Frederick, MD

I have been talking about comparing FHA loans to Conventional loans and how to use your money wisely in my last 2 mortgage posts. The links are below and I suggest you reading them to find out what the fuss is all about. But in this post, I wanted to bring up 2 important points.

• some people argue that you should put more money down if you have it, so you don't become up-side-down in your property (I disagree with this statement)
  

• another point is that you could actually make a lesser down payment and take some of that extra money that you saved and use it to buy your interest rate down. It all comes down to your goals.

So, let's jump into this a little deeper...

So your fear is that you could be upset down on your property if you don't put 20% down or so? Let me pose a question to you. Why would it matter right now? Homes aren't suppose to be purchased like a car, to where you sell it or trade it within 2 to 5 years. Sure, unforeseen things can happen. But homes are suppose to be a place to live in, raise a family, possibly have your kids go to that school system, and for fond memories. And overall, it's a long term investment.

If you were to buy a home for $200,000 and put 20% down, you would have a mortgage of $160,000. What happens if in a year or so that value of your house drops to $165,000? Then you have nothing at that moment. And if you needed money as an emergency, you just can't walk up to your house and say, "house, please give me some of money back." Especially not in today's market, because of the fact that it's tougher to get mortgage financing.

I don't have a crystal ball, but home values should come back in the next 3 to 5 years. And in some areas they have come back now. But if they don't, why not take the money that you saved from not putting it all down as a down payment and invest it, to make more money. It can happen, think about it. And worst case, you have that extra money for emergencies.

Please read - Don't be cash poor - Cash is king

Onto the second part of this post, something else that you could do with your left over down payment. Buy your interest rate down, which allows you to get another bang for your buck. It's very simple math.

In my scenario below, you will be putting 10% down on a FHA loan as opposed to the required 3.5% down for all FHA loans. I will show you the difference in mortgage payments and what you could actually do with that extra money, even when it comes down to lowering your interest rate.

FHA Loans – Comparing 10% down to 3.5% down

Scenario # 1

My sole purpose in this comparison is to show that cash can be king and that you aren't hurt as much if you just put 3.5% down on FHA loans. On the 10% down, you will be better by $4,193.60 in 5 years. But by putting 3.5% down, you are keeping $14,787 in your pocket upfront and your total monthly mortgage payment is only a total of $41.61 extra. In my honest opinion, that is a very good trade off in order to have more cash left over for several things such as :

• monies left over to fix up the house

• future home repairs

• new furniture

• loss of future income

• family emergencies

• possibly put some money into investments to get a better return
  

Overall, just left over cash for security for unknown circumstances....

FHA Loans – Comparing 3.5% down w/buying down interest rate

Scenario #2

Lastly, this is a very simple comparison. You now have the extra cash from scenario #1 above to use to buy down your mortgage interest rate. Not only do you save $91.22 per month, but it only takes you approximately 3 years to recoup the money that you spent to buy down your interest rate. As I have stated in several posts, the average person stays in their home for over 6 years. Your end result then is that you will save more money by buying down your interest rate.

Disclaimer : The rates are examples in today's market, aren't any form of advertising, and aren't for solicitation of new business. It's merely to educate the consumer. And the spread shown in these examples are real as in the profit margins for both sides, in order to compare apples to apples.

For more FHA loans vs conventional loans comparisons :

• FHA loans vs Conventional loans - A true numbers comparison with 5% down - 12-20-08 -Using a 710 credit score
  

• FHA loans vs Conventional loans - A real comparison with 5% down - 11-15-08 - Using a 659 credit score
  

• FHA Loans vs Conventional Loans - 20% down - A Rude Reality Check - 04-03-09 - Would you believe that FHA loans could be cheaper even with 20% down? Come see why and how.

• FHA Loans vs Conventional Loans - 5% - 4 comparisons that you need to know - 05-02-09 -Comparing a FHA loan against 3 types of conventional loans with different types of monthly mortgage insurance. Guess who won while still using a 679 credit score.....

• FHA loans vs Conventional loans - Knowing the true comparisons - 07-10-09 - A great comparison with a 679 credit score and 5% down. This example will still show that even with a better than average credit score, that FHA loans are still better in many cases.

• FHA loans vs Conventional loans - Things you need to know with 10% down, especially in regards to Condos - 09-19-09 -

Donw Payment Series - A Must Read -

• FHA loans vs Conventional loans - A real comparison with 20% down - Part 1 of 3 - 01-28-10 - Not much of a difference, unless you stay in the house for more than 5 years. Hence why a loan officer should be talking about your goals. So very important, yet many dont ask.

