, the supporting spouse may now be uninsurable or have pre-existing conditions that make the cost of obtaining life insurance prohibitively expensive.
Health insurance is another issue to consider. Under COBRA, after a divorce an ex-spouse can continue to receive health insurance coverage for up to 36 months, Cheng says.
But don’t wait for those 36 months to pass to look into replacement health insurance coverage.
“While 50 may be the new 30,” Gross says, “unfortunately, insurance isn’t priced that way. So it’s really important to research your options.”
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What Is an FHA Streamline Refinance – Guidelines, Pros – Cons, fha streamline refinance
What Is an FHA Streamline Refinance Guidelines, Pros Cons
If you have an FHA-insured mortgage on your home, you may have the opportunity to refinance with an FHA streamline refinance. While the hype surrounding the FHA streamline refinance program makes it sound fabulous, the reality is that mortgage lenders often put what are called overlays on FHA guidelines. In other words, while the FHA says you can basically refinance your underwater home even if you have bad credit and are unemployed, most lenders require you to meet a certain level of standards.
That said, if you have an FHA loan and can qualify for an FHA streamline refinance, it can be a great deal. Just make sure you compare your options for other types of mortgage refinance.
Unlike other mortgage refinance options, the FHA streamline refinance program offers borrowers with an existing FHA mortgage a new FHA-insured home loan without requiring an appraisal or any documentation of income or assets. Furthermore, depending on when the current loan was taken out, lower mortgage insurance fees may be available to the borrower.
FHA Streamline Refinance Process
Before you take any refinancing steps, make sure you meet the few guidelines established by the FHA:
- Your current mortgage must be FHA-insured.
- You must have made on-time, in-full mortgage payments for the past 12 months.
- Your FICO credit score has to be at least 620 or higher. Some lenders require a credit score of 640 or 680 on an FHA loan.
- You cannot have refinanced within the past 210 days.
If you meet these guidelines, you can contact your current mortgage lender to inquire about a streamline refinance. You can also contact other mortgage lenders to compare rates and fees. Different lenders have different loan requirements, so even if one lender turns you down, another may be willing to work with you.
In addition to various individual mortgage lender requirements, you need to meet the FHA net tangible benefit requirement, which says that refinancing will either help you avoid future mortgage rate increases (refinancing from an adjustable rate mortgage to a fixed-rate mortgage works for this) or will reduce your total monthly payment including principal, interest, and mortgage insurance by at least 5%. The interest rate doesn t have to drop by 5% just your payment.
That can be a catch for many homeowners, because even though you have been paying mortgage insurance premiums with an FHA loan, you need to continue paying them with a refinance. Depending on when you took out your current mortgage, those mortgage insurance premiums could be higher on your new loan and erase any payment reduction achieved with a lower interest rate.
FHA Mortgage Insurance
How much you ll pay in mortgage insurance depends on when you closed on your current mortgage. As of June 11, 2012, the FHA offers reduced upfront mortgage insurance premiums to borrowers who took out their current mortgage prior to June 1, 2009. Those borrowers must pay 0.01% of the loan amount.
If you took out your current loan on or after June 1, 2009, you ll pay a higher upfront mortgage insurance premium of 1.75%. That s a whopping difference from $10 to $1,750 on a $100,000 mortgage. The upfront mortgage insurance premium can be added to your loan balance.
As you already know if you have an FHA loan, you have to pay both an upfront mortgage insurance premium and an annual mortgage insurance premium. However, the annual mortgage insurance premium is eliminated if your loan-to-value (LTV) is 78% or less.
Here s the breakdown on annual mortgage insurance premiums: If you are refinancing a loan taken out before June 1, 2009, your annual mortgage insurance premium will be 0.55%. If you are refinancing an FHA loan taken out more recently, you will need to pay 1.25% of the loan amount. The annual mortgage insurance premium on a $100,000 mortgage would be $550 at the lower rate compared to $1,250 at the higher rate. These premiums are paid on a monthly basis, so on a $100,000 loan you would pay $58 more per month at the higher mortgage insurance rate.
Pros Cons of a Streamline Refinance
Clearly, homeowners with an FHA loan taken out before June 1, 2009 benefit the most from the FHA streamline refinance program, but even those with more recent loans should compare their current monthly payments with their payments under a refinance.
- Easy to Qualify. FHA financing is designed to help borrowers with less-than-perfect credit. If your credit score is less than 740 and above 620 or 640, compare your options for conventional and FHA financing. If your credit score is above 740, conventional financing is likely to be the better deal.
