Five Steps to Boost Your Retirement Savings

RISMEDIA, September 9, 2010--According to a Bankrate-commissioned survey, only three in 10 workers expect to have enough funds to comfortably retire with. To avoid being one of those other seven, Bankrate offers these five tips to increase your retirement nest egg.

Start EarlyThe biggest help you can offer yourself is to start as soon as possible. Employees who begin squirreling away at the age of 25 can accumulate twice as much as those who start just 10 years later. Begin early, and continue regularly contributing.

Max Out Your Company's MatchIf you work for a company that offers to match on 401(k) contributions, you can get free money for doing what you already should be doing. Bankrate offers the following example: "A 30-year-old employee earning $50,000 per year contributes $5,000 annually to a company 401(k) plan; his employer matches 50 cents on the dollar up to 6% of pretax income, or $1,500 in this case. Assuming an average annual return of 8% for 35 years, the employee will have nearly $270,000 more with the company match than without it." That's quite a difference. Take advantage of any match program your company offers in order to capitalize for your future.

Investigate FeesTake control of your account. Don't let fees add up and take away from your retirement savings. Even a percentage fee as little as 1% can cut your savings by 25% over 35 years. Take a hard look at your management, distribution and advisory fees and make sure that your plan is working to pay you and not the other way around.

Make Your Payments AutomaticA study by NACHA, The Electronic Payments Association, found that those who have money automatically deposited into savings save up to $90 more per month than those who don't. Over many months and years, that money adds up. Don't risk forgetting. Set up automatic deposits to make sure your contributions are regular.

Most Importantly: Don't Touch ItTo make the most of what you have, put your money away and don't even think about touching it. Keep it in a 401(k), 403(b), IRA or other plan that works for you and let it compound and grow until you are ready to retire for good. Though college tuition, buying a house and many other factors can tempt you into dipping in, avoid doing so at all costs.

If you are disciplined and regular with your contributions, you can successfully plan for your future starting today.

Fannie Mae Launches the HomePath Program to Help the Real Estate Market

RISMEDIA, September 9, 2010--Fannie Mae has launched a new program called the HomePath Program as a means to aid the Real Estate market and sell the tens of thousands of foreclosures it has racked up since the housing bubble burst, says Mortgage Lending News.

The HomePath program is restricted to Fannie Mae foreclosure holdings. All participating brokers can be viewed by state at http://www.HomePath.com. Fannie Mae says they will only accept offers that come through participating brokers and not ones directly from buyers. Most properties are open to bids from owner-occupant buyers and investors, but some follow the "First Look" law, allowing owner-occupants the first 15 days to make a bid without the competition of heavy-handed investors.

There are two main options for the HomePath program: Financing to buy the house "as is" or financing the house through renovation. For renovation financing, Fannie Mae lends additional amounts needed for what it describes as "light to moderate" fix-ups, such as a roof repair or replacement of a heating, ventilation or air conditioning system, reports Mortgage Lending News. The maximum rehab amount is $30,000 or 20% of the projected "as completed" value of the renovated house.

According to Kenneth Harney from courant.com, the full program offerings are:

• Minimal down payments -- 3% for buyers who plan to live in the house, 10% for investors. Most of your down payment can come from documented gifts from relatives or others with no direct connection to the transaction.
• No requirement for an appraisal on the property unless you're applying for additional money to renovate the house. This is crucial because lowball appraisals can be deal-breakers, especially when the house needs cosmetic or other repairs.
• Generous "seller contribution" limits of up to 6% of the price, effectively reducing the cash you'll need to pay closing costs.
• No requirement for mortgage insurance coverage, despite your high loan-to-value ratio at purchase.
• A minimum credit score of 660 -- significantly lower than the 700-plus scores many lenders now demand for conventional loans on favorable terms.
• Maximum loan amounts tied to standard conventional loan limits: $729,750 in the highest cost markets, $625,500 in others, and $417,000 everywhere else.

If you are considering buying a foreclosed property in the near future, Fannie Mae's HomePath program might be your answer for closing on a new purchase.

5 Tips for Getting the Best Mortgage Deal

RISMEDIA, September 9, 2010--The number of mortgage applications are still steadily dropping, and it's no secret that mortgages today are simply harder to get. Lenders have stricter guidelines, and thanks to the recession, many are struggling to qualify. But don't count yourself out just yet. Bankrate suggests the following five tips to improve your chances of not only getting a loan, but getting it with the best possible terms.