• FHA loans vs Conventional loans - Don't be cash poor!! - Part 2 of 3 - 01-29-10 I want to show even a bigger difference if you put less down. And even if you decided to put less than 10% down, because cash is king now. You can't predict even next week. And keeping in mind of some misleading rumors, that you need more than 10% down to buy a house.
  

• FHA loans vs Conventional loans - Get a bang for your buck - Large down payments aren't always the best way - Part 3 of 3 - 02-01-10 - Some great examples of having cash left over and not really affecting your monthly mortgage payment. And that you will have cash left over for emergencies. Keeping in mind that cash is king.
  

• Make sure you know about the NEW FHA loan changes : FHA loan changes for 2010 & why they changed. Reasons for these FHA changes and when they go into effect.

• And sellers, don't listen to your agents on how bad FHA loans are.

FOLLOW ME ON FACEBOOK

- FHA Loans - USDA Loans - VA Loans -

- Energy Efficient Mortgages -

- Conventional Loans - 203 k loans -

- Mortgages -

Experience & Knowledge at its BEST !!!

_________________________________________________________________________________________

For more information on FHA loans, please go to this link. The FHA Expert

For more information about the 2009 Tax Credit for First Time Homebuyers : 2009 Tax Credit

For important mortgage insight to watch for, please read : Consumers need to be aware of these Red Flags!

Copyright © 2010 by Jeff Belonger of Infinity Home Mortgage Company, Inc

Don’t be CASH POOR – CASH is KING

FHA loans have been used more in recent years. Many have talked negatively about FHA loans because of their high default rates as of lately. Don't be fooled by chatter that is not backed up by fact and why this is happening. Please read : Should we ABOLISH FHA loans?

One of the main myths that I wanted to dispell in this blog post is that you don't need 20% to buy a home in today's real estate market or that you need a 720 credit score. These are bad myths and rumors. You can read about it here : Credit scores/FICO scores - I need a 700 credit score?

Yesterday, I wrote a post about comparing a FHA mortgage to a Conventional mortgage with 20% down. FHA loans vs Conventional loans - A real comparison with 20% down. - Overall, it all comes down to the borrowers needs and goals. Yet not all loan officers dig this deeply. Usually because the focus is lost when the borrower wants to know the mortgage interest rate and fees. More on that in a post on Sunday.

Please read these links before moving forward (the next 3) : It’s extremely important

Please read this question about why my conventional rates are so much higher : Someone's question to why my conventional rates are so high.

My response : Just a basic response to why the conventional rates are much higher.

And proof that it's not just me.. all lenders need and have to follow the same pricing hits. Conventional PRICING HITS

What is the big fuss of putting 20% down other than you don't have mortgage insurance? Here is my chart from yesterday.

Loan comparison of 20% down between FHA loans and Conventional loans

SCENARIO # 1

In regards to scenario #1, this is great if you have 20% down. But is it? Please read why going with a conventional loan with 20% down still might not be your best option. 20% down comparison between FHA loans and Conventional Loans Hint: Goals -

Dropping the down payment by 1%, making it 19% down and not 20% down.

Scenario # 2

Scenario # 2 - There is no large difference except that your monthly mortgage payment is lower on a FHA loan when putting less than 20% down. **Conventional mortgage insurance is not standard as it use to be. Meaning that these figures could change depending on the insurance company, the fico score, and in some cases, where you purchase the property.**

Loan comparison of 10% down between FHA loans and Conventional loans

Scenario # 3

As you can see, when you put less than 20% down, and depending on your credit scores, FHA mortgages will be much cheaper in the monthly mortgage payment. I give a better description and understanding of the differences in this blog post : 10% down comparison and understanding the upfront mortgage insurance on FHA loans vs conventional loans.

My whole point to this post though is about cash, cash savings, and reserves. And in today's economy, cash is king. Let's look at it this way.

Loan comparison – Conventional loan w/20% down vs FHA loan w/10% down

Overall, there is no true correct answer. It first must come down to how comfortable you are in your finances. But here is a clear indication that just because you put down 10% more, which is an additional $30,000, doesn't mean your payment drops as signficantly as many of you might think. (this will vary depending on loan amounts) Don't get me wrong, saving an additional $186.71 a month can be huge. But at the same time, you could keep $30,000 in your pocket instead. If you want to try and compare apples to apples, just take the difference out of the monies that you saved from your 10% down payment. Set aside $11,200 in a seperate account to lower your payment. It would still leave you with $18,794 now, after closing.