- No Appraisal Required. Even if you owe more on your mortgage than your home is worth, an FHA streamline refinance is an option as long as you find a lender who does not require an appraisal. However, that can be a challenge, even though the FHA says an appraisal is not needed.
- Mortgage Insurance. When you take out a new FHA loan, you must pay upfront mortgage insurance again. And if your loan-to-value is higher than 78%, you must pay annual mortgage insurance premiums. The mortgage insurance increases your loan balance and your monthly payments. If you took out your loan after June 1, 2009, your mortgage insurance premiums will be higher on your new loan.
- Closing Costs. The FHA says borrowers cannot finance their closing costs into their loan balance. Closing costs vary widely by location: The average closing cost is approximately 3% of the loan amount, or $3,000 on a $100,000 loan. Most lenders allow you to wrap closing costs into your loan balance for a conventional loan refinance. Your options on an FHA streamline refinance, however, are to pay your closing costs with cash or to find a lender who will do a zero cost refinance. While zero cost sounds like a great option, what this actually means is that you must pay a slightly higher interest rate over the life of your loan to reimburse the lender-paid closing costs.
If you are considering a zero-cost FHA streamline refinance, be sure to compare your options for refinancing into a conventional loan to see which mortgage product results in the lowest monthly payments and the lowest long-term costs.
If you have an FHA-insured mortgage approved before June 1, 2009, refinancing to a lower interest rate with an FHA streamline refinance will probably save you money. But even if your mortgage was approved after that date, it s worth talking to a few different lenders to see what they can do. Even though it s relatively easy to qualify, you may still need to shop around for a loan approval if your home equity is low or you have credit challenges. Either way, the effort is worth it and could lead to thousands in annual savings.
Have you taken part in the FHA streamline refinance program? What was your experience?
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Refinance home loan – $1,500 cash back
Refinancing your home loan can be a good way way to make sure you have a loan that’s right for you.
It’s also an opportunity to find a good deal on interest rates and fees, or more appropriate loan features if your circumstances have changed. You may want to take the time to consolidate other debts into your home loan..
You might just be looking for a supportive relationship with your bank, and want your home loan with a bank that’s big enough to help and small enough to treat you like a person – not a number.
Start the conversation
Enjoy the convenience of talking with friendly bank staff you trust, either on the phone or face-to-face in the branch.
There are costs involved with refinancing, but we can help with the basics – a suitable home loan with features for you, and a bank that’s easy to bank with.
We’ll take you through the application and approval process to make sure you are comfortable with what happens next. We could provide you with conditional approval and will organise a valuation on your home if required so you know how much your home is worth and get an estimation of how much you could borrow.
Start your journey online
There are 3 reasons why applying online might be the way to go:
- You can learn how much you could borrow anytime, anywhere, without knowing the loan type
- Receive indicative approval in under 10 minutes
- A home loan expert will call to discuss your options and next steps
Credit criteria, fees and charges apply. Before making a decision, it’s best to read the terms and conditions:
The information on our website is prepared without knowing your personal financial circumstances. Before you act on this, please consider if it’s right for you. If you need help, call 13 33 30 .
The information on this page has been prepared without taking your objectives, needs and overall financial situation into account. For this reason, you should consider the appropriateness of the information and, if necessary, seek appropriate professional advice. The taxation position described is a general statement and should be used as a guide. It does not constitute tax advice and is based on current tax laws and their interpretation. St.George – A Division of Westpac Banking Corporation ABN 33 007 457 141 AFSL and Australian credit licence 233714
*Based on St.George’s credit criteria, residential lending is not available for Non-Australian Resident borrowers. New home loan applications received from 23 January 2017 to 7 October 2017 and settled 15 December 2017 for refinance purposes where foreign income is not required for serviceability. Offer current as at 23 January 2017 and may be withdrawn at any time. Excludes refinances from Westpac, St.George, BankSA, Bank of Melbourne and RAMS and refinances into Owner-Occupied Interest Only loans and Portfolio Loans. Only one cash back paid per main applicant. Multiple applications submitted by the same main applicant are not eligible. Not available in conjunction with any other special offers. Applicants must have a St.George transaction account linked to the home loan at the time of settlement. Applicants’ home loan repayments must be direct debited from this transaction account. The account must be kept open for at least 60 days after settlement and the cashback will be paid into this account during this period. There may be tax consequences arising from this promotion for our business customers and rental property investors. This is not taxation advice and customers should seek independent advice on any taxation matters.
