Technology TransactionsMarch Round-Up: Rates Up, Houses Shine, & Tax Time Approaches
Mortgage Rates Edge Upward In Late March
It had to happen. When combat with Iraq began in
March interest rates rose, a not-surprising event
given the uncertain nature of war.
But even with the March bump, mortgage interest
rates remained unusually low. According to Freddie Mac, the bottom during
the first quarter was 5.61 percent plus .6 points
for 30-year fixed-rate financing. One result of
the low rates: the Mortgage Bankers Association of America said loan applications reached record
levels during the month.
Clean Houses Soothe The Psyche
"A clean house makes people feel happy, satisfied,
comfortable and healthy" says The Soap and Detergent
Association. SDA research shows that 78
percent of Americans plan on spring cleaning this
year, up 11 percent from 2002.
"The urge we have to clean may be a trait that is
biologically programmed into us," explains Carol
Nemeroff, Ph.D., associate professor of psychology
at Arizona State University. "And, because we know
that good hygiene leads to good health, cleaning
may ultimately be related to a basic survival
instinct."
According to SDA"s study, the leading
characteristics of a clean house include:
*A clean, fresh smell (37 % of respondents)
*Knowing dirt and grime are gone (31%)
*A shiny, dust-free look (14%)
*Taking good care of furnishings (11%)
Tax Time Nears
April is the traditional time to unearth records,
crank-up adding machines and do battle with
endless streams of tax forms and publications.
If you"re a harried taxpayer, the latest trends on
the tax front look like this:
*Audits are down. Only .057 percent of all
returns were audited in 2002 -- down from 1.67
percent in 1995. Among those with incomes of
$100,000 or more, the audit rate was .50 percent
in 2002, substantially lower than the 2.97 percent
of all such returns checked in 1995.
*Collections are up. The IRS pulled in an
additional $32.5 billion in 2002 as a result of
notices and actions, up significantly from the
$25.1 billion collected in 1995.
Homeownership, of course, remains one of the best
available tax benefits for citizens. Mortgage
interest and property taxes are generally
deductible while you own a home, and sale profits
of as much as $250,000 for single owners and
$500,000 for married owners are often completely
untaxed. For details and specifics, speak with an
enrolled agent, CPA or tax attorney.
When to Cancel Mortgage
Insurance Premiums
To reduce their risk, lenders stay away from
mortgages with less than 20 percent down unless
there is a financially-strong third-party in the
picture, someone willing to pay off the debt if
the borrower gets into trouble. In many cases,
that "someone" is a private mortgage insurance
(MI) company, firms which promise to repay lenders
if loans go bad.
By using MI, borrowers can buy with 5 or 10
percent down and sometimes less. With less cash
needed at closing, borrowers with MI can usually
purchase sooner than borrowers who wait to acquire
20 percent down. No less important, by purchasing
sooner buyers are often able to get a home for
less money than if they delay buying while homes
appreciate.
MI is insurance and so it follows that borrowers
must pay insurance premiums. Such premiums,
however, do not have to be paid for the entire
loan term. Under the Homeowners Protection Act of
1998 (HPA), MI for private mortgages
originated after July 29, 1999 can usually be
canceled once the original loan balance has been
reduced to 78 percent of the purchase price.
In some cases, however, lenders will allow
homeowners to cancel coverage sooner, especially
those with good payment histories and significant
equity. For details, speak with your lender
regarding their cancellation policy. Also, the Mortgage Insurance Companies of America (MICA) has a calculator and free "PrivateMI Cancellation kit" online at: http://www.privatemi.com/cancel/in
dex.cfm.
Practical Mold Clean-
Up
While mold has been with us for millions of years,
the combination of certain molds and sensitive
individuals can create health risks, everything
from minor allergies to far more serious
consequences for some people.
One problem with mold is that it"s here and it"s
not going away. According to the Environmental Protection Agency, "it is impossible to get rid of all
mold and mold spores indoors; some mold spores
will be found floating through the air and in
house dust."
A second problem with mold is that even a thorough
cleaning is unlikely to entirely solve remove such
spoors -- more must be done and in the case of
mold "more" means getting rid of dampness and
moisture.
"If there is mold growth in your home," says EPA,
"you must clean up the mold and fix the water
problem. If you clean up the mold, but don"t fix
the water problem, then, most likely, the mold
problem will come back."
The good news is that you can do something about
mold. The EPA"s "A Brief Guide to Mold, Moisture,
and Your Home" is free and useful. It offers a
good description of what mold is, why it can be a
health hazard, and some common-sense steps to take
if you find indoor mold. Copies are available from
your real estate broker or online at: http://www.epa.gov/iaq/molds/moldguide.html.
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