Although renting gives the advantage of not having to worry about maintenance and other financial obligations associated with owning property, Dallas home ownership offers tax benefits as well as the freedom to make decisions about your home. Unlike renters, homeowners who secure a fixed-rate loan can lock in their monthly housing costs - maintenance and natural disasters notwithstanding. Even if, in some markets, your mortgage payments would be greater than rent for a comparable property, the tax breaks available to homeowners can make the cost of owning a home lower than the cost of renting.
Maintenance expenses
Experts generally agree that you can plan on annually spending 1 percent of the purchase price of your house on repairing gutters, caulking windows, sealing your driveway, and the many other maintenance chores that come with the privilege of homeownership. Newer homes may cost less to maintain than older homes. It also depends on how well the house has been maintained over the years.
Learn more about Dallas real estate by visiting TexasHomeCentral.com or giving us a call, 972-562-0896.
What Is The Real Cost Of A Dallas Home Mortgage?
Understanding the true costs of your new Dallas home mortgage is very important in getting a firm grasp of your financial future. Sometimes the information can be overwhelming but once you understand the basics, everything else will fall in place. The total cost of a mortgage is comprised of four main elements:
1. P - Principal
2. I - Interest
3. T - Taxes
4. I - Insurance
PITI is part of the formula that mortgage lenders use when calculating your affordability ratios. Many times home buyers ignore these additional costs when figuring how much of a home they can afford.
Principal
Principal represents the amount you borrow, which has to be repaid over time.
Interest
Interest is the cost that mortgage lenders charge for the use of their money during your repayment schedule.
Taxes
Taxes are an assessment that local governments collect on property to pay for local services. Property tax rates will vary by location and can affect your total cost and affordability.
Insurance
Homeowner's Insurance will be required to replace the value of loan in the event of a disaster such as fire, earthquake, flood, etc.
Understanding Escrow
Property taxes and insurance costs must be collected and paid when they are due.
In most cases, mortgage lenders will make the collection by allocating the amount you need to pay for taxes and insurance each month to your mortgage payment.
These collections are placed in escrow, a depository account that the bank manages.
Your total monthly mortgage payment will include payments for real estate taxes, insurance, and Private Mortgage Insurance (PMI) and other items that are placed in escrow and used to pay taxes, insurance, PMI and other items on your behalf when they come due in the future.
Note that the escrow portion of your monthly payment may increase or decrease depending on the change of your taxes and insurance assessments.
If your mortgage does not have an escrow account, you will be required to pay your taxes and insurance separately and show proof of payment to your lender.
Local Property Taxes
Your county and city may levy taxes on your real estate property. These taxes pay for government services such as schools, roads, police, and other community services. The annual tax is usually calculated as a percentage (factor) of your property's appraised market value. For example, an assessment may look like this:
* $0.94 per $100 in appraised value
This calculates into a tax factor of 0.94% on the appraised value of your home Contact your local community and county officials to determine your county and city tax factor. And, keep in mind that many of these local real estate taxes may qualify for tax deductions. Check with your tax advisor for more information. At your home closing, you will be required to pre-pay up to one year's cost of your property tax. Then each month, your loan payment will include 1/12 of the annual property tax that will be deposited in your escrow account until the property tax payment is due.
Hazardous Insurance You may be required to carry hazardous insurance on your home in the event of a fire, flood, disaster, and any other natural disaster that destroys or partially destroys your home.
The insurance will protect your investment (and the lender's) and repair any damage that may occur. The annual premium may vary depending on your home area and location. You must provide proof of insurance before closing and settlement.
At your closing, you may be required to prepay up to one year's cost of hazardous insurance.
Then each month your loan payment will include 1/12 of the annual hazard insurance premium to be deposited in your escrow account until payment is due.
Other Costs (PMI)
There may be other associated costs that may be included in your escrow payment such as Private Mortgage Insurance, tax liens, etc. Check with your real estate agent or your legal council to determine what other charges may apply.
Private Mortgage Insurance (PMI) Private Mortgage Insurance (PMI) is mortgage default insurance that is required for all conventional mortgage loans with less than a 20 percent down payment. It is designed to pay the lender a portion of the outstanding balance of a loan in the event the homeowner defaults.
If PMI is required as part of your loan, the initial annual premium will be included in your closing costs while your subsequent premiums (1/12th of your annual premium) will be included in your monthly mortgage payments and deposited into your escrow account.
You need to check with your lender to estimate your cost percentage for PMI if your down payment is less than 20 percent. Nationally, the average annual percentage is around 0.005 of your loan balance. (Courtesy of SayLending)
Seven out of ten pet owners consider their pet part of the family. Here are some tips for moving your pets to their new home.
Cats and Dogs
Cats and dogs can be taken in your car. If so, remember to take along the following items:
Depending on the animal's temperament and size, it might be better to have it shipped by air. Be sure to check if your destination has any local requirements or restrictions on animals. If you ship your pet by air, make sure someone can meet your pet at the destination airport and take care of it until you arrive. Kennels provide this service and if necessary can keep your pet until you have completed your move.