1. Discounts on products apply at time of application when you tell us you’re an Advantage Package customer
2. Advantage Package Conditions of Use and Terms and Conditions apply and are available at stgeorge.com.au. Annual fee, currently $395, applies.
3. A discount of 0.20% p.a. will apply only if the interest in advance amount is automatically deducted from a St.George transaction account.
The Bank will apply the fixed rate that is available at the loan settlement date or the date the fixed rate period commences, unless the customer locks a fixed rate in on the loan using our Rate Lock feature. The Rate Lock fee is 0.15%p.a. of the loan amount or $500, whichever is higher, capped at $1000 for loans up to $2mil. For loans above $2mil, the Rate Lock fee is 0.15%p.a. of the loan amount. After fixed period, rate reverts to applicable Standard Variable Rate. Excludes internal switches and portfolio Loans.
Student Loan Refinance – Find a Loan #student, #loans, #refinance, #e #student #loans, #education,
Student Loan Refinance Program
Student Loan Refinance Program Features
- Take control of your student loans with a Student Choice Refinance Loan from DCU.
- You’ll be able to refinance and consolidate your private and federal student loans into one manageable loan, setting up one convenient payment, and potentially saving thousands of dollars in interest rate charges.
- Featuring a competitive interest rate, our refinance loan can help you simplify your life while amplifying your funds.
Please refer to Details and Rates tabs for additional information and important disclosures.
Student Loan Refinance Details
What You Need to Know Before You Borrow:
- Refinance your private or federal student loans, including PLUS loans, up to $100,000
- Keep in mind that by refinancing federal student loans, you may lose certain borrower benefits from your original loans. These may include interest rate discounts, principal rebates, or some cancellation benefits that can significantly reduce the cost of repaying your loans.
- Receive a 0.25% rate discount for automatic electronic payment 1
- U.S. citizens or permanent residents who have graduated from an approved public or private not-for-profit school 2
- In repayment or grace on one or more outstanding private or federal student loans
- Able to pass a credit check (A co-borrower may be necessary in order for you to meet credit criteria, and may also help you qualify for a lower rate)
1. If your loan is subject to a floor rate (also known as a minimum interest rate) as specified in your promissory note, your rate will never be less than the floor rate.
2. Approved schools subject to change.
Variable Rate Solution
The Annual Percentage Rate (APR) is variable 1 and is based on the Prime index 2 plus a margin 3. The rate you receive depends on your credit qualifications and the repayment term you select.
The current offered variable rates are 4 :
between 5.00% and 9.50% APR
All loans are subject to approval and restrictions may apply. Digital Federal Credit Union reserves the right to change rates for new applications at any time and without notice. Credit union membership and a minimum share deposit is required. Contact us for membership details.
Important. Please remember that federal loans do offer certain benefits and protections that do not transfer to a private loan. By refinancing your federal student loans to a private loan you will lose any federal benefits that may apply to you. Please review this important disclosure for more information.
Rates are effective .
* Rates shown include a 0.25% discount for optional enrollment in automatic electronic payments.
1. Variable interest rate solution: the rate is subject to increase after consummation. Your Interest Rate is variable and may be adjusted quarterly based on the Index. Any increase in the Index may increase the APR and may increase the amount of your monthly payment.
2. As of March 1st, 2017, the Prime index (Index), as published in the Wall Street Journal, used is 3.75%. The interest rate will not exceed 18.00% regardless of the Index.
3. Margin will be disclosed upon approval. This Margin is added to the Index to determine the calculated interest rate.
4. Current offered rates are calculated using the Index, Margin, and Floor values in effect. Your specific Interest Rate, Margin, Floor, and/or credit approval will depend upon the student borrower’s and co-borrower’s (if applicable) credit qualification. Applicants may apply with a creditworthy U.S. co-borrower which may result in a better chance of approval and/or lower interest rate.
5. Fixed interest rate solution: your interest rate is fixed and is based on your credit qualification and the repayment term you select. Your actual rate within the ranges stated will be disclosed upon approval.
APR = Annual Percentage Rate.
Examples provided use highest current offered rate in effect for each repayment term and assume a constant interest rate on a $50,000 loan amount. Rates shown include a 0.25% discount for optional enrollment in automatic electronic payments.
Variable Interest Rate Solution
- 5 year loan term: with a 7.00% APR, the monthly payment will be $990.06. Finance charges will be $9,403.55
- 10 year loan term: with a 7.50% APR, the monthly payment will be $593.36. Finance charges will be $21,221.05.
