Steve Chavarria

I have a success story for you all. Recently I had a customer from Fontana call me because he had recently bought a home back in December and when he received his first bill he noticed that it was terribly higher. Well, what happened is that the taxes where being assessed based on the previous value which was about $250,000 higher so it gave him a tax bill twice that of his regular payment.

To correct his situation I evaluated his finanical situation and noticed that his interest rate was high compared to the current rates. I advised him to do a streamline refinance benefiting him by saving $190 per month plus he didn't have to come in with anything money out of pocket and.... he skips his next month's payment saving him another $2,700. He did all this with out re-qualifying for the new loan (credit or DTI). Instead of taking that money and buying some tools like all handy men like to do, I advised him to apply half of it toward his savings and the other half towards his car payment which is in the form of a credit card. By applying that money towards his credit card he lowered the amount on his monthly bill and if he keeps paying the same amount he is used to paying he now lowers the time it will take to pay it off.

In regards to his property taxes, the homeowner went online to www.mytaxcollector.com and downloaded a reassessment request form to expedite the process, but because San Bernardino county is so backed up with work it still may take some more time. Now, the over payment of taxes will get refunded back to him once the reassessment finalizes so he must consider it a savings account for the time being. Once the reassessment kicks in he will be in a much better financial position that he started off when he bought the home.

Check out the Total Cost Analysis I did for me and take at look how his new mortgage will benefit him. I also advised him once he gets back on his "feet" financially, he should reinvest the $190 savings by appling it towards a safe conservative investment account that accumates interest. This will show on the analysis under "Streamline Refi".

If you or somebody you know would appreciate a complementary analsysis to find out if there's a better loan or better way of structuring the mortgage fill out the online application or call me direct at (951) 662-3389.

Work related deductions are great for reducing the amount you owe to Uncle Sam at the end of the year, but it may reduce your qualifying strength.

When is it a good time to buy? My first response would be when your financial situation permits then I would say when the market is desperate. When the market is cold, buying a house/property is one of the best moves one can make. Combine it with low interest rates and a low minimum down payment requirement and you'll find yourself in a "no-brainer" moment. A large percentage of people acquire their wealth from their homes equity and like Robert Kiyosaki teaches, never buy when the market is hot. Whether it's a stock, commodity, or a property, we all saw and experienced the devastation of buying when the market was booming. You'll buy the property at or close to its peak not leaving much room for appreciation.

One must also consider the future when selecting a home meaning that in the future when you decide to move up due to your family growing, relocation of job, or if you simply want a newer home you will most likely rent your current home. Think to yourself, can I rent this house to a family fairly easy and will the rent cover the mortgage payment? "Cash flow is king"! By renting the home for more than the mortgage payment you create cash flow. It's considered king because even if the home does not appreciate in value you still generate another pillar of income and regardless of the situation, it will not place you in a bad financial situation. A great strategy to consider is reinvesting the new found income into an interest bearing account and guess what; you are on your way to your Freedom Point. What is a Freedom Point you ask? When your assets exceed your liabilities and you reach a point where your assets allow you to pay off your home.

Now back to buying your first home in this market. We are currently in a REO (Bank Owned), short sale, and distressed sale market. These homes have been generally abused, vacant, not maintained, or simply in need of a little TLC. Expect to have some initial repairs or improvements made to the house upon purchasing. Treat this endeavor like you would a business. The number 1 rule is... never use your own money! Since you are buying in a low market, you can expect value to go up in the future so invest the banks money (credit or a personal loan) to fix up your investment and when time permits, pay it off. Your credit file will become stronger because you're adding another tradeline to your credit profile and by keeping the balance at 50% or below the maximum limit and by paying at least $1 more than the minimum payment you are setting yourself up for future gain in FICO scores. I'm not saying that you should go out and open a bunch of credit cards and loans, but by opening up an account that is going towards financing the improvement of your home then by all means, do it.

Consider acquiring credit in the form of a credit card or even a Home Depot home improvement loan, but remember to add that payment (1-2% of the balance) to your overall pre-qualification. Not including it will put yourself in a tight financial situation and it will keep you from reaching any future financial goals. Have your Mortgage Planner prepare a mortgage plan that coincides with your overall financial plan and include all the repair and improvement costs. Be sure you know what your loan looks like now, 10, and 20 years down the road as a small mistake can add up to be a big difference not only in total costs, but with your total net worth.