If you are flying to your new destination, your cat or dog can ride in the baggage compartment. You may need the following items:
Entry Requirements
If you move across state lines, call or write the State Veterinarian, State Department of Animal
Husbandry, or other appropriate authority.
Interstate health certificates must be obtained for dogs and horses prior to entering most states.
All but four states require a rabies vaccine for dogs and many require it for cats. Hawaii requires that cats and dogs be quarantined for 120 days.
Some pets must have an entry permit issued by the destination state's regulatory agency.
A few states have border inspection of all animals being transported; others have random inspections.
Smaller Animals
Hamsters, birds and other small animals can easily be transported in your car. To help keep the animals calm and quiet, cover cages with a cloth. Also, make sure they have food and water available.
Fish
It can be very impractical and risky to move fish. Check with your local pet store for recommendations on moving your specific type of fish.
Renting a truck and moving yourself can make sense for many people. The amount and type of household goods, distance of the move and costs are all factors in that decision process. Here are some guidelines for additional help.
Setting a Move Date
Once you have decided to move it is important to plan your move. The amount of notice you will need to reserve a rental truck will vary depending on the time year and the time of the month you plan to move. Rental trucks companies tend to rent more trucks on weekends rather than during the week. The end of the month is always a busy time. Not to mention that summer months tend to be more demanding than winter months. Pricing can also be affected by the volume of trucks in need. For example, it would be less expensive to move mid-month during the middle of the week in October.
What Truck Size Do You Need?
Most rental agencies provide a size-guide. Remember, it's always better to error on the side of caution and rent a larger truck, then running the risk of not having enough space, especially if you are moving a long distance. Even if you are moving a short distance, too small of a truck could result in making multiple trips. Trying to switch truck sizes at the last minute will only cause delays.
How Much Will It Cost?
The cost to rent a truck varies greatly. There are many factors that affect the cost, such as: distance being moved, time of year in which you are moving, size of truck, fuel expense, one way fees, insurance coverage, towing an additional auto and packing materials. It is important to compare costs between rental truck companies. Make sure each of the contracts provide the same services, so the fees can be properly compared.
Are You Moving Any Additional Vehicles?
Be sure to compare the cost between driving your auto and towing it behind the truck. This will help you decide what is more cost efficient and convenient. A tow lift or trailer is an additional cost beyond the rental truck. Or, you could decide to ship your car with a car carrier which would also be an additional expense.
What Type of Coverage Do You Have?
Make sure you are fully covered. Most rental agencies will offer you additional coverage at a per day rate. Most credit card companies offer additional coverage too. In either case, make sure you are clear on what is covered. What is the coverage for the rental truck or trailer? If you're towing your vehicle, does the coverage extend to any potential damage to your car? Will it protect you for collision? What is the deductible? Does the coverage extend to other states and countries? Does the coverage include property damage if your belongings are affected by an accident? What about theft?
What Packing Materials Do You Need?
Most rental agencies sell boxes, tape, packing papers and markers. They can rent pads and dollies. Dollies can essentially make your move easier. Padding is useful to protect your furniture from scratches and dirt, as well as protecting your residence from damage resulting from lifting and moving the furniture. It can help the walls and woodwork from being damaged.
How Do I Pack My Boxes?
How Should You Load the Truck?
The heaviest and largest items should be loaded first. The lightest boxes should be top loaded on to the heavier boxes. The most fragile and odd shaped items should be loaded last. It is best to disassemble any items before loading them on to the truck. Be sure to fill in all open cavities so items do not shift.
When You Return the Rental Truck
Make sure the truck is clean, that all debris is removed and the fuel tank is full. Be sure to return all dollies and pads you rented from the agency.
The level of home sales is expected to show little movement in the months ahead, according to the latest projections by the National Association of Realtors.
The Pending Home Sales Index, a forward-looking indicator based on contracts signed in July, fell 3.2 percent to 86.5 from an upwardly revised reading of 89.4 in June, which had risen 5.8 percent from May. The July index remains 6.8 percent below July 2007 when it stood at 92.8.
Lawrence Yun, NAR chief economist, said home sales continue to edge up and down. "Pending home sales are oscillating month-to-month, with the long-term trend essentially flat," he said. "Overly stringent lending criteria imposed by Fannie Mae and Freddie Mac in the past month no doubt held back contract signings."
Let's take a look at Dallas real estate sales statistics to understand what is happening locally.
Dallas Real Estate Sales Statistics:
Active listings this August dropped 14% compared to August 2007 with the number of homes sold down 19%. Available inventory increased 3%. The median and averages sales prices decreased 19% and 2%, respectively.
Acitve listings August 2008: 28,367
Active listings August 2007: 32,915
Sold listings August 2008: 4,702
Sold listings August 2007: 5,840
Months of August Inventory 2008: 6.7
Months of August Inventory 2007: 6.5
Median Sales Price August 2008: $162,100
Median Sales Price August 2007: $167,700
Average Sales Price August 2008: $221,800
Average Sales Price August 2007: $226,900
The decrease in inventory is a good sign that the Dallas real estate market is starting to stabilize. Interested in learning more about Dallas real estate, visit TexasHomeCentral.com.
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