- 15 year loan term: with a 8.00% APR, the monthly payment will be $477.83. Finance charges will be $36,008.08.
Fixed Interest Rate Solution
- 5 year loan term: with a 8.25% APR, the monthly payment will be $1,019.81. Finance charges will be $11,188.60.
- 10 year loan term: with a 8.75% APR, the monthly payment will be $626.63. Finance charges will be $25,195.60.
- 15 year loan term: with a 9.25% APR, the monthly payment will be $514.60. Finance charges will be $42,628.00.
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Can I refinance student loans I ve already consolidated
Mortgages & Home Loans – Refinance & Interest Rate Calculators, refinance mortgage loans.#Refinance #mortgage
CHECK MORTGAGE RATES
American homeowners are tapping their home equity again, with the cash-out share of refinances rising to its highest rate since 2008, according to data from Bla.
Find out your estimated monthly payment.
Should you refinance your mortgage? Figure your monthly savings. Compare your principal balance in years with and without refinancing.
Is home ownership the right path for you? Analyze the total cost to rent versus the total cost to own for a specific period of time.
Mortgage Payment Calculator
Tool to help home buyers estimate the cost of monthly mortgage payments.
Mortgage 101 Daily Rate Averages are collected for standard mortgage programs from over 700 companies in 50 states and the Disctrict of Columbia.
Applying for a Mortgage after a Bankruptcy
By understanding the requirements to get a mortgage after a bankruptcy and by carefully rebuilding your credit standing, you can apply for a loan and buy a home.
What Are Typical Mortgage Down Payments?
Traditional mortgage down payments have always been 10 to 25 percent of the total purchase price of the property.
FHA Eligibility with Bankruptcy and Foreclosure
FHA mortgage loans require borrowers to wait three years after a foreclosure and two years after a bankruptcy before applying for financing. Good credit since the incident is generally a requirement as well.
The content on this site is provided for informational purposes only and is not legal or professional advice. Advertised rates on this site are provided by the third party advertiser and not by us. We do not guarantee that the loan terms or rates listed on this site are the best terms or lowest rates available in the market. All lending decisions are determined by the lender and we do not guarantee approval, rates or terms for any lender or loan program. Not all applicants will be approved and individual loan terms may vary. Users are encouraged to use their best judgment in evaluating any third party services or advertisers on this site before submitting any information to any third party.
5 Best Companies to Refinance Your Car (STI), Investopedia, top refinance companies.#Top #
5 Best Companies to Refinance Your Car (STI)
When you need to buy a new car fast, you can end up accepting an auto loan with a high annual percentage rate (APR) just to close the deal. Paying more for interest on a car loan than what you should be paying can cost you money that you could use to pay off bills or put into your savings. Therefore, it pays to shop for a refinance loan at a lower interest rate. Consider one of these top auto refinance companies.
The United Services Automobile Association (USAA) offers 36-month auto refinance loans through its Auto Circle Program, with rates as low as 1.49% on models 2015 or later, and 2.75% for models older than 2014. You must be a USAA member to qualify for the loans. Some loans approvals are instant, and you can get an answer on your application in about five minutes. After e-signing your loan documents in your USAA account, you can print out your loan check instantly or send the payoff amount to your dealer by using your smartphone. USAA does not charge an application fee, and you won’t have to make payments on your new loan for up to 60 days. Reviews on the USAA website give USAA auto loans 4.4 stars.
Autopay is a lender marketplace that partners with credit unions and other finance institutions to offer loans at interest rates based on your credit profile. If you want to maintain a traditional loan, Autopay can help you find better interest rates from a lender that suits your needs. Cash-back refinances through Autopay can help you to get up to $12,000 in cash that you can use to pay off other debts. If you plan to keep a leased car after the end of a lease, the lease payoff option allows you to pay off your lease early and avoid costly mileage fees. Customer reviews on LendingTree give Autopay 4.3 out of 5 stars.
CarsDirect specializes in helping people with bad credit find lenders to finance and refinance their vehicles. The process begins by filling out an online application that provides CarsDirect with some basic information about your gross monthly income, employment and housing payment, and you give the company permission to pull your credit. A credit processor will contact you with more information about the loans for which you qualify. When you decide to work with a lender, you will probably have to provide additional documentation, such as proof of your income, residence and insurance. The interest rate on the loan offer you receive depends on your credit score. Testimonials on CarsDirect’s website give the service high marks for an easy application process.