One word of advice.... you don't have to try and pay down your mortgage as soon as possible. Yes, this is a good security blanket for so many. But you also don't know what the future holds for you. Besides, you could take $10,000 of your money left over and invest it in several areas that would give you a better return of 7% to 8%, especially since you are paying 5% on your mortgage. But you would need to speak to a financial consultant about this.

Summary : No matter how much cash you have or don't have, this is how your loan officer should help you understand your mortgage and financial situation. Cash can be king and be useful in unknown emergencies. Don't always fall for those commercials that scream, "don't let the banks rip you off, learn how to pay off your mortgage quickly".(you don't need these programs, such as the mortgage accelerator programs... you can do this on your own)

On another note, I am not saying that your loan officer needs to show you this exact breakdown. But it's more than just about the best interest rate and or fees. What is the best program for you based on your goals and the mortgage program. I will be talking about this over the weekend. Stay tuned.

Knowledge is Power... And don't forget that you can still put down 3.5% with FHA loans, as opposed to conventional loans needing 5% to 10% down.

Disclaimer : The rates are examples in today's market, aren't any form of advertising, and aren't for solicitation of new business. It's merely to educate the consumer. And the spread shown in these examples are real as in the profit margins for both sides, in order to compare apples to apples. The conventional rate also includes the penalty for the 659 credit score and down payments. This is because of the large pricing penalty for the credit score.

For more FHA loans vs conventional loans comparisons :

• FHA loans vs Conventional loans - A true numbers comparison with 5% down - 12-20-08 -Using a 710 credit score
  

• FHA loans vs Conventional loans - A real comparison with 5% down - 11-15-08 - Using a 659 credit score
  

• FHA Loans vs Conventional Loans - 20% down - A Rude Reality Check - 04-03-09 - Would you believe that FHA loans could be cheaper even with 20% down? Come see why and how.

• FHA Loans vs Conventional Loans - 5% - 4 comparisons that you need to know - 05-02-09 -Comparing a FHA loan against 3 types of conventional loans with different types of monthly mortgage insurance. Guess who won while still using a 679 credit score.....

• FHA loans vs Conventional loans - Knowing the true comparisons - 07-10-09 - A great comparison with a 679 credit score and 5% down. This example will still show that even with a better than average credit score, that FHA loans are still better in many cases.

• FHA loans vs Conventional loans - Things you need to know with 10% down, especially in regards to Condos - 09-19-09 -

Donw Payment Series - A Must Read -

• FHA loans vs Conventional loans - A real comparison with 20% down - Part 1 of 3 - 01-28-10 - Not much of a difference, unless you stay in the house for more than 5 years. Hence why a loan officer should be talking about your goals. So very important, yet many dont ask.

• FHA loans vs Conventional loans - Don't be cash poor!! - Part 2 of 3 - 01-29-10 I want to show even a bigger difference if you put less down. And even if you decided to put less than 10% down, because cash is king now. You can't predict even next week. And keeping in mind of some misleading rumors, that you need more than 10% down to buy a house.
  

• FHA loans vs Conventional loans - Get a bang for your buck - Large down payments aren't always the best way - Part 3 of 3 - 02-03-10 - Some great examples of having cash left over and not really affecting your monthly mortgage payment. And that you will have cash left over for emergencies. Keeping in mind that cash is king.

• Make sure you know about the NEW FHA loan changes : FHA loan changes for 2010 & why they changed. Reasons for these FHA changes and when they go into effect.

• And sellers, don't listen to your agents on how bad FHA loans are.

FOLLOW ME ON FACEBOOK

- FHA Loans - USDA Loans - VA Loans -

- Energy Efficient Mortgages -

- Conventional Loans - 203 k loans -

- Mortgages -

Experience & Knowledge at its BEST !!!

_________________________________________________________________________________________

For more information on FHA loans, please go to this link. The FHA Expert

For more information about the 2009 Tax Credit for First Time Homebuyers : 2009 Tax Credit

For important mortgage insight to watch for, please read : Consumers need to be aware of these Red Flags!

Copyright © 2010 by Jeff Belonger of Infinity Home Mortgage Company, Inc

-Search Real Estate Listings in Frederick, MD -Find a Realtor in Frederick, MD

-List a Home for sale in Frederick, MD -Commercial Real Estate in Frederick, MD

Buying or selling a home in Spring Ridge in Frederick, MD? You should read this first.