1. The first step to getting the best rate is to ensure that your credit score is excellent. Request a credit report and make sure that everything reported is entirely accurate. Lenders look at a borrower's credit score when deciding interest rates. Make sure your score is as high as possible. "If there is anything negative on your credit report, you need to call the creditor to correct it or to work out a payment plan," says Cindy Tessier, manager of mortgage processing and closing for a credit union in Virginia. "When you apply for a mortgage loan, be sure to provide documentation of any negative accounts, especially if this is something in dispute."

There is no replacement for keeping your debt low and paying your bills on time. Experts suggest using under 20% of the credit that is available to you.

2. Next, be honest and upfront in your loan application. Don't lie or fib about income or asset information. Take your time filling out the paperwork and don't try to hide anything. Holding back requested documents can only work against you by delaying the process and maybe even preventing a mortgage approval. The lender needs to be convinced that you can repay the debt. Be prepared to disclose all assets and income. This includes overtime pay, a bonus, or any other sort of extra income.

3. Make a hefty down payment, or at least put down as much as you can afford. The more you put down, the better you look to lenders. Some programs even accept contributions from family members or friends, though it may require a gift letter asserting that you won't have to repay the money. The more you have to offer upfront, the more likely you'll get a killer interest rate.

4. But it's not only about the interest rate. Make sure to evaluate your entire budget including monthly payments and fees. "A home loan is not just about getting the best deal--it's about getting the right mortgage with no surprises so you can be a successful homeowner," national bank sales executive Todd Dal Porto tells Bankrate.

Calculate your debt-to-income ratio and determine just how much you can comfortably afford monthly. Compare good faith estimates and make sure there is no prepayment penalty if you decide to refinance in the future. Discounts, origination fees, underwriting fees and document preparation fees should all be taken into consideration.

5. Lastly, prepare for the appraisal if you decide to refinance. You should always have a realistic expectation of the value of your home, especially if you decide to refinance. Any repairs that you've been putting off should be fixed before getting the home appraised.

If you're in the market for a great mortgage rate, take heed of these five tips before attempting to lock down a deal. If done the right way, you can ensure a better rate and terms for your new home loan. 

 

Green Windows Help Achieve Building Goals

RISMEDIA, September 8, 2010--Among the many recent real estate trends, energy efficiency has been one of the most popular forerunners. By installing energy efficient windows, doors and appliances, builders are making sales, homeowners are saving dollars and both are conserving energy while "going green." Such is the case with Hardwick G.C., a contracting company that has seen its business double with the use of green Simonton windows and patio doors on its projects.

"We have five custom green projects underway right now, along with show homes for major industry trade shows," says Greg Hardwick, president and owner of Hardwick G.C. "Our clients have responded very positively to our desire to focus on sustainable construction."

Hardwick seeks out top-quality, energy efficient products for his new construction and remodeling projects. "Energy efficiency and quality performance are the keys to a sustainable home," says Hardwick.

Hardwick educates his consumers on the advantages of using energy efficient products so that they can make informed decisions about what to use for their homes. "I share my understanding of building science principles with my clients and help educate them on sustainability."

Hardwick used Simonton ProFinish® windows in a green show-home project he renovated in Longwood, Fla. Working with One Stop Green Home Certification, Hardwick allowed attendees to see "behind the walls" as he and his team applied green construction techniques required to certify the home. "This 2,500-square-foot house was originally built in before green technology was truly available," says Hardwick. "For this renovation we're adding a second story bonus room by surgically modifying the existing trusses. Simultaneously, we're replacing key products, like the windows and doors, and using energy efficient products and construction practices that will make this home sustainable for decades to come."

"Homeowners look to their architects, builders and remodelers for guidance when selecting energy efficient products for their homes," says Hardwick. "I take that responsibility seriously and invest a significant amount of my time researching, reviewing and evaluating different building products."

Have We Seen the Last of the First Time Home Buyer Tax Credit?

RISMEDIA, September 8, 2010--The Obama administration has not yet decided whether it should renew a popular tax credit for first time home buyers, says HUD Secretary Shaun Donovan in an interview on CNN's "State of the Union."

"It's too early to say whether the tax credit will be revived," he says. Donovan says the current administration would "do everything we can" to help in stabilizing a shaky U.S. housing market.

This analysis is based on the previous $8,000 federal tax credit awarded to first time home buyers that boosted home sales, reviving parts of the housing industry. When the credit expired, a market slump began. But will the return of the tax credit save us from this low, or simply delay the inevitable--that the industry is going to have to eventually pick itself up off the ground.

Though the post-credit stats were worse than the administration expected, says Donovan, the government is already taking measures to counter them including rolling out a refinancing program for borrowers and an emergency loan program for the unemployed, reports Mortgage Lending News.