RoadLoans offers both traditional and cash-back refinance options. The RoadLoans traditional finance option allows you to lower your APR and monthly car loan. As an added perk, you can skip payments on your new car loan for up to 60 days. The cash-back refinancing option allows you to borrow more than you owe, up to the full value of your car, but the cash-back option is not available in all states. RoadLoans takes applicants with a wide range of credit backgrounds, so interest rates vary. As of August 2016, RoadLoans was the top-ranked auto refinance company on the Consumer Affairs website, with an overall rating of over 4.5 stars.
LightStream is a division of SunTrust Banks Inc. (NYSE: STI). As of August 2016, the lender offers auto refinance rates between 2.24 and 3.49% APR for 24 to 36 months, and 4.94 to 6.19% for 61 to 72 months. LightStream offers unsecured auto refinance loans for borrowers with excellent credit, but borrowers with less-than-stellar credit can qualify for secured auto loans. You can borrow from $5,000 to $100,000 to refinance a loan on any car through a simple online application process.
The above tool estimates monthly mortgage payments with taxes, insurance, PMI, HOA fees more.
Click on the “define” “more” tabs for a description of each input how they are used in calculations. Set an input to zero to remove it from the calculation.
Home Value: the appraised value of a home. This is used in part to determine if property mortgage insurance (PMI) is needed.
Loan Amount: the amount a borrower is borrowing against the home. If the loan amount is above 80% of the appraisal then PMI is required until the loan is paid off enough to where the Loan-to-value (LTV) is below 80%.
Interest Rate: this is the quoted APR a bank charges the borrower. In some cases a borrower may want to pay points to lower the effective interest rate. In general discount points are a better value if the borrower intends to live in the home for an extended period of time they expect interest rates to rise. If the buyer believes interest rates will fall or plans on moving in a few years then points are a less compelling option. This calculator can help home buyers figure out if it makes sense to buy points to lower their rate of interest. For your convenience we also publish current local mortgage rates .
Loan Term: the number of years the loan is scheduled to be paid over. The 30-year fixed-rate loan is the most common term in the United States, but as the economy has went through more frequent booms busts this century it can make sense to purchase a smaller home with a 15-year mortgage. If a home buyer opts for a 30-year loan, most of their early payments will go toward interest on the loan. Extra payments applied directly to the principal early in the loan term can save many years off the life of the loan.
Property Tax: this is the local rate home owners are charged to pay for various municipal expenses. Those who rent ultimately pay this expense as part of their rent as it is reflected in their rental price. One can’t simply look at the old property taxe payment on a home to determine what they will be on a forward basis, as the assessed value of the home the effective rate may chage over time. Real estate portals like Zillow, Trulia, Realtor.com, Redfin, Homes.com Movoto list current historical property tax payments on many properties.
PMI: Property mortgage insurance policies insure the lender gets paid if the borrower does not repay the loan. PMI is only required on conventional mortgages if they have a Loan-to-value (LTV) above 80%. Some home buyers take out a second mortgage to use as part of their downpayment on the first loan to help bypass PMI requirements. FHA VA loans have different down payment loan insurance requirements which are reflected in their monthly payments.
Homeowners insurance: most homeowner policies cover things like loss of use, personal property within the home, dwelling structural damage liability. Typically earthquakes floods are excluded due to the geographic concentration of damage which would often bankrupt local insurance providers. Historically flood insurance has been heavily subsidized by the United States federal government, however in the recent home price recovery some low lying areas in Florida have not recovered as quickly as the rest of the market due in part to dramatically increasing flood insurance premiums.
HOA: home owner’s association dues are common in condos other shared-property communities. They cover routine maintenance of the building along with structural issues. Be aware that depending on build quality HOA fees can rise significantly 10 to 15 years after a structure is built, as any issues with build quality begin to emerge.
Our site also publishes an in-depth glossary of industry-related terms here .
Charting: By default the desktop version of this calculator displays an amortization chart along with the ability to view a payment breakdown donut chart. These features are turned off by default on the mobile version to save screen space.
Amortization Tables: Clicking on the “show amortization tables” link reveals options to display monthy or yearly amortization tables to compare monthly versus biweekly payments. By default our calculations set bi-weekly payments to half of the monthly payment. Since there are 52 weeks in a year that means there are 26 biweekly pay periods, which means this payment strategy would be equivalent to paying a 13th monthly payment each year, which can help buyers save $10,000’s years of loan payments.
Sharing Saving Calculations: If you want to send a calculation to a spouse, client, or even send an email or text message to yourself there are buttons to “share this calculation a “printer friendly version” which can be used to share a loan scenario or create a page with a white background which makes it easy to print out an amortization chart.