Spring Ridge was developed by the Buchanan Partners Land Development Group in the 1980's. Spring Ridge is one of the largest master planed community located in Frederick, MD. It is a mix of single family homes, town homes, condos, is well as retail and office space. Spring Ridge totals about 1,650 housing units constructed from the early 1990's to 2008 and is home to about 4,500 people. Some of the community amenities in Spring Ridge including, walking paths, a pool, club house, grocery store and more. House values in Spring Ridge have declined on average 39% from the peek values.

-Single Family Homes in Spring Ridge sell in the $300,000 to $600,000 price range.

(Search Single Family Homes for sale in Spring Ridge).

-Town Homes in Spring Ridge sell in the $200,000 to $285,000 price range.

(Search Town Homes for sale in Spring Ridge).

-Condos in Spring Ridge Sell in the $150,000 to $230,000 price range.

(Search Condo's for sale in Spring Ridge).

(Learn your homes value) and see other recently sold homes in Spring Ridge.

Contact a REALTOR today! (301)524-4471

Mike Muren
REALTOR,
TheMurenTeam
Mackintosh Inc., REALTORS
Cell (301)524-4471
Direct (240)529-0123
Office (800)727-7653 x239
www.TheMurenTeam.com

Named one of the top 30 REALTORS in the nation under 30 years of age by the national assoc of REALTORS and REALTOR magazine. We have sold a home every 7 days for the past 6 years and were the top selling group in the Frederick office of Mackintosh Inc., REALTORS in 2008.

<GREEN HOMES = SMART HOMES = SMART INCOME!

Are you helping your clients live safer and healthier in their new home? You could be. Chances are, you probably bought, sold or staged a vacant house-maybe a foreclosure, or a short sale. It was probably a mess—and needed help.

These are changing times, especially in the real estate market. Whether we like it or not isn’t important. People who are buying are focusing on green living. Homeowners now want to feel safe and healthy. Just because they needed to buy a fixer, doesn’t mean that’s how they want to live. They are remodeling, redesigning, cleaning up, and they need help!

How do we earn smart income with green homes? Today, people are looking for all aspects of green living. From a short sale, a foreclosure, to staging or remodeling, the Meredith Design Group, and JDRock , are redesigning rooms, installing eco-friendly building products, providing an energy efficient way of living—and, offering a cost-effective alternative to expensive design firms. But, it doesn’t stop at remodeling. There are many directions of going green from soup to nuts—like Emeril Green Recipes and Living With Ed . Homeowners are cooking with healthy whole foods, driving smaller cars, and redesigning their living space. And most homeowners are just sick and tired of being around chemicals that create allergies, headaches, itching, and other health problems.

As a stager, I hear about these problems often, so I personally refer these safe eco-friendly cleaning products to clients, using them myself, as well as the health and wellness products. I love all of the items, so I offer many of the products as thank you gifts, holiday gifts, prizes at open houses, meetings, and presentations, including fundraising. It’s very rewarding.

So, in this unhealthy economy, I have the ability to enhance my real estate business with a healthy income. We hold a niche. Refer environmentally safe products to clients for their home or office. It’s that simple.

More product information and details can be obtained by emailing, or by calling.

mailto:ljr@greenstagersunite.com or mailto:ljr@MeredithDesignGroup.com

877.465.4975

Frederick County Maryland Public Schools

Are you considering a move to Maryland, but are concerned about the educational opportunities available for your children? Do not worry, the schools of the Maryland public educational system are rated among the best in the entire country.

Maryland tracks key performance indicators to determine how it compares to the nation as well as to compare the school districts within its own boundaries. Maryland continually strives to improve its performance in all of these areas.

In all categories, Maryland is at or near the top. Maryland has information regarding important factors such as:

• graduation rates;
• college acceptance rates;
• SAT and PSAT scores; and
• assessment scores for math, reading, and writing.

Also provided are demographics for the various schools and school districts.

For detailed information about the schools in Maryland you can start at the following web site:

http://www.marylandpublicschools.org/MSDE

For detailed information about the schools in Frederick County Maryland you can start at the following web site:

http://fcps.schoolwires.com/fcps/site/default.asp

To determine the specific school attendance area for a particular address in Frederick County Maryland, you can use the following link:

http://fcps.schoolwires.com/152910103114101710/blank/browse.asp?a=383&BMDRN=2000&BCOB=0&c=54061&152910103114101710Nav=|&NodeID=386