Whether to bring the tax credit back or not is quite a controversial topic among many. Those opposed say that the return of credits will only blast a bigger hole in the federal deficit. Though, some are for the credit's extra support in stabilizing the market.

"I think it would help enormously," says Florida Governor Charlie Crist. "I would absolutely encourage the president to support that."

Getting to the Bottom of Your Credit's Utilization Ratio

RISMEDIA, September 8, 2010--Some spenders may view their credit as a maximum spending limit they can achieve before being penalized or declined. But what most don't know is that credit scores place a large emphasis on your credit utilization ratio, that is, how much of your credit is used every month. Your credit score takes a plunge whenever that number climbs high.

Credit scores do not distinguish between balances you are paying off, it only looks at the new charges you are racking up. If you want to keep your credit score high, it is of dire importance that you keep those balances low.

To calculate your utilization ratio, add up last month's balances and divide that by the total of all your credit limits on open accounts. The two-digit number after the decimal point is your utilization rate. Do the same for each individual card as well--FICO scoring looks at how much of your total limit you're using, along with each card individually, says Bankrate. Utilization is a significant portion of your scoring--30%. It is recommended that you try to achieve the lowest score possible. Those with the highest credit scores, 760 or above, usually have a utilization of approximately 7%.

Know the Difference between Charge Cards and Credit Cards

The main difference between charge cards is that they require you to pay the balance in full every month. They also aren't included in your utilization rate, according to the most recent versions of the FICO scoring system. If you have a card and are unsure if it's a charge card or credit card, call the issuer or check your latest credit report. Notations indicating "revolving" mean it's a credit card; notations stating "open" means it's a charge card.

Experts say that worrying about utilization rates or credit scores is unnecessary, but it can pay off to look more closely if you are a year or less away from purchasing a home or car, have unexplained card problems such as declining credit scores, or if you have a new card and want to see its impact on your credit score.

Understanding your credit can be extremely important, especially in situations when you need to rely on a good, solid credit score. By keeping your balances low and properly managing your credit card usage, you will hopefully never be financially limited by a poor credit score.

Why You Should Stop Worrying About Your Home Value

RISMEDIA, September 7, 2010--With the market currently in limbo, it's no secret that homes all over the nation are depreciating in value. Some homeowners may be overly stressing about this devaluation. But as long as you're not currently planning a move for the near future, you should stop worrying about the long-term value for your home, says Lita Epstein from HousingWatch. Epstein offers the following four reasons why you should stop worrying about your home's value.

1) View your property as a home, not an asset. If you're planning on living in your current home for the next 10-20 years, think of your property as a home and start building those important family memories. Over the course of one or two decades, the market is bound to fluctuate often, and if a move isn't in sight, you shouldn't excessively worry. The worst is over--live in your home and enjoy the time you spend there.

2) Some experts agree that this is the perfect time to "get greedy". Epstein points to stock guru Warren Buffett to showcase this: "Occasional outbreaks of those two super-contagious diseases, fear and greed, will forever occur in the investment community. The timing of these epidemics is equally unpredictable both as to duration and degree. Therefore, we never try to anticipate the arrival or departure of either. We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful," he says. While others may be fearful of the current market situation, investors might be experiencing the exact opposite feelings and may view this market as a unique opportunity.

3) Your home can be included as part of your retirement portfolio. A home that you own can be worth hundreds of thousands of dollars once you hit retirement...even if the price of the property has fallen. Should you want to transition towards renting once you sell, you will still have a very healthy amount of money to fall back on and enjoy throughout your retired years. The market will rise and fall, but you will still have plenty to lean back on once you sell.

4) Panic is unnecessary. Many experts anticipated a drop after the home buyer tax credit expired. Many rushed to close and make the deadline, pushing what would've been July closings up to June. So far, market inactivity was to be expected because of the tax credit. While dropped prices may continue for a bit, panic and stress are needless.

If you are content with your home and aren't currently planning a move, then sit tight and relax. Let the market rise and fall like it always does, and work on enjoying your life in your home.

Home Buyers Receive One Month Window from FHA to Seek Lower Insurance Premium

RISMEDIA, September 7, 2010-- "The Federal Housing Administration (FHA) is giving homeowners and buyers until October 4, 2010 to lock in a low monthly insurance premium," says Gibran Nicholas, chairman of the CMPS Institute, an organization that trains and certifies mortgage bankers and brokers. "After October 4, the monthly insurance premiums on FHA loans will increase by over 63%."

How does this affect home buyers?A home buyer purchasing a $200,000 home using a $193,000 FHA mortgage before October 4 would pay an insurance premium of $88.46 per month. If the same home buyer waits until after October 4, the insurance premium would jump to $148.01.

"In this example, the home buyer would lose $59.55 per month, or $7,146 over a ten year timeframe," says Nicholas. "Although the upfront mortgage insurance premium is going down after October 4, the real impact to the home buyer is actually a net increase in their out-of-pocket costs because the monthly premium is going up by 63%. Remember, sellers can pay the upfront premium or it can be financed into the loan amount, so home buyers rarely pay the upfront premium out of pocket. On the other hand, the increase in the monthly premiums will be paid right out of the home buyer's pocket with their mortgage payment each month."

Ironically, home buyers who plan to be in the mortgage for less than three years and decide to pay the upfront fee themselves (instead of having the seller pay it for them), may actually save money by waiting until after October 4 to apply for an FHA loan. "Home buyers with a short-term time horizon may actually benefit from this change because the upfront premium will be reduced to 1% from 2.25%," says Nicholas. This change will impact over 30% of the home buyers in today's market who use FHA-insured financing.

Home buyers considering an FHA loan should find and contact a CMPS professional in their area or their preferred lender to discuss their options and what this means for their situation.

For more information, please visit www.cmpsinstitute.org.

First Look Program to Help Stabilize Communities

RISMEDIA, September 7, 2010--HUD announced a new program that will give state and local governments, and nonprofit organizations participating in HUD's Neighborhood Stabilization Program (NSP) preference in looking at and acquiring homes from the Department's inventory of foreclosures.

"This First Look initiative is a marriage of two programs to accelerate our effort to confront property abandonment in communities struggling to overcome the effects of the foreclosure crisis," says HUD Secretary Shaun Donovan. "By essentially giving our NSP grantees a first bite at the apple, we hope to accelerate the sale of FHA's foreclosed properties while supporting the Obama Administration's neighborhood stabilization efforts."

Under the FHA's First Look Sales Method, NSP grantees will have an exclusive option to purchase HUD homes before they are marketed to other purchasers. This will give all NSP grantees a jump-start on picking up these foreclosed properties before investors get their hands on them and at a 10% discount from their appraised value and minus the cost of any listing or sales commissions.

The First Look period will last about 14 days from the FHA's receipt of the property. Properties that remain unsold at the expiration will be listed and sold according to standard procedures. This program and its procedures will be effective through May 31, 2013.

Lightning Damage Prevention Tips

RISMEDIA, September 3, 2010--It has been a sweltering August, but with that nice weather comes ferocious summer storms that often include thunderstorms and lightening. Lightning can strike at an average current of 30,000 amps, the equivalent of 100 million volts of electrical potential. When lightening does bolt down, it is at a temperature of about 50,000 degrees Fahrenheit. Statistically speaking, lightening storms are more responsible for injury, death and destruction each year than all hurricanes, tornadoes and floods combined. This statement is particularly true for the Northeast.

"Lightning striking a home can have a devastating impact on a family, even if no one is injured," says Kurt Detmer, vice president of marketing for a Michigan-based insurance company. "While it's true that lightning losses are generally a covered peril in most property insurance policies, many things can be lost that simply can't be restored. You can replace a damaged device, but personal photos, music, and other files stored on electronic devices can be irretrievably lost." By following these few simple guidelines, you can keep your family safe and help prevent this sort of damage from ever occurring to your home.

Protect Your Personal PropertyEvery connection in your home is a potential route for lightning energy, including surface and buried connections, such as electrical, telephone, cable television and plumbing. Whole-house surge protection is ideally what you want to aim for. Surge breakers are available and can be installed on the main panel board. Alternatively, you can ask your utility company to install surge suppression right at your meter.

Equip devices separately, if possible. Things like telephones, computers and garage door openers can all be equipped with individual transient voltage surge suppressors (TVSS). These have three sets of MOVs (metal oxide varistor) rated at least 250-300 joules. If your device has built-in surge protection, MOVs are listed on their power supply circuit boards. Check all of your important electronics, and find out which of them needs to be protected.

Quality surge protectors are usually more expensive, however, provide better protection. In particular, higher-end surge protectors can activate thermal cut outs to prevent fire in the case of MOV failure. Most general protectors cannot do this.

Lightning rods are also a great idea employed by many. These need to be designed and installed by professionals, but they will provide additional protection. Or, if you want to do it the good old-fashioned way, unplug your electronics during a lightning storm. It really is the best protection for any electronic device.

By being conscientious of lightning damage that can potentially harm your home, you can take preventative measures to protect yourself, your family and your belongings.