Fixed vs Adjustable Mortgages: In most countries home loans are variable (also known as adjustable), which means the interest rate can change over time. The ability for United States homebuyers to obtain a fixed rate for 30 years is rather unique. Interest rates are near a cyclical, long-term historical low. That makes a fixed-rate mortgage more appealing than an adjustable-rate loan for most home buyers. ARMs can reset to a higher rate of interest over the course of the loan cause once affordable loans to become prohibitively expensive. What’s worse is when interest rates spike home prices also fall, which makes it harder to sell a home anyone refinancing their purchase will also be forced to refinance at a higher rate.
Comparing Loan Scenarios:This calculator makes it easy to compare loan scenarios, while this calculator shows what would happen if a buyer made extra payments. Another way to estimate the impact of extra payments is to use the calculator on this page generate an amortization table for a shorter term like 22 years instead of 30; then make the asosciated payments to pay off a 30-year loan faster. If you would struggle to force yourself to make additional payments then an alternative solution is to go with a 15-year loan to require the higher payment which will pay off the home quickly.
A Good Retirement Savings Option for the Self-Employed
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Whether you’re a new entrepreneur or an experienced business owner, self-employment brings its own set of challenges. One of the key challenges is saving for retirement. In a traditional job, you might have an entire human resources department looking after your retirement planning, but it’s a different ballgame when choosing a plan for yourself.
Among the available retirement options, Solo 401(k) plans are worth considering, due to their relatively high contribution limits, flexible investments and the ability to make after-tax Roth contributions.
Here are some reasons self-employed business owners should consider Solo 401(k) plans.
Because the self-employed professional wears the dual hat of the employer as well as the employee of the business, the contribution limits for a Solo 401(k) include both employee deferral (up to $18,000 annually, plus up to $6,000 in catch-up contributions for those over 50) and profit-sharing employer contributions (up to 25% of business income, depending upon the structure or type of business).
Combining these two, the Solo 401(k) limits for 2016 are $53,000, plus a $6,000 catch-up contribution for professionals 50 or older for a total of $59,000.
Under an alternative retirement savings plan for business owners, the Simplified Employee Pension (SEP) IRA. the contributions are limited to the lesser of 25% of the business income or $53,000 for 2016. The absence of elective salary deferrals or catch-up contributions restricts the overall contribution limits of a SEP-IRA when compared with a Solo 401(k) plan.
Here’s an example of how the Solo 401(k) leads to higher limits: Let’s say you had a business income of $100,000. With a Solo 401(k), you can make profit-sharing contributions of up to $25,000 along with employee-deferral contributions of $18,000, totaling $43,000. On the other hand, a SEP-IRA would allow you to make only a profit-sharing contribution of $25,000, hence limiting retirement savings.
Alternative investment options
A self-directed Solo 401(k) retirement plan offers alternative investments, including real estate, tax liens, tax deeds, mortgage notes, private equity, personal lending, precious metals, and the traditional stock or bond investments. These alternative investments help you diversify your portfolio while achieving competitive returns.
However, these investment vehicles and alternatives require an understanding of their core operating principles. Make sure to educate yourself before investing in them and, if necessary, get an expert opinion.
Like all 401(k) plans, with a Solo 401(k) plan your retirement savings enjoy tax-deferred growth. Thanks to compound interest and the steady rise of equities over time, this should be a solid investment. Compound interest is one of the key factors that decide the size of your retirement fund. In the purported words of Albert Einstein, “The strongest force in the universe is compound interest.”
Roth savings option
You can opt for the Roth feature in your self-directed Solo 401(k) retirement plan, which allows you to diversify your tax strategy with after-tax investments that will not be taxed when you withdraw your funds in retirement.
And unlike the regular Roth IRA. there are no income phaseout limits in a Roth Solo 401(k) plan. Under a Roth IRA, a single filer over 50 making less than $117,000 can contribute up to $6,500 in 2016 ($5,500 under 50), but as the salary grows, eligible contributions decrease proportionately. If you make $132,000 or more, you will be ineligible to contribute to a Roth IRA in 2016. A Roth Solo 401(k) has no such phaseout.
If you want to benefit from the higher contribution limits of a Solo 401(k) plan in 2016, set up your retirement plan before Dec. 31, 2016. You can make actual contributions for 2016 until the regular tax-filing deadline, but an account has to be set up before the year’s end.
Dmitriy Fomichenko is president and founder of Sense Financial. a provider of self-directed retirement